This originally appeared on Hackthings as part of a series about how to bring your product to market. The first post was “How To Price Your Hardware Product.“

The death of brick and mortar retail has been pounded into our heads since web2.0. The failing of major retailers (Circuit City, Blockbuster, Kmart, etc.) with Amazon’s continuous domination has the whole world assuming retail is in its dying days. I agree, online purchasing will continue to rise, forcing retail to change in significant ways. But it doesn’t mean it’s going away.

So if you are making a physical product, what should you do about retail?

Staying out of retail is the first answer. Post your Kickstarter campaign, selling exclusively through your website and e-comm channels, is a great way to build a healthy margin businesses and figure out which initial marketing tactics are working. Once these sales channels are exhausted, retail is still a real option. Whether you make your own stores like Warby Parker and Chrome Industries, or sell through existing retailers, it can offer a touch-and-see experience that online can never provide.

The following is a short guide about what it takes to be ready, to succeed, and to fund your retail dreams.

Retailers Are Not Marketing
Retailers are not marketing vehicles, they are order-takers for the demand you have already created. So before you enter the door, understand this…creating customer demand is entirely up to you.

Gaining distribution doesn’t mean that more people know who you are, it just means your device is available for sale in more locations. Understanding your brand promise and hitting your marketing stride is critical BEFORE you think about retail.

When you are ready, every retailer will tell you they can help you create more awareness. Disguising programs such as email blasts, website placement, better store real-estate, training events, etc., all in an attempt to maximize their margin. But despite the marketing story they sell you, just recognize that the more consumer demand you have the easier their job is to sell your product.

Creating “national” awareness is not easy and nor can it be done with a few advertising campaigns. True brand awareness takes years and costs money. Controlling your retail growth to match the awareness of your brand is super important because having product sitting on shelves that doesn’t sell is the fastest way to bankruptcy. If it doesn’t sell fast enough retailers will ask for more marketing dollars, discount the price, and if all else fails return the product.

Focus first on awareness, second on growing distribution. If not, you risk losing all the leverage in the relationship, turning retail partners into cash eating machines.

Retail Ready Product
Every time I pick up an Apple product, I am blown away by the packaging. The simplicity is amazing, but even more impressive is the level of detail they deliver on, which I can tell you is painstakingly difficult. Being retail ready doesn’t mean just slapping your logo on a box, it comes with a full list of requirements and expectations. The bigger the retailer, the longer the list.

Before you can even start with the box you need to find both a designer and a vendor. If you are going to retail for the first time I highly recommend working with a design firm or a freelancer who has designed packaging for retail. No substitute for experience, a quality new box design will run you $20-40K, including all the imagery, copy, and material selection. The right person or group will save you time and thousands of dollars in mistakes. They will also have a network of suppliers you can work with both in the US and Asia.

Designing the box is hard. You will spend hours debating what should and should not be on the box. Regardless of how much the box is expected to influence the purchase decision, I recommend going with something simple. Make sure the box stands out on the shelf, people can understand what the product is, and your logo is subtle. Also make sure you have plenty of room on the back to explain how it works and why they want it. When it comes to copy, less is better than more.

The out-of-box experience matters and the right designer will help you make it thoughtful as well as compact. The smaller the box the cheaper the product is to ship (very important) and the better it fits on the retail shelf. Just remember, the fancier the inside of the box is the more expensive it is, and don’t be shocked when you get quoted the price for recyclable materials. Saving the earth is expensive.

The most painful part is nailing the user manual. Not everyone is part of the internet generation, which means they do expect a manual in the box, no matter how easy your product is to use. If you can get through v35 on the manual without killing each other, completing the legal jargon and sku information is a breeze.

And oh yeah, make sure your product is theft proof. You may think that is the retailer’s problem, but when your product gets stolen and the retailer returns their inventory, you will be reminded whose problem it really is. Taping the box doesn’t count. If it can be ripped off the peg, opened with keys, or anything in between you will have a big problem. Even Apple stores aren’t safe from theft.

In Store Expectations
I like to think of retail as an extension of your team. The people in the store represent you, which means that if they don’t use your product, understand its differences, or prefer it, you will have a hard time succeeding.

Seeing your product on the shelf at Best Buy is really cool, until you realize there are some 3,000 blue shirts you have to train. To make matters worse, employee turnover at retail is high, which means that training is an ongoing experience, not a once-a-year event. Growing retail at the speed you can train is important and if your staff can’t cover this, you can hire firms that can help. At the end of the day you need them to successfully answer the question, “So what’s the difference between these two?”

Training can carry you a long way, even without Point of Purchase (aka POP) materials in the retailer. Flyers and crappy counter top stands are a waste of time, so if that’s all you can afford then wait on producing POP. If you are really going after retail you will need to design POP that stands out, doesn’t break, and requires minimal maintenance. Even more expensive than packaging, POP design can run you up to $100K. It’s not the messaging that costs so much, the right vendor will help you make POP that is light, cheapest to ship, updatable, easier to manufacture, and less likely to break.

Get the POP wrong and it is incredibly expensive to update, or worse they get thrown away because they don’t work.

