Tuesday, August 28, 2007

Learning from Dancing with the Stars and Mark Cuban

Today, Kara Swisher in her All Things D column complimented Mark Cuban for being thought provoking about the Internet being Dead and Boring. As always, Cuban, with his aggressive personality and potential "Dancing with the Stars" gig can teach a lot of communicators a thing or two. Ok. He can be abrasive and loud. But he's also provocative. He takes what most people think and turns it on its ear.

Aside from being interesting, this is also a very effective way to be heard. People don't want to talk about what they already know and think. They like to talk about, debate, rant about, new ideas. And, by the way, that's true about most markets.

Of course, not everyone has something provocative to say that will be thought-provoking to the mass audience (nor do they have access to the world media). But, even so, if a company is communicating with a specialized (or vertical) market, it can take advantage of this technique. Particularly if it is setting out to be a leader: Why not raise questions and challenge conventional wisdom? Get people to think differently.

Yes. I know there are some arguments against this approach: for conservative markets will you alienate your constituencies; or do you have the potential of sounding like a know-it-all; etc. Of course you have to use discretion when using this approach. It's always critical to understand your markets and leverage that understanding. But, there's always a way to accomplish your goals if you think about them clearly within the right context.

Look where it's gotten Mark Cuban!

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Sunday, August 26, 2007

The Snack Algorithm and Leadership

Recently, I was sharing with a group of entrepreneurs that we at Roeder-Johnson have a rough internal algorithm for snacks in start-ups. We have learned through working with more than 80 start-ups over the years that you can learn a lot about the mood of the company by going into the kitchen and seeing the state of snacks. The algorithm roughly goes like this:
  • Phase I: Garage or the equivalent. Very particular to the founders.
  • Phase II: Early development (some seed money). A rough assortment of "developers' snacks"
  • Phase III: First institutional investment (still on the honeymoon). The piles of developers' snacks grow. Software needs to be programmed; products need to be developed. It's critical to keep those key developers fueled.
  • Phase IV: First product launched. Hope runs eternal. Developers snacks have bloomed to more exotic fare. A variety of sodas, some special juices and coffee drinks (and back in the Netscape days, fancy espresso machines in every kitchen);
  • Phase V: Reality sets in. People need food, but the company should be helped in paying for the more exotic fare. There should probably machines that require some subsidy to dispense the snack.
  • Phase VI: (Hopefully not every company gets here.) Coffee and tea bags only. The rest is on the employees.

Note: These phases can differ by the industry segment, investors involved, temperament of the management, and other factors. But anecdotal evidence supports this general scheme. (Also note that you can learn a lot about the cleanliness and other conditions of the kitchen, but I won't dwell on this.)

It's in phases V and VI where you actually see the mettle of the CEO and other senior management. As reality sets in and everyone starts to find out that the grand vision is still grand but a lot harder to accomplish than originally thought that you see the leaders come out.

I have observed CEO's of all sorts of young companies over the years. And it's pretty spectacular to watch the great ones lead their teams through the ebbs and flows of company challenges. The great ones are really heroes in my book. To keep the team going through development and customer challenges, and through the vicissitudes of the snack algorithm is terrific to see.

It's easy to think that being the CEO of one of these great technology start-ups is very glamorous. It might be. But it's also hard, sometimes lonely, and rarely is there a cookbook for the snacks or any of the other challenges the company may face.

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Sunday, August 19, 2007

No Hype

This morning, I was reading an interesting analysis of Katie Couric and Meredith Viera with their respective 1-year anniversaries upcoming. It was yet another reminder of why hype usually hurts those who are supposed to be the beneficiaries. In essence, the point was that Meredith Viera has had the chance to grow into her role on the Today Show (as has Charles Gibson on ABC) while Katie Couric was under such a microscope on her and faced huge expectations, it would be nearly impossible for her to succeed.

You will notice, if you have read this blog before, that our view of the world is that hype is a bad thing in communications -- particularly in the world of young, start-up companies. This is an important reminder today when young entrepreneurs see Google and Facebook and believe they, too, can benefit from lots of attention. Some do; most don't. Here are some of the reasons why:

  1. With lots of hype, comes lots of expectations. Even the most established companies are challenged by meeting expectations that have been magnified by a unidimensional view of a company's strategy and plans;
  2. With hype comes lots of scrutiny. Have you heard the expression "you can only know the dynamics of a relationship if you are in it"? The same goes for start-up companies. It's easy to second-guess a company unless you really understand what's going on inside and all of the pressures the company and executives face on a daily basis.
  3. In a fast-changing world (and even sometimes when things are not moving so fast), it's good to be in a position to learn and refine your strategy and execution as you move along.
  4. Every company needs to learn about their product. Particularly when you are first coming to market, it's important to learn from what the market is saying to improve the product. It's hard to do that when everyone is watching and the slightest change leads to big questions.
  5. The simplifications that result from (and sometimes contribute to) hype lead to long-term misunderstanding.
  6. There are more.

To be fair, I really should enumerate the benefits:
  • A lot of attention can lead to quick visibility which can lead to quick consumer product adoption, if the product is really good. (See 4, above. Also, as a note, I have often thought that one of the great sources of Starbucks' success is that they combine great marketing with great products.)
  • If you are interested in doing a quick-flip financial transaction, hype can certainly create an opportunity to achieve a higher valuation in the near term (but there are other ways to do that, as well).
  • Anyone want to suggest some more benefits?
So, what should a young company do, if they aren't supposed to hype themselves?
  1. Create a strong perceptual goal and a plan to help the market understand it.
  2. Create a good, substantial, and easy to understand story that can form the foundation of long term communications.
  3. Build strong relationships and understanding among influencers in the market.
  4. Develop an ongoing flow of news that helps people understand who you are, where you are going, and why you are important.
  5. Be prepared to learn from what you are hearing from the market and refine as you move forward.
  6. Be patient and plan to work hard. Very few people get something for nothing.

But, don't get me wrong. Attention for a company is not a bad thing --when handled in the right ways. It just leads to an important reminder: Most of all, build a great company!

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