All posts by ClayHebert

Studying with Seth Godin and eight other amazing people in NY for six months.

Consistency of Voice

When people see James Earl Jones, they know to expect his booming baritone voice. When Gilbert Gottfried takes the mic, you know what he’s going to sound like. In fact, you can probably hear him right now. Of course it makes sense when the voices are auditory, but the same thing happens online. People get accustomed to your voice and expect the same in the future.

murrow

If you always drop interesting, valuable nuggets to your readers, that’s what they come to expect. If nugget #1282 is slightly less valuable than #284, your readers won’t care because you’ve already earned the benefit of their doubt.

If you shout at people, that’s what people come to expect. If your readers want to be shouted at, you’re in business (although not many do).

If you are consistently funny, people will be primed to laugh before they click on your next post.

Is your voice consistent? What do your readers expect you to say next?

Not an opportunity. An obligation.

Last month, I went with my friend to visit a man who is in the hospital with multiple sclerosis. We talked with him for a while, we helped him setup speed-dial for his family in his hospital phone and we helped him setup a new GMail account because he had forgotten the password to his Hotmail account.

He was so happy and grateful to have visitors, even for an hour. Mentally, he was still very sharp but the MS had debilitated his body and his speech. I sat there wondering what things he wanted to accomplish that he never got the chance to.

hospital

As we walked out of the hospital, I couldn’t help but feel guilty. Guilty that I could walk out of the hospital. The guilt quickly turned to a sense of obligation to do something great because there are so many people that don’t have the chance.

What we all have isn’t just a chance. We all have a responsibility to do something great. We all need to change the world in our own ways. We’re all blessed with enough intelligence and drive. Plenty of people are willing to teach us the skills and techniques. We have no excuse not to succeed.

What we all have is not an opportunity. It’s an obligation.

Do you have a card?

So imagine you’re a musician and you just finished giving a show to a passionate crowd at a medium sized venue. The crowd loved the show but let’s say they already bought your debut CD for $10 at the last gig. You still want to capitalize while they’re still all tingly from the show’s finale. So you announce that for only $1, they can download three unreleased songs, only available to people who buy the digital download card.

This is a great marketing tactic. The cost is known upfront. You can set the price or give them away free to your permission email list to stretch the tribe a bit.

Where else could this tactic work?

_________________________________________

DIGITAL DOWNLOAD CARDS

* 1000 cards for only $489.00
* Free card design (a $100 value)
* You keep 100% of card sales revenue
* No hosting or set-up fees
* Free shipping in the USA
* High-quality, full-color 30 mil. plastic cards (not laminated paper)
* Works on all MP3 players
* DRM-Free (allows files to be burned to CD!)

How does it work?

Each card has a unique, eight-digit code printed on the reverse. This code gains the cardholder access to a personalized download page at the Soundtrax website. You decide how many times the code can be used to access the download page. Once downloaded, the music can be imported to any MP3 player (including the iPod and Zune) or burned to a CD.

You keep 100% of the revenue from card sales. And unlike iTunes and most other download services, you set your own price for the music or use the cards for free distribution for promotional purposes.

Other advantages include the ability to sell the cards at performances, rather than counting on fans that prefer downloads to seek out a download service later (after the glow of the live experience has worn off).

Want a free Soundtrax card?

Send us your address and we’ll mail you one today!

info@soundtrax.com

3rd prize is…you’re fired.

Alec Baldwin’s phenomenal speech as Blake in Glengarry Glen Ross is even more true than when the movie was released.

glengarry11

Now, more than ever, it is critical to be the best in the world. The internet has flattened everything out. If your customers want something else, your competitor, or the next, or the next, is just a click away.

Choice has become infinite, so being the best in the world is paramount.

There is good news, though. The same internet that flattened everything out and requires you to be the best in the world has a hidden secret. It allows you to define the size of the world. If you find yourself at the bottom of Blake’s chalkboard, the internet allows you to define your own chalkboard and write your own name at the top.

Staying there however, is another story.

(warning – clip contains adult language)

$10,000 for waffles

Radiohead, U2 and Trent Reznor have publicly embraced some innovative new ways to sell more than their music. They sell an experience.

Josh Freese, former NIN drummer has a new album (titled ‘Since 1972′) and he has decided to take the whole “souvenir / experience” model a little further. OK, a LOT further.

This is brilliant. I for one, hope he sells out all the packages.

From Idolator.

$7
* Digital download of Since 1972, including 3 videos

$15
* CD/DVD double-disc set
* Digital download

$50
* CD/DVD double-disc set
* T-shirt
* “Thank you” phone call from Josh for buying Since 1972. You can tell him what you like about the record that you purchased, or what you thought sucked. Ask whatever you want, like “Is Maynard really THAT weird?” or “Which one of Sting’s mansions has the comfiest beds?” or “Are Devo really suburban robots that monitor reality or just a bunch of dads from Ohio?” or “Why don’t the Vandals play more stuff off the first record?” It’s your 5 minutes to yack it up. Talk about whatever you want.

$250 (limited edition of 25)
* Signed CD/DVD and digital download
* T-shirt
* Signed drum head and drumsticks
* Go on a lunch date with Josh to PF Changs or The Cheesecake Factory (whatever you’re into)

$500 (limited edition of 15)
* Signed CD/DVD and digital download
* T-shirt
* Signed cymbal and sticks
* Meet Josh in Venice, Calif., and go floating together in a sensory-deprivation tank (to be filmed and posted on YouTube)
* Dinner at Sizzler (get your $8.99 steak and “all you can eat” shrimp on)

$1,000 (limited edition of 10)
* Signed CD/DVD and digital download
* T-shirt
* Signed cymbal, drum head and drumsticks
* Josh washes your car OR does your laundry … or you can wash his car
* Have dinner with Josh aboard the Queen Mary in Long Beach, Calif.
* Get drunk and cut each other’s hair in the parking lot of the Long Beach courthouse (filmed and posted on YouTube, of course)

$2,500 (limited edition of 5)
* Signed CD/DVD and digital download
* Get a private drum lesson with Josh, or for all you non-drummers, have him give you a back and foot massage (couples welcome)
* Pick any 1 member of the Vandals or Devo (subject to availability) to accompany you and Josh to either the Hollywood Wax Museum or the lunch buffet at the Spearmint Rhino
* Signed DW snare drum
* Take 3 items of your choice out of his closet (first come, first serve)
* Change diapers and make bottles with him for an afternoon (after hitting the strip club)

$5,000 (limited edition of 3)
* Signed CD/DVD and digital download
* T-shirt
* Josh writes a song about you and makes it available on iTunes
* Co-direct a video with him for the song about you and throw it up on the YouTubes
* Josh gives you and a friend a private tour of Disneyland
* Get drunk together. If you don’t drink, we can go to my dad’s place and hang out under the “Tuba tree”
* Stone Gossard from Pearl Jam will send you a letter telling you about his favorite song on Since 1972

$10,000 (limited edition of 1)
* Signed CD/DVD and digital download
* T-shirt
* Signed DW snare drum from A Perfect Circle’s 2003 tour
* Josh gives you a private drum lesson OR his and hers foot/back massage (couples welcome, discreet parking)
* Twiggy from Marilyn Manson’s band and Josh take you and a guest to Roscoe’s Chicken ‘n’ Waffles in Long Beach for dinner
* Josh takes you and a guest to Club 33 (the super-duper exclusive and private restaurant at Disneyland located above Pirates of the Caribbean) and then hit a couple rides afterward (preferably the Tiki Room, the Haunted Mansion and Tower of Terror)
* At the end of the day at Disneyland, drive away in Josh’s Volvo station wagon. It’s all yours … take it. Just drop him off on your way home, though, please.