Big Box is Really Big
Getting your feet wet with smaller, specialized retailers is a great way to start. Because the larger the retailer, the more you need to make them succeed.

By the time you hit national retailers your marketing awareness and retail formula needs to be dialed. Learning with thousands of stores is a recipe for disaster. And generally when you get there you will need a designated person to manage the account, a strong channel marketing person who knows which programs to maximize, POP that is working in smaller retailers, and capital to fund the growth. Net 90 payment terms are painful and if you can’t keep their shelves full, you will get the boot, faster than you got in the door.

International Is a Multiplier
Being able to say your product is available worldwide is great for the ego and terrible on your bottom line. International partners will help your start-up cash flows by pre-paying for product, but the margin expectations as well as the retail demands are significantly higher. Succeeding in English is hard enough, multiplying that to Europe or Asia, is just that, a serious multiplication in costs, time, and expectations.

On top of what we already discussed, you will need even more to succeed internationally. Hiring a designated product manager is imperative because getting the product and packaging ready is a full-time job. Time from your engineers and designers will be necessary to make sure your experience doesn’t suck in different languages. Translating the product, support documents, and website can cost you $10-25K, even with grammar errors. Hiring a designated support person is preferred to spreading out your existing team, especially if you want to deliver a great customer experience. Lastly, traveling is important to understanding the market and ensuring that proper training is happening.

Going global can be a strategic advantage, just understand that it is a multiplier in costs, not simply an addition.

Financial Model
Retail is not a cheap game. Once it gets cranking, it provides thousands of points of distribution, while exploding the number of people talking to consumers on your behalf. Before you enter, make sure you get your pricing right, so you understand what it takes to be profitable. Unprofitable retail channels don’t work.

Here is a cheat sheet to help you during the planning process.

Conclusion
Brick and mortar retail is slowing, but it’s not going away anytime soon. Smaller, high touch focused stores are working to educate consumers, which means you can build a successful retail channel. It can also provide powerful, category leading, real-estate. Reminding everyone which is “the” product to buy.

Retail is not a burning fire you want to run into, especially if you have zero experience. Most of the mistakes start-ups make are scaling distribution too early, before they have all of the kinks worked out. Spending time to get the experience right and the in-store formula working, is the difference between stardom and failure.

If retail is where you are heading, just be ready to play the game necessary to succeed.

Image Credit: JavaColleen via Creative Commons

Entrepreneur: “I need a VP of ______. Know anyone?”
Me: “Maybe. Can I ask you a few questions?”

At this point in the conversation I’m thinking, okay she wants to add someone senior to the team. The Entrepreneur, with her pen out, is clearly waiting for me to spout off a list of amazing people. And so for the next five minutes it’s a delicate balance as I try to understand the real role, while the Entrepreneur just wants a name.

Stepping back, it is clear the entrepreneur made a series of assumptions and decisions to arrive at this role. Probably drowning in too many roles herself, she is raising her hand to say I need some help. And although a title is the easiest way to say just how senior of the help you need, it is irrelevant to finding the right person for the role.

To make matters worse for the entrepreneur, the advice you receive is incredibly conflicting. Your investors often tell you to hire the most senior person possible. Your existing team is saying we just need another worker and not another boss. Other entrepreneurs you ask have organized their teams in completely different ways, making their input even more confusing. All the while, the work piles up by the minute, making it nearly impossible to keep your head above water.

So how do you define the role you really need?

Define The Functions
Before you even start defining this new role you need to understand why you are hiring someone. The easy answer is, I’m underwater, while the more difficult answer is to challenge if the existing team has too much on their plate. I could write pages just about this topic, but for now you should really ask “why” before you define “what.”

Assuming you move forward with hiring someone and putting the title aside for a minute, let’s understand what you are really looking for. Don’t start by copying random job descriptions that you think express what you want. Most of the time they are filled with meaningless words designed to inspire people to apply.

Instead I find the easiest place to start is to build a list of all the things you want them to do. I’m not talking about areas they will help, but the functions they will be 100% responsible for on a daily basis. If it helps, imagine this person walking into a bar with their friends and answering the question, ‘So what do you do?’

Ideally, your team built the list for you, but if not, they need to provide real input. Especially if you are outlining a manager’s role, you need everyone to understand why they are being added to the team, what this new person is going to do, and how they complement the existing team members. The worst is when the CEO is running around hiring roles that the rest of the team doesn’t understand or worse, disagrees with. Even if there is a discrepancy between you and the team in regards to seniority of the role, ambiguity only sets your new hire up for failure with the existing team.

Understand What Type of Leader
This is harder than it looks. Sure you’d hope that everyone can grow into leading and building teams. The reality is they can’t nor should they. Some people are great as individual contributors while others are better at people wrangling, a phrase Rand recently discussed in detail.

Having everyone reporting to you doesn’t scale, believe me I tried, so you need to be thoughtful about what kind of leader you are looking for. If you are looking for more than an individual contributor I have found two types of leaders.

The first is a team lead, aka a manager, in a big company. You are looking for someone great with people, someone with experience having direct reports, and someone who is a really good listener. If you have an existing team that just needs some daily guidance this can be a great fit. I have found the best team leads will give you references with raving reviews from people who worked for them in the past.

