Posted: October 22nd, 2008 | No Comments »
I’ve been through two of these, like many of my fellow serial entrepreneurs. Once when the bubble burst around my ‘convergence’ company, Oxygen Media, and now again with my current company, Expo Communications. We’re in a period of high revenue growth, so it isn’t easy to distinguish what is critical spending and what is not. But you should be motivated thinking that your competitors – whether they compete for your customers, users or funders – may be acting faster and more decisively than you are right now. Here were some tasks that I’ve found effective for long-term strengthening:
1) Build Staff 2.0. You never have a second chance to make a first impression. Unless there’s a crash. Then, you totally can. Here are some thoughts about how to build Staff 2.0:
a. Be very skeptical of keeping headcount that is not directly attached to revenue, or in evidenced growth areas. There is no time to be investing ahead of success when success just got a lot riskier. It’s called right-sizing and it will save your company and the jobs that it should support.
b. Start with a blank org chart. Build an org chart with no names of people…just titles and functions. It helps you think less emotionally about who you’d like to keep and more about who the company needs.
c. Do it all at once. I can’t stress this enough. Doing it in a thousand cuts is demoralizing, painful, and will result in losing the staff you need to keep. Work very hard at shaping your target org, then create it in a humane but decisive process.
2) Support the resulting Staff 2.0. Your staff is far from stupid. They know why you made those changes. They silently questioned why that guy over there was writing copy all day. They might have liked that guy and thought he was talented, but deep down they didn’t think he was contributing to the company like they were. After your restructuring, bring Staff 2.0 together, and give them the positive news: this team is the team that you believe will bring the company to the promised land.
3) Extend your payables. Why are you paying on time when no one is paying you on time? You will pay…just a little later. The amount of working capital you will free up that first 30 days will amaze you.
4) Change old policies. This action may not save a lot of money, but it can start a culture of frugality that will benefit the company for years. Tighten the travel policy, and start tracking vacation days. Overhead contracts should be now treated as variable. Cancel all contracts you can terminate, and negotiate new terms with either existing or new vendors – HVAC, cleaning, legal, consultants, etc. Put new cost controls in place, such as additional approvals for discretionary spending.
5) Exude a positive attitude. Be transparent in all these changes and answer all questions about the health of the company, additional staff reductions. This is where your prior planning can help you answer decisively, clearly, and immediately. Having a plan can help you communicate with a level of certainty that you probably don’t really have, but that your staff will crave.
As you make your plans, target a material amount to reduce – try to find over 25% of existing costs. You don’t have to make all the cuts, but forcing yourself to identify potential reductions is the first step toward honestly evaluating whether you need to make them.
Posted: October 10th, 2008 | No Comments »
There’s a lot written about the
Sequoia “world is ending” meeting, with presentations by Sequoia professionals Mike Moritz, Eric Upin, Michael Partner. At the very least, this presentation helps clarify the task at hand during this very complex environment.
Here’s the actual presentation, thanks much to Fred Wilson’s blog where I found the link first.
The presentation is MUCH better than any of the writeups, as it provides context to the comments.
SlideShare Link
Posted: July 26th, 2008 | 1 Comment »
Last night Bill Hildebolt and I attended the annual Techcrunch Meet-up in the valley. There was a definite dearth of East Coasters there. We did meet some new folks at cool SF companies. But more importantly, we saw a bunch of old friends at even better SF companies. Here’s a more detailed run-down of some of the HBS contingent we saw there:
Heather Harde : has to be one of the classiest people in the joint. CEO of Techcrunch, and our personal ticket connection. (Heather, we should have pulled a Todor and just yelled “BUT WE KNOW HEATHER” at the doorpeople.) Michael A, I don’t know you, and while you looked like you adore Heather, as a woman I have to implore you not to give your beautiful CEO a noogie on the head during speeches. It’s a hair thing.
Tom Patterson : gets second billing because it was his “not-yet-40” birthday. He got sung to by a bunch of drunk entrepreneurs (I think the VCs were lip synching) and a free cake. I thought that big fake check was for you, too, but alas, it was for malaria . Tom’s the CEO of Wize.com, a soon to be partner of Expo.
Raj Kapoor: whose lovely doctor wife Lydia is due any day! MD at Mayfield and one of the best friends an entrepreneur could have, having been a great one himself.
Carol Linburn , group product manager for mobile authoring at Adobe and one of the nicest people in the valley. Trying desperately at the party to feel like an entrepreneur again. We asked her to go back to work that night and, for the love of all that is holy, get flash working on the iPhone.
Steve Abernethy The founder of squaretrade.com and the only guy I know that got kicked out of the Apple store during the iPhone debut because of anti-competitive practices. Steve, Expo taped at the NY Apple store without incident…
Todor Tashev: Director of Investments at Omidyar Network. His wife sings with Sting.
Erik Eklund. Stealth. I’m afraid to even link to his LI profile.