$20,000 (limited edition of 1)
* Signed CD/DVD and digital download
* T-shirt
* A signed drum from the 2008 Nine Inch Nails tour
* Maynard James Keenan, Mark Mothersbaugh from Devo and Josh take you miniature golfing and then drop you off on the side of the freeway (all filmed and posted on YouTube)
* Josh gives you a tour of Long Beach. See his first apartment, the coffee shop on 2nd Street where his buddy paid Dave Grohl $40 to rip up tile just weeks before joining Nirvana. See the old Vandals rehearsal spot, the liquor store he got busted at using a Fake ID when he was 17 (it was Dave from the Vandals’ old ID). Go check out Snoop Dogg’s high school. For an extra 50 bucks see where Tom and Adrian from No Doubt live. For another $25 he’ll show ya where Eric from NOFX and Brooks from Bad Religion get their hair cut.
* Spend the night aboard the Queen Mary and take the “Ghosts and Legends” tour. (Separate rooms … no spooning.)
* Josh writes 2 songs about you and both are made available on iTunes and appear on his next record (you can sing back up on ‘em, clap, play the drums, triangle, whatever)
* Drum lesson OR foot and back massage (once again … couples welcome and discreet parking available)
* Pick any 3 items out of Josh’s closet

$75,000 (limited edition of 1)
* Signed CD/DVD and digital download
* T-shirt
* Go on tour with Josh for a few days
* Have Josh write, record and release a 5-song EP about you and your life story
* Take home any of his drum sets (only one, but you can choose which one)
* Take shrooms and cruise Hollywood in Danny from Tool’s Lamborghini OR play quarters and then hop on the Ouija board for a while
* Josh will join your band for a month … play shows, record, party with groupies, etc.
* If you don’t have a band he’ll be your personal assistant for a month (4-day work weeks, 10 am to 4 pm)
* Take a limo down to Tijuana and he’ll show you how it’s done (what that means exactly we can’t legally get into here)
* If you don’t live in Southern California (but are a U.S. resident) he’ll come to you and be your personal assistant/cabana boy for 2 weeks
* Take a flying trapeze lesson with Josh and Robin from NIN, go back to Robins place afterwards and his wife will make you raw lasagna

111 Ridiculously Obvious Thoughts on Selling

A phenomenal ebook on selling from the one and only, Tom Peters.

111

On 24 January 2006, Tom spoke to a group at GE Energy, and he posted seven PPTs and two PDFs for the occasion. Among them were a PowerPoint presentation titled 89 Ridiculously Obvious Thoughts About Selling Stuff, and a PDF document titled “90 Ridiculously Obvious Thoughts on Selling.” By 28 January, four days later, the piece had grown into “111 Ridiculously Obvious Thoughts on Selling,” and made available on our website as a simple PDF. It was then picked up by our friends at ChangeThis to be produced as a manifesto. Thus, Tom’s collection of sales theorems evolved into its final form, which you find below.

111_thoughtsonselling_030806

It’s not about the bracket.

The killjoys over at at Challenger, Gray and Christmas waste a bunch of money running an annual study of (ironically) the money and productivity lost by people checking out the NCAA tournament while at work. CGC calculates it to be as much as $1.7 billion in wasted work time over the 16 business days of the tournament.

I don’t buy it.

It’s not about the bracket. It’s not about the entry fee or the prize money.

It’s about the incremental camaraderie.

watercooler

It’s about the shift of power when the mousy receptionist taunting the big shot sales guy about her team upsetting his.

It’s about the invisible IT guy gaining respect by hacking together a system for the office to enter their pools ‘online’ (in 1998).

It’s about the female CFO finding out that the janitor majored in finance at Syracuse, a year ahead of her.

It’s about the new connections and conversations that occur every March.

Challenger, Gray and Christmas can’t put a dollar value on that.

The Leech Lake Knife Company

A great story. A purple cow. Phenomenal design. A Free Prize Inside. An army of customer evangelists. Scarcity.

Pretty phenomenal marketing from a 70 year old who has never heard of Seth Godin.

Don Canney has a superpower. He makes the best fillet knife in the world.

Don is an avid fisherman who has a home on beautiful Leech Lake in northern Minnesota. It isn’t unusual for Don to have filleted hundreds of fish after a day of fishing.

Years ago, Don noticed that his fillet knives got dull very quickly from the initial cut behind the gill. When making this cut you are cutting down into the scales that protect the body of the fish from the razor sharp teeth of other predator fish. With a nod and a wink to Mr. Charles Darwin, Don set out to redesign the traditional fillet knife.

Don used his education in metallurgy and material science to design a high carbon/semi-stainless alloy steel that is then hardened and tempered to Don’s specifications. The blade is extremely thin and flexible but the most unique and effective feature of this knife is really what sets it apart. The top is a sharp hook and top two inches of the backside of the knife is razor sharp.

Don didn’t just redesign a knife, he redesigned the process of filleting a fish.

Don’s Leech Lake knives are not only beautiful and extremely durable, they work unlike any other fillet knife in the world. When a Leech Lake knife owner meets a fellow fisherman, it is impossible not to show and talk about the knife.

You can’t buy Don’s knives on Amazon. Don prefers to sell his knives personally, one by one at the many sport shows he attends every year. This gives Don the ability to hand engrave the blade, “Made especially for your nameyear of purchase“.

Also, each knife comes with a nice leather sheath in which Don puts one standard size Band-Aid. Even though he warns people, everyone forgets and cuts themselves on the sharp upper side of the knife.

With a flexible, paper thin blade, many owners are worried about sharpening it themselves. After reminding you that it should only need sharpening once every couple years, Don offers to sharpen it for free, either at any of the sport shows or by mailing it to him. People that attend sport shows usually go every year, so after using your knife for a year, you go back to Don’s booth and buy a couple more for friends or family.

You can buy a basic fillet knife for $12 almost anywhere. Don’s amazing, hand-built knives cost $90 and are worth every penny. You get a lot more than a knife.

My Dad visited with Don at the Minneapolis Sport Show yesterday like he does every year. Don is getting older and he doesn’t do as many shows as he used to but he was still there, affable as ever, selling new knives and sharpening old ones, adding small but important personal touches that also help owners continue to tell his story.

Farmers’ market?

Today, we went to the local farmers’ market. It’s the smallest one I’ve ever been to with about 20 – 25 vendors total.

This farmers market was different in another way. Most of the vendors there weren’t farmers at all.

There were heaps of high end honey. Many muffins. Oodles of olives and oil. Boku bread. Stacks of spice tins.

spice1

More than half of the vendors sold items that were packaged, shrunk wrapped, bottled or jarred elsewhere. There were only a couple vendors that were selling real produce grown locally, which is the whole point of farmers’ markets (or it used to be).

In a larger market, it makes sense for some non-produce vendors to round out the selection, but when accounts for 80% of the market and you can’t find a potato anywhere, is it still a farmers’ market?

Want to be on the list?

Take it from Danny Meyer, famed NY restaurateur who has redefined the meaning of customer service for the restaurant industry.

dicker600span

You don’t need to know the chef since middle school.
You don’t need to eat there four nights a week for a year.
You don’t need to tip the maître d’ $100.

You do need to be sincere.

If you loved the dish, ask to meet the chef.
If you loved the service, tell your server (and their manager).
If you loved the entire experience, tell the owner.

And make your next reservation on the way out. By the time you return, you’ll be on the list.

Sincerity wins again.

Everyone is an entrepreneur

lemonade-standWhen you were 4 years old, you were an artist (until someone said you weren’t).

When you were 7 years old, you were a poet (until someone said you weren’t).

When you were 12 years old, you were an entrepreneur with your lemonade stand (until someone said you weren’t).

When you got your first job and your second and your third, you were a salesman. You sold yourself.

So we’ve established that you’re an artist, a poet, an entrepreneur and a successful salesman. The world needs you! What are you waiting for?

The perception of the prospect

entrepreneurship

In sales, the perception of your prospect is always true.

If they think you are spamming them, you are.

If they think you are sleazy, you are.

If they think you are pressuring them, you are.

But there is good news…

If they think you are accommodating, you are.

If they think you are authentic, you are.

If they think you are patient, you are.

If your intent isn’t pure, the words you use to sell won’t matter. If your intent is perfect, your words don’t have to be.