The second, and much harder to find, is a team builder. Not only are they great at leading people but they are amazing at finding talent. Hiring a recruiter doesn’t count. I’m talking about someone that others will follow to your company when you are ready to hire them. Much more experienced, team builders have seen it all, living the startup life. Just remember if someone hasn’t laid people off, it means they really haven’t built a team before. Unfortunately it’s a horrible part of building.

If you are hiring your senior leadership team they should be fantastic at leading people and building teams. Hiring for them will undermine their leadership with the rest of the organization, plus you don’t have enough hours in the day to do your job and theirs.

Leave Room In the Title To Grow
Before you slap a title on the job, understand you are building an organization over many years. The structure you use today will be very different once you hit market fit and even more complex once you are ready to really scale the company.

For example, just because this is your first sales hire, doesn’t mean they are the VP of Sales. Sure they are the most senior person on the marketing team, but it’s not a game of fill up the highest, open title slot. It creates a dangerous expectation and devalues real leadership. Even if you have to start with a vague “marketing leader” title, that’s okay.

But if I want someone really senior don’t I have to give them a VP title?

The easy answer is yes. In the short term it will satisfy a recruit, even if it undermines the organization down the road. It is also true that the more senior the title you place on the job description the more people who apply. I mean who doesn’t want to be a VP in a startup? It sounds so awesome!

But the hard answer is no. Down the road when you realize they aren’t the leader you thought they were and you need to hire someone more senior to lead the team, you will either have to demote their title or fire them. Although they provide tremendous value a demotion in title is something you rarely recover from.

I have found that until you have about 20 people, it’s okay to start with directors and team lead titles with a clear plan how you will build your leadership team. The people you have on board today, may not be your most senior leadership team as the company begins to scale. A difficult subject Ben Horowitz covers well in his post about staying great.

Conclusion
I wish I could say building a team is easy. It’s not.

Finding random people will satisfy the pressure you feel, but assembling a really awesome group is incredibly difficult. Trying to balance thoughtful with opportunistic hiring, will drive you crazy, especially when you recognize that not everyone you hire today will be what you need a year from now. A disparaging feeling you can do nothing about until you get to that point.

With a much better understanding of the role, the type of leader you are looking for, and a title that gives you room to grow, you are ready to start looking for people.

Image Credit: Brenda Gottsabend via Creative Commons

This post originally appeared on Hackthings.com

So you have a hardware product in the works? Before you can launch it, one of the most important things you need to figure out is pricing. Unlike software, you can’t AB test your pricing and change it for different customers, which means your product has one price and everyone wants to know what it is.

I have found pricing matters for two reasons. First, it determines your profits, i.e. how long you can stay in business. Second, you are stuck with the initial price you set, which means you need to get it right.

Although you may want your product to be affordable, it likely isn’t cheap to make when you get started. You have a cart before the horse problem. Your pricing is determined by your volumes, which you have no understanding of until you launch your product, which you can’t do without a price. It doesn’t mean you can’t change your price on future models, but the rule of thumb is you can always lower the price, you can’t raise it.

The mistake most hardware startups make is they don’t charge enough because they don’t think of the problems they will encounter at scale. They don’t calculate the real cost to deliver their product to a customer’s door, they leave no margin to sell through retail down the road when opportunities arise, and they can’t easily raise the price after it has been set.

After some painful lessons, this is the process I would go through if I was bringing a new device to market.

Profits Matter
At the end of the day you are picking a price that enables you to stay in business. As @meganauman says “Profit is not something to add at the end, it is something to plan for in the beginning.”

Before you can calculate your price you need to understand how much money you need to make per unit, which in the hardware world is called gross margin. It’s the difference between how much cash you keep from the customer and the amount in cash you paid to deliver a final product to your front door. This spread stays in your bank account as your profit.

Because gross margin dollars between products can vary so widely, I prefer to use gross margin percentage. Unless your product includes ongoing service revenues, i.e. the Kindle that makes money on book sales, you want to make at least a 50% gross margin on the sale of your device. Especially when you start, your volumes will be low, your mistakes will be high, and you will wonder where all the money went after you fulfill the initial customer demand.

Know Your Costs
This seems obvious, but it’s not. You start by calculating the cost of the physical product, with packaging, shipped to your door. Don’t get fooled when the supplier gives you an initial price without packaging or a price with packaging you have never seen before. Assuming anything is a mistake, especially when the Apple like packaging you are thinking about is a far cry in cost from the packaging they initially quoted you.

Once you come to an agreement on the final price of the product, you can call on a handful of logistics companies to figure out the shipping costs. You are a long ways from shipping palettes or containers full of product, which means you will be airfreighting everything, the most expensive option available. Be sure to shop around for the best price.

Your cost analysis doesn’t end here. You also need add in the cost to support the customer and manage defective units.

Although it’s only you and your dog when you start, you should expect to hire 1-2 people at $10 per hour to help you with customer support, shipping, and managing random surprises. This is something you can scale up after you determine the success of your product, so for now use it as a rough guide.

