The Dip
What the General knew
Seymour Hersch quotes the late General John D. Lavelle on Vietnam,
"Hey, either fight it or quit, but let’s not waste all the money and the lives the way we are doing it."
Stuck in another Dip.
The Dip
Was Google right to be so sure of themselves?
Chris Anderson has very nice things to say about The Dip. In his post, he wonders about a quote I related from Sergey Brin, co-founder of Google. Sergey said,
"We knew that Google was going to get better every
single day as we worked on it, and we knew that sooner or later,
everyone was going to try it. So our feeling was that the later you
tried it, the better it was for us because we’d made a better
impression with better technology. So we were never in a big hurry to
get you to use it today. Tomorrow would be better."
In return, Chris says,
The problem with
extrapolating marketing lessons from once-in-a-lifetime success stories
like Google and Apple is that most of us aren’t Jobs, Brin or Page, nor
can we count on the luck that played a role on all of their successes.
Products that market themselves are ideal, of course, but there aren’t
many of them. And even those that are don’t always reveal themselves as
such at the start.
Here’s the thing: When Sergey said this, Google wasn’t legendary and he wasn’t a billionaire. When he said it, Google was just a well-funded startup with a plan. And the plan was to confront the Dip. While other startups were playing it safe, being defensive and watching the cash, Google made a decision: do this to get through the Dip or don’t do it at all.
Ironically, Chris made similar decisions with The Long Tail. It would have been easy to publish this book as a normal business book. And it would have hit the wall. Chris embraced the Dip that faces every book and acted instead like his book was surely going to be a record-breaking bestseller. His actions made it likely the book would either fail miserably or succeed magnificently.
As a result of Google’s decision, they made counter-intuitive decisions. No ads, for example. No clutter. No popups, no tricky interpretations of privacy policies. Instead, every decision was, "If this is going to be the one and only choice, the best search engine in the world, what should we do?" The feeling was, if they built that, the money would take care of itself. And the investors who bought in were in on the game from the start.
Did they get lucky? You bet. Did it seem arrogant? Sure. But my point is that if they hadn’t made those decisions, they would have certainly failed. They would have had no chance to get lucky in the first place if they hadn’t embraced the Dip and organized to get through it. I think if you plan on a once-in-a-lifetime success story, it’s a lot more likely to happen to you.
Definition: Mashup
The mainstream media doesn’t understand what a Mashup is. You should. It’s not a ‘lift’ or a ‘copy’ or even a parody. A mashup is a distinct way of spreading ideas.
When a DJ takes two records and melds and mixes them into something new, that’s a mashup. When an Obama supporter takes a twenty year old commercial and splices it with some campaign footage, that’s a mashup too. Online services can be mashups as well, like the Google search box on the bottom of this page.
Expect to see tens of thousands more, on every conceivable topic.
Humanification
A clever way of talking about being small: gapingvoid.
It’s a great goal. I wonder how many of us can reach it.
The surprising thing is the rarity
Kim points us to this account of over the top recruiting: An offer you can’t refuse. It’s not particularly difficult or even expensive, yet it’s rare.
The reasons are simple: most recruiters don’t really care about hiring the very best people, and/or recruiters haven’t yet realized that they are marketers too.
What do I get?
Most marketing (and most business) is usually like this:
Do this and get that.
Figure out what you want, figure out what you need to do to get it, and go do it.
I was thinking about the way my Dad does business the other day. He’s been a successful executive (and then entrepreneur) for more than 50 years. I realized that I can’t remember one time when he did this to get that.
When he volunteered to run the United Way or the local theatre, or when he helped a local church raise money for a new building, he didn’t have an ulterior motive. When he negotiated with the UAW to create a different sort of workforce structure for his plant, it wasn’t so he could get more. It was so they could get more. Same thing when he helped dozens of people emigrate from the Soviet Union a few decades ago.
It’s been a consistent approach, and it sure seems to work. Consistent as in all the time, not just when it’s convenient. It works for a factory in Buffalo but it also seems to work for others… for successful marketers all over the world. Now, more than ever, it’s easier to give even when it seems like you’re not going to get. The happy irony is that this turns out to be a very effective marketing approach, even though that’s not the point.
A few easy google hacks
Need pictures? Try Google Image Ripper v.0.2.0.
