This article is my first in a three part series specifically focused on Driving Nonprofit Innovation.  I’ve broken it into three pieces to make it easier to digest: 1) Managing the Process from Idea to Launch, 2) The Challenges of Funding Nonprofit Innovation, and 3) Building the Culture & Skills for Sustained Innovation.

During discussions with nonprofit leaders the first concern with innovation programs is always how to manage the process: too many ideas, too few people, too little time, and too much risk.  This is what I have learned.

Starting the innovation journey

Most nonprofit leaders have new ideas flooding in all of the time.  How they might improve their organization, expand their services, and expand their reach.  These ideas come from every group of stakeholders: board members, funders, employees and clients.  The challenge for most nonprofit organizations is not a shortage of ideas but a shortage of resources.  This is the identical problem that for-profit startups have.  Where will the money come and who will lead and support each of these great ideas?

Sorting through of the opportunities is usually the first challenge.  Which will provide the best material benefit to the organization but not consume too many resources?  Being able to answering this question is necessary for defining an innovation strategy for your organization; a process that will take effort, patience, and focus.

A first step should review your organization’s mission, vision and values.  These elements will be important factors when weighting out which initiatives you will focus on and which priority of sequence.  One of the next tools that I encourage organizations to consider is building a frame work for an Innovation Pipeline.  The stages of a pipeline can be unique for the organization but should have a sequence of filters and gates that will help guide the team in making decisions and tracking ideas as they move toward execution.

An example that I use with retail organizations has five phases to a pipeline: 1) idea, 2) concept, 3) experiment, 4) pilot, and 5) launch.

An Innovation Pipeline as a tool

The pipeline moves from left to right.  Ideas should enter the funnel and be captured from all of the stakeholder groups previously mentioned.  The next step requires support from a group that can continually help compare and contrast those ideas against the mission, vision, and values.  The ideas that rank well should be prioritized and move into concept phase.  During the concept phase there will need to be some effort put to quantifying the idea.  Ideas should be measured for their potential impact, possible drain on resources, likelihood of success, impact of not taking action, and risk to the organization.  The goal is not to be 100% accurate with your calculations but with a degree of uncertainty that you and the organization are comfortable with.

This is a good place to discuss the unique difference between Incremental vs Disruptive innovation initiatives.  Incremental initiatives usually involve less unknown elements.  They take an original product or service and build on it or change it slightly.  With less unknown elements there is a lower risk of failure when launching the initiative.  These ideas can more easily be tested and corrections can be made along the way.  Disruptive innovation usually involves a higher degree of unknown elements and thus a higher risk of failure.

One way to reduce the risk of failure in either type of innovation is by running the concepts through an experiment phase.  Is it possible to validate the hypothesis in a smaller test prior to committing the full amount of resources that would be required to launch such an initiative?  The experimentation phase should be iterative – testing and retesting different variations of the hypothesis.

Once you have found pieces that work through the experimentation phase you can bring them together in a pilot program where you are testing something that will more closely resemble the final product or service.  Similarly, the pilot phase is also an iterative process and sometimes will require running new experiments.  A pilot is meant to give you “real world” feedback on your initiative before you roll out the final version.

The process culminates with the Launch (or Scale) phase.  A couple of noteworthy points here based on experience and research – most ideas will not make it to the launch phase.  According to a Fahrenheit 212 (a NYC based innovation consultancy) survey of 100 Chief Innovation Officers fewer than 25% of their innovation initiatives ever see the light of day.  Most new ideas do not work out along the way.  This is the simple reality of innovation work – new ideas require a level of risk taking.  How much risk your organization can take or should take depends greatly on the organization.  An example I often give is that most grocery stores operate on 3% gross margins and 1% net margins.  Those thin margins leave grocers with very little room for error when trying out new ideas with their business.  The good news is that they can run experiments easily with real customers every day and unlike social service nonprofits a failed experiment is not going to negatively impact someone’s life.  If their failures can be quick and cheap they can minimize their impact.

Not perfection but a process

The intent of the Innovation Pipeline is not perfection but as a tool to help you manage the processes involved, develop criteria and measurement standards, funnel resources to priority projects, halt or end non-priority projects, and to reinforce an iterative process.  Getting a project from idea to experiment is a success.  Deciding not to go forward based on experiment results does not mean failure.  Instead it means successfully freeing up those resources to work on another higher priority project.  Maybe circumstances will change to your favor in the future and suggest that you retry that initiative but you cannot spread your resources too thin or you’ll be certain to find an abundance of failure.

Food for thought:

• What tool(s) do you use for managing the innovation process?
• Are you good at deciding to stop projects?
• Do your leaders manipulate the pipeline process to ensure their projects make it through?

(image source: Huffington Post)

I got my first taste of the amazing BIF storytellers a three years ago when I participated by watching a live stream of the event.  I immediately loved it!  There were authentic people sharing their authentic stories.  When people ask me what the difference is between these storytellers and speakers at your average event or conference I suggest that it all has to do with the expectations set by Saul and the audience.  They have come to expect authenticity, vulnerability, and passion.  They expect BIF storytellers to leave a piece of themselves on stage.  Not all of them succeed but that is the expectation.

Saul kicked off this year’s event by sitting on a stool in the center of the stage and addressing the audience.  He suggested that we were all “innovation junkies.”  He was suggesting that collectively we see the world with a similar perspective – we want to improve it.  Not that we all have the same vision of how the world should be but that when we see something that isn’t working quite right our initial reaction is to think of how it can be improved.  Often these innovation junkies will feel compelled not to sit idle but to begin working of how they might participate in changing things.

Based on my discussions with other attendees it sounds like Saul was able to depict most of us with one broad stroke.  That is why I fell in love with this conference and the other attendees.  They are my tribe!  Like me, they see something that is off and they want to make it better.  They are activators, not patient enough to sit by and wait for someone else to get around to fixing things.  They may not always be moving mountains but they are changing the world in their own way.

I wanted to share with you one of my favorite story tellers from this year’s event – Jeff Sparr, the founder of Peace Love Studios.   Jeff suffers from a painful form of mental illness, Obsessive Compulsive Disorder (OCD).  This disease is in constant battle with Jeff seeking to destroy any moments of his happiness.  Jeff shared one of his most painful bouts in his battle with the audience.  It involved a moment with his son that should have been sheer joy – but it wasn’t.  Through Jeff’s struggles he took up painting as a way to relieve stress and clear his mind.  For him the distraction worked and it gave him a sense of control.  Rather than keeping this discovery to himself, Jeff wanted to share it with others who were similarly suffering with OCD and mental illness.  That was when he created Peace Love Studios as a vehicle to help others.  As of today the organization has had an impact on over 19,000 individuals.  Take just a few minutes to watch Jeff’s story and learn about how he and his tribe are making the world a better place.