Defective units on the other hand are very real. A 2% defective rate would be amazing, but don’t be surprised if it’s 15% when you start. Yes, 15%. If you haven’t already, you will need to have worked out in grave detail with your supplier, who is going to cover what, as well as the process to repair units. Regardless, expect to cover the customer’s shipping costs (both directions) to replace the the crappy product you sold them.

To demonstrate how you calculate your product cost, lets assume I am launching a new device that costs me $50 (with packaging), has a 15% defective rate and requires me to hire my first employee. You want to estimate a monthly sales volume for your product so as that grows over time you can see how your cost per unit changes. I picked a flat number of 1,000 units sold per month to be conservative, recognizing that with larger volume I can likely drive my costs down across the board. But until I am at that point, I’m not.

What you notice right away is the $50 per unit price I get from my supplier is a far cry from my final cost. If I had missed this $8.10, I would have been $8,100 short in the first month and almost $50,000 after six months.

Top Down Pricing
In school they teach you about top down pricing. It’s where you look at the market, compare similar products, and try to guess what the price should be. Regardless of your cost structure this exercise is an estimation of what you think people will pay. Largely irrelevant when you start, I recommend using top down pricing strictly to guide where you ultimately want your product to be priced in the market.

Early in your product development process you can ask people how much they would pay. This exercise can be helpful, but often misleading because they quality they are picturing for your product is a lot higher than will come off the production line when you start. And until they actually give you the money you can’t be certain how much they will pay.

Next you can look at your target customer and think about what else they buy. At Contour we recognized that our customer was an outdoor enthusiast, therefore spending significant money on gear, travel, and sport. We compared the prices of helmets, goggles, clothes, and select accessories to give us an idea of how much they were spending on their existing sport. Hoping to be an accessory to their gear, this gave us an idea of what price range our product needed to fit into.

Last, you can look at adjacent products. Again using the Contour example, we researched both digital cameras and video cameras. We found similar pricing for both categories, where $149-299 was for every day consumers, $299-1000 was a large enthusiast range, and $1,000 was the beginning of the professional market. These numbers helped us understand where our prices needed to be over time to reach different types of customers. Even though a Contour camera is now $199 we spent many years in the $299-399 price range.

Continuing my example I have created a top down analysis for my new device. Wanting the product to retail at $200, I calculate how much it will cost me to reach a customer and therefore my gross profit. Whether you go to retail or not, it’s important to build a model that shows you the impact on your margins either way. Pricing your product to sell direct when you aren’t yet sure on your distribution strategy can be a costly mistake, especially if you want to be in retail down the road.

Please keep in mind I used general retail channel percentages based on my experience at Contour. Although applicable to most consumer electronics, you will want to spend time understanding what margins retailers expect to make on your category.

If your gross margin is less than 50% your price is too low.

Bottom Up Pricing
As a start-up and first time maker of your new product, I highly recommend this method of pricing. Sure, you want your product to be affordable out of the gate, but picking a retail price (MSRP) that enables you to stay in businesses is even more important.

To calculate bottom up pricing, you start at the bottom (your costs) and work up to what the retail price would be. The number you arrive at will freak you out, thinking there is no way someone will pay that price. You’re right, millions of people probably won’t, but when you start you’re focused on hundreds to low thousands of first customers.

Again continuing my example I assumed I needed a 50% gross margin and that I wanted to understand the pricing impact both in and outside of retail.

In this model you can quickly see the price impact to the customer if you leave room for a healthy retail channel. It is why a lot of products, including FitBit, started online only, enabling the company to build cash flows, lower its costs, and ultimately it’s MSRP price.

Conclusion
Everyone wants to deliver a great price to their customers, but recognize that if you don’t make enough money per unit sold you won’t be in business very long. You are a start-up and it does take time to efficiently deliver a quality product to market. You can’t short-cut this learning curve and reducing your own margin is one of the fastest ways to become non existent.

I believe that bottom up pricing is the best way to go. And yes it will make the MSRP of your product more expensive than you first imagined, but that’s okay. Your initial customers will be early adopters and if they aren’t willing to pay your high price, you most likely didn’t create a product they can’t live without.

Don’t be afraid to charge more. Long term, your loyal customers will thank you for staying in business.

Image Credit: Savings by Enjoy The Fresh

Winston Churchill in Downing Street giving his famous ‘V’ sign.

Winston Churchill is one of the most celebrated leaders of the 20th Century and perhaps the savior of democracy as we know it. Someone I would love to have met, I got to know Winston through articles, his speeches, and reading “The Last Lion: Defender of the Realm.“

Inspirational even through words, Winston would have made a ferocious entrepreneur. His triumphs and tribulations through WWII are eerily similar to the struggles a founder and CEO goes through to build a successful company. I believe there is a lot to be learned from Winston on how to be a better leader.

Give people something to believe in
Everyone always talks about how an entrepreneur needs a vision, as if they are as easy to create as writing your name. Creating a clear and concise vision is incredibly hard. But even more difficult is getting people to believe in that vision against all odds.

