Recommending “The Founders Dilemmas” by Noam Wasserman

I’ve been recommending The Founder’s Dilemma by Noam Wasserman a lot these days. I like how Wasserman takes a his empirical study of 10,000-ish startups and looks for patterns.

The conclusion: People problems are the leading cause of failure in startups.

The patterns he focusses on are:

• Career Dilemmas – Should I found? When? Why? With Whom?
• Wealth vs Control Dilemmas – The finding that drives this is On average, the founders who keep the most control over their company make the least amount of money.
• Founding Team Dilemmas – Solo vs Team? Friends? Roles? Rewards ( Equity Splits and Compensation), Hiring, Investors, CEO-Succession

Many of us have a few unique experiences in each of these areas, but none of us have this huge array of experiences. It is good to see that we’re not alone in our experiences and that there are other choices to make.

The Wealth vs Control Dilemma is a curious one to me. It really grabbed me when I read Eric Ries’ review of this book last year. It made me think of PMC-Sierra founder Greg Aasen right away. I always thought his “give up control” strategy was unique and only worked for him. But turns out, “it’s a thing”. A good “thing”.

The only “quibble” that I’ve found so far with this book is that “It’s not a practitioner book”. It’s a data driven study of startups. That’s not bad, just is what it is. How one chooses to “interpret” the data always creates some “tension”. It’s also “too logical”, if that makes any sense.

More Stuff

• There is a good review by Eric Ries focussing on Equity Splits
• Chapter 1 is available at the author’s website, Read Chapter 1 « Noam Wasserman
• There is also more great material on Noam Wasserman’s Blog

Be Remarkable! ( Seth Godin’s “Purple Cow” Still Rockin’ )

Seth Godin’s “Purple Cow” Ted Talk is still “remarkable”.

I like how Seth starts with the no-brainer idea of “sliced bread”. Yup “Sliced Bread” sucked for 15 years, it was not an instant hit.

More On Purple Cow Book

He argues that the only way to cut the hyper-clutter of products and advertising today is to innovate something new, unique and remarkable – like a purple cow.

In a world of too many options and too little time, our obvious choice is to just ignore the ordinary stuff. Marketing guru Seth Godin spells out why, when it comes to getting our attention, bad or bizarre ideas are more successful than boring ones. (via Seth)

Responding to “Freak Out”

Revisiting a response to the “Freak Out” post.

After reading the “Freak Out” post my buddy Seattle Dave recommended that I read, “Leadership and the New Science, by Margaret Wheatley“. I’m almost finished it and my first reaction is wow! This is awesome Just how many exclamation points can I put in a post

The concept of her book is simple — apply the concepts of 21st century science to organizational behaviour. The result is shocking and inspiring. It provides a great deal of hope for the future. This book must be read.

The key point that she focusses on is that “new science” is all about relationships and not Newtonian reductionism. Topics covered are: “Field Theory” ( provides an analogy of corp vision and EM fields ), Heisenberg Uncertainty Principle (Measuring one variable more accurately comes at the expense of less accuracy in other variables. You can’t know it all at the same time. In fact knowing more about one thing ensures that you’ll know less about another.), Quantum wave/particle duality ( if the experiment looks for waves it finds waves and if it looks for particles it gets particles), Schrodinger’s Cat ( admits to not getting it, but then applies it to the common phrase “you see what you want to see — so choose something nice”), self-organizing systems, information vs. content, and more.

Quotes – There are some great quotes on the Margaret Wheatley Wikipedia page. The first paragraph ends with this sentence

She describes her work as opposing “highly controlled mechanistic systems that only create robotic behaviors.”

Warning: For some this book may come off as too “New Agey” and “difficult”, especially when she starts off by noting “Fritjof Capra‘s Turning Point (another book I loved) and reading some quotes from it. I urge all readers to to get/look past this and “listen”.

Get Inspired! Read About Aravind’s Mission to Eliminate Curable Blindness

Inspiring! Wow! The story of the Aravind Eye Hospital in the book Infinite Vision: How Aravind Became the World’s Greatest Business Case for Compassion is “mind blowing”.

There are good works happening in the world today! This is a feel good book like Abundance: The Future is Better Than You Think.

In 1976 Aravind opened in Madurai, India, with 11 beds and a mission to eliminate “curable blindness”. In 1981 they did 10,000 surgeries. In 2009 they did 300,000! In the process they developed their own rural out-reach programs, cataract surgery processes, started a company (Aurolab) to build lenses, started a training program LAICO for third and first world training. Just wow!