Jeff was amazing and his story was incredibly inspiring but his was just one of many powerful narratives.  Over the next few weeks I will share with you a few more of my favorite BIF storytellers.

In this photo provided by Kellye Voigt, from left, Gabe Voigt, Joe Garvey and Rachel Lindbergh pose for a photo outside the Kennedy Space Center Visitor Complex in Cape Canaveral, Fla., Sunday, June 28, 2015. (Kellye Voigt via AP) MANDATORY CREDIT

This time the rocket took off from Cape Canaveral, Florida and as it achieved liftoff the teens began to high five each other with excitement.  But as they headed to lunch their phones began to buzz with messages of condolence.  This rocket too had exploded before it could reach orbit.  With two attempts the teens had two failures.  What were the odds?

The reality is that while rocket failures are not as common as they once were when we ushered in the space race – they are hardly rare.  In fact this was the third failed rocket attempt to resupply the ISS.  The other cargo ship had to be abandoned in April after the Russians had lost control of it.  Now a fourth Russian cargo ship is scheduled to launch on July 3^rd as each of the other organizations continue to determine what had gone wrong.

What I really appreciated about this story was the reaction from the students, there are some real lessons in their comments for all of us.

Joseph Garvey noted that “this one didn’t hit as hard or hurt as much, maybe because they really didn’t see it.”  Likely what also was a factor was that in feeling the failure of the first failure their anxiety was diminished with the second.  They had already been through a similar experience, they survived and moved on.

Rachel Lindbergh said, “That’s rocket science. Failure happens.”  She went on to comment, “Disappointing, sure, but you can’t let things stop you.”  How many times have we heard someone use the phrase “How hard can it be… it’s not rocket science?”  Well in this case it is rocket science.  It is hard and there are lots of variables involved in these equations.  Not even our most sophisticated computers can calculate every value and simulate the outcome.  But we persist anyway.  Sometimes we will fail and sometimes we will fail repeatedly.  But as Rachel suggests – you can’t let things stop you.

Each one of these students shared a real maturity about the episode but Gabe Voigt had already recognized the value in this lesson.  “There’s a lot of life lessons to take from this too.”  He went on to suggest that “If something happens, that doesn’t mean it’s the end of that.”  A failure can only be define as a failure when it is time boxed – otherwise it is just another attempt.

I have no doubt that these teenagers have the right attitude and hopefully their next attempt is successful.  Either way they have successfully learned the underlying lesson of scientific discovery, innovation, entrepreneurship.  Failures will happen along the way but as Albert Einstein noted “You never fail until you stop trying.”

Image Credit: Kellye Voigt via AP

• For the individual, a failure can lead to a tarnished brand, missed promotions, lost bonuses, or even termination.
• For an organization, how it responds to failure can impact the culture and determine the success or failure of future innovation initiatives.

This post is from an article that I originally published on April 1st, 2015 in Innovation Excellence.

Until the last few years not much has been published about innovation failure rates within organizations because everyone feared the stigma or repercussions that came with disclosing any failure.  For publicly traded companies the idea of giving stock analysts any ammunition for a critical stock rating would be tantamount to committing career suicide.  Instead most organizations would prefer to quickly sweep their failed initiatives under the proverbial rug and hope they are never discussed again.

A couple of data points can go a long way in helping us to understand the frequency of innovation failure.  It is first worth noting that there are significant differences in the success/failure rates of 1) incremental innovation and 2) disruptive innovation.

Incremental innovation is most commonly thought of as product line extensions (e.g. new cereal flavors, new soda brands, etc.) which tend to have lower failure rates.  Incremental innovation can more easily be tested with consumers because there is a benchmark to compare and contrast against.  Disruptive innovation is frequently a new to market product, service, or business model (e.g. Apple iPhone, Uber, HP Touchpad, etc.) that is much more difficult to evaluate prior to launch.  With that increase in uncertainty comes a higher rate of failure.

Data scientist Thomas Thurston (@thurstont) is CEO of the strategic consulting firm Growth Science.  For years Thurston has been working with innovative startups, large corporations, and educators trying to better understand innovation success by studying failure.  Over that time he has amassed a significant data set of over 1000 corporate innovation initiatives.  In the data Thurston has found that 78% of those initiatives cease to exist seven to ten years after their initial funding.  Stated differently, 3 out of 4 of those initiatives either failed to reach scale or to become self-sustaining.  Many others in the industry hint that the 78% sounds accurate with their experiences.

Even world-class innovation organizations see a significant percentage of failed initiatives.  Last year I had a discussion on this topic with Mark Payne (@MarkF212) the President and Co-Founder of innovation consulting firm Fahrenheit 212.  At the time Mark was proactively trying to address the issue of innovation failure by sharing the lessons he and his firm had learned in a book How to Kill a Unicorn.  Mark noted that even with all of the experience that his firm brings to an engagement they see a 20-40% failure rate for innovation initiatives.  Earlier in 2014 Fahrenheit 212 conducted an informal survey of 100 Chief Innovation Officers asking “what percentage of their innovation initiatives made it to made it to market?”  What they heard back was that two thirds of the respondents saw a 75% failure rate or three out of four of their innovation initiatives never made it to market.

When leaders don’t recognize these high failure rates and the corresponding risks involved to their individual employees they are setting their organizations up for difficult consequences when innovation projects do fail.

In a previous article for Innovation Excellence (Five Ways Organizations Lose When They Cover Up Innovation Failures) I highlighted some of these consequences:

• Concealing failures sets the wrong standard for the entire organization. Values of deceit or dishonesty are not sustainable in the long run.
• A failure cover-up pushes out some of your most talented employees. You need those curious intrapreneurs who are willing to take the personal risk to drive the organization forward.
• Severely punishing failures will influence other employees to reconsider and reduce their risk taking. This can have a severe impact on who will participate in your future innovation initiatives.
• Hidden innovation failures create false expectations for future success rates. If the only stories that you share are successes then you are reinforcing deceit and cover-up for future teams.
• Obscuring failures prevents the entire organization from learning from them. You have already spent the money on your failed initiative but not learning from it will doom your organization from seeing any return on that investment.

Based on these high failure rates and the negative impact to employees many in the innovation community have suggested it is better to just outsource their breakthrough (e.g. disruptive) innovation work to external teams.