Even in Winston’s case, if he had run around saying “we’re going to defeat Germany,” doesn’t mean people would have believed him. At the time Germany’s army was superior in nearly every facet and as they rolled up European country after European country, their momentum appeared to be unstoppable. Britain could have just waited like a sitting duck, for the enemy to crush them. But they didn’t.

“You ask what is our aim? I answer in one word: It is victory, victory at all costs, victory in spite of all terror, victory, however long and hard the road may be, for without victory there is no survival. Let that be realized; no survival for the British Empire and all it has stood for, no survival for the urge and impulse of the ages, that mankind will move forward towards its goal. ~ Winston Churchill (May, 1940, Speech at the House of Commons)

Instead, Winston gave them something to believe in, even larger than the salvation of Britain. They were fighting for the world’s democracy.

“And now it has come to us to to stand in the break, and face the worst that the tyrant can do. Bearing ourselves humbly before God, but conscious that we serve an unfolding purpose, we are ready to defend our native land against the invasion by which it is threatened. We are fighting by ourselves alone; but we are not fighting for ourselves alone.” ~ Winston Churchill (July 14, 1940 , BBC radio speech)

What I found most intriguing about Churchill’s leadership style was how vulnerable he allowed himself to be. Never afraid to show a tear in front of his people, he used a mixture of emotion, grit, and near poetry to inspire his country. He wasn’t considered strategic, or a great military mind, or even well liked before the events of WWII. But when it was his turn to inspire his people he rose to the occasion. The loyalty the people showed him goes to show that inspiration is even more important than strategy.

Don’t give up
They called him the bulldog. Many often felt he was a direct representation of the British common man, he was tenacious. His round body, occasional snarl, and top hat uniform only added to the image of a dog who wouldn’t back down from a fight. Even during the Battle of Britton, when Germany was on the brink of destroying the entire country, he willed his people to never give up. With bombs falling he preferred being above ground to see what was happening than to be hiding in the bunker.

“Never give in. Never give in. Never, never,never, never – in nothing, great or small, large or petty – never give in, except to convictions of honor and good sense. Never yield to force. Never yield tot he apparently overwhelming might of the enemy.” ~ Winston Churchill addressing the boys of Harrow

No different than a successful entrepreneur, Churchill never quit. Granted a company going under is very different from thousands of people dying, but what he constantly showed was that no matter what occurred, he wasn’t going to take no for an answer. He always pushed through, to the point of sending FDR a hand written letter nearly every week for two years asking for the Americans to help in the war. Some would call that obnoxious, others would call that relentless.

Churchill waves to crowds in Whitehall on the day he broadcast to the nation that the war with Germany had been won, 8 May 1945.

Unwavering confidence
There are a lot of times during WWII when privately, even Churchill struggled to see how Britain could survive Germany. Especially in 1940 and 1941, before the Americans or the Soviets joined the war, Britain was fighting by themselves. With their finances hurling towards bankruptcy and their people starving, he found it in himself to show complete confidence to his country.

“He gave his countrymen exactly what he promised them: blood, toil, sweat, tears, and one more thing – untold courage.” ~ Time Magazine

To everyone, including Churchill, it was clear that Germany was superior, but by his speeches you never would have known it. It reminds me of smaller brands picking a fight with larger brands, who theoretically should be crushed with one fell swoop. Churchill constantly reminded Hitler of his fate.

“He Hitler may carry havoc in the Balkan States; he may tear great provinces out of Russia, he may march to the Aspian; he may march to the gates of Indai. All this will avail him nothing. It may spread his curse more widely throughout Europe and Asia, but it will not avert his doom.” ~Winston Churchill

One of Churchill’s traits, which I believe all entrepreneurs need, is the ability to find the positive out of a negative. Apparently Churchill’s mood was volatile, especially in private, where he could express the intense emotions of anger, stress, sadness, and frustration he was feeling. But at the same time he would take the bad news and then move on to the positive, discussing what his country could do with the resources it now had.

Being Winston Churchill, just like being a CEO, was at the end of the day an incredibly lonely job.

The journey is long

“Long dark months of trials and tribulations lie before us. Not only great danger, but many more misfortunes, many shortcomings, many mistakes, many disappointments will surely be our lot. Death and sorrow will be the companions of our journey; hardship our garment; constancy and valor our only shield.” ~Winston Churchill (October, 1940 , Speech to the House of Commons)

Building a great company is a multi-year journey. There are very few Instagram like successes, instead most companies can take several years to hit their stride. Which means taking care of yourself so you don’t get burned out and actually enjoying the ride, is critical if you want to arrive at the end in one piece.

Churchill wasn’t known for taking care of himself. His daily diet of cigars, alcohol, and minimal sleep were a recipe for disaster. Known for the work rate of a young man, Churchill would out work, out read, and out worry all of his staff. Early in the war it wasn’t a problem, but as the war waged on without an ending in sight, his body began to deteriorate. Eventually suffering a heart attack and experience several periods of utter exhaustion.

Being a war time leader or a CEO requires you to be on 24 hours a day, 7 days a week. Your physical strength, emotional sanity, and mental freshnesses are needed to be at the top of your game, at all times.

