Monday, November 19, 2012

Regarding Steve Jobs' Bio by Isaacson

As a very young man I worked for a time for a company that was located in Grass Valley and San Mateo and I heard stories about Jobs and Wozniak.  Being a good engineer I grunted along with the other engineers and thought Woz was a hero and Jobs was a bully.

After reading the bio I still hold this view.

However, my appreciation of Steve Jobs has grown in many ways.  Probably the most growth in my appreciation came from the fact that he was a father and husband, and he approached this task with the best of his abilities.  Knowing this makes him an "ok" guy in my book. At least I hope his kids and wife thought he was a good dad - i can't judge.

Even with this, it is accurate to call him a bully.  When we see kids in school yards terrorize others with force or harsh words to get control over them, we call it bullying.  Although bullying may have many reasons, it is highly-prized in companies.  It's all about getting the best from your employees, and building tough hard employees who can handle the stress ... blah blah blah.

Being a bully is bullshit.

I suspect when someone bullies they want fear to be the instilling emotion in the victim rather than something else like a desire for happiness.  That's probably why being a bully is so effective.  You are immediately afraid of someone, but you have to visualize the happiness you may achieve the other way so it's a two step process.  It is effective in the short term - very effective.  But like my mom used to say, "Bullies end up getting cancer".  So maybe in the long-run bullying doesn't work so well.

So does the alternative to bullying work?  And what is the alternative to bullying?

I'm totally onside on telling the truth and cutting through the crap, but empathizing with others is an skill we learn early in our childhood.  I've been trying to learn stuff from everything I read, and there's no way I can pull off a Steve Jobs rant on someone.  These rants have always been associated by the clique-ee super-intelligent (and usually immature) kids in the elite clubs at high-schools.  I hated them and don't feel right using their tactics.  I can definitely send something back to the drawing board because it doesn't fulfill the what is required - but if my people can't guess what I want, I'm not going to yell at them.

Do me a favor and look up "mental illness LSD lack of empathy" or "cluster B personality disorder" on Google.  Maybe Jobs actually "fu**ed" himself by doing drugs - but the book seems to say that his oldest daughter Lisa shared some of these empathy issues, so maybe it was genetic or a product of an image of abandonment.  Who knows?

I just wanted to learn something in bringing my ideas into reality, and Steve Jobs' story didn't help much - although I had a good laugh at the red dress and Joan Baez (Guy Kawasaki's joke press release was pretty funny too).

Wednesday, October 31, 2012

Marketing and Adopting

How important is Marketing and Adopting Other People's Technology to maintaining rabid customer following?  Let me give you a little help:

Invented the MouseApple invented the mouse in 1983Xerox and the Canadian Military invented mouse and track-ball pointing devices independently in the 1970s with the first commercially sold mouse from Xerox in 1981
Invented the Graphical User InterfaceApple invented the GUI with the Lisa in 1983 (then sued Microsoft)Xerox PARC Star workstation was released in 1981 and was based on their GUIs from the late 70s.
Invented the Online App StoreThe Apple-invented App Store opened on July 10, 2008 NTT Docomo opened an app store about 7 years earlier.
Invented the MP3 PlayerOctober 23, 2001, Apple Computer unveiled the first generation iPodFirst mass-produced MP3 player was released by Saehan Information Systems in 1997
Invented MultitouchThe 2007 release of the iPhone allowed you to use server simultaneous presses.Fingerworks invented it in 2005, and was purchased by Apple
Invented USBApple invented the USB with the release of the iMac in 1998Compaq, DEC, IBM, Intel, Microsoft, NEC and Nortel began development on USB in 1994
Invented the smartphoneApple releases the first smartphone in 2007.IBM released the Simon Personal Communicator to BellSouth customers in August 1994.
Invented the Desktop Music PlayerApple released iTunes in January 2001Apple purchased SoundJam MP from Casady & Greene in 1999 and converted it into iTunes by removing sound recording and addid DVD burning

If you notice a pattern, Apple is one of the best companies at lying marketing! Steve Jobs had his Reality Distortion Field and so do Apple users!  A company, with such rabid users that have their script ready about the value of the products they use, has to be respected.

In Business School everyone talked about being the first mover.  You can see here though, Apple was not the first mover or adopter.  And yet these innovations are very key to the success of Apple.  So being an adopter and expanding the market seems to be what Apple was good at, and convincing users that they were the FIRST to get something when they bought an Apple product was very important too.

