Knowist

The South Pacific Part One

2010-03-05T23:25:48-06:00

I had the fortune of spending 3 weeks in Australia and New Zealand during February. Which in addition to being a great place to be on its own, has the distinct advantage of being a lot warmer than Chicago. Since a picture is worth a thousand words. And a video is about 30 frames per second, here's about 18 million words worth of vacation.

The journey begins. Wherein, Christine reveals her to run the 2010 Chicago marathon. Apparently, my insanity is contagious

Aussie Friends and a bit of Sea Cave exploring at low tide:

12 apostles. Not the biblical kind. The ... big random rock formation in the ocean kind. Actually, they were originally called the Sow and Piglets, but the tourism board didn't think that sounded as distinguished:

Walking around Melbourne with our dear friends Andy and Martine. Lamenting the obvious lack of Kangaroos:

Platypii aren't very rare, but they are rarely seen in captivity. Since they are nocturnal and a little shy, this was a real treat. This particular platypus was pretty fat. We dubbed him fatypus.

The Melbourne botanic gardens are really beautiful. They got some big frickn' trees there. Like LOTR Big Frickn' trees. The city isn't that old. Maybe 150 years of actually being a city, and this garden goes back right to the beginning of it. It's amazing that this city is so big and has such incredible infrastructure. Humans can do a lot in a 150 years.

We went to this really awesome open air nature reserve. We finally got up close and personal with some Joeys. Sadly there were no Chandler or Rosses, but ther were some other friends... wombats and emus

A Quick Interview

2010-02-02T09:19:21-06:00

A student sent me some interview questions for his entrepreneurship class. I only had about 5 minutes to shoot off some answers. So, this is what popped off the top of my mind:

What ignited the spark in you to start a new business venture or to make significant changes in an existing business? How did the idea for your business come about?
-There was a push and a pull. The push:I didn’t want to work for somebody else anymore. The pull:I saw that no service existed to show hungry people all the restaurants that deliver to them.

What three pieces of advice would you give to college students who want to become entrepreneurs?
-The most important step to get started is to accept the risk of failure.
-Pick one thing. Do it well.
-Figure out how to generate revenue immediately

How do you generate new ideas?
-The creative problem solver naturally discovers solutions to problems. Therefore, the best way to get new ideas is to put oneself in a situation to observer real life business problems.

What is your greatest fear, and how do you manage fear?
-Commit to not acting on fear, but on possibilities. Maximize upside first. Minimize downside second

How do you define success?
-Success is a continuum and journey, not a destination. A successful journey is characterized by the continual maturation and evolution of my projects and myself.

What do you feel is the major difference between entrepreneurs and those who work for someone else?
-The ability to accept the risk of failure

What sacrifices have you had to make to be a successful entrepreneur?
-Stability

Where you see yourself and your business in 10 years? 20 years?
-I will be working on opportunities nos 2-4. This particular business will have taken a life of its own.

What is your favorite aspect of being an entrepreneur?
-The satisfaction of setting my own goals and measuring my success against them.

Do you believe there is some sort of pattern or formula to becoming a successful entrepreneur?
-Identify opportunity. Act to engage that opportunity. Measure. Rinse and Repeat.

9 tools for growing a startup from 1 to 50 employees

2010-01-19T13:19:38-06:00

Here is a roundup of 9 tools for growing a company from 1 to 50 employees:

Tool #1: Revenue. Apparently there are business models that are proponents of not making money right away, but I don't get them. Cash allows an entrepreneur to hire people and resources to get things done. At first it is all about increasing velocity on the sales -> product -> sales cycle. Successfully executing that cycle then requires supporting activities... billing,finance,IT infrastructure, etc

Tool #2: Options and Environment. Finding and motivating employee #2 can be very challenging. Options help (though less so in the midwest). The right person for this role will be very interested in equity. The right option plan will provide long term incentive when cash is hard to come by. More importantly, the startup environment will be very attractive to the right person. Meeting in coffee shops, lots of responsibility, and flexibility in direction should inspire rather than frighten early employees.

Tool #3.Throw away the partnership documents. Get a handshake you can trust. I swear we spent 100 hours arguing over the minutiae of our partnership document. This was largely based on several people I knew who had been screwed by their partners. The lesson to be learned is *not* about getting a long contract. In the end, you just need to pick the right partner. Because, if they want to screw you over, they'll find a way regardless of what papers have been signed.

Tool #4. Don't hire just good people, hire good startup people. A good startup employee has a few key attributes. Look for people that have a lot of adaptability. They take initiative. They are good with ambiguity and change. Look for these kinds of things in the interview process. Give a preference to candidates that follow up and ask (the right) questions.

Tool #5. Hire deliberately. Never, ever, ever hire the wrong person because of pressure to fill a role quickly. It is always, without exception, under every case imaginable better to wait on the right person than to rush into a bad decision on hiring. In the end, your company is only as strong as its people.

