I ran the 4th
annual Turkey trot in Huntington
yesterday. Great weather. 40 degrees at the start. It was a hilly 4 mile course. My time was 29:58 which was good since my goal was 30 minutes.
Then I celebrated US Thanksgiving with friends. I certainly have a lot to be thankful for. I lead a charmed life.
And today, I will dig in and get caught up on things.
I read a great book by Barry Libert
- "Social Nation - How to Harness the Power of Social Media to Attract Customers, Motivate Employees and Grow Your Business
". Sometimes a book is great because it reinforces and clarifies things you already know at some level. Social Nation is one such book for me.
I am quite active in social media and I have been active since fairly early in the cycle. I Tweet daily and send those same updates on Facebook
. And of course I blog.
It starts with a quote(and everyone knows I love quotations
"We make a living by what you get. You make a life by what you give" Winston Churchill.
Part of being an active participant in social media is giving back. The challenge I have is I am such a time management fanatic
that I filter what I say based on "less is better" and "respect others time".
Social media exploded even during down swings in the economy. The book cites examples of companies like Avon that were able to dramatically impact their sales through social media during the downturn.
Part 1 sells that social media is big and here to stay.
Part 2 has 7 principles for building your Social Nation. Things like Principle 4 - Monitor and measure your communities' contributions and Principle 6 - Rely on your community for growth and innovation.
Part 3 is how to get started.
Part 3 has a chapter on "How to get started and 10 pitfalls to avoid". Things like number 2: "underinvesting
in social initiatives and abandoning them too soon".
Social Nation talks about the similarities between online and offline. Simple etiquette applies to both. Be genuine. Be nice. Obvious but...
I liked that the book separated real readers and just followers. Or as Libert
says "differentiating friends and followers from fans and fanatics". I know I could build 100,000 twitter followers in a couple of months. But few of them would actually read what I tweet. Confusing eyeballs with readers (or fans and fanatics) is a common social media error.
It is a good general book on social media that covers most of the bases. I often give speeches on social media and will cite this book as a good source. It goes well with Hilary Toppers "Everything you wanted to know about Social Media but were Afraid to Ask
". Now I think I should write one on "How to do Social Media in 20 minutes per day" since I see a need for people to figure out how to be efficient in the use of it.
Angel Capital vs. Venture Capital
Angels and VCs
are often very synergistic.
The line between venture capital and angel capital can be blurry. I know some VCs
who have invested $500,000 in an deal and I know some Angels who have invested $3,000,000. I know some small VC
funds have only $10-20M and I know some angels have placed more than that.
For purposes of discussion here though, I go with Angels being smaller an VCs
There are also huge variations in the degree of sophistication and backgrounds so there are no hard and fast rules but...
Angels can often:
1 - Spend more time monitoring the investment. I like to even dole out money monthly based on milestones and performance rather than giving a huge lump sum amount up front. VCs
love this detailed attention and the feeding $ in over time can often save them money. If required, the terms on the money going in sometimes need to change based on performance.
2 - Spend time coaching, training and mentoring the entrepreneurs. Many Angels are successful business people with deep experience on growing and scaling businesses. This coaching can add significantly to the value.
3 - Be more in the detail of the business. Their background in operations of a business often makes them more suitable to do the detail work.
4 - Care more about the business. For many Angels, the investment is more significant so they will watch things closer than a VC
might. The same goes with personal touch. For many Angels, their investments are personal and they take things personally. I find Angels do not give up as quickly and that can add value to the VC
1 - Provide more money and more follow on rounds of financing. This added cash is often needed to get the company to profitability.
2 - Provide introductions. Many VCs
have deep rolodexes
and respect that gets calls with key parties returned.
3 - Provide more mature views on business, exits, growth etc. VCs
often think big which can inspire companies to be great.
4 - Provide due diligence. I know some angel groups like Golden Seeds
do awesome due diligence but on the whole, VCs
are better than Angels at it.
5 - Help in negotiation. Negotiation is much of what VCs
do is negotiation so they tend to be good at it.
There are overlaps and there are synergies. Angels and VCs
can be synergistic and good matches.
I know this differs from some peoples' view of early exits
Mostly Links and Random Thoughts
Today, I thought I would change it up a bit an just do a few links to content that might interest. I had feedback that my blog was turning into just a book review blog.
I am feeling optimistic today. I did an interview where I spoke of my business optimism
called How to Own the Future.