For innovators, I would suggest you become a Casady and Greene or a Fingerworks rather than a NTT Docomo or a Xerox.  Make your product useful for Apple, not the idea of your product (and make sure you have patent protection).

Tuesday, January 24, 2012

Understanding "Markets" in Economics

What's a Market?

The writer's of Wikipedia state in the first line of their discussion on Markets: "A market is one of many varieties of systems, institutions, procedures, social relations and infrastructures whereby parties engage in exchange. "

Markets are necessary for my line of business (software development).  If I was a thief, I wouldn't need a market.  If I was a government I wouldn't need a market.  But I'm a capitalist, so I need a market.  And my hypothesis is I need a FAIR market for sustained business activities.

I will re-define market for my own purposes here, but I think it's a useful definition (if more specific).

A market is a system of procedures where a buyer transfers stored value to a seller who concurrently (or as concurrently as possible) transfers goods or services to the buyer.  For the market to function well, and all parties to be recurring members, a mutually agreed upon, fair and sustainable exchange rate needs to exist at transaction time.

So what?

When you start a company; known in the lingua franca as a "start-up" (go figure!), you need to find a market.  From my definition, as the seller you need to:

  • find a buyer
  • find a service or good
  • find a fair price
  • find the system of procedures for exchange
These four things make up your Go-To-Market strategy.

There doesn't have to be a lot of buyers.  For example last year Boeing had a handful of buyers, but their price of service and product was fair enough to keep Boeing going and bring more buyers to the table later.  Sometimes the system of procedures for exchange is not well defined.  For example how do you sell home-grown pot to people on the street?

Having this system is a very important go-to-market strategy component.  Can you name some places for desktop/laptop software sales?  How about - Best Buy,, Amazon.  What about Mobile applications? iTunes, Android, Ovi.

Knowing where the market is the responsibility of the seller and the buyer - but most work to get the word out  is being done these days by sellers.


Let's now apply this to business plans that come across my desk.

  • How many buyers do they have?  How do they define a buyer?
  • How do they offer their service or product?  What benefits are there to the buyer and seller?
  • What's the price of the product?  Is it a market sustaining price?
  • What existing market or procedures are they using?  Are they giving their buyers directions of getting to their market?
I find this the weakest in most of the plans I see.  I can only suggest making friends with a good marketing person here.  This part of the plan becomes the "gray-area", where there is no black or white, plus you need to use the "gray-matter" between your ears to see if this is reasonable. 

Maybe it's weak because engineers can't think in fuzzy grays.

Thursday, January 12, 2012

The OpenText Guy and being a good Drummer Boy

Who should decide my freedom? me.
Who is responsible for my choices? me.
Who should control the federal Innovation Grants? elected officials.
Where should they get policy advice from? experts in the field.
How should I qualify for these grants? only by fulfilling the criteria.
Background: I didn't vote for Stevie Wonder's government in the last election.

Now begins the rant.  Parents, please remove your children from the room.

I haven't been given access to every SR&ED and IRAP claim or the way the money was used in the history of Canada.  However I am going to make a bold statement here: I bet there was abuse.  But, I believe there is (and will be) abuse in every place where money changes hands: in filing taxes, in paying taxes, in collecting refunds, in applying for grants.  And in every department: Agriculture, Natural Resources, Defense, Human Resources, you name it.  If you use the Prone-To-Abuse Trump Card in your argument against innovation credits, you are a POLITICAL ASS, a puppet for the white-bread-eating bogey-man-fearing bean-counting mandarins that provide government services to us (us, BTW, the people that actually build the wealth in Canada - not the bank of Canada, not the department of Finance).  When there is abuse in a department (let's say 5% of employees).  Do you shut down the department or do you change the employee's behaviour?  Do you enact rules so this doesn't happen?  Do you shut down the company for 5%?  When you eat people's bagels in the cafeteria and don't drop in a dollar in the donation box to cover the cost?  Do you commit suicide because of the gross abuse you have committed?

WARNING: Analogy shift here.

Say I'm a farmer, and I know that the expectant lifespan of my fruit trees is 30 years and the economic value years of those trees is the years from 5-20.  So basically every 20 years I need to have a whole new orchard of trees to keep my business afloat.  That means that every year I need to nurture young trees so that they can reach their 5th year so I can gauge if they have any economic value.  It would be pretty stupid not to support trees at this stage and give them a chance to grow.  Because bringing young trees into the orchard is the main way I keep my farming business going.