Tool #6 Rock Band. Ain't nothing like playing some classic rock and drinkin' a PBR to bring a group of people together. Sure, sure, we got a little carried away. In fact, we are still waiting for some other group to put up a decent challenge to our rock band supremacy. You can all go pound salt. We rock.

Tool #7 the monthly board/employee meeting. Using content that is as similar as possible, make sure that the board of directors and every employee at the company is informed. Each person knows the strategic plan of the business. Each person knows the historical performance of the business. Each person knows the projected growth of the business.

Tool#8: The bimonthly management team meeting. This is a meeting where I invite smart people to call bullshit on me. Actually, that only happens sometimes. Mostly, we just meet and talk about the priorities and work flow of the upcoming month. Doing this twice a month provides continuity and clarity. Its amazing how often the statement... "I thought we all agreed on this last month" comes up. Sure, we all agreed, but not on the same details. This regular meeting eliminates misconceptions and aligns expectations. "Muy Bueno" as they say in France.

Tool #9: Patience. Be slow to make judgments. Deliberate in actions. Patient in execution. These things are critical. Employees are trying their hardest to accomplish their goals. Trust them. Give them time.

The Third Office (50 employees)

2010-01-19T11:23:32-06:00

This is the eighth installment in my series on going from 1 to 50 employees.

We outgrew our 2nd office in 18 months when we went from 15 people to 50. Two things have changed about the nature of the business during this latest evolution. First, instead of being very scrappy with cash, we've loosened the purse strings. Second, vendor relationships have become much more important.

We used to be real cheap. We hated spending money. We worked so frickin hard to get the investments in the door that we wanted to squeeze every possible penny out of our investment. Unfortunately, its easy to save a dime and spend a dollar with that attitude. Maybe we should hire some movers for the office move... Maybe we should get a coffee service instead of running to whole foods every day... Maybe we should get a furnished office instead of worrying about starting from scratch with an empty space.

One of the ironies of getting larger is that we have identified more areas where we need external vendors to continue to grow. When there was only 10 of us, we did everything ourselves. Now, it is clear that we can be more efficient by sticking to our core competencies. Or, in Abe Lincoln's words "whatever you are, be a good one" All sorts of stuff... from doing the dishes, to hiring mobile application developers. We rely on "vendors" Sometimes those vendors are a single person that cleans up every night. Sometimes they are large consulting shops.

So now that we are at 50 employees. I have one more tool that is really critical...

Tool #9: Patience. Be slow to make judgments. Deliberate in actions. Patient in execution. These things are critical. Employees are trying their hardest to accomplish their goals. Trust them. Give them time.

Winter Camping in Manistee

2010-01-18T09:21:00-06:00

I take a trip to Manistee, MI every January for a fricking cold winter camping extravaganza. Getting away from work and everything for a couple of days is great. The snow was so deep this year that it was a serious grind to get the 10.5 miles to the campsite. Day 2 was tough, another 10 miles back to the car. Best part was: I didn't think about work all weekend. Here is a video of the trip:

Promoting People (35 employees)

2010-01-11T15:08:27-06:00

This is the seventh installment in my series on going from 1 to 50 employees.

My view on management hierarchy underwent a 180 degree flip at around 35 employees. For a long time I had been a big proponent of "We don't need managers and hierarchy, a flat organization works a lot better." All well and good, but when you get above 15 people asking you for direction, you become pretty much useless to all of them.

There are hundreds of books on management structure. They address a lot of important issues: should we use a matrix structure? how many direct reports should a manager have? How closely should a manager supervise their direct reports? I don't have a clue how to answer these questions. I've instead relied on two principles: Promote from within; Hire rock star VPs.

Promote From Within. The folks who created and learned their jobs from scratch are the first candidates to be managers of others in those positions. Keep in mind I'm talking about a group of people with a lot of potential, drive and intelligence. These are exactly the right employees to challenge with tougher positions. The benefits of seeing a person meet these challenges far outweigh the risks of putting a junior person in a more senior role.

Hire Rock Star VPs. I keep hearing of this mythical manager who is threatened by hiring people more talented or smarter than themselves. I don't get it. Sure, I once managed the technology team and priorities, but why would I want to hold on to that with tight fists. I'd rather have somebody who has done that for 15 years take over. Giddy up. Of course, once you get a pile of VPs, it becomes even more important to communicate. Which brings me to...

Tool#8: The bimonthly management team meeting. This is a meeting where I invite smart people to call bullshit on me. Actually, that only happens sometimes. Mostly, we just meet and talk about the priorities and work flow of the upcoming month. Doing this twice a month provides continuity and clarity. Its amazing how often the statement... "I thought we all agreed on this last month" comes up. Sure, we all agreed, but not on the same details. This regular meeting eliminates misconceptions and aligns expectations. "Muy Bueno" as they say in France.

The Far Flung Sales Team (25 employees)

2009-12-28T14:04:09-06:00

This is the sixth installment in my series on going from 1 to 50 employees.