If something sparks from that work then the internal team can focus on building out the necessary capabilities to sustain the innovation initiative.  But if the project fails there is less impact to the organization.  Simply stated the resources can more easily be eliminated if the initiative fails.

I recently co-hosted a Twitter Chat (#InnoChat) focused on the innovation domain where I posed the question of “Should mature organizations hire external teams or leverage internal resources if they want to drive breakthrough innovation?”  The participants provided some great insights and direction to this thinking.

• Start by asking “Why?” It was suggested that organizations start by getting clear on what their innovation objectives are before determining how to resource the work.  Why are they seeking breakthrough innovation opportunities?  The follow up questions should then be a realistic assessment of how they currently treat innovation and innovators?
• Understand the capabilities and culture within the current organization. If your internal talent is strong enough and your culture is supportive enough then absolutely include internal resources as part of your breakthrough innovation team.
• Identify skill and knowledge gaps. If your team lacks certain domain knowledge or innovation process expertise you can “wake up the innovators” by bringing in outside resources to fill in the gaps or lead the first few iterations.  External resources can also add value to the equation by bringing a fresh perspective and questioning internal dogma.
• Examine competitive landscape: If an organization lacks agility and is changing slower than the competition it would suggest that a more radical approach is necessary by jump-starting the work with external teams.  It is critical to recognize that only internal teams can implement the initiatives in the long run so they need to remain as an important piece to the equation.

This is just a portion of the insights gleaned from the #InnoChat discussion but it is a great example of the “wisdom of crowds” in action.  Everyone brought their unique experiences, priorities and perspective to the conversation making it a robust exchange.  Here is a link to the complete transcript including insights into how organizations can help their employees de-risk their decision to join internal innovation initiatives.

While we still have an “it depends” answer I believe that the group has identified four great criteria that can help any organization through the process of determining their innovation resourcing strategy.

image credit: alleywatch.com

Making mistakes is inevitable in life. But for entrepreneurs and innovators the path to success is always laden with frequent failures along the way. This conference is designed to help us navigate through those rough waters.

In Greek mythology the Phoenix is a long-lived bird that is cyclically reborn.  Quite frequently in entrepreneurship and innovation the individual that is able to rise from the ashes of their previous failures ultimately finds success.  But rebirth can only occur when the individual demonstrates the resilience to stand again and the community around them supports their effort.  We hope that The Phoenix Rising Event can help us in building that resilience and in creating that supportive community.

The event will feature over a dozen inspiring and insightful presenters from our Minnesota entrepreneur and innovation community.  Each speaker will share their authentic experience with failure, their lessons learned, and their advice for moving forward.

Since risk, innovation, and failure are not unique to the for-profit world we have also intentionally included speakers from both the for-profit and non-profit communities.

In 2013, I had the chance to speak at the FailCon conference in San Francisco, CA.  The conference was an eye-opener for me in just how far that community had come in building a healthy approach to risk and failure.  They facilitated that journey by creating an open dialog around it.

Our goal with The Phoenix Rising Event is to strengthen our local community of entrepreneurs and innovators by tackling our collective fear of failure head on and by creating our own open dialog around it.

Please join us on May 20th for our first Phoenix Rising Event:

Wednesday, May 20^th, 2015
9:00 AM – 4:30 PM
Carlson School of Management, University of Minnesota

More information on our speakers and a registration link for the event are available via our website at www.phoenixrisingevent.com.

[This post was originally published on January 16th, 2015 via LinkedIn.com]

I first mentioned the challenge Target was having with their Canadian stores in a post from January 2013 (see Target Misses the Mark). At the time Target was delayed in launching their new Canadian stores and they had just admitted their failed partnership with Neiman Marcus. In that failed endeavor both retailers utilized high-end designers to create a unique collection of holiday gifts that both companies would sell online and in-store. Sales of the unique product never materialized and quickly those items were slashed to 70% off on their website with only a few being listed as sold out.

My suggestion to Target at the time was that they should examine what really happened with the failed experiment by taking the time to reflect on their story and being transparent within the organization. The goal would be to share 1) what had they accomplished, 2) what had they learned, and 3) what would they have done different. Going through this process would be a great chance for Target leaders to shape how the organization would handle risk and failure in the future. At the time they were still two months from opening their first Target stores in Canada.

When I speak on the subject of risk and failure I start by focusing on the distinction between mistakes and failures. Mistake can be caused by bad judgment, lack of information, or lack of attention to detail. We make numerous mistakes every day of our lives without serious consequence. While we would prefer to avoid mistakes we understand that without perfect attention and perfect prediction they are inevitable. Failure is a little different. Failure is simply a lack of success-when something you’re trying to accomplish fell short of what was required or projected. From the analysis on Target that I’ve read it sounds like they had made a series of mistakes that ultimately ended failure.

Pricing: From reports it sounds as if Canadian consumers loved visiting target in the United States. For many it was a good shopping experience and Target offered lower prices than they could find in Canada. But setting up operations in Canada increased costs and required Target to raise prices in their new stores. No longer did they have a pricing advantage over other Canadian retailers.

Experience: Another complaint from Canadian consumers was the availability of products. It sounds like Target stores were challenged to keep products on the shelves. Since they cited that sales were low this must have been problems with their operations of logistics capabilities. The other option is that Target over estimated their sales projections and didn’t want to burden their stores with higher inventory costs. Preferring instead to keep their shelves thinly stocked.

Loyalty: Another insight was that many Canadian consumers loved shopping Target when they visited the US but Target had failed to understand that they didn’t shop the same way as American consumers. They were also facing an uphill loyalty battle with Walmart and Canada’s Loblaws. This reminds be a bit of the battle that Coke faced with their loyalists when launching New Coke (see Creating Common Language).

The reality is that Target is not the first retailer to fail with their international expansion plans. In fact, the “king of retail” Walmart has had very mixed results. They have had success in the United Kingdom, South America, and China but failed in Germany and South Korea. Best Buy, another retailer located just minutes from Target’s headquarters, has had its own string of failed international expansions including China, Turkey, and the United Kingdom. Just last month Best Buy announced that it was selling its Chinese retail brand Five Star to a Chinese real estate group leaving them with operations only in the US, Mexico, and Canada.

I am sure this failure will sting for some time for Target employees and their leadership team. If they ever again have an appetite for international expansion plans the question won’t be if they will see more failure but when they will see more failure. This work is inherently risky and the path is littered with previous failures. But how Target responds now will set the tone for how employees will perceive risk for years to come.