Shift back here.

What do the following companies have in common: Odesta, NIRV, OnTime, Dimensions, Lava Systems, Bluebird, LeadingSide, Centricity, Gauss, Eloquent, Corechange, IXOS, Vista Plus Suite, Hummingbird Ltd., eMotion LLC, or Spicer Corporation?  These are all smaller companies or products acquired by OpenText.  Awesome strategy huh?  Our trees are getting old, and let's keep the orchard fresh with young trees with a future.

Now if small businesses are the key for big business success, why would someone take-away the SR&ED credit from small companies?  Only an ECONOMIC ASS, would jeopardize the future of small business in Canada.  One employee grows to two, two grow to three.  That's the reality of day-to-day business growth in Canada.  As you get bigger your corporate growth only begins to match the birth-rate, unless you buy smaller companies.   So why, oh why, would anyone propose dropping this credit for small companies?  I know, because there are lots of small companies and they make up the majority of claims.  That's my guess, anyway.  Ok, so it's about saving money.  So let's not drop the funds evenly across the board, let's just cut the small company's portion.  Could it be because they don't have a voice? a political voice?

When I look at companies to invest my time and money in, I look at broad indicators of what they are doing and what the political and legal frameworks are for these companies.  Most WTO and OECD nations have some sort of research refunds/grants/credits/incentives for small business.  Some are directed in only certain areas, some are broad.  I'm going to be less interested in riskier ventures if I know that these innovation credits will be harder to come by in Canada.  I am.  It's because the government is saying "F**K YOU, small business doesn't deserve our help, we all have big companies now and we have no clue.  There's the door, please leave."

So here's the next proposal.  Let's give it to Universities.  Ya.  There's no abuse in those institutions, and they're right on the ball on the economic-feasibility stuff.  (If you have more than a grade 12 education in Canada, you don't need me to explain that last sentence.)

[cut to Andrew, sitting behind the desk, looking somber into the camera, dim lights behind him, put a warm light on his face.]

Starting companies (one of my greatest joys) entails lots of risk. [pause] Life ends in death so these risks are not so bad.  Starting companies requires a good mix of Courage and Stupidity.  I have excelled in both.  Once there were no tax credits. (There was a time of no personal taxes too!) Life will go on. Governments will pay for Canadian flags to be sold in Quebec, for memorials of the war of 1812.  Innovation will be stifled in Canada.  Dollar stores will be the most influential store chains.  These chains will claim to have more and broader clientele than any other stores in Canada.  We will continue to dig up things and trade them for Chinese goods.  And then one day [very dramatic pause] the Chinese will take our land, all because the OpenText Guy didn't have the balls to stand up for the innovative courageous and stupid visionaries that start small businesses but chose to be a good Conservative Drummer Boy.

Monday, November 28, 2011

Financing a Start-Up on a Personal Credit Card


(2) But, if you have a cheque in the bank that has cleared but it is on hold, and you need cash flow for one or two days until the bank releases the funds, you may use a credit card, but only if you pay back the money drawn on the card in the two or three days following the transaction.

(3) If you have reason to believe that the value of your share of the start-up will grow at faster than the 20-ish % (that the credit card is offering) you may want to infuse your start-up with this type of borrowed money.  Even if you have a card that offers you 0% for a few months, or with some transaction fee of 1% or even for a smaller %-age like 12%.  You really have to believe that your company will be growing at an astounding rate.  But remember, even if your company will grow at such an astonishing rate ... are are giving that 20 points to the credit card company.  You take all the risk and they make all the money.

So where do you find money with assets at your disposal?

  • Operating Loan
  • Line of Credit

Where do you find money without assets?

  • Government Grant
  • Low-Interest Loans
  • Partner Programs
  • Angels
  • Friends
  • Family
A lot of people even put their own money in!  I know that seems like a novel idea, but I certainly appreciate the people that do this.  I think people that follow on with investment also like to see some equity put into the prototype/product by the founders before they show up.

Tuesday, July 19, 2011

Rating the Angels

How do you know when to listen to an Angel that tells you a bad thing about your product, or to an Angel that tells you a good thing?

How do you know the guy causing you stress by telling you that your business model sucks is right and the guy telling you to keep working on those buggy whips is wrong?  What we really need is a way of rating the Angels.  (Of course, any Angel that give you money is Right On!  But they're few and far between.)