I read with interest an article on Tech Crunch about Linkedin's success
. They are adding a member a minute. What I like about Linkedin is everyone maintains their own contact information so unlike my contact database that has old email addresses, they tend to be current. Linkedin members is different that web site hits since some members log on daily and others would be dormant. Linkedin is a good example of the network effect
I am looking forward to Brothers weekend
this weekend. Always good to see them. Glen
won the Rural Community Power Award
:Rural Community Power Award: Glen Estill.
“As a pioneer of Ontario’s wind industry, Glen Estill represents the ideal of what a developer should be. Glen has successfully developed a number of projects in his community of Lions Head and has always actively worked with his neighbours to ensure that they are not just a step in the process but partners in the project. Glen continues to champion renewable energy by helping spur wind and solar initiatives in his community, helping others help themselves, while being an articulate voice of reason online through his blog and within the larger renewable energy sector.”
I wrote a marketing article on "The Power of Free
" for CMA Blog.
Funny video on ideas and brain crack
My health hint for the day is to smile. This is not natural for me so need to work on it. Smiling helps you live longer
My 20 minutes of blog time is up. My most popular article of all time remains "How to write an Article in 20 Minutes
Angel investors and VCs all like to sell one of their portfolio companies. This is called the exit.
Basil Peters, a famous angel investor wrote a book Early Exits - Exit Strategies for Entrepreneurs and Angel Investors (and maybe not VCs)
. Yes - the title includes the maybe not VCs part.
His thesis is that most businesses sell in the $10-30M range so it is best for angel investors to push for a sale at that point which can provide a great return for the angels and for the entrepreneurs rather than holding on, raising VC funds and trying for the big IPO or $100M+ sale.
The theory is VCs muddy the water because they tend to want to big win and push the entrepreneurs to hold on for the big exit often to the point of having the business fail. I have heard VCs say they would rather lose all their money trying than exit for a modest profit.
I like the theory. I like small wins. They suit my conservative risk profile. Better to take a small profit than always wait for the big one.
But I do not like the theory if it is the only way. As with many things, there is no right answer. Where would RIM be if they had sold before they went public? I doubt they would be $15B in sales and $2.5B in profit.
And I love the $100M exits. Not only for the returns but for the intensity. And it tends to be the big exits that leave meaningful marks on an industry and change the way things are.
For me - I like both. There is a right exit for everything.
I read Smart Moves Management - Cultivating World-Class People and Profits
by John Thedford.
Thedford is the founder of a chain of pawn shops - Value Financial Services. This gave me the wrong knee jerk reaction to start. I am borderline to thinking pawn shops prey on the poor. He did give some interesting pawn shop stats - 80% of what people pawn, they reclaim. Only 0.1% of what is pawned is stolen.
And he has succeeded in a very tough industry in growing a $100M+ company.
Thedford is straightforward about why he wrote the book. To attract staff and to gain business. I liked his refreshing attitude on this.
The big thesis is "pay people well and put them in the right positions". He also thinks he can hire the right people. I have always said despite our best efforts, we will hire average people. It is managements' job to make them above average. This is done through slotting people properly into the right job, Giving them the tools to do the job well. Designing the job to "work" and constantly refining it to make it better. Some coaching and mentoring. Lots of training. Treating people with respect. And finally inspiring them.
He offers 41 "Smart Moves" on what a business should do to thrive. EG Smart Move 26 - Discover the Benefits of Long-Term Training Programs.
I liked chapter 11 on "real profits". He correctly points out that many companies do financial engineering moves and make short term decisions in the short term interest of profits while sacrificing the long term business. (Smart Move 41 - Make Profits Possible)
It has a good bibliography of business books. Likely worth reading all of them.
Its a Jungle In There
Sometimes I like to work slowly. I think this is one reason I love early mornings. If I have 3 hours before the world starts, I can putter away at things and still be on top of things. I love the feeling of being caught up and on top of things.
Of course I am not advocating working slowly. One of my strengths is the ability to work quickly and efficiently for long periods of time.
But as I always say Leadership(Direction/Work on the right thing) before Management(efficiency). That is the thesis behind my Time Management book
Time is a substitute to efficiency.
I read It's a Jungle In There - Inspiring Lessons, Hard-Won Insights and Other Acts of Entrepreneurial Daring
by Steven Schussler. I could tell from the title that I would love it. I always like reading books about entrepreneurship.
Schussler is the founder of the highly successful Rainforest Cafe (hence the jungle theme). Apparently his Minnesota home has a life size elephant replica and 40 live tropical birds. He sounds like quite a character.