Food for thought:

• Should Target have started off with a smaller entrance into the Canadian market?
• Instead of shuttering all 133 stores should Target just have cut the lowest performing stores?
• Estimates are that Target has between 600-700 employees at their headquarters supporting their Canadian stores. If they lose their jobs how will that impact future decision making for the remaining employees?

Others articles on Target Canada:

• Forbes: Target Leaves The Great White North: Why The Retailer Is Bailing On Canada
• New York Times: Target’s Red Ink Runs Out in Canada
• USA Today: Target to shutter all stores in Canada
• Fortune: What Target Failed in Canada

Image Source: Huffington Post / The Canadian Press

When he recognized that his people were not stepping forward with their ideas or their support of innovation initiatives he asked his leadership team to help solve for “why?”  This article is an examination of what was going on within the organization and some simple suggestions for both leaders and employees who might be facing similar circumstances.

Saying All of the Right Things

As I had mentioned the company has been in existence for over 25 years but for the first 23 years there was a hierarchical top-down approach to leadership.  Research and development was done exclusively within a certain group and “innovation” was something that other departments didn’t really need to concern themselves with.

For most of the organization’s history this top-down hierarchical structure had been the accepted model and truthfully they had been reasonably successful with it.  The company had successful innovations, their customers were reasonably satisfied and employees had chosen to remain with the company – for the most part.

The new CEO, having come from a large Silicon Valley company, quickly spotted a couple of the challenges facing his organization.  There was a lack of synergy between the organization’s structural silos and there was lack of engagement from the employees outside of the research & development function.  The new CEO saw great potential in breaking down those barriers and encouraging all employees to help drive innovation.

In response a new vice president was hired to lead the newly created innovation office and town hall meetings were held to encourage innovation across the organization.  But still little innovation happened outside of the traditional R&D function.  Sometime later at a follow up meeting with employees the company’s leaders asked “why they weren’t engaged in supporting new innovation initiatives?”  The answer back from employees was that leadership was saying all of the right things but employees didn’t believe them.  Employees had previously experienced the negative consequences from failed initiatives and they didn’t see how that policy had changed much.

The Organization’s Culture Hadn’t Changed

There’s an old adage that states “just because you keep saying it doesn’t make it so.”  Most human capital (formerly human resources) and change management professionals will tell you that it takes significant rigor and years to effectively change an organization’s culture.  The reality was that the company wanted employees to take on more risk but leadership hadn’t yet demonstrated how they would respond to failure.

Employees knew that these innovation initiatives were higher risk than their normal responsibilities.  They had seen before how a failed project could threaten their earnings, their ability for promotion, and even their future employment.  Before taking on these risks they would need to trust that their leaders were looking out for their best interest.

For innovation to thrive there would need to be a demonstrated shift in the organization’s culture.  Employees would need to see that they weren’t punished for taking on these riskier initiatives.  To be clear, I am not suggesting a “free pass” for employees who lead innovation initiatives but instead for everyone to understand and support that these are riskier projects.

The Risk vs. Reward Equation Was Out of Balance

The problems this organization encountered is not unique.  Too often in business, just as in our personal lives, our actions don’t align perfectly with our words.  In fact I recently met with a “world class” innovative organization who still struggles with the challenges of risk vs. reward.  They have employees with 20 or 30 years of tenure with the company who are not willing to take on risky initiatives because it might tarnish their career and cost them that next promotion.

Here are a few recommendations I have for organizations that are struggling to build a culture of innovation within their organizations.

1. Take a pulse – Talk with your employees (small groups preferred) about the need to drive innovation at every level of the organization and set expectations for their role in the work.  Ask for their feedback on how they see the risk vs. reward culture within the organization.  Ask what obstacles they see preventing others from joining in the work.  When working with client I have developed a current state assessment tool that looks at three areas: the people, the processes, and the tools.
2. Recalibrate if necessary – Based on employee feedback work with your leadership team and your human capital team to help make necessary changes.  Often times this will require behavioral changes on the part of leaders and subtle changes to company policies and procedures.  For example, what happens to employees when an innovation initiative ends?
3. Reinforce the behaviors you seek – One of my favorite quotes come from Mahatma Gandhi, “You must be the change that you wish to see in the world.”  The same hold true for business.  If you are the leader who presses your people to take risk and drive innovative ideas then you also need to be the leader who is there to support them when plans don’t turn out as expected.  Are you ready to share your failures and lessons learned with your employees?

Innovative organizations are not born they are made and the same is true for innovative employees.  Some employees are more adapt than others at creativity, risk taking, and moving ideas forward but without the right culture they too will soon sink.

Creating a culture of innovation where employees both trust and are trusted in innovative risk taking does not happen overnight.  It happens when leaders are humble enough to listen to their employees concerns, to make the investment and changes necessary to change the culture, and to reinforce the necessary behaviors with their own actions.

I’d love to hear your thoughts and feedback.  If you found it valuable please feel free to share it.

If you are interested in learning more about creating a culture of innovation here are some other articles worth reading:

• Don’t Innovate. Create a Culture of Innovation – Forbes – Scott Eddinger
• How to Create a Culture of Innovation – Fast Company – Faisal Hoque
• Six Ways to Create – and Sustain – a Culture of Innovation – WhatIf! Innovation Partners – Lisa Buckley

The Four Bands Community Fund was started in 2000 as resource for financial literacy training, entrepreneurship education, and small business training and lending.  To date the fund has lent out more than $8 million in cumulative deployment to its community. The people there are building credit and the community is growing because Tanya Fiddler accepted the challenge.  She wasn’t satisfied with the status quo and wanted to make both herself and the community stronger through financial independence.  This is her story.

[This article was originally published in Pollen on October 23, 2014]

Q1. Many of us are not familiar with the challenges of building financial literacy programs on a reservation.  Can you share some of the hurdles that you faced starting out – including public versus private sector jobs, banking, and property ownership?

It is important to know that according to a CFED report, 55 percent of our tribal population is unbanked and/or under-banked (see map – the reservation spans Dewey and Ziebach Counties in South Dakota).  Most have very limited experience with banking. Our tribe is federally recognized and has “sovereign nation” status.  The nation owns and controls most native-owned land/assets and tribal members can get a “lease assignment” for business or homeownership purposes.  In addition we can also get tribal range unit leases for native-owned ranchers.  Having no land assets or property complicates the collateralization required to access financial products for loans or credit.  So although you build a home on your five-acre land lease assignment, there is no value on the land or property.  This also means that property taxes aren’t collected. Often that money is what sovereign states use for infrastructure development and maintenance.