The high volume is because they do “free” and “less than” free surgeries as well as paid. Chapter 2 is “When Free is Not Enough”. For their poorest patients they need to do more than just pay for the surgery. Aravind’s fee structure for 2010 (page 289 ) was

• Free 27%
• Minimal Payment 26%
• Regular & Premium Payment 47%

10x More Cataract Surgeries per Doctor per Year

The most amazing statistic is Average Number of Cataract Surgeries per eye surgeon per Year. It’s 10x the developed world! (page 291) And the complication rate is equal or lower! (page 292)

• Aravind 2,000
• USA less than 200

More Links

• So amazing that there has been an HBR case available since 1993.
• Profitable Audacity: One Company’s Success Story « Vijay Govindarajan – Harvard Business Review

Explore & Refine With Bill Buxton

Sketching User Experiences: Getting the Design Right and the Right Design by Bill Buxton Wow! Wow! Wow! I found this in the Bibliography of Business Model Generation.

This is not an easy read, so I find it hard to make it a must read. That said there are so many good ideas that are well developed and explained thoroughly. If you’re into innovation then this is a must read. I really like how much time Buxton spends relating and positioning design with respect to the other disciplines like marketing and engineering. The whole concept of sketching vs. prototyping took a while to sink in for me. I’m hoping to write more on this book. It has a good history of the iPod in it too.

Diagramming Innovation – Explore & Refine

I find that most people “want to believe” that innovation is “incremental refinement” and that some people “want to believe” that innovation is a “grand exploration”. Buxton provides to two very simple diagrams to convey these themes on page 388. I think innovation requires both. I think that is why I like Steve Blanks Customer Development Model with it’s Search (Explore) and Execute (Refine) phases.

Refine

Figure 149 Prototyping as Iterative Incremental Refinement

Explore

Figure 150 Design as Branching Exploration and Comparison

The red lines

In fig 150 the RED Line is to emphasize how many branches were being explored at that given time in the process. …
The branches in Fig 150 are intended to represent the various alternatives that were explored in the process of arriving at the end design, which is represented by the branch at the extreme right. This is where the RED ARROW in Figure 149 begins.
Buxton page 387

It’s Sunday – Matthieu Ricard’s “Tibet” is a Photographic Gem

Tibet: An Inner Journey by Matthieu Ricard is not a challenging book. It is just an amazing set of pictures and brief histories of spiritual places in Tibet.

The one thing that comes to mind is “time warp”. It’s like going back in time – horses, hand printing, etc.

I’ve also reviewed his book “Happiness” It is a more challenging read.

Mandatory Nerd Reading – The Other Side of Innovation (Execution)

“Ideas are the easy part … delivering on an idea is the hard part. It’s a long hard journey – from imagination to impact” is the theme of the “HowTo Innovate Book” The Other Side of Innovation: Solving the Execution Challenge « Vijay Govindarajan, Chris Trimble To the books authors, VG & Trimble, Thank You for that. I’ve always found that delivering on an innovation is extremely challenging. Reading through this book was like poring salt in old wounds. It reminded me of all the screw-ups I’ve made and introduced me to many more. My first reaction has been to recommend this book to anyone I come in contact to. It is that good.

I really like how they position an Innovation Team within an existing business. It’s a partnership. They dig into the issues of the “relationship” between Innovation Teams and Corporate Staff. They talk about hiring outside employees. Why and Why not. They dig into Power Balance and Status Issues. They cover most of the “conventional” wisdom and either confirm or debunk it. Fantastic.

The second section of the book is “HowTo Run an Innovation Experiment”. I really like the implications of that title. It is enough to ruffle a few feathers. That is “Innovations are Experiments … they are not guaranteed, we’re doing this test because … we don’t know how to do it”. They introduce very good concepts and provide a few tools.

How Does It Fit With Steve Blank’s Leanlaunch Pad and Customer Development?

I’m a Steve Blank fan-boy and didn’t need another book on innovation, but I did find it on his blogs’ short-list of books to read. I was curious since he hasn’t added many books to the shortlist in a long time.

My first pass is that VG & Trimble are very synergistic with Steve Blank’s Customer Development and Leanlaunch Pad. They are Yin & Yang. The complementary nature is in the style of delivery and where they come from. VG & Trimble choose a more time honoured business school justification of “Innovation as an Experiment” via collecting a ton of data and synthesizing it. They provide a very good “wrapper” for understanding “Innovation as an Experiment”. This is in contrast to Steve Blank’s “Gonzo/Manifesto” style that “practitioners” prefer. That said everyone has to read both, especially your “evil twin”, if you’re a practitioner then you have to read VG & Trimble no matter how much you don’t want to, and vice-versa. In a nutshell, VG & Trimble’s data seems to validate the LLP “Innovation as Experiment” approach. They are friend.