Be thoughtful with your words

“Never in the field of human conflict was so much owed by so many to so few” ~ Winston Churchill (Referring to the RAF in the Battle of Britain during a Speech to the House of Commons)

If anyone has heard of Churchill, they have heard of his legendary speeches. Never one to miss an opportunity, he demonstrated just how important it is to be thoughtful about what you say. A type of influence that most CEO’s don’t realize, Churchill understood just how powerful his words were. Often writing his speeches not just for the people of Britain, but for the entire population of the world.

“It fell to me to express it, and if I found the right words you must remember that I have always earned my living by my pen and by my tongue. It was a nation and a race dwelling all round the glow that had the lion heart. I had the luck to be called upon to give the roar.” ~ Winston Churchill

It is easy to take for granted, opportunities to address your company. Thinking it’s just another company meeting or just another email, is definitely a mistake. Each time you get the chance to address the company you should think hard about what you want to say and what words you want to use. You don’t need to be as verbose as Churchill, but words are a powerful way to paint the picture you want painted.

In a culture that communicates in 140 character phrases, be thoughtful with what you have to say.

British Prime Minister, Mr Winston Churchill, looks over the Rhine from the ruins of the west end of the bridge at Wesel during a visit to the front.

Personal touch matters
In Churchill’s mind there was no substitute for a personal visit. Through a rough exterior, his ability to charm was legendary, something he didn’t jus reserve for world leaders. Many of his visits were to the common man in Britain, in particular visiting cities after bombing raids or battle fields after victory. Not always welcomed by his generals he made it his mission to be seen as much as he was heard.

“As soon as it delivered him to a scene of destruction, out he’d climb to take off on foot. He might poke at the end of a bomb craters with his walking stick, or scramble up a pile of rubble to get a better view of the damage…He always sought out the people.” ~ The Last Lion: Defender of the Realm

The loyalty he experienced with the people of Britain was in large part due to his personal visits. Never too important for the everyday family, he would tour around London after bombing raids, visiting the shelters, and talking to people on the street. Asking how they were doing and what he could do to help. He had a way of keeping people upbeat.

As an entrepreneur, being on the ground is critical. Spending time with everyone across the company, even if they aren’t your direct report, gives you a sense of how people are feeling, what their frustrations are, and how connected or disconnected the whole organization is. Visiting customers, partners, and your investors provides insights that you just can’t capture through email, twitter, Skype, or any other virtual communication tool.

Yalta summit in February 1945 with (from left to right) Winston Churchill, Franklin Roosevelt and Joseph Stalin.

Leverage Wins
Leverage taught Churchill some of his hardest lessons. Generally considered a trusting guy, he wore his emotions on his sleeve, sometimes to a fault. He cared about what people thought and although he could be tough with his opinion he would often give in to partners so they would be happy. This was most evident with the Americans and Russians, two countries he desperately needed to help win the war.

After two years of fighting alone, Britain brought the least strength to the table in their partnership with the US and Russia. Both FDR and Stalin knew this, which means they took advantage of Churchill every chance they could. No different than how Britain took advantage of the countries it had colonized in the past. Churchill was learning a tough lesson about how leverage wins.

Being leveraged is a painful lesson many entrepreneurs learn along the way with investors, partners, competitors, acquiring companies, etc.

Everyone makes mistakes
No matter how many companies you build, everyone makes mistakes. It gets easier over time to avoid the simple mistakes, but the ever changing circumstances constantly create new challenges. At Contour I made a ton of mistakes, something I was constantly aware of as I tried to learn from them as fast as possible.

It was shocking to read just how many military mistakes Churchill made. He was thrust into the Prime Minister position, with complete war power, with minimal experience. Since Napoleon, the world had never seen a military force as dominating as the Germans and to make matters worse, the technology being used in WWII was completely overhauled from WWI, making the strategies used to win the first world war nearly irrelevant. No different then when the market or technology platform shifts under your feet.

“He simply did not grasp that fleet actions of that sort were now a thing of the past. Although he could never bring himself to entirely give up the old, when the facts demanded, he embraced the new, in the case of sending task forces to the Indian Ocean, almost literally overnight.” ~The Last Lion: Defender of the Realm

As fast as Churchill learned from his mistakes, the cost was irrevocable. Losing thousands of men and hundreds of war craft in single battles, he was paying a heavy price to gain the knowledge and instincts he would need to be a great war leader.

People want consistency
Most entrepreneurs have a unique ability to see an opportunity few around them even understand. Often guided by gut instinct, their leadership by sense has a hard time scaling when you get to dozens, hundreds, or even worse, thousands of people. Moving such a large force takes a unique type of communication and planning process, something Churchill wasn’t great at. His belief in using a fluid planning process (i.e. attack opportunistically) didn’t go over well with many of his own generals let alone the US military leaders who were used to rigid plans.

“He was not at all a theoretical strategist who considered the best thing to do and then made quite certain nothing detracted from it, and that the proper forces were concentrated in the proper place.” ~ Sir Edward Ian Jacob

One of the hardest parts for a CEO is to balance planning with gut instincts. Churchill’s instincts about Stalin were right, but they were ignored by FDR. While watching the Japanese struggle to improvise, was the opposite of what Churchill wanted in his military. A fear shared by most CEO’s the inability to pivot to opportunities just realized is a paralyzing feeling. But at the same time people need consistency and a plan they can hold on to.