When Four Bands started the reservation population was 80 percent Native American, however they owned less than 1 percent of the businesses.  This was the major driving factor for our loan fund.  We wanted to increase access to capital, provide business training and technical assistance, and support native business incubation.

We knew many of a tribal members lacked personal and business financials skills.  Since our inception we have trained thousands of tribal members in these skills, along with bookkeeping, marketing, and other specialized courses.  Knowing that our market had this low skill level going in, we tied all of our financial products to a training or technical assistance requirement. So far this work has resulted in over $8 million in loan capital deployed in two of the poorest counties in America.  We say in our work that we are “creating our economy” because of the lack of historical investment in private sector development and job creation.

Job creation presents another unique hurdle in our community, as evidenced by the disproportionate number of government jobs provided on “the rez” (reservation).  Our research shows that 47 percent of the jobs on Cheyenne River are government jobs, compared to 15 percent statewide and just 14 percent nationally.  We needed more jobs in the private sector in order to create a more stable economy, circulate dollars locally, and decrease our dependency on the tribe and the federal government for jobs.

Q2. We know that many of us learn best from example.  As you launched the Four Bands Community fund, how difficult was it for these communities to identify “examples of good” in financial literacy to learn from?

It was extremely difficult.  We were trying to expand the financial education work in many ways, but because of the huge need for it we knew that we were going to have to identify partners and systems that could help us leverage our limited resources. Originally we thought we could leverage many of our Tribal Program Service providers who already work with our low-income, distressed community members.  Since these providers already work with the same group we hoped to reach, we tried partnering with them.

We hired a financial skills trainer to deliver a “train-the-trainer” session for our Building Native Communities – Financial Skills for Families program.  We thought since these providers were jobholders, they would have a general idea of money management and credit.  We set out to create a delivery system supported by one trainer and 36 service providers that had gone through the training.  This leverage would quickly increase the number of tribal members that could get help and training.

But while the service providers graduated as certified trainers, none of them felt confident enough to help anyone else.  It was eye opening to say the least, and we realized that we needed a new approach.  From this failure we devised another strategy that eventually became our Making Waves Campaign.

Q3. You had mentioned that early on you tried to launch an after-school program to teach financial literacy that failed.  Looking back, can you share the shortcomings of the program?

We started by going into the schools trying to operate an independent after-school program to teach financial literacy.  We soon discovered that most of the 2,000 kids rode the bus and couldn’t stay after school.  Those that could stay were often in sports so they couldn’t make the meetings.  We realized we also lacked an internal champion within the school system itself.  Teachers thought what we were doing was critical because of the high poverty on the reservation, but they were already overcommitted and couldn’t take on additional after-school duties.

That’s when we figured out that we needed to meet the students and teachers where they were at by integrating the concepts into the core subjects that were already being taught.  Hence the Making Waves K-12 Teacher Toolkit was created and tested.  There have been many other challenges in our delivery model, but we have trained several other tribes and tribal programs on how to service the delivery model we created.

Q4. When you began your work you mentioned that there were systemic failures that prevented your communities from finding success.  One of those failures was a lack of credit reporting on the reservation.  Can you explain how your group is working to resolve that shortcoming?

We had three banks in the local community and none of them reported their lending to credit bureaus.  We were told that their attorneys advised against it because of all of the regulations and potential lawsuits that might come from any inaccurate credit reporting.  This was a huge barrier in a low-income community because its individuals have no credit score.  Those that are in successful repayment of a loan cannot show that they are creditworthy to other lenders for personal loans or business loans.  With no credit score, our members are vulnerable to predatory lenders because no one else will lend to them.  There is an exorbitant number of payday, predatory, or title loan companies that are actively advertising on the reservation.

We were new in the Community Development Financial Institutions (CDFI) industry, but were networking and learning from other microenterprise development organizations both rural and native to try and find a solution to the problem.

Finally, our advocacy was heard and a national nonprofit called Credit Builders Alliance (CBA) formed and began to work with the credit bureaus to launch a plan to warehouse our loan repayments so they would hit one of the major bureaus.  I think currently two of the three national credit reporting agencies receive our data.

When credit reporting became available we launched a credit building loan product.  It was a short-term, low-cost loan to help people begin to build credit histories.  We began with personal finance training, ordering the customer’s credit report, and then setting goals to build or rebuild their credit histories.  We have a credit coach that helps members create an action plan to maintain good credit and have seen astonishing results.  We had found that 55 percent of the folks coming in our door had no credit histories at all.  Many of our clients went from no file, to building a score in the low 600s after the first year.  Most that did have credit files had scores nearly 100 points below the national average of 700.  The credit builder loan helped members clean up bad debt and rebuild their credit histories.  The CBA evolved to create a system/service for “soft pull” of credit reports that didn’t impact credit inquiries on the customer credit file.

Q5. How much in community loans did you make your first year and how much has that grown since?  Which organizations have been most supportive in helping that growth?

We did $19K in micro business loans our first year and broke the $1 million mark in 2008.  In seven years we built a capacity for larger loans and new loan products.  We expanded our lending seven times over the last six years, with a total cumulative deployment of more than $8 million to date.

Our growth can be contributed to our Making Waves Strategy that has been deployed through 12 community organizations to implement financial literacy and entrepreneurship behaviors.  These partnership opportunities helped expand program outreach and gave us additional ideas for loan products and services.  Our advocacy network, the South Dakota Indian Business Alliance, is the other organization that helped escalate our growth through statewide access to capital through the Native Entrepreneurship Investment Fund.  We managed and grew that fund from an initial Citi Foundation investment of $100K, to $1.2 million in off-reservation lending.

Q6. You mentioned before that most of these financial concepts were foreign to you – having grown up in poverty yourself.  How have you personally managed the steep learning curve you faced?

I am trying to serve tribal members that have a similar story to me.

I completed my first personal finance class after I got divorced and moved back to the reservation with my two kids.  I worked as a loan officer for a housing nonprofit developer that was promoting homeownership using federal programs.  I worked to get borrowers ready or prequalified for the lending programs.  When I got divorced I had to file for bankruptcy and start from scratch.  I got counseling from Consumer Credit Counseling of the Black Hills and later discovered its curriculum “Credit When Credit is Due.”

I took the course and I woke up.  I didn’t have any previous financial education beyond that.  Growing up it was embarrassing when your mom gives you a bad check to buy groceries while she’s traveling and trying to provide for six kids.  There was always so much stress, shame, hurt, and anger in our world around money.  I hadn’t seen anyone that was successful at it.

So after taking the course and working on my own personal finances, my experiences directly translated to many of the customers I had in housing and then later at Four Bands.  It was a life changing moment when I began to pursue financial education. I rebuilt my finances after bankruptcy and put my kids through college.