So what's a decent rating system for Angels?  Going back to my MBA training: we need to itemize a scorecard.

Obviously, if the Angel has no record, it's hard to evaluate their abilities, so the first scorecard metric is a public track record of investing in ideas/concepts/prototypes/start-ups.  Sorry Mr. First-Time-Angel, you don't make the cut, but I'll take your money if you have some!  Happily take it!  The second metric is accessibility.  If there is no way of contacting the Angel, then it's the same as if they didn't exist.  Does the Angel have an email, website, blog, linked-in profile?  The third metric is also pretty easy to figure out, does the Angel work in your chosen field?  There's a good chance that you could convince someone that your product is a decent idea, but getting them to risk their money with you usually means they need to know the market you are in or they need to trust you intimately.

Ok, so let's put this to a test with an Angel from the virtual world.  (DISCLAIMER: Jeff has never loaned me money nor invested in my companies, but I will fax him the Bank transit number as soon as he calls!)

Angel: Jeff Clavier
Track Record:, Blekko, Buzznet, Eventbrite, Foodzie, Kaboodle, Kongregate, Milo, Outright, Seesmic, Tapulous, Truveo, Userplane, Mint, Get Satisfaction, Topguest, Gigwalk
Accessibility: linkedin, facebook, twitter, corporate phone number, email
Area of Interest: Information Technology, Web, Games

Now we have to compare Jeff to someone else. So ...

Angel: Andrea Zurek (I really like the Rye Zurek with a boiled egg and a some kielbasa chunks.)
Track Record: Chai Labs, Eatlime, Facecake Marketing, Global Fresh Foods, Lotus, Metropark Usa, Pathwork Diagnostics, Plusmo, Poddaddies, Posterous, Rallypoint Tv, Scoopler, Tapulou,s Tsumobi, TwitVid, Vaxart, Hug Energy, BackType, Crocodoc, MightyMeeting, MyLikes, Nowmov
Accessibility:  linkedin, facebook, twitter, corporate phone number, email
Area of Interest: Information Technology, Mobile, E-Commerce

Track Record
Area of Interest
Jeff Clavier
IT, Internet
Andrea Zurek
IT, Internet

The winner: Andrea Zurek.  Why? Because I really like the Rye Zurek with a boiled egg and a some kielbasa chunks (and Rene Descartes was a drunken old fart).

Although, funny (ok, slightly funny), this could really help you weigh the comments your Angel gives you.  I would suggest going a little deeper though.  Look at the companies they invested, look at their payroll, the business and technical knowledge of their teams, the type of exit or current revenue of the company, and compare those to your company's model.  You'll obviously be able to get better advice from a Angel that is already working with a concept or team like yours than someone from a different part of the spectrum.

Friday, January 14, 2011

How do you time the introduction of disruptive technology?

How often does a farmer plow their field?

I know very little about agriculture, but my guess would be either once at the end of the harvest or once at the end of harvest and once at planting time. Why? - because plowing is DISRUPTIVE. If you plow during the growing cycle you gain no benefit from the growth of the stuff you plowed under – unless it was meant as fertilizer!

The same applies for new disruptive innovations in a company. You don’t want to plow under a crop that is going to earn you money. Because of fear, the big argument is that in the end you may never disrupt the growing because a short growing cycle remains and your disruptive innovation won’t have time to mature enough. This is the real meaning of disruptive. You need to have to guts to see your field producing way more value with your new crop than with your old one. And it may take more than one growing cycle. (That’s why corporate strategy is hard and making the tough decisions is why the CEOs get paid so much!)

Probably the intelligent thing would be to follow a portfolio strategy, to do is divide your field in two and plant one with your core money making crop and the other with your disruptive crop. A definite amount of stable cash flow is always necessary to incubate a disruptive crop. Then as your disruptive crop gains in value over the years, you convert more of your field to produce it and you eventually stop growing the other stuff.

This idea is entirely similar to the Boston Consulting Groups Growth-Share Matrix. The idea that the cows aren't growing but they bring in the cash, the dogs are just a waste of time, and the stars grow their market share and bring in the cash.

To summarize: timing is important in introducing disruptive technology, but it takes guts on the part of the CEO to introduce it when it appears to be the wrong immediate choice.

Good Luck CEO!