Consistency is really hard, especially if you personally feed off the energy of new ideas. Your “brainstorming” can be taken as a new plan and a new direction, which not only drives your team nuts but ultimately lowers their confidence in your leadership.

Not Everyone Will Agree With You
Realizing that your title doesn’t mean you’re always right can be a humbling lesson to learn. Especially as you begin to lead you want everyone to agree with you. But the best leaders realize this isn’t going to happen. Even Churchill struggled with this, wanting everyone to like him and agree with his strategies.

“The P.M. is starting off in his usual style!!…I don’t think I can stand much more of it…His method is entirely opportunistic, gathering one flower here, another there! My God how tired I am of working for him.” ~ Alan Francis Brooke 

It was interesting to read about Churchill’s struggles. His inspirational words worked with everyone he met, but how he managed his team did not. Often not listening to their advice, he would go with what he wanted to do until everyone had bought into his plan. His relentless style wore people down to the point where key relationships of his would explode in frustration.

As a leader you have to make some really hard decisions. But at the same time you have to enable your capable team to make most of those decisions for you. A trust that can take a long time to build and that can be destroyed instantly if you don’t listen.

————–

If you want to learn more I highly recommend the “History of the English Speaking People” a four part series about the history of Britain from Winston’s perspective and “The Last Lion: Defender of the Realm,” the final volume of three, which covers WWII in grave detail.

Image Credit: Imperial War Museum once and twice, Unknown Author, United Kingdom Government via WikiCommons

“Don’t do it for the money.”

It’s easy to say when you have it. It’s easy to say when you aren’t scared shitless your company will go under. It’s easy to say when you aren’t living at home because you can no longer afford the rent. It’s easy to say when you don’t have investors with an excel spreadsheet masterminding your cap table. It’s even easy to say when you don’t have employees comparing the compensation package you offer to your competitor.

When you start, collecting on a huge pay day is the last thing you are worried about it. Surviving is all you care about and convincing everyone around you to believe consumes every waking hour you have. Hearing “no” a thousand times, to the point of it sounding like maybe, is the struggle you go through to get off the ground. Often you see an opportunity few people around you can see, until you turn it into a cash generating, user growing machine.

And then at some point you look around and realize everyone else has their hand out. You realize your investors aren’t going anywhere until they collect theirs. Potential employees worry about compensation first, job details second. Retail “partners” add fees to protect the margin they expected to make on every sale of your product. Vendors change the terms to better improve their cash position, despite your contract. Banks don’t care about your potential, just your balance sheet. Even customers are searching Google to figure out how to get your product for less.

It hits you like a ton of bricks when you realize everyone else is just thinking about the money.

As Mike Tyson would say…

“People want to be my friend so they can get my money…People are trying to steal my fuckin’ money…You work all your life, break your fuckin’ back, and a guy who doesn’t have calluses on his hands wants to take your fuckin’ money…I’m gonna wind up rich…They’re stealing from me…I’m not gonna wind up broke.”       ~ Mike Tyson (“Bad Intentions: The Mike Tyson Story”)

Despite all of this, don’t do it for the money.

Because when you do, it changes everything. The passion you started with turns into a spreadsheet instead of a real problem in the world. The people around you turn into costs. Your brand is referred to as an asset to be leveraged. Your customers become annoying people who won’t leave you alone. Your handshake gets replaced with a legal contract that protects you in all circumstances. You start taking short cuts expecting the acquiring company to fix it. You stop worrying about making your culture great because it won’t matter once everyone makes money.

You start destroying the very masterpiece your are trying to build.

Instead, do it because you love it. Do it because you actually give a shit about making the world a better place than you left it. Do it because making the rules is more interesting than finding a way to screw everyone. Do it because when the walls are crumbling around you, there is still no place you would rather be. Do it because a customer loving your product is sweeter than collecting a check. Do it because creating opportunity for people is better seen than politicized. Do it because you see a world yet to be created that few people even understand. Do it because hearing “no”, motivates you to make it a yes. Do it because having lived is better than having not. Do it because when you are awake in the middle of the night you believe you will find a solution to the problems you face.

Do it because no matter what happens at the end of the day you are happier after your company than before it.

If not, when you don’t have a pile of money, your company fails, or you’re on the outside looking in, you won’t be happy.

Image Credit: 401(k) via Creative Commons

Celebrating the Small Things is the fifth and final post in a five part series called ”Enjoying the Ride.” Comparing a start-up to surfing, this is a simple guide to turn your grueling start-up battle into a more soul fulfilling experience by helping you battle the sets and pick the right waves so you can enjoy the ride.

“When you overcome the fear and all the elements that are working against you and ride one of those waves, there is a feeling of gratification and accomplishment that is beyond words.” ~ Greg Long (big wave surfer)

Beating your numbers feels good. It’s such a binary understanding that everyone, from employee to investor, can grasp. And your success against your own predictions is the industry’s way of saying “this company is killing it” or worse, “they are struggling.”