Once I came out of income poverty I had to deal with asset poverty. I didn’t have assets to leverage for my kids’ education and they were no longer eligible for aid because of my income. Everything was an out-of-pocket expense.  Only later in life did I develop financial skills and asset-building strategies.  I just didn’t have ample time to create college funds for my kids.

This is why I think it’s important to have an Individual Development Account program where families can save and get matched for that initial investment into homeownership, business startups or higher education.  Many outsiders assume these assets are readily available, but that’s not the case in reservation communities.  Without a community development organization to provide the initial investment in that person, things such as a home, business, or college education are out of reach.

Last year I lost my husband so retirement planning has taken on a whole new meaning for me.  Luckily my kids have all completed personal finance training, have great credit histories, and are now coaching me on how to plan for my future.  My son has even become my financial advisor. I feel like we have broken the cycle.

Q7. What advice do you have for other leaders who want to make a difference in their communities but are facing similarly difficult starting points?

Leaders, especially community leaders, need to see what’s right about the place instead of everything that’s wrong.  Messaging and the media in Indian Country are usually negative and frequently cite everything that is wrong.  A good leader is able to look past that and identify the assets in the community to create products and services to meet people where they are at with dignity and respect.

You also have to be authentic and truthful about your own experiences.  Talking about my financially reckless life gave other people the ease to talk about themselves.

I also discovered that for the most part, credit reports from our community were not as bad as people thought.  Just the education alone helped people develop comfort and proficiency in having a discussion around credit.  There is a lot of shame and suffering in low-income households, so we focus on providing a supportive environment to eliminate that shaming.  We have countless examples of how our customers benefited and saved themselves from financial woes because of the education they’ve received.

Q8. If Pollen readers want to offer a helping hand in your work, what’s the best way to get involved?

We collect a lot of information that we could use help analyzing.  Folks can invest in our loan fund to keep the work rolling. That info is available on our website: www.fourbands.org.

I would also encourage readers to come and visit Cheyenne River for hands-on learning about the realities on our reservation – both good and bad.  We have some people who think we still live in teepees, and others who are afraid to drive through the reservation because of news reports on violence. We invite people into the community so that can help us debunk these myths and help us make connections with the outside world that may benefit our work.

Finally, if readers are considering expanding a business, give us a chance at the opportunity.  Our CDFI is innovative and resourceful, with keen expertise in successful community economic development.

Tanya and the Four Bands Community Fund have undoubtedly made great progress, but they will tell you that there is still much to be done to improve the lives of people in their community.  Their first attempt to teach financial literacy in an afterschool program failed, but it was a move in the right direction.  Tanya and the team knew it was going to be a challenging journey and that they would make mistakes along the way, but they were willing to pick up the pieces and try again.  If not for the lessons learned, they might not have found success with their revised Making Waves program.  You can read more success stories from the community on their website at http://fourbands.org/success.htm.

If you are interested in connecting with Tanya or learning more about her journey, you can reach her via LinkedIn and email at tfiddler@fourbands.org, or you can stop by the reservation for a visit.

[This post is a reprint of my article that was originally published on October 23rd, 2014 in Innovation Excellence.]

According to Clay Christensen and his team at Harvard (The Big Idea: The New M&A Playbook) – companies spend more than $2 trillion on acquisitions annually.  With research showing the failure rate of mergers and acquisitions between 70% and 90% the best case scenario is that we are wasting $1.4 trillion per year on failed acquisitions.

The question then becomes “why is it that so many of these acquisitions fail to deliver the expected benefit for the acquiring company?”  Are the acquiring companies imposing their slow pace and risk mitigation policies onto the smaller company?  In 2002, consumer electronics giant Best Buy was looking to fuel their growth into PC, home theater, and appliance services.  To jump start that work Best Buy acquired the then startup Geek Squad which had been founded by entrepreneur Robert Stephens in 1994.  During our recent interview Robert shared his story of entrepreneurship, risk taking, acquisition strategies, his pick for Most Visionary CEO, and an expensive 99 cent burrito.

Q1.  In 1994 you started Geek Squad with $200 and a bicycle. By 2002 Geek Squad became a subsidiary of Best Buy. How many agents and locations had you grown to in those first 8 years?

In 2000 when I called on Best Buy we were in four cities: Minneapolis, Chicago, San Francisco, & Los Angeles.  We didn’t have any offices.  Literally we didn’t have any offices.  Just cars and people and we dispatched everything out of Minneapolis.

Our model was kind of like Uber is today.  We didn’t have a lot of infrastructure – we just had people, cars and dispatch.

Q2.  As an entrepreneur what was your approach to risk taking and driving growth?

I’m risk averse. I don’t take risks. There are risks that you know you’re taking and the ones you don’t.  At the time my risk was staying in school and taking on more debt.  That was the risk I was avoiding by starting my company.  I didn’t think I could work anywhere in a big corporation so I was forced to found a company. I didn’t wake up deciding to be an entrepreneur – I just didn’t see any other options.

The truth is that I applied to become Prince’s head engineer but he didn’t hire me. Had Prince hired me I would have toured the world and had fun parties but I would have never started my company. There is a reason that you start a company in your 20’s before you have kids and settle down. You have less risk.

Like for me my youngest is 16 years old so in two years I will have reduced my risk again. I will go back to having 20 hours a day free, no kids at home, and under the age of 50. This means with the current progress of medical technology I will have 40 years of work ahead. Now I am more experienced. With my next startup I will be even more dangerous.

I don’t want to own anything.  I do that because I am extremely risk averse.  I don’t want to be encumbered by debt and that dates back to being a college student. I once bounced a check for a 99 cent burrito.  I knew that I was going to bounce the check but I hadn’t eaten in a day and I was really hungry. As I watched the burrito cook in the microwave I remember knowing that this burrito was going to cost me $23. That was a really expensive burrito!

I never really got over that sense that I was that close to starvation.  Which is good – it keeps you hungry and keeps you on your toes.

In terms of risk the whole deal with Best Buy is that I had no other choice. I couldn’t franchise Geek Squad.  Proof of that is today. How many Geek Squads are there?  None – why is that?  It is a hard business that doesn’t really scale. You can barely franchise burgers and doughnuts let alone franchising a complex in-home service. The fact that there are no other “Geek Squads” is my proof that I made the right decision.