Are you living your story?

The following is an interview with Evan Williams, the founder of Twitter, as published in the New York Times. Read it carefully and see if you notice anything interesting.

By EVAN WILLIAMS
Published: March 7, 2009

evan-williams

I GREW up on a farm in Nebraska, where we grew mostly corn and soybeans. During the summers I was responsible for making sure the crops were irrigated.

After high school, I enrolled at the University of Nebraska at Lincoln, but I stayed only a year and a half. I felt college was a waste of time; I wanted to start working. I moved to Florida, where I did some freelance copywriting. After that I moved to Texas and stayed with my older sister while I figured out what to do next. In 1994, I returned to Nebraska and started my first company with my dad.

We didn’t know anything about the Internet, but I thought it was going to be a big deal. We produced CD-ROMs and a video on how to use the Internet, and we did some Web hosting. I recruited some friends and we tossed around some ideas, but none of us knew how to write software and we didn’t have much money. We watched what entrepreneurs in California were doing and tried to play along.

We figured out how to create Web sites, but I didn’t want to work on other people’s projects. I had no business running a company at that time because I hadn’t worked at a real company. I didn’t know how to deal with people, I lacked focus, and I had no discipline. I’d start new projects without finishing old ones, and I didn’t keep track of money. I lost a lot of it, including what my father had invested, and I ended up owing the I.R.S. because I hadn’t paid payroll taxes. I made a lot of employees mad.

In 1997, I moved to California and worked at what is now O’Reilly Media. By 1998, I had acquired enough technical skills to do freelance Web development. In 1999, I started Pyra Labs with a friend, Meg Hourihan, to develop project management programs. Then we started a side project called Blogger, a Web publishing tool. In 2003, we sold that company to Google. I worked for Google for two years.

Several years ago I started Odeo, a podcasting company, with Noah Glass, another friend. I ran that company for 18 months. We started Twitter as a side project within Odeo during that time.

I didn’t like the direction Odeo was going. For one thing, Apple made a lot of what we worked on obsolete when it introduced podcasts into iTunes. I bought Odeo back from the investors and moved the assets to another company of mine, Obvious, a Web product development lab now on hiatus. In 2007, I sold Odeo and spun off Twitter into a separate company.

I appointed Jack Dorsey, who was engineer at Odeo, as C.E.O. of Twitter. In October 2008 it became apparent that Twitter required a day-to-day approach from a single leader. I took over as C.E.O., and Jack became chairman and assumed a more strategic position. He had worked in the courier and dispatch field, which is where he got the idea for Twitter — a social network for sending short messages to friends over cellphones and the Internet.

When people ask me when Twitter will make money, I tell them, “In due time.” They forget that we’re only 30 employees who have just gotten started. Right now, anything we would do to make money would take our time away from acquiring more users. We have patient investors.

My life has been a series of well-orchestrated accidents; I’ve always suffered from hallucinogenic optimism. I was broke for more than 10 years. I remember staying up all night one night at my first company and looking in couch cushions the next morning for some change to buy coffee. I’ve been able to pay my father back, which is nice, and my mother doesn’t worry about me as much since I got married a year and a half ago.

My wife, Sara, a designer, keeps me balanced. We’re building a modern house that we hope will be done by 2010. The design is a challenge — that’s why she’s in charge.

As told to Patricia R. Olsen.

_______

Did you notice? How many sentences in the entire article were longer than 140 characters? If you don’t think this was intentional, read any other article in the Times and perform the same count. (Copy and paste each sentence into Twitter for easy counting.)

Evan Williams is living the Twitter story everyday, even in a NYT interview.

Are you living your story?

The best TV show you’ve never seen

We are a culture without the will to seriously examine our own problems. We eschew that which is complex, contradictory or confusing. As a culture, we seek simple solutions. We enjoy being provoked and titillated, but resist the rigorous, painstaking examination of issues that might, in the end, bring us to the point of recognizing our problems, which is the essential first step to solving any of them.

David Simon – executive producer and head writer of The Wire

HBO’s The Wire is a gritty, street-level morality play about drug dealers, police detectives, school teachers, government officials and news media in inner-city Baltimore.  The executive producer and head writer is David Simon,  who wrote Homicide: A Year on the Killing Streets, which spawned the popular TV show.

Michael Kenneth Williams brings Omar to life

Truth over trophies

The Wire isn’t for everyone but that is precisely what made it great.  Most shows are designed for the masses and that is what makes them mediocre at best.  The Wire garnered some critical acclaim but was too ‘urban’ for Hollywood’s seal of approval.  As a result, The Wire only had two Emmy nominations in its five year run.  To those who have seen the show, it reflects more on the Emmy selection process.

”It’s like them never giving a Nobel Prize to Tolstoy,” said Jacob Weisberg, editor-in-chief of the Slate Group and a correspondent for Slate.com. ”It doesn’t make Tolstoy look bad, it makes the Nobel Prize look bad.”

Mark Harris from Entertainment Weekly feels the same.

I mean, seriously — cancel the telecast, go home, and hang your freaking heads in shame. The Emmy voters are like your great-grandmother; news travels slowly to them, and you have to say anything very loudly to make sure it gets through.

The Wire got a little more play at the Television Critics Association awards, a more honest vote from people who don’t care about the red carpet of Hollywood, where it garnered four nominations in 2008. The timing was unfortunate, because the Wire ran up against another phenomenal show, AMC’s Mad Men, and took home only the Heritage Award, which recognizes a long-standing program that has had a lasting cultural or social impact. Ironically, Season 5 was The Wire’s final season.

The Wire

The top six reasons The Wire is the best television series ever
I won’t spoil any of the plot because I want all of you to get every drop of enjoyment I did out of the show so I’ll simply put forth the top six reasons why The Wire was the greatest television series ever.

1) The Writing
Gritty. Intense. Unapologetic. Complex. Best writing for a TV series ever.

2) The Characters
There are no big stars in this show. If you recognize any of the actors, it is likely from something they did as a result of their work on The Wire.

Other drama shows such as 24 and The West Wing focus on about ten main characters. The Wire has three times that many and at least as many bit players. Each is deeply complex and flawed but you find yourself rooting for them for different reasons.

3) The Pace
More happens in one episode of The Wire than in a season of some shows. The show moves so fast, it requires your undivided attention.

4) The Unpredictability
Have a favorite character? Don’t get too attached because they may disappear for a season or they may get killed. The show must go on. Getting settled into the plotline for the first season? Don’t get too comfortable. Each season analyzes a completely new side of Baltimore, but Simon weaves it all together like the master storyteller he is.

5) The Dialogue
Street language. Nicknames. Police slang. The language is so real that I watch the show with English subtitles on.

6) Omar
Everyone’s favorite bad guy, Omar, played brilliantly by Michael Kenneth Williams, is reason enough to watch the show. Despite being the baddest of the bad guys, a scar crossing his face, Omar is a gangster with a heart. Omar walks around shirtless under his duster, his shotgun always ready at his side. Feared by everyone, Omar doesn’t deal drugs himself, he simply lays in wait and ruthlessly robs the top drug dealers whenever he pleases.

One other thing….Omar is openly homosexual. Such is the brilliance of The Wire.

David Simon, the rest of the writers and the cast and crew of The Wire created a masterpiece, a visual novel, a show for the ages. Do yourself a favor and watch it from the very first episode; you only get 60. Get pulled in. Find yourself rooting for murderers, drunk womanizers and corrupt politicians.

But don’t forget to turn the subtitles on.

Manufacturing scarcity

Last Sunday, we went to lunch at the historic Serendipity 3 Cafe. Our friend had warned us that sometimes the wait can be well over an hour, so we were intrigued.

Luckily, we found parking nearby and the wait was only about 20 minutes. The space to wait inside is small, so people fill up the entryway and spill out into the street.

the wait is the story
the wait is the story

The hostess walked us up the narrow staircase and seated us at a small table upstairs. The decor was as advertised, cute but kitchy, from the abnormally sized ancient clock to the mosaic chandelier lighting. We shared the famous Frrrozen Hot Chocolate and enjoyed a leisurely lunch.