The high-level stuff. VG & Trimble provide a high-level framework for innovation within an existing business – Intrapreneurship. They provide a solid justification for spending time on “The Team” and “The Experiment”. VG & Trimble are much more focussed on Intrapreneurs and that means that they have some amazing points on “relationships” between the Core Business and the Innovation Team. A lot of these relationship issues are similar to those between Investors and Startups, but many are very different. If you’re an Intrapreneur you really need to read the “The Team” section. It will make a difference.

The main differences are about depth & details in “The Experiment” section. Here I would say that VG & Trimble do a great job laying out the problem to be solved. They provide useful tools and processes. If you’re doing this for real right now, then you need that mental support right now. And if your “Experiment” requires you to get customers for your product then you’d better dig into The Leanlaunch Pad (LLP) process via the Startup Owner’s Manual for more detail provided by a “practitioner”.

Slideware & Chapter 1

• The Other Side of Innovation « Slideshare
• Download Sample « MBA.Tuck
• the other side of INNOVATION « MBA.Tuck

More Reviews

These are both very detailed reviews.

• The Other Side of Innovation and Ten Rules for Strategic Innovators: Planning the Unknown | The Innovation Architect

• Innovate on Purpose: Book Review: The Other Side of Innovation

What A Beautiful Rant! Willful Blindness – A full frontal assault on the image of our daily lives

What a beautiful rant! Willful Blindness: Why We Ignore the Obvious at Our Peril by Margaret Heffernan is so much fun. The book moves with the pace of a Sci Fi Thriller like Kill Decision. She just rips our day-to-day existence to shreds! Page after page. But like a Sci-Fi Thriller I was turning pages fast. I’ve read about a lot of psychology and neurology mentioned in this book so I’m a bit more willing to believe her.

I keep thinking that there is a connection between “Willful Blindness” and the use of the word “Illusion” in spiritual writings. For example, I’ve read many dharma books where monks mention that “our lives are illusion” and I usually have no clue what they mean. This book is full of “concrete examples of the illusion that is our lives”. Maybe this is what they mean. Super cool and Super not cool. (tip to Doug Duncan for recommending this book and planting this seed )

Here is the “promo description”. It’s a full frontal assault on our daily life. I’ve also got a few links of books and readings on this thread below.

Margaret Heffernan argues that the biggest threats and dangers we face are the ones we don’t see–not because they’re secret or invisible, but because we’re willfully blind. A distinguished businesswoman and writer, she examines the phenomenon and traces its imprint in our private and working lives, and within governments and organizations, and asks: What makes us prefer ignorance? What are we so afraid of? Why do some people see more than others? And how can we change?

Covering everything from our choice of mates to the SEC, Bernard Madoff’s investors, the embers of BP’s refinery, the military in Afghanistan, and the dog-eat-dog world of subprime mortgage lenders, this provocative book demonstrates how failing to see–or admit to ourselves or our colleagues–the issues and problems in plain sight can ruin private lives and bring down corporations. Heffernan explains how willful blindness develops before exploring ways that institutions and individuals can combat it. In the tradition of Malcolm Gladwell and Nassim Nicholas Taleb, Margaret Heffernan’s Willful Blindness is a tour de force on human behavior that will open your eyes.

More on this thread

• open secrets « Malcolm Gladwell
• The Righteous Mind: Why Good People Are Divided by Politics and Religion « Jonathan Haidt
• Imagine: How Creativity Works « Johah Lehrer
• Neurolaw – Neuroscience and the Law « Iain’s Chips & Tech
• ‘Willful Blindness,’ a Look at Unnoticed Red Flags – Review « NYTimes.com
• When Things Fall Apart: Heart Advice for Difficult Times « Pema Chodron
• Beyond Agency Theory: The Hidden and Heretofore Inaccessible Power of Integrity « Werner Erhard & Michael C. Jensen

Web Sales – Readings & Links

This is a modified version of a post from the current Leanlaunch Pad session. It’s intention is to provide a set of “Introduction to Web Sales” readings.

Web Sales.

On the topic of Selling on the Web the Startup Owner’s Manual « Steve Blank is a great resource. There are a couple things extra that may help. The first is getting in tune with what the “Spirit of Internet Marketing” is, or could be. The second is that funnel development is an ongoing puzzle – there are lots of innovators.

The High Level – What is the Spirit of Internet Marketing

The best place to start is still Seth Godin’s Permission Marketing. The book has the least jargon and get’s to the core of what you’re trying to do. From this base of knowledge you’ll be able to extend to the many more modern takes on the subject.