I felt I had no choice and that I had to sell Geek Squad because for me the risk was that I didn’t want my first startup to be a failure. By putting it inside of Best Buy I was able to ensure its survival. I might have made more money taking it public but I felt that I would have been ripping off my shareholders by selling them a company that wasn’t scalable. I cheated because now Geek Squad is scalable as part of Best Buy.

Q3.  Was it a difficult transition for you in moving from entrepreneur to part of a Fortune 50 retailer?

It was a huge change – you can’t keep beer in your office.  There are two kinds of risk – those of action or inaction. There is the risk of losing the culture – startups are great and they can be innovative and drink beer at night but they lack scale and leverage. Large corporations have resources and market share that they can deploy, use, and influence but they tend to lack agility.

My risk also was staying small.  I didn’t want to stay a small fry, some little computer repair person like everyone else in the yellow pages. So I traded one risk for another – and that is really how everything goes in life.  You have to be honest and aware of the risks. Where people get in trouble is where they fool themselves and lie to themselves about what the risks are.

We give founders way to much credit.  When you are 24 and you’re eating Ramon Noodle and 99 cent burritos that’s not really a risk you are taking.  It was either that or taking on $100,000 in college debt.  Now that is risky – toiling away for decades to pay off of that debt.  Now that is risky.  I will tell you what I am impressed with a 30, 35, or 40 year old parent who has kids and family obligations and a spouse to love and pay attention to and then decides to start a company. That is ballsy, that is gutsy, that is a person that I respect.

Q4.  What advice do you have for executives that are acquiring growth startups? Which acquiring organizations would you cite as examples of good in this space?

I don’t see many examples of good in this space.  The best acquisition that I can think of is YouTube when they got acquired for $1.2 billion.  Everybody thought that was insane.  Now it looks like an incredibly good deal.  It is very profitable.  Goggle didn’t touch it, they didn’t mess with it.

If you buy a business, first of all, get over the idea that you’re going to incorporate it into your business.  Whatever.  That’s not really going to happen.  It is better to let it live on its own because if it was hitting some growth rate you should just let it happen and not ruin the momentum.

Q5.  What advice do you have for entrepreneurs considering or currently going through a similar transition?

My advice to founders is unless you are planning on staying you need to know what you are going to do next and don’t kid yourself. What I would say is that for me going forward I am only interested in working for visionary CEOs.  And there are very few of them, like a handful in the world. That’s the biggest problem in corporations – they lack vision.

There is the whole size issue and can big corporations innovate but I would argue that the fish stinks from the head down.  It comes down to the CEO – if your CEO does not get it your doomed.  The second most important thing is the board [of directors].  For example, more than half of Amazon’s board is digital and has real expertise. I don’t know anybody from Best Buy’s board in the last ten years that had any digital expertise.

The reason that is important is that the board is the one to review the big strategic plans but if they don’t understand digital or they don’t understand trends then they can’t really evaluate it. I don’t care if they have an MBA from Harvard – there is so much disruptive technology going on that you have to know what you are talking about.

Q6.  You had mentioned the idea of working for visionary CEOs. Who would be on your short list of visionary CEOs?

I think the most interesting and fun CEO in the world right now is John Legere (@JohnLegre) of T-Mobile US.  I love his style – he is super irreverent and breaks rules.  He was the fourth place carrier at T-Mobile and what is the first thing he did.  He said that cell phone plans were insane and too complicated. He simplified them. That is something that any of us can do. The best CEOs simplify things – they simplify their offers. They don’t try to use trickery and fine print.  You can tell his enthusiasm and he’s also made some smart moves.  He is growing market share. They are still small and they have some coverage issues but I think he has done the best he can with the hand that he was dealt.

In January, he was in Las Vegas for the Consumer Electronics Show (CES) and showed up at AT&T’s party. He loves Macklemore and showed up for the concert and they kicked him out.  AT&T played it just like David vs. Goliath and Legere played it masterfully.

So he uses Twitter, he’s a CEO who is really on social media. I don’t even think that a company should have a social media team anymore. That was fine when Twitter and Facebook came out but the problem is that when a company has a social media team – nobody else in the company needs to be on social media.

I want the CEO to be on social media – I want the CEO personally tweeting. You can have legal and marketing departments on Twitter but the CEO needs to be there and available.

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As Robert stated above, sometimes the risk isn’t in starting your own company but in taking on college debt with the uncertainty in how you will repay it. For Robert and Geek Squad it was imperative to partner with a company like Best Buy that could scale complex in-home services across the country. He recognized that would mean slower decision making and more politics but he saw it as the lesser of two evils which was remaining the “small fry.”

Robert has a good understanding of his own risk tolerance is looking forward to returning to entrepreneurship soon. With his further experience and understanding he expects to be even more edgy in his future endeavors. Robert follows his own advice and is incredibly active with the Twitter community. You can follow him or engage him in discussion at @RStephens.

Those that know Robert can attest that he never has a shortage of opinions.  With his permission I have edited our interview for brevity and a few explicit remarks.  If you’re interested you can watch our entire Skype interview available on my YouTube Channel.

Since 2009, former Minneapolis native Cass Phillipps has been hosting the FailCon conference in San Francisco, CA. FailCon is a daylong event focused on entrepreneurs and the startup community sharing their stories of failure and the lessons learned. The tagline for the event is “Stop being afraid of failure and start embracing it.” In my opinion we need to bring a little of that attitude back home to Minnesota?

In the last decade of my professional career I focused on driving high risk innovation initiatives and through those experiences I have learned to become comfortable with failure. I have seen firsthand the benefits of learning from my failures and those of others. I have seen the confidence rebound for individuals and teams when they realize that they have survived from a failure. My goal in sharing these stories is to help build a stronger entrepreneurial community by learning these lessons together.

Local entrepreneur Jon Wittmayer learned many lessons over the last few years and is willing to share his story of shutting down his application startup inSphere. This is Jon’s story:

[A condensed version of the following interview was originally published on
September 11, 2014 in TECHdotMN.]

1. You’ve mentioned before that the idea for inSphere came from your personal experience. What was the manifestation for inSphere?

Often when individuals find themselves in a job transition they are seeking to quickly expand their personal network with as many introductions as possible. They are hoping for quick outcomes with an introduction, a forwarded job opening, or a referral to a potential employer. This rarely happens.

It isn’t until people start building a deeper relationship that this type of support occurs.

inSphere was developed to help people build these deeper relationships. I described it as “CRM” for an individual’s professional relationships. I now see the term PRM “Personal Relationship Management” being used a lot.

When I found myself in transition I was meeting between 10 – 15 people a week. I could hardly keep up remembering anything about them. I turned to others in the same situation and what I heard was that were using Excel spreadsheets to manage their relationship network.