Abnormally leisurely, in fact.

Our server was polite and seemed otherwise very experienced but he stopped by our table only about every 20 minutes. We were ready for him at every step, ordering and paying. We weren’t in a big hurry but if we had been, the delay would have been more annoying. Servers at other tables operated at the same pace. An hour and a half later, we got him to run our credit card and made our way to the door.

Then, the nickel dropped.

The wait at the door was the same as it had been when we got there, about 20 minutes! If the twenty or so servers inside had moved even a little quicker, they could improve the ‘throughput’, seat more diners quickly and there would be no wait outside at all.

Which would completely ruin Serendipity’s story.

Some days the wait is legitimately 5 hours. That’s a great story but it falls apart if “some days you can walk right in”. The crowded entryway and the line spilling out on the sidewalk is their story.

So with a little slight of foot, a few minute delay in bringing the check, the kitchen taking a few more minutes on each order, Serendipity 3 is manufacturing scarcity to keep telling their story.

How are you telling your story?

What to Do if Your Startup Is Failing

A simply phenomenal article from Jason Calcanis…sage advice from an expert who has been there and back.

broke

The Jason Calacanis Weblog

What to do if your startup is about fail (or “Don’t Stop Believing”)

Location: Mahalo HQ, Santa Monica
Date/Time: February 26th 2009 6:25pm
Subscribers: 12,483
Rock out To This While Reading: Don’t Stop Believing
http://www.youtube.com/watch?v=ip1zsUIosoA
Forward To: Startups that are hitting the wall

A lot of CEOs with less than 12 months of capital left have been
asking me for advice about what to do, given the massive economic
turmoil we’re facing. I thought I would take the time put these
various conversations into one email to help those who are “up against
it,” as we say in Brooklyn.

Now, sprinting to the startup precipice is one of the most horrible
and exhilarating experiences you can have as an entrepreneur.

The exhaustion sinks in as you slam on the brakes. You dig in your
heels and watch the dirt and pebbles fly off the cliff as your left
foot dangles down in the ravine, with your right foot desperately
trying to save you. Your momentum could–if the wind kicks in–send
you straight down to your death. Heck, even the two inches of earth
under your right foot could give way and send you to your death.  Or,
you could slip and fall on a magic carpet that will take you to the
Promised Land.

OK, that last part is made up. You’re probably screwed and you know it.

This email is intended for startup companies with less than 12 months
of cash in the bank, who know in their hearts that their VCs have lost
faith, and that Google, Yahoo or Microsoft aren’t going to pick them
up on a magic M&A carpet ride.

This is the email I’d like you to forward to your friends who are
running startups that could go under in 2009.

Some background
————————-
I’ve been to the precipice and faced the fall a couple of times. I’ve
learned a couple of things from the experience. I can tell you that
the first time it happens, you’re terrified, because everything you’ve
done–all the effort and dreams–will probably be lost (like tears in
the rain).

The second time it happens, you’re deeply concerned, but know it ain’t
over until you’re splattered on the boulders below.

The third time it happens, you smile and say “let’s get it on!”

You see, there are two types of entrepreneurs in this world: real ones
and the folks who play entrepreneurs for some portion of their lives.
From a distance, most folks can’t tell who’s who. In up times, when
the market is flush with cheap money and unexplained exits (Bebo,
anyone?), everyone looks brilliant.

It’s only when the tide goes out that you know who’s naked. (Who said
that? I hear it on CNBC every other week now).

The differences between the two types of entrepreneurs become clear
when the fan and the manure meet. The faux entrepreneurs run for cover
rather than dealing with the storm. They go back to their plush,
somewhat mindless jobs as VPs at mega-companies, while the real
entrepreneurs suit up and clean up the mess.

We’re going to find out who the real entrepreneurs are in 2009 because
they are going to spend another 12 months, on top of the last six,
cleaning up the mess. It will be two years of total pain, so before we
go any further you gotta make the decision if you’re in or you’re out.

In or out?
————————-
Here is a really easy way to figure out if you can deal with the mess
in front of you. How many of the following can you deal with:

1. Laying off half your staff.
2. Laying off half your staff again three months later.
3. Spending 20 hours a week on the phone being yelled at and
threatened while trying to renegotiate a dozen contracts–like your
T1, phone system, rent, equipment leases, etc.
4. Having an investor scream at you and tell you that they will ruin
you, your career and that “you’ll never raise money again, you mother
f-er.”
5. Laying off half your staff for a third time.
6. Getting served a half-dozen lawsuits, courtesy of the folks who you
tried to renegotiate with in point number three who wouldn’t deal.
7. Having one of the people you’re renegotiating with come to your
office every week and ask for their check in person.
8. Having the same media outlet that once claimed you were the next
Barry Diller write that you’re a fraud.
9. Not getting a good night’s sleep for six months.
10. Having dozens of paying clients default on their bills.
11. Having staffers who you really need to double down and focus walk
out the door after you helped make their careers.
12. Have the people who begged you for a meeting at the peak not even
return your emails or phone calls.

If you can’t deal with these 12 situations, then you’re out. It’s time
to refresh your resume, tell your board you resign, sublet your place
and go to Thailand. Go sit on the beach and lick your wounds for $40 a
day (all-in) like the fauxtrepreneur you are. You suck. I hate you.
You’re smart enough to cut your loses in a way I could never
understand.

If you think you can handle most of the horror above, well, then you’re in.

How do I know this?

Those 12 things–and more–happened to me for over a year when Silicon
Alley Reporter, my first business, got whipsawed by the dotcom bust.
We went from $11.6m in revenue one year to $600k the next. From 70
full-time people to 12. From a 20,000 square foot office to subletting
ten desks at a PR firm.

Personally, I went from being on top of the world, with appearances on
Charlie Rose, 60 Minutes, CNN, and Fox News, to being savaged in the
press as a fraud who got lucky and who no one would ever hear from
again.

My office used to get 100-200 phone calls a day and I had two
assistants.  Six months later, I answered my own phone–on the rare
occasions it would ring. When it did, it was either my mom calling to
check in on me or a vendor calling to yell at me.

It was the worst year of my life, but it made me who I am today. I’ve
never talked about the tailspin that my business went into, and how I
barely managed to land the plane, but I get the sense that there are a
lot of twenty-somethings about to experience the same thing, and
perhaps my lessons could help.

I’m not going to tell the story. (That would take 80,000 words, a hard
cover and the right publisher), but I’m gonna share some of the
lessons.

Let’s get to work.

The Good News
————————-
If you’re a real entrepreneur, you’re still reading. If you’re a faux
entrepreneur, you’re writing your resignation letter, considering
which beach to surf and how long to grow your beard. God bless you
fauxtrepreneurs, because you’re gonna have a much nicer 2009 than the
real entrepreneurs who are “up against it.”

Of course, a year from now, the real entrepreneurs will be
battle-scarred beasts who are capable of taking big bold risks, and
you’ll still be crying about what could have been with your last
business while attending back-to-back meetings about nothing at BigCo.
Not that I’m judgmental of fauxtrepreneurs who create noise, distract
investors from the real workhorses, suck at their jobs and take no
real risk in their lives.

No, on the contrary, I love you fauxtrepreneurs, because you create
the foundation upon which real entrepreneurs stand. At the start of my
career, it wasn’t east to stand out, but by the time I’d done two or
three businesses and become a fixture in the technology industry, I
had figured it out: Longevity is a big part of credibility. I met
Esther Dyson, Fred Wilson, John Brockman, Jerry Colonna, Mark Cuban,
Ted Leonsis, Seth Godin and countless other luminaries between 1994
and 1997.

Well, it’s a dozen years later and they still take my calls and
respond to my emails.

Longevity is credibility.

Oh yeah, I almost forgot the good news: People’s reputations are made
in the bad times more than the good times.