Most of the growth in our employee ranks came from a national sales team. Once we got to 25 employees, 9 of them were out in different markets signing up customers. The work experience for these valuable folks is very different from those of us in the office. They work from home.They have minimal contact with their supervisor. Their compensation is very clear cut and based on performance. How do you extend company culture to them? Is that culture relevant?

Consistent transparent communication is the most important way to connect off site employees. For communication, we share the monthly board meeting content with the entire company and make sure the sales folks get a two way video and audio feed of the meeting. Every month we lay it all out there for the whole company to see: our mission, financial information, goals and objectives, challenges and windfalls. This level of transparency served us particularly well during an economic downturn. Everybody is nervous but accurate information dispels fear.

Is culture relevant for commission based off site sales people? Absolutely. These folks are the face of our company to our paying customers. There is a world of difference between just getting the sale no matter what, and approaching each client with a desire to improve their business. I'm no sales manager, but for the life of me, I'm not sure how you would build this value into a compensation package. Its got to be part of the company ecosystem.

Tool #7 the monthly board/employee meeting. Using content that is as similar as possible, make sure that the board of directors and every employee at the company is informed. Each person knows the strategic plan of the business. Each person knows the historical performance of the business. Each person knows the projected growth of the business.

The Second Office (15 employees)

2009-12-16T08:46:51-06:00

This is the fifth installment in my series on going from 1 to 50 employees.

Once we hit 15 employees, a lot of stuff that happened automatically before wasn't so automatic. We moved into a larger office and communication started to get confused. Seemingly simple sales and marketing messages all went through a disastrous game of phone tag. Lots of simple things were added to help communication: cross department meetings, monthly strategy sessions, public calendar scheduling, etc. All routine things for most businesses. But they weren't routine for us, they were revolutionary.

As we start getting a little more corporate how do we make sure to stay true to our roots? More importantly, how do we make sure we all know what our roots are when we can't even get our simple signals straight? So, we created a mission statement and core values. It can be really hard to make decisions of a moral nature in a company because each person in the company has a different value system. But the process of talking through our common beliefs in the context of a profit generating business actually helped us gel together as a team.

Of course, there are other ways to keep the team tight. My next tool for managing a high growth team:

Tool #6 Rock Band. Ain't nothing like playing some classic rock and drinkin' a PBR to bring a group of people together. Sure, sure, we got a little carried away. In fact, we are still waiting for some other group to put up a decent challenge to our rock band supremacy. You can all go pound salt. We rock.

The Office (7 employees)

2009-12-07T10:36:19-06:00

Getting our first office was really exciting! This is a continuation of my series on going from 1 to 50 employees.

One of my original claims to investors was "we operate efficiently without any need for an office". At some point having an office stopped looking like a liability and started looking like an asset. An office makes communication easier. Best practices get shared. Policies are easier to keep consistent. At 7 employees, the cost of the office is very small relative to the cost of payroll,but the benefit to each employee is very large. So go ahead and get those swanky new digs.

The other big change was that with the 7th employee, it becomes very clear that the founder needs to stop doing 100% of direct effort and start putting a lot more effort towards managing employees. This is a big stumbling block for most entrepreneurs. We want to do everything ourselves. What a waste. Entrepreneurs have lots of drive and understanding of the business. This resource shouldn't be squandered on one individuals work, but shared across the organization.

At this point in a company's life cycle, there are 2 key tools for hiring:

Tool #4. Don't hire just good people, hire good startup people. A good startup employee has a few key attributes. Look for people that have a lot of adaptability. They take initiative. They are good with ambiguity and change. Look for these kinds of things in the interview process. Give a preference to candidates that follow up and ask (the right) questions.

Tool #5. Hire deliberately. Never, ever, ever hire the wrong person because of pressure to fill a role quickly. It is always, without exception, under every case imaginable better to wait on the right person than to rush into a bad decision on hiring. In the end, your company is only as strong as its people.

Running the Chicago and NYC Marathons

2009-12-05T09:50:00-06:00

In March I decided to run for this charity in both the Chicago and NYC marathons. I've been training pretty consistently for the last 4 years. Sometime in July I realized I was seriously fatigued with this ongoing training. Only through the support and encouragement of my friends and family was I able to keep running "for the kids" Thanks to their support I ran 552 miles from June 1 to November 1.

The Chicago marathon dawned on a beautiful October day. What a great race. Three weeks later I ran NYC. It turns out that 3 weeks is probably not enough recovery time. Somewhere around mile 12 I realized I was in trouble. Finishing that race was one of the hardest things I will ever do.

What inspired me to keep running was my donors and our shared commitment to Team Hole in the Wall. The evening before the marathon, I met with several great people including several volunteers from the Team Hole in the Wall Camps, an adult survivor of several aggressive forms of cancer (who now works at the camp!) and Paul Newman's daughter.

I was deeply moved by the bravery, laughter and tragedy of the kids who attend the THITW camps. I'm honored by the contributions that made it possible for 2 more kids facing life threatening illnesses to go enjoy a week of joy and healing.