He shares a list of 5 P's of breakthrough success:
Personality (Schussler has it. It shines through in the book)
Product "Be excellent or be gone". Sweat the small stuff.
Persistence "Never say die"
People - be genuine and care
Philanthropy - give some back. It provides purpose. He has a great chapter on passion which clearly is what drives business success. I think he may have well had passion as the 5th P.
The book starts with a section on risk taking. The interesting thing is I never really considered myself to be a risk taker. I have always felt more in control when I am doing my own entrepreneurial businesses. I, personally, think entrepreneurship is not really about taking big risks.
"Only those who will risk going too far can possibly find out how far one can go" T. S. Elliot
Each chapter starts with a self examination question. I likely would have got more from the book by reading it more reflectively. Example of a question he asks:
"Once your creation is in the marketplace do you still look to improve it?"
"Do you consider the impact you have when selling your product or service?"
And then each chapter goes on to delve into the reflective question.
Good book. Interesting. Inspiring. Worth reading.
The First 30 Days as CEO
It seems presumptuous for me to post "advice" but a friend is likely taking on a new CEO role and I have been thinking about the best 90 day plan.
The first 30 days of a 90 day plan in a new leadership role seems obvious to me. They are "Listen and Learn". Regardless of background and experience, there will still be lots to learn.
Some of the things to focus on learning:
1 - Peoples names. I asked everyone to email me a photo of themselves. I also had people laser print their names in big letters for their cubicles. And nametags are essential for the first number of gatherings. I would schedule breakfasts, lunches and dinners with staff as well as whole group meetings.
2 - Metrics of the business. Figure out how the money is made. What measurements are in place and what measures are important.
3 -Meet the key customers. Developing relationships quickly is key. So the sooner you can start - the easier.
4 - Meet key suppliers. Again -developing relationships is a key part of the position. I asked for a list of suppliers and called them all to introduce myself and followed up with an email.
5 -I suggest high presence - so being there counts. I would start my day before most people arrived and end it after most people left. This one is a bit of a tough judgment call - to travel or not. I chose not to travel much in the first month but to call everyone who were in other locations.
And through all of this - LISTEN carefully. What are people saying? For me, copious note taking helped crystallize thinking. I tried to not make suggestions for the first 30 days.
At the same time, I am suggesting NOT doing anything. So freeze decisions to the extend possible. My experience is many of the decisions that are pressed for are simply not well thought through which is why previous management did not implement them. Many decisions that are pressed for do not take into account the whole picture.
My second 30 day plan
was the 5 Whys.
The Laws of Charisma
I often say "I never get sick" which is largely true (although perhaps a bit of an overstatement of positive thinking). I read yesterday that exercise is a good preventative and cure
for the common cold. And I do exercise a bit so perhaps it is true that I get less colds.
I read a book by Kurt Mortensen called "The Laws of Charisma - How to Captivate, Inspire and Influence for Maximum Success
I had previously read that there is no connection between charisma and success
as a CEO. This book makes a convincing case that it does matter and goes on to outline how anyone can improve their charisma.
The book has 5 sections:
1 - Presence - What Do You Radiate.
Chapters in this section include among other things Passion, Optimism, Humor and Happiness and my favorite Energy and Balance (also called Vibrant Well Being)
2 - Core Qualities - The Inside Dictates the Outside.
Chapters in this section include such topics as Self-Discipline, Competence, Purpose, Integrity etc.
3 - Delivery and Communication - Speak with Conviction.
Chapters in this section talk about presentation skills, communication, listening etc. I have long been an advocate of Toastmasters
for almost anyone at any level in an organization. Although this section of the book was on a lot more than just public speaking.
4 - Empowering Others: Contagious Cooperation
Chapters in this section talk about credibility, goodwill, empathy, respect etc. I know from experience that empowered teams accomplish great things. I also know that my "control freak" attitudes through the years have held me back. I am getting better at this though (the more I know myself, the better I do)
5 - Subconscious Triggers:It Just Feels Right - Or Not.
Chapters here talk about emotional state, how you say things and even physical appearance (uh oh - better up my game).
The conclusion was "The Fable of the Fighting Brothers" which I read with interest since I grew up with 3 brothers (one of whom emailed me after reading my Diet Broth recipe
yesterday and said it sounded dreadful and that he would plan the meals at the next brothers weekend
) and we did our fair share of fighting. And of course I could tell you the whole fable but there is a difference between a book review and a book summary - and this is a review.
And one of the closing quotes from the book:
"It is not what you are going to do, its what you are doing now that counts" Napoleon Hill