Even if you’re 100% sure your company is going to crash in the next
six months, you’ll learn more from staying on board than you will from
running. You’ll also earn the respect of your peers and you’ll learn
exactly how people break down and lose their cool. You’ll see how
certain VCs screw entrepreneurs, you’ll see entrepreneurs screw VCS
and you’ll watch the lawyers and landlords collect their vig the
entire time.

Most of all, you’ll realize who you are and who your real friends are.

So what’s the sitch?
————————-
You need to figure out your runway immediately. This is really easy to
calculate: you look at how much cash you burn every month and divide
that into how much cash you have in the bank. Your accountant can do
this for you or you can simply look at your P&L and bank statement.

Once you know how many months you’ve got left, you’ve got to do the
hard work of trying to extend it by at least 1/4. This means cutting
staff, negotiating with your landlord and cutting any and all
recurring bills. You then need to look at your revenue streams and
figure out if you can double them. In most cases, if you do these two
simple things, you will have increased your runway by 50-100%. If you
double your runway, your chances of figuring out what your business
actually is will go up exponentially.

You also need to do a monthly P&L review with your management team.
Look at every single recurring cost you have and figure out how to cut
it. In an up market, this level of obsessiveness is often wasteful,
because you’re in a race to take market-share. In the case of MySpace
vs. Friendster vs. Facebook all having unlimited funds for a period of
time, this makes total sense. Why worry about $100,000 in server costs
if you’re racing to see who gets bought for a billion dollars first?
However, this is not that time. You have to change your style. There
are times to hit the gas and there are times to conserve your gas.

Look at it this way: Getting the most market-share and running out of
cash is the equivalent of getting to the moon first without the
ability to get back to Earth. Congratulations, you won the race… and
now you’re dead!

My primary business right now, Mahalo.com, is lucky to have raise a
large amount of capital and is going to fairly easily make it to
profitability based on our growth curve, runway, modest spend and
significant traffic (we’re at 5.6m unique visitors over the last 30
days).

We couldn’t be in a stronger position.

However, even we recently did a deep review at Mahalo and were able to
cut 30% of our costs in under 60 days. The company is still growing
just as fast, and in fact we’re actually more efficient. There is
something strange about that: 25-person companies seem to get more
done than 40-person companies in my experience (other CEOs have told
me the same thing).

Perhaps it’s because after you trim down you have the most efficient
folks left, or maybe we’re all more focused because we don’t have to
communicate what’s going on to as many people? Does anyone know if
there is any research on optimal team size for startups? I’d be
interested to hear what the studies say. Anyway, we made the hard
decisions and that extended our runway by a year. That means Mahalo
will be here in 2013 if we make every single wrong decision and we’re
asleep at the wheel. Of course, we’re focused like lasers on getting
to profitability and developing a really helpful service. If we can’t
figure this business out by 2013 or 2014 then, well, either we really
suck or there is no solution to combining search and knowledge
exchange (of course we know search and knowledge exchanges can and
have worked–so we’re bullish).

Also, when your company goes through this kind of economic boot camp,
I think you get stronger. You understand which parts of your business
are working the best and which ones are, well, not working at all. We
had one area of our business that was two percent of our spending
making 30% of our revenue. You figure these things out when you start
cutting. It’s a sick and sad process to be sure, but Darwin is your
friend at a startup.

Put your VCs to the test
————————-
If you’re running out of money, you’ve got three choices: cut costs,
make money or raise capital. We’re going to get into cutting costs and
making money below in a minute, but I’m a big fan of testing your
investors. When the market is crushed, most VCs get realistic, greedy
or paralyzed. You’ve got to figure out where you stand with your
current investors as quickly as possible, and the quickest way to do
that is to ask them for more money.

Let’s say you’re burning $200k a month and you have a million dollars
in the bank. Go to your VCs and say something like the following:

“John, we’re going to run out of cash in five months. I’ve developed a
cost-cutting and revenue-generating plan that I believe will extend
our runway to 10 months. I’d like to present it to you and your
partners tomorrow for a half-hour with the goal of doing an ‘A+ round’
of one million dollars. I truly believe in this business and I’m
willing to do a flat-round, bust my ass for the next two years and
come out of this recession on top.”

Now your VC is probably going to start asking questions–as they
should. They may try and push off the discussion of the “A+ round.”
Your job is to stand firm and say something to the effect of:

“Well, we’re both vested in this business and I’d like to take the
time to present to you guys this week and get a response from you
either way within five days. I know it’s a compressed time frame, but
we’re living in extraordinary times, and if you guys don’t believe in
the business the way I do, I can accept that and make other
arrangements.”

At that point, you say nothing. Silence is the greatest negotiating
tactic ever created–use it. Your VC right now will be thinking the
following:

a) “This guy/gal’s a real killer and I wish all my CEOs were this
focused. At the very least, I should hear them out.”
b) “This guy/gal has another opportunity, so I’m gonna have to deal
with this train wreck myself–that will suck.”
c) “This business is a dog and I shouldn’t have invested in it. Since
they’re asking for the truth, I might as well give it to them.”
d) “I’m an idiot and I can’t make decisions. Let me push this out a
couple of weeks and make this person’s life hell while I
procrastinate.”

That last part is not what the person would actually say, but that’s
basically the translation of “let me think about it.”

Now, in cases a, b, and c you’re in good shape. You’re gonna either
get your meeting and money or you’re gonna get told you’re not getting
any more funding. Situation D is what you don’t want. If you’re
running out of provisions in the middle of the Atlantic, your best bet
is to go either East or West–not in a circle.

VCs and investors will sometimes send entrepreneurs in circles, either
inadvertently or as leverage. Sometimes VCs are juggling a lot of
balls and can’t focus. Sometimes they’re inexperienced and/or they
have issues that don’t concern your business, like their limited
partners, their partners or their divorce settlements. Sometimes
they’re cutthroat and know that, when you’re down to your last two or
three payrolls, they can extract a 2-3x liquidation preference out of
you.

It’s your job to force the issue now–don’t wait.

Heck, even if you have a year’s worth of runway, you should probably
do this kind of thing so your VCs know you’re the real deal and so you
know where you stand with them.

Put your staff to the test
————————-
If you’re down to six months of cash, you’re gonna have to cut the
bottom 1/3rd of your staff, if not half. This sucks, but there is no
choice. You’re gonna also have to cut salaries. So, here are some
suggestions on how to do this:

1. Get rid of the non-core staff. Look in places like PR, marketing,
and admin to cut. See if you can put some of these folks on part-time.

2. Look at the salaries of your current staff vs. market and look for
ways to cut the high-priced ones who you can get cheaper at the
current market. I know this sounds cutthroat, but remember, this is
advice for folks going out of business in six months. Another way to
run this test is to ask yourself “Would I hire this person for this
amount today?”

3. Go to each member of the team who is over-paid by today’s market
rate and tell them that you’re probably going to be cutting their
salary and that you’re increasing their options. Ask them how they
feel about it. Some people can take a pay cut, others can’t–you don’t
know until you ask.

I’m really against cutting people’s pay above cutting position because
you want the people remaining in your organization to be happy. Of
course, sometimes that’s just not realistic. Many CEOs overpay in a
hot market because they feel they have to, and those folks are the
ones who really need to take this hard action now.

Put your landlord to the test
————————-
Call your landlord and ask them to get a cup of coffee. Do this in
person. Let them know that it’s 50-50 you’re going out of business and
that you need their help in the form of four months free rent,
starting today, the ability to sublet some space (if you don’t have
that right already) and to keep the rent at the same rate you already
have. Tell them you feel horrible about this, and you wouldn’t ask
them to do this if it wasn’t urgent, but you didn’t want to drop the
bomb on them five months from now when there were no more options.

Remember, silence is your friend. Tell your story and see what they
say. I did this at one point and not only got free rent, I got 50% of
our letter of credit freed up. It was a win-win. Trust me, your
landlord is probably facing a LOT of fallout right now… better to
get half than nothing.