Having come from a business that developed SaaS based solutions I was surprised to see there was no one else working on this problem?

2. Once you identified the idea, how did you go about getting things started?

Honestly, I thought about the idea for a long time. I wasn’t sure if it was good enough to actually be a business or if I was just solving a problem for myself. I started to talk about this in my networking circles. I received positive feedback. People would say “I need something like that” or “when is it going to be available?” From there I took pen to paper and started to define how it might work, what it would look like, etc. I then bounced the idea off of a focus group and things just started to roll along.

3. Did you find it challenging as a non-technical founder of a technology company?

This is a really good question and one of the reasons I moved to close the business. I recognized early on that having a technical co-founder was important but I didn’t take action early enough. When I did start to look I didn’t realized how difficult it would be to find someone with the technical skills and the same level of passion.

Having a technical co-founder on a project is extremely important. With a technical co-founder you can stop and change directions at a moment’s notice. This allows you to be much more responsive to quick learning, customer input, and changing market conditions. It’s also the difference between spending cash out of pocket and doing it in-house for sweat equity.

4. Not having been an entrepreneur before, were you able to network with other entrepreneurs?

The Twin Cities has a tremendous support network for entrepreneurs; there are meet-up groups, organizations whose sole purpose is to help entrepreneurs. While I tapped into this a bit late it was a great help as I was getting going.

5. You have mentioned before that you appreciated Eric Ries’ book The Lean Startup. What did you find most helpful in your journey?

Eric talks a lot in his book about “Build, Measure, Learn” which, as a mantra, is really helpful to an entrepreneur. What I take from that is don’t over build and find out it’s not what your customers want. Build a little, build it quick and test to see if it’s what your customers are looking for. Fail fast, fail early and keep failing until you hit on something that is right and you can develop further and market. I didn’t do enough of this.

Along the way I also came across “Who is your customer, what problem are you solving, and what solution will you deliver?” I’m not sure if this is an Eric Ries concept but it certainly permeates the learn philosophy, and should be a guiding principle for anyone who is thinking about starting something new.

6. In 2013, the professional networking site LinkedIn added “relationship tracking” functionality to their site. Did you see this as a direct threat?

While I was working on inSphere I mostly focused on what I was doing. I was trying to get my offering right by building something to meet the needs of my users.

At the time LinkedIn had significant scale with close to 200M users, they had completed their IPO so they were flush with cash, and they were the de-facto professional networking tool – they were the 800 pound gorilla.

While their functionality was still just a fraction of what I was trying to create, I knew they could easily own relationship management.

7. Before you decided to shutdown inSphere operations you mentioned that you were putting the company on a timeline. Can you explain more?

I had my product in the marketplace for about 18 months. Somewhere around the 12-month time frame I was getting the inkling that it might not be working. The primary measure I was fixated on was the number of users and paying users.

At the time I was not focused on the product since I was receiving positive feedback every time I demonstrated it to potential users.

Instead I was focused on marketing efforts. Feeling as though I could (or should) do more. So I put myself on a 3-month timeline, with an additional 3 months if I could show significant progress. Really what I was doing was trying to hold myself accountable to the business.

8. How difficult was it for you to make the final decision to shut down the business?

It was really rather easy – easy and relieving. I stepped back, as unbiased as I could, took a look at the state of the business. Where we were today and what efforts had we tried. I assessed what could be done differently to keep the business going. In the end it was easier to discontinue the business rather than try and move forward in a new direction.

9. Looking back, are there any things that would you have done differently?

First of all I would have preferred to have a technical co-founder from day one. It is so much easier to make changes, pivot, and be agile when your development team is also a founder.

Also, I would not have sacrificed the cost of development for speed to market. I would have staged the development much more so that we could have gotten parts of the product into the hands of beta users much sooner. Momentum was lost from when I first introduced the concept to potential users and when we finally rolled out a product.

10.From your vantage point, how supportive is the local venture / entrepreneur community with failed startups?

I don’t think it is. Of course everyone wants to speak of the success story but given the failure rate of start-ups today, we should be more willing to share our stories.

I have learned so much along the way from others, I would think that someone else might be able to learn from what I did or should have done.

Just this year at MinneBar I sat in on a presentation where someone talked about his failed start-up. It was the first time I had heard someone honestly pour their heart out in an open forum. The room was packed and there were many questions for this person. I think the community is clamoring for more of these types of debriefs.

11. Do you have any advice for those that are thinking now about starting their own company?

Yes, do it! You will never regret it regardless of how it turns out. Also, talk to a lot of other entrepreneurs. Learn from what they did, didn’t do, and what they would do differently.

12. What are some things that you learned from the experience?

Being Humble – You have to be willing to do it all. Especially if you’re a solo entrepreneur you have to be willing to take on all aspects of the business. You have to learn things you never expected you might have to learn and to manage tasks you don’t particularly care to.

Highs & Lows – There is tremendous satisfaction is seeing your vision take life and to actually see people using it. On the flip side of that you also can experience the low of the lows when something isn’t going the way you had planned. But through all that you come back the next day and continue on because you still have confidence in what you’re doing.

Generosity of Others – I was amazed that so many people were willing to give their time to help me be successful. They were willing to speak the honest truth, tell you their stories, and pour their hearts out to you. This was extremely important in the early days.

Team Effort – It takes more than one person to move your idea forward whether you have employees, contractors, or friends willing to lend a hand. Recognize those people along the way and make sure they understand how important they are to you.

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Jon was right on his opportunity identification but missed the mark on execution. There is an absolute need for tools like inSphere to help individuals move beyond personal connection “transactions” to building professional relationships.

Earlier this year I was introduced to Chuck Feltz, a former CEO at Deluxe and now an executive recruiter with Korn Ferry. A great insight that Chuck had shared with me is that in all of the people he meets as an executive recruiter fewer than 10% follow up with him after the initial introduction. They are seeing the introduction as a transaction rather than an opportunity to build a long term relationship. Chuck didn’t have a job for them at that time so they decide to move on.

As Jon mentioned, LinkedIn has added some of this relationship management functionality but the tool set available for users to manage this information is sparse to say the least. Maybe this is an opportunity for another Minnesota entrepreneur to move the idea forward? If you have any questions for Jon or just want to reach out you can connect with him via LinkedIn at Jon Wittmayer.

If you would be willing to share the story and lessons learned from your failed startup in a future issue of TECHdotMN or if you know of a good failure story that we should track down please contact me via email at matt.hunt@stanfordgriggs.com or on LinkedIn at Matt Hunt.