Dana Shapiro Marotto , Marketing at ExpertCEO that just launched in Q2 of this year. Dana, how did you get into HBS with a CPA? Did you just not put that on your application?
Elliott Ng in marketing at Uptake.com, who we saw in line and then completely missed the entire rest of the party.
Was great to see others, like Bong Koh, Deb Schultz, Sam Lessin (another NYC interloper, but he’s like 12 so he fit right in).
Oh, and I cannot fail to mention that as a NYC citizen (our car-related excitement is limited to flagging a hybrid taxi), despite all the change-the-world ideas at the party, the most motivating was seeing Jason Calacanis’ Tesla up close and personal. Bill was hyperventilating. Go electric.
Posted: July 16th, 2008 | No Comments »
Procter & Gamble’s Social Media Lab
P&G was one of the top 10 brands that our members wanted to talk to. So, we felt pretty lucky to be asked to participate in the P&G Social Media Lab.
P&G marketing has historically been known to try to impact consumers directly. When they can’t find solutions to help them reach the right people, they’ll pioneer their own, like Tremor, and Vocalpoint. Direct ownership of these initiatives by the brands gets into its own thorny issues about influencing consumers, and disclosure.
The P&G Social Media Lab, I believe, helps broaden P&G’s perspective on how to harness the power of passionate consumers — beyond the simple, direct control of them. By exposing their brand managers to a broad range of robust community sites in a learning environment, their marketers are afforded the proper structure to evaluate and understand the strengths of this delicate, but powerful new source of consumer connectivity. The Lab helps facilitate the conversation between partner and marketer by instilling an even playing field for learning, and, more importantly, a structure to define success. The lab’s focus helps the conversation not slide into the predictable marketing mode of “what’s the CPM and how many eyeballs can I get”. I find that trodden line can singlehandedly stunt the emergence of new models and lead to unnatural, force-fit projects best suited for old media. Instead, our partnership discussions have been directed to define how engagement, influence, and dialogue can be measured (and priced) to ensure that the right consumers — the interested consumers — are reached. Our projects are focused on impacting the buying process, and on developing metrics which measure our members’ purchasing influence. By being invited to help craft the right success metrics, social networks involved in the Lab are empowered to make sure that their ‘consumer conversation’ projects don’t go as astray as they have when demographic reach and frequency became the end goal.
We talked a lot internally about how the P&G Social Media Lab helped ‘even the playing field’ for us so that we could influence how P&G brands should define success with our community. Because we are hyper-focused on our members’ expectations and needs, we think we can easily create something that will leave our community and P&G better off than when we started. Can’t say that for most of the eyeball deals I’ve done.
For the more official story on the social media lab…see Deb Schultz’s blog.
Posted: July 12th, 2008 | No Comments »
We have a 19 year old intern from UCLA in our company this summer. He is pretty interesting because he’s got some great film making skills already under his belt. In discussing how to get us some great consumer video, he thought up the idea (the night before) to go to the iPhone opening in NYC. He got some great footage, edited it and put it up on the same day. Because he was in a self-professed “good mood” he left out the two “criticisms” that he heard that day about the iPhone (the whole thing about not being able to connect because of the problems Apple was having with their system). He even put together his own music.
His presence in the company is a fun reminder that fearlessness will always be a big part of entrepreneurialism. I hope you enjoy his creativeness to real consumer reviewing the iPhone!
Posted: April 22nd, 2008 | No Comments »
If you are in a long term contract, or about to enter one, think about reopening pricing. A few things:
1) retainer companies are losing clients as clients take a closer look at overhead
2) with the emergence of startup activity in 06-07 and outsourcing overseas, there is a lot of price competition in the service industry
3) you’d be surprised what a company with high fixed costs (ie staff) is willing to do to keep some semblance of a retainer
I signed a 12 month contract with webex.com because I just assumed the sales rep was selling me the right sized product. Turns out they had a cheaper product available online that the rep was not allowed to sell on the phone. I am trying to cancel the contract, and they are trying to keep me as a client. The conversation has been fascinating.
I’m not saying to try to nickel and dime your outsourced firms because they need to survive, too. But all is fair when you simply do your homework on what the current environment is yielding. Your partners need to stay competitive, and you shouldn’t be funding their other clients who may be getting a better deal.
Posted: March 14th, 2008 | No Comments »
I totally think I don’t have the time for this blogging crap.
“Post everyday”
“Post twice a day”
“Write on searched topics”
“Build a following”
“Have a point of view”
My god, if I had the time to do all this stuff, shouldn’t I be fired from my job? How do you people all do this?
My turning point was the sxsw Interactive 2008 conference in Austin Texas. Find some podcasts here. So awesome. So inspirational. So fun. Met and talked to bloggers, developers, cool people, who all seem to find the time.
So, I decided I’m just a loser.
I hope that I can post often, on searched topics, for a following, with a point of view. Doubtful, but let’s give it a whirl.
-D