Put your vendors to the test
————————-
Since you’ve probably got webhosting, CDNs, equipment leases, and
other recurring charges on your credit cards, cancel those cards
immediately. Call up each vendor and tell them you need six months
free while you figure out your status, and if they can’t do it, ask
for suggestions. Then call each of their competitors and let them know
that you are willing to switch over for the first six months free.  If
you get one of four vendors to do this you just saved 25%–I bet you
can get two or three.

Vendors would rather eat some profits for six months than lose your
business. If they can’t support you in your time of need, then you
should find someone who will. There is a LOT of competition out there
and you can negotiate harder than you probably think you can. Tell
vendors you’re willing to switch if they give you six months free and
see what they say. We’ve had folks offer us a *year* of free service
to switch (of course, that’s an exception, not the rule).

Put yourself to the test
————————-
If you’re going to ask so much of your staff, investors and vendors,
you obviously have to take a hit yourself. Go to your VCs and ask them
to participate in the next round–the A+ round. Tell them you know
it’s not a lot but you want to put in $5 or $10k in the round as a
show of support. This will result in them saying it’s not necessary.
After that, tell them you’ll sell your car and take a bike to work and
put $20k into the business if you can get that for your car. Make sure
your staff doesn’t take a bigger cut than you do in salary if you’re
doing salary cuts.

Even if it’s just ceremonial, it means a lot to make cuts. I’ve
stopped traveling as much to conferences even though they cost me
little to nothing (normally people pay me to speak or at least pay for
my travel). Of course, don’t cut traveling if you’re going to
conferences where you might find clients or investors (which is why I
travel half the time!)

Put your product to the test
————————-
As Mark Cuban told me over and over again, “Sales solves everything.”
If you can’t sell your product, it’s not a product–it’s a hobby. Take
your consumer service and sell it as a software package to someone. Go
on the sales calls yourself. During the final year of Silicon Alley
Reporter I made cold calls and set up lunches to sell folks on our new
product, Venture Reporter (the rebranded Silicon Alley Reporter). It
works. When people see the CEO making sales calls, they respect the
company and take it seriously. When the VCs and staffers see you doing
this, they get inspired.

Put a whiteboard up and count any stat you can: sales calls made,
meetings scheduled, contracts sent and sales closed. Give your team
something to think about other than just the bottom line, because you
might have to celebrate the little victories before getting the check
in the door. Celebrate getting the meeting. Celebrate sending a pitch
out.

What to do if it’s over
————————-
If you’re going to hit the wall, you should do so with three or four
months of capital left in the bank. You should cut down to your core
staff and tell them “we have 120 days of cash left and we’re going to
try to land the plane safely. If you want to leave at any point during
the 120 days you’ll get the reference of a lifetime from me. If you
help us land the plane safely I think we’ll all be better off because
of it.”

Then make a plan to do one of the following:

a) sell the business
b) close the business
c) sell the assets of the business

There’s a little bit of overlap up there, since sometimes you close
the business and sell the assets, or you sell the assets and leave a
shell behind. The point is, don’t wait until you have a month left. Do
it when you have 120 days left. If you signal to everyone it’s over,
you’ll have done the honorable thing for your employees, by giving
them the maximum time to have a safe landing, and for your investors,
by allowing them to roll the business or its assets into another
company.

The worst thing to do is to delay this process. I’ve gotten down to
this point exactly, but when I was at break-even at my first business,
we looked for a buyer, because I didn’t think we had much chance of
making it on our own in the 2001-2002 market. I could have been wrong
about that in retrospect, but either way, I’m glad I got out because
it set me up for Weblogs, Inc.

And that is the final lesson: when one door closes, three more open
up. When you shut down your business properly, you will have a clean
slate and renewed energy to take on your next project. You might even
get the investors to give you the company with the 90 days worth of
capital left to start your next project with a recapitalized
structure.

Remember that there is no shame in failure but there are honorable and
dishonorable failures. If you’re going to lose the game, remember that
it’s just that: a game. There will be another and another and another
yet to play. Don’t lose your cool and don’t get depressed. Just get
yourself back up, dust yourself off and get back in the game. The
precursor to success is almost always failure.

[ To the 17 folks who made it to the bottom: If you’re struggling with
failure right now, if your business is failing and you don’t think you
can go on, remember that at the very least you’ve been lucky enough to
take your shot. That’s more than most people get. You’re going to be
much stronger for getting through the heartbreak of a failed business.
Also, you’ve always got me–your pal Jason–if you need a shoulder to
cry on. I’m only an email, tweet or IM away jason@calacanis or
jasoncalacanis on skype/twitter/AIM. ]

The culture of Zappos

I love Zappos.  The way that they are redefining customer service is raising the bar and positively impacting how sell things and how people treat their customers.  I recently wrote a Squidoo lens on Zappos’ story.  You can see it here.
zappos_logo
In a slideshare presentation on Zappos, they offered a book outlining their culture to anyone who asked by emailing Tony Hsieh, the CEO of Zappos and the driver behind their customer driven culture.  I sent Tony an email on Tuesday.  My email was responded to on Wednesday and the culture book arrived already today.  In the email, Tony invited me to take a tour of Zappos the next time I come to Vegas.  They even have a shuttle from the airport!

Zappos continues to overdeliver and delight their customers.   Read the email below and strive to treat your customers as well as Zappos does.

– – – – – –

Clay,

Thanks for your email! We’ll be sending out the culture book to
you right away and you should be receiving it within the next few
days.

Also, if you’d like to learn more about how we manage our culture,
customer service, marketing, training, hiring, and business in
general, check out our new “Zappos Insights” subscription service:

http://www.zapposinsights.com/

There are a number of free videos if you click on the “Featured
FREE articles” in the left column. You can also see a list of
books we recommend reading by clicking on the “Suggested Reading”
link.

Next time you’re in the Las Vegas area, be sure to stop by our
offices for a tour! Our headquarters are located right next to the
airport. Tours take about an hour and are available on any weekday
(we recommend Mondays through Thursdays when there are more people
in the office), and we have a free Zappos shuttle service that can
pick you up from the airport or your hotel and then drop you off
afterwards. To schedule a tour, just email Jerry Tidmore at:
jtidmore@zappos.com

Hope you enjoy the culture book, and please let me know if there’s
anything else I can do for you!

—————
Tony Hsieh
tony@zappos.com

Inside Zappos at http://blogs.zappos.com
Follow me at http://twitter.com/zappos

There is a permanent record

This week, Seth Godin ran an excellent post on personal branding in the age of Google.  You can read it here.

It is ironic that when we were in elementary and middle school we were all threatened that any transgression, from running in the hallways to food fights to selling marked up dime bags of Kool Aid on the playground was going to go in your “permanent record”.  It was a very effective threat because eleven-year-olds didn’t have a way to prove that the principal wasn’t keeping a manila folder of every mistake and misstep.  Many parents even leveraged the same threat.

We were safe then.  There was no manila folder following us around and most of us didn’t realize it until long after we figured out that Mom was the Easter Bunny and Dad was Santa Claus.

But today, there is a permanent record.  Pending recent changes in their terms of service, Facebook is forever.  MySpace is MyHistory. Google doesn’t forget.  Everything is archived.

Don’t believe me?  Check out this view of the Apple website.

How does your permanent record look?  Are you ready for “just Google me” to be your business card?

business-card

The Blue Sweater

Jacqueline Novogratz is changing the world.  She left Wall Street years ago (before doing so was trendy) for all the right reasons and single-handedly changed the way we think about philanthropy.  She founded the Acumen Fund, now recognized as a leader in the field of social entrepreneurship.  Jacqueline designed a new system, a combination of venture capitalism and traditional charity and she is making an extraordinary difference in countries where the average citizen lives on less than $4 per day.  She sees people living on limited incomes not as passive victims, but as potential customers and budding entrepreneurs and she helps them control their own destinies.

Jacquline’s new book, The Blue Sweater publishes in the US this week.   Order it, read it and give it to a friend or family member.  Then check out the Acumen Fund.  Jacquline is changing the world for the better and she can use a little of our help.