Funnel Development ( more Customer Development fanatics )

• Master of 500 Hats: Greatest Hats « Dave McClure Loads of Startup Metrics. Dave McClure.
• The 10x Product Launch « Ash Maurya
• Unfortunately it looks like the Markets by Numbers guys took down most of their blog content prior to their new books release this coming month. There might be useful stuff here in the future. They’ve had some good discussions on ordering of functions and how to build it up over time.

Startup Owners Manual Web/Mobile Selling

• Appendix C “How To Build a Web Startup: A Simple Overview” provides a very good primer. (page 541–547)
• The Customer Relationship section (page 126–168 ) describes the Get-Keep-Grow funnel with adequate detail for Customer Discovery.
• “The Acquire/Activate Customers Plan for Web/Mobile” is page 304–328 describes the Get-Keep-Grow funnel for Customer Validation.
  • The “Managing The Activate Plan” diagram (page 328) is a good summary of what you’re trying to do.

Physical Channel Needs the Web Too.

Physical Channel Products will also need an Online presence – “Online Tools for Physical Channels” page 302–303.

What is Sales? Recommended Readings

This is a modified version of a post from the current Leanlaunch Pad session. It’s intention is to provide a set of “Introduction to Sales” readings.

Let’s talks Sales.
I cover the positioning of a Sales department in a company by Steve Blank. The “Spirit of Sales” by Malcolm Gladwell on Ronco founder Ron Popeil. Sales books for Managers and for Sales people. I also add in Geoffrey Moore’s discussion of “innovation styles” available to companies.
enjoy.

Positioning of Sales vs Marketing, Engineering, Finance, Legal, etc

The Sharp End of the Stick « Steve Blank

In an early stage startup, instead of sales being up front, the point departments are likely to be product development and customer development. Later on in this same company’s life, sales will become the pointy end and product development moves to a supporting role. In other companies it may be that manufacturing or finance is the sharp end of the stick. In an IP licensing business, legal and finance are the sharp end of the stick. It varies by company and changes over time. There’s no magic formula but there are always “leading” departments. And all “leading” departments have some type of “consequence-based” feedback loops that make success or failure obvious.

The “Spirit of Selling” — Gladwell covers Ronco

This story is magic. Malcolm Gladwell’s coverage of Ronco founder Ron Popeil in The Pitchman captures the essence of selling products you love. Every product developer, marketer, or sales person needs to read this. In the end you can’t fake product love and knowledge. Ron Popeil knows his products because he lives with his products.

The “shocking point” is that this story is relevant to us all and yet Ronco is the “sleazy” television sales world. Many people simple will not read this and get upset with me for recommending it to them.

Sales Books

I asked two extremely knowledgeable Sales people to recommend a sales book for me. From the VP of Sales I got Customer Centric Selling. I liked this recommendation because I had already read and liked Solution Selling by Bosworth. From the best sales person I’ve ever worked with I got ProActive Sales Management by Skip Miller

Customer Centric Selling « Bosworth

I like both books, they’ll both make a difference in your work. It was very interesting the choice that each person made since each book has very similar themes. In the details each book services a different audience. So if you’re a sales guy looking for direct tips and a means for understanding corporate sales management go for ProActive. It’s feet are firmly on the ground of a sales guy. If you are a management type looking to understand sales systems go for CustomerCentric.

Personal Perspective – ProActive Sales Managment

ProActive Selling: Control the Process – Win the Sale: Amazon.ca: William “Skip” Miller: Books

Managing Perspective – Customer Centric Selling

Customer Centric Selling « Bosworth

Innovation Techniques — “Dealing With Darwin”

Geoffrey Moore’s – Dealing With Darwin does an amazing job discussing Innovation Techniques available to companies as they age. This book is recommended for “Intrapreneurial Teams”. For the rest of you it is nice to know. It provides a detailed discussion on why Product Innovation is the innovation style necessary for “young” startups.

Summary Points

• The book is about managing innovation and overcoming inertia in established enterprises.
• It’s major thesis is that most companies love to innovate but hate to take risk, the net result being lots of me-too innovations that lack economic impact because they do not have the force to distinctively differentiate their offers.
• Its primary prescription is to pick a single vector of innovation and march so far down it that your competition either cannot or will not follow.
• The book describes fourteen innovation vectors all told. Different types are privileged at different points in the category maturity life cycle, so that innovation strategy must adapt to life-cycle dynamics. The overall model is used to help management teams winnow down innovation vector choices to one or two and align the bulk of their investment behind that choice.