Need a phone number? (My cell phone company charges more than a buck a call!). Try 877-520-3463. Free.
Here’s an RSS reader.
Save time and hassle with autofill.
Bonus: drag the bookmarklet on this page into your toolbar.
[Notes! The phone number is not incorrect, but we appear to have broken it. The image ripper defaults to not SFW, so you’re on your own. The RSS reader still works, though.]
The Dip
A few free galleys
Sometime in the next few weeks, Allison is going to be mailing out a number of galleys (pre-production paperback review copies) to bloggers. If you’ve got a blog, if you think your readers might want a review and you’d be willing to take a look at The Dip, drop Allison an email. Let her know what you write about and be sure to include your mailing address.
No promises, of course, but hopefully she’ll be able to get a number of copies out in April. [Yikes, they’re all gone. That was quick.]
The realistic entrepreneur’s guide to venture capital
Optimism is a key to success, but it doesn’t necessarily work so well when it comes to VC. Because this is a cottage industry with thousands of players, all with different objectives, it’s very easy to keep knocking on doors, just waiting to find the right match. It’s also easy to spend a year or more adjusting your business to what each VC asks for ("bring me the broomstick of the wicked witch!" while you could have been out there building a real organization.)
Here are a bunch of conditions that you ought to take seriously before you invest the time and the energy to track down outside money for your great idea:
- Investors like to invest in categories they’ve already invested in. If your business is so new that it’s never been tested before, or is in a category VCs hate, think twice.
- Investors want you to sell out. As soon as possible. For as much as possible. They have no desire to own part of your company forever.
- Investors want to invest in a project that’s tested. If you can’t make it work in the ‘small’, why do you think it’ll work when it’s big?
- Being a little better than the market leader is worthless.
- Investors don’t want you to use their money to cover your losses. They want you to build an asset (a patent, an audience, channel relationships) that’s actually worth something.
- Investors want someone to run your company who has successfully run a company before.
- Investors want to be able to come to one of your board meetings and still make it home in time for dinner.
- VCs like curves more than they like cliffs.
- There are actually very very few business problems that can be solved with money.
- You will probably have to replace many of your employees if you raise money from someone.
- VCs understand that being the best in the world (#1) is the place with the biggest rewards, so it’s unlikely they will settle for any performance (even a profitable one) that puts you in second or third place.
- VCs are very smart and very connected, but they’re smart enough to know that their connections and their insights can’t fix a broken business.
- Investors are very focused on the company, not you. They’re not interested in having you take out your original investment or paying you a large salary as profits go up.
- Business plans are bogus. The act of writing one is critical, but no one is going to read more than three pages of what you write before they make a decision.
- The companies that VCs most want to invest in are the companies that don’t need their investment to survive.
[For those keeping track (and I wasn’t one of them) this is the #2,000th post since I started this blog a long time ago. Which goes to show you–you can build a really big wall if you start early enough and have enough little bricks].
Digging it out of the ground
Six years ago, in Unleashing the Ideavirus, I wrote, ""Twenty years ago, the top 100 companies in the Fortune 500 either dug something out of the ground or turned a natural resource (iron ore or oil) into something you could hold." This statement was a little hyperbolic, but not by much.
Teena did some research and sent me numbers on the current state of the list. I sorted it by "Hold" stuff (like a can of Coke) and thought-value added businesses (like computers, pharma or stores). Here’s the breakdown:
Aerospace and Defense 7
Beverages 1
Chemicals 2
Food Consumer Products 1
Food Production 2
Forest & Paper Products 2
Household and Personal Products 2
Industrial & Farm Equipment 2
Metals 1
Motor Vehicles & Parts 4
Petroleum Refining 7
Pipelines 1
That’s 32% of the list. The rest, the majority, are companies that traffic in ideas, not stuff.
Commercial Banks 5
Computer Software 1
Computers, Office Equipment 3
Diversified Financials 2
Entertainment 3
Food & Drug Stores 5
General Merchandisers 4
Health Care 6
Insurance: Life, Health (mutual) 12
Mail, Package, Freight Delivery 2
Network and Other Communications Equipment 2
Pharmaceuticals 4
Savings Institutions 1
Securities 4
Semiconductors and Other Electronic Components 1
Specialty Retailers 4
Telecommunications 4
Wholesalers 5