Thanks.

blue-sweater-cover

The best informercial product ever

I’m starting the P90X workout program today.  With all due respect to Chuck Norris, Ron Popeil and the ShamWow guy, P90X is the best product you can buy off of an infomercial.

It’s 2am and you’re flipping the channels between two infomercials.  One promises magic weight loss through an expensive, non-prescription pill.  The other offers a set of exercise DVDs and promises not just weight loss, but to help you completely transform your body.

The first one is snake oil, sold by scam artists and fake doctors.

The second one works,partly because it is real but in large part because it is a Tribe.

There is no magic pill that in any way helps you lose weight.  If such a pill existed, everyone would be slim, obesity would be a footnote in history books and the inventors would lend money to Warren Buffet and Bill Gates.  I still can’t believe people fall for such obvious scams but they clearly do.  The infomercials keep running.

The other option I’m referring to is a detailed and prescriptive exercise program called P90X.  The program consists of 13 DVDs, an exercise guide and a nutrition guide.  Each DVD is led by an inspirational, extremely fit 50 year old named Tony Horton.

P90x

The program works because it contains the three critical elements of any successful fitness program:

  1. Strength training
  2. Cardio and
  3. Nutrition

P90X isn’t easy and never claims to be.  Each workout is about an hour and you can expect to be sweating profusely during each one (even on yoga day).

But many similar fitness programs contain those three elements.  So why is P90X so successful?  Because people stick with the program long enough to realize their transformation.

Why do people stick with the program?  Because it is a Tribe.  It has an inspirational leader in Tony Horton.  Members use the P90X terminology.  Members connect and support each other, posting their before and after pictures on P90X message boards.  People who finish the program can’t wait to tell others about it and recruit.  Many first-timers then become ‘coaches’ for new members.  Many people post their transformational stories on YouTube.

If there was no Tribe, P90X would still work but the idea wouldn’t have spread.  People wouldn’t tell their friends and family or coach each other on the message boards.  As a result, Beachbody, the parent company, wouldn’t have sold nearly as many units.

Does your product or service have a Tribe?

P90X-Posters

Out of tragedy, sportsmanship has a shining moment

The list of things that are wrong with sports seems endless. Steroid scandals. Rising ticket prices. Greed trumping loyalty. Individual statistics over team accomplishments. A lack of accountability. Fewer and fewer role models.
So it is refreshing to see the level of class shown by Darius McNeal in Milwaukee on February 7th.  It’s stories like this that keeps my passion for sports alive.

From the Milwaukee Journal Sentinel:

At first, Johntell Franklin just wanted to watch his friends play basketball.

“I wanted to go and support my team,” said Franklin, an 18-year-old senior at Milwaukee Madison High School. “I’m a captain. I set an example.”

As it turned out, Franklin wound up teaching everyone in the Madison gymnasium a lesson – about friendship, about the value of sports, about themselves.

A somber cloud hung over the Knights as they played DeKalb, Ill., High School on Saturday, Feb. 7. News spread quickly that Franklin’s mother, Carlitha, had died earlier that day after a five-year battle with cervical cancer. She was 39.

Madison coach Aaron Womack Jr. was in Madison’s laundry room, washing the Knights’ uniforms from the previous night’s game, when he got the news.

“I didn’t have my cell phone with me back there, so by the time I heard, the junior varsity game had already started,” Womack said. “I headed straight to the hospital. Johntell, understandably, he was despondent.”

Carlitha Franklin had been in remission recently. But Womack said she had begun to hemorrhage on Saturday morning – while Johntell was at Wauwatosa East High School, taking his college entrance ACT exam. By late Saturday afternoon, the decision had been made to turn off the life-support system.

At the hospital, Womack asked Franklin if he should call off that evening’s game. “He said, ‘No, tell the guys to go out and do their best,’ ” the coach said. “I told him we would, and I went back to school.”

So Womack gasped with surprise when he saw Franklin walk into the gym early during the second quarter.

“A few seconds after I spotted Johntell, all the people in the stands did, too. They surrounded him. The players, his friends in the stands, the cheerleaders,” Womack said.

“They were showing me that they were supporting me, comforting me,” Franklin said. “Yeah, on a hard day, that’s a nice feeling to have.”

Then came another surprise: Franklin didn’t just want to watch. He wanted to play.

“I’m a competitor. I can’t just sit there and watch,” he said.

Womack sent Franklin, a 6-foot-2 forward, to suit up. He returned to the cheers of the crowd – including the coaches and players from DeKalb, whose amazing display of fellowship and sportsmanship had just begun.

“I was late getting back from the hospital, and they could have called us on that,” Womack said. “But they were great about it.”

“We were sympathetic to the circumstances and the events,” said DeKalb coach Dave Rohlman. “We even told Coach Womack that it’d be OK to call off the game, but he said we had driven 2 1/2 hours to get here and the kids wanted to play. So we said, ‘Spend some time with your team and come out when you’re ready.’ ”

Since some of Franklin’s teammates had joined him at the hospital, Womack entered only eight names into Madison’s official scorebook. The game began almost two hours behind schedule.

But Franklin’s desire to play created another problem: The referees were required to call a technical foul against Womack for failing to list Franklin in the scorebook.

“I told the referees I knew there would be a technical,” Womack said. “I put Johntell in after DeKalb called a timeout (midway through the second quarter), and the next thing I heard was DeKalb’s coaches complaining that they didn’t want a technical.”

“We argued, but the referees said those were the rules, even if there were extenuating circumstances,” Rohlman said.

The discussion lasted more than seven minutes. Eventually, Rohlman devised a solution: His team had to shoot two technical free throws  . . . but didn’t have to make them.

“I gathered my kids and said, ‘Who wants to take these free throws?’ Darius McNeal (a 5-11 senior point guard) put up his hand. I said, ‘You realize you’re going to miss, right?’ He nodded his head.”

During technical free throws, no other players are allowed around the free-throw lane. So Womack gathered Madison’s players around his bench, on the other end of the court, and was trying to reel in their emotions when he saw something odd out of the corner of his eye:

Instead of swishing through the basket, the ball rolled slowly across the end line.

“I turned around and saw the ref pick up the ball and hand it back to the player,” Womack said, “and then he did the same thing again.”

“Darius set up for a regular free throw, but he only shot it two or three feet in front of him,” Rohlman said. “It bounced once or twice and just rolled past the basket.”

“I did it for the guy who lost his mom,” McNeal said. “It was the right thing to do.”

After the second shot, everyone in the gym – including all the Madison players – stood and applauded the gesture of sportsmanship.

“Any one of my teammates would have done the same thing, and I think anyone on the Madison team would have done the same for us,” McNeal said.

Madison broke open a close game after the timeout and went on to win, 62-47. Franklin finished with 10 points, matching his season average.

“Just being in the game was a good feeling,” Franklin said. “I knew my Mom would have wanted me to play. She was always proud of me playing basketball.”
A friendly rivalry

This was the third straight year that DeKalb and Madison have played a non-conference game, and as in the other visits, both teams gathered for dinner afterward. “We set it up so that there were four kids to a pizza, two Madison kids and two DeKalb kids,” Womack said.

Franklin stayed for only a minute and didn’t have a chance to thank McNeal for his gesture.

“It’s OK,” McNeal said. “I just would have told him I was sorry for his loss.”

Womack was so moved by the events of the day that he wrote a letter to the DeKalb Daily Chronicle, praising the Barbs’ coaching staff and players.

“That letter became a big deal in DeKalb,” said Rohlman, whose team is 14-10 with three regular-season games remaining. “We got lots of positive calls and e-mails because of it. Even though we lost the game, it was a true-life lesson, and it’s not one our kids are going to forget anytime soon.”

Carlitha Franklin’s funeral on Friday was attended by dozens of Johntell’s Madison friends, teammates, coaches and administrators . . . plus the cheerleading squad, in full uniform.

“Even the cooks from the lunchroom came,” said Womack, whose team is 6-10 overall but upset Milwaukee King, 46-43, on Jan. 27. “You never know how much you’re loved until a tragedy happens. It was amazing. It shows what a good kid Johntell is.”

“I’m all right now. It helps to have so many people behind me,” Franklin said. “This will be my first week back in practice, and we have a big game (tonight) against (Milwaukee) Hamilton that I’m looking forward to.”

An all-City Conference linebacker, Franklin has drawn some interest from Division I and II programs, most notably Ball State.

“That’s what I want to do next. I really want to play college football,” he said. “I want to keep competing.”

(end article)

There are three types of meetings

There are three distinct types of meetings. Only three.

meeting

1) Information – “Unfortunately, we had to let Ziggy go today. He was stealing the coffee pods.”

2) Approval – “We need all of the VP’s to sign off on the Zorca, Inc. acquisition.”

3) Feedback – “What do you all think of the new logo?”

Know what type of meeting you’re having and prepare for it accordingly.

Assume the positioning.

Positioning is about comparing your product, your brand, your service to what already exists. Positioning isn’t about actual results. It’s about perception.

To define your positioning, draw a two dimensional graph using axes that are relevant to your product or service. Plot your position relative to your competitors on the graph. If you can’t do this, then you don’t understand your positioning.

1) Know your positioning relative to your competitors.

Owning a quadrant:

Kellogg’s bought La Jolla based Kashi in 2000. When they did so, they didn’t change the branding, the packaging or the logo because they needed Kashi to stay positioned in the “healthy” and “appears to come from a small company” quadrant, at the time competing against others in that quadrant, like Bear Naked. Then in November of 2007, Kashi (now a subsidiary of Kellogg’s) bought Bear Naked as well, so they own both of the brands that dominate that quadrant.

cereal-positioning

2) Constantly monitor your positioning. If your competitors successfully move, know how and when to strengthen your position and when to hold your ground.

Extending your positioning advantage:

FedEx is squarely positioned as being the most reliable choice for shipping. As a result, they have been able to charge a premium price. The US Postal Service isn’t much less reliable than FedEx but as we said above, positioning is not about actual performance, it is about perception.

When UPS tried to compete with FedEx on reliability and beat them on price, FedEx responded with technology. By allowing you to check on your package at any point during the delivery, FedEx pushed themselves further out on the reliability access, not because FedEx is much more reliable than UPS, but because we perceive them to be.

shipping

Defining new axes:

Wal-Mart realized that if it had enough stores and moved enough volume that it could coerce suppliers and offer consumers the lowest possible price. They are also friendly (think of the Wal-Mart greeters). So Wal-Mart’s positioning is “Cheap and Friendly”.

Wal-Mart’s main competition is Target, who was smart enough to realize that they would never be able to beat Wal-Mart on price. So Target changed the axis and defined new positioning. Instead of “Cheap and Friendly”, Target became, “Cheap and Design”. They now appeal to a different customer who has a different worldview.

K-Mart can’t win the battle of “Cheap and Friendly” or “Cheap And Design”. They’re “Just Cheap”, which is Latin for “Chapter 11″.

walmart_target1

3) Powerful positioning can overcome adversity.

Weathering the storm:

Perrier, the French mineral water company lost millions of dollars after the discovery of minute traces of benzene, a hydrocarbon thought to cause cancer, in their bottled water. This hit public confidence in a drink favored by the health-conscious and billed as absolutely pure. Unable to track the affected batch, Perrier recalled 140 million bottles at a cost of $40 million.

But today, Perrier is as popular as ever. Their positioning on the axis of ‘pure’ was enough to weather the storm.

Perpetuating a story:

Today, Volvo cars now are no safer than many other cars. They are less safe than many. But because of that strong positioning that Volvo has established in the brains of many consumers, people still believe that Volvos are the safest cars on the road. That is a primary factor in the acquisition of Volvo by Ford. They weren’t buying the cars, they were buying the word ‘safe’.

4) Find an existing hole and fill it.

bobdylanlp

Look at Bob Dylan. When he walked into Greenwich Village, he was a Jewish kid from Minnesota with a funny voice. But NOBODY KNEW THAT. He invented a new position for himself and he became a musical legend.
jacksonpollock

Some people see Jackson Pollock’s art and say, “I could do that”.

But to people who understand positioning, the answer is, “You didn’t. He did”.

Your business plan is incomplete.

Many business plans include things like mission statements, values, demographics, competitors and market share data. Those are important but too often they are given more weight than the three critical components of any effective business plan:

1) The Story
2) The Marketing Plan
3) The Sales Plan

The Story

story
What is your story? What is the story you are telling the people who buy your product or service? What is the story they are telling themselves? What is the story they are telling their friends, neighbors or family? Who else is going to be there? What are they going to experience?

Your story gives you the chance to tell your customers why this is a dream come true for them.

The Story feeds…

The Marketing Plan

whisper

How do people find out about it? How do you reach them? How does it spread? Who is talking about it? Why are they talking about it? Who are they telling? How often? In what format?

The Marketing Plan is a road map for how your story will spread.

There are three primary mistakes are made with The Marketing Plan:
1) Too much of the overall business plan is devoted to The Marketing Plan, forgetting about The Story and The Sales Plan.
2) The Marketing Plan is too focused on buying advertising to interrupt and yell at people…
3) instead of focusing on building and enabling the organic, viral component necessary for the idea to spread. Remember, a friend passionately telling ten friends about your product or service is more valuable than a thousand billboards on the busiest highways.

The Marketing Plan leads to…

The Sales Plan

purchase

Sales exist when the money changes hands.

Who will buy it? Where will they buy it? From whom? Are there coupons? Discounts? Joint ventures?

Just like your business plan should never contain the statement, “And then a miracle happens…”, your sales plan shouldn’t contain the statement, “And then someone will want to buy it.”

Is your business plan complete?

The problem with lists

Why do we feel more comfortable with lists?

to-do-list_small

Because teachers don’t give open ended essay questions to 2nd graders. Because nobody ever tells a girl scout troop to go raise money however they see fit. Thin Mints and Samoas are the tasty, structured proof.

Because the jobs we get early in life are always very structured (ever had a paper route?). Everything is laid out, do this, then do that, then do the other thing. When you’re done, it will look like this. Exactly like this.

It extends beyond childhood. The jobs we get after college are also very structured. Consulting is often nothing but repeating for a new client the same methodology, process or technology that worked for the last client. Lists of what to do and how to do it are everywhere.

Lists aren’t evil.  Many times, lists are important, such as in accounting, CPR or the construction of a safe building.  But we all want to know that if we check all the right boxes, that we get the A+, admission to the right school, a good review and a 7% annual raise.

Almost everyone is more comfortable with lists. Almost everyone wants people to tell them exactly what to do and exactly what finished looks like.

This is why the people that don’t need lists are so valuable.

Learn to be that type of person. Learn how to take an ambiguous task and figure it out. Learn how to fundraise without Samoas. Learn how to improvise.  Learn how to host a conference. Learn how to start a company.

Learn how to do things without lists.  You’ll become indispensible.

Drive change constantly.

The leaves on a tree have it down pat.  They wait until the weather turns cold, then they turn beautiful colors, fall off and wait until spring.  Same routine, year after year.

leaves

Unfortunately, you’re not a tree. You can’t wait to create change once it’s needed. You have to proactively and constantly change.  It is difficult, because you can’t sell change when you’re doing well, but you can’t afford change when you’re doing poorly.

Are you uncomfortable?

If not, maybe you should be.

be uncomfortable often
be uncomfortable often

To achieve anything beyond what you already have, you need to leap out of your comfort zone. You may be familiar with the old saying, “If you keep doing what you’ve always done then you’ll keep getting what you’ve always gotten.”

Look at what is keeping you in your comfort zone.  Ask yourself two questions:
a) What is the worst that can happen?
b) What is the best that can happen?

‘b’ is almost always greater than ‘a’.  The pain of ‘a’ is temporary.  The benefits of ‘b’ are forever.

Unless you’re completely, 100% satisfied with your life, take a leap. Push yourself out of your comfort zone. You’ll be surprised at the result.