But should it be?

I spent a lot of time at Contour feeling the joy of beating, and the pain of missing, our own numbers. People got worked up at the end of every quarter based on our performance, when the only number that really mattered was how much cash was in the bank. Having to explain lower than expected numbers is never a fun conversation, but for the rest of the organization it meant they had nothing to celebrate. All the work they did went for nothing because outside of the sales team they had minimal impact on the numbers. Most people don’t have a budget and they don’t sell, which means they have an indirect impact on the financial results.

The elation or disappointment around the quarterly numbers was masking the real question.

Are we getting better?

Building a great company or being an amazing surfer isn’t like playing a team sport. There is no trophy you walk away with or a championship you can try for again if you lose. There isn’t a fixed time you play or rules that define how the game is played. It’s an ever changing quest that has no timeline and no clear definition of victory. And the only thing that tells you if you are improving is how you feel.

When you talk to people who have surfed their whole lives they don’t talk about the wins they had or the expectations they beat. They describe beautiful pictures about the journey, about the moments they remember with their friends, about the conditions on a particular day, about the power of the wave under their board, about the near misses, or about how surfing fills their soul. Getting better is a life quest, while improving is a confidence you gain wave by wave, set by set, session by session. It can’t be measured, but it can be felt.

Now that my time is over with Contour I don’t always remember the quarterly numbers or how we did against our own expectations. I don’t remember what our annual objectives were or what we talked about at every board meeting. What I do remember are the too few times we celebrated the journey. I remember the happy hours, the company parties, the lunches to welcome a new employee. I remember our product launches and the excitement when great reviews got emailed around the office. I remember the company pride people shared attending events and trade shows. A list of things I remember that rarely had anything to do with our numbers.

Yes, numbers are important and you will never get away from quarterly projections or investor expectations. As long as you are building a growth company your success will be measured by how “up and to the right” you are. Beyond the numbers proving frequent employee reviews, clear quarterly objectives, a consistent vision, and values, they help in keeping your whole team on the same page.

But even if you do all of this, which is expected, people will still wonder if you’re getting better. Seeing numbers on a chart or passing out a few beers at a company meeting isn’t memorable. It’s what everyone does.

What’s memorable are the things you celebrate. It’s the small ways you make people feel appreciated or the small ways you help people feel the wave of momentum the company is creating. Helping people feel the journey is a critical part of your job and something most entrepreneurs overlook. Because most of us are intrinsically motivated, celebrating before our life’s work is done doesn’t make much sense, something I often struggled with.

But to everyone else it matters. And when your time is done and the company is gone, it’s one of the few things you will take with you.

Celebrate the People
We all need recognition. This may be hard for entrepreneurs to believe and it may even drive you nuts that people need positive confirmation of the work they are doing, but get over it. If you want to lead people you have to keep them inspired for a very long time, doing their best work.

Abraham Maslow, a psychologist who created Maslow’s Hierarchy of Needs, explains why esteem, to be valued and respected, is one of our basic human needs. What Maslow goes on to say is that there are two types of esteem. The first is the desire for personal achievement, adequacy, mastery, and competence, which gives us self confidence and ultimately personal freedom. The second is the desire for reputation, respect from other people, which includes status, dominance, recognition, attention, importance, and appreciation.

Knowing people need some form of recognition, doesn’t mean you have to run around congratulating everyone, nor does it mean you have to call everyone out publicly at a company meeting. Not everyone wants public recognition for their work and it’s not your job to do all the congratulating. Instead your job is to create a culture that helps people appreciate one another.

I have found two areas to focus on. The first is creating an environment where people can do their best work. One of the reasons people join a start-up is to have an impact and they can’t do that if they are unable to make decisions on their own. Too often at Contour plans were passed down to people instead of being built with the team from the ground up. By the time people got their assignment it was just that, an assignment. The best example I have found is Valve, a software company based here in Bellevue, Washington. Their employee handbook is a must read and from it you can see that their entire premise is to create a place where people can do their best work.

The second area is to appreciate people in small ways. From the time they join the company to the time they leave, you want to celebrate their accomplishments along the way. Ideas on how to do this:

• Make their first day amazing. Before they show up have a computer ready, desk arranged, people available to help them, and everyone in the company knowing what their role is. If someone’s first day is disorganized it makes them feel undervalued from the second they arrive.
• Anniversaries are like birthdays, don’t miss them. People spending a year or multiple years at the company is a big deal.
• Give them the tools they need. It doesn’t mean everyone gets Mac screens, but before you hire people make sure you can afford the tools they need, otherwise they become frustrated they can’t do their job and instead of concentrating on the work they are wasting time with equipment that doesn’t work.
• Constantly give feedback! It’s easy to get lazy and put off annual reviews, but don’t. And don’t put off telling people you thought they did a good job or you thought their work was great. A simple “thank you” or “congratulations” in person (not on email) goes a long way.
• Buy people food. Eating is a great way to put down the laptop and say thank you.

Keep it fresh. However you celebrate people, be creative about it and don’t make it a pattern or people will assume you are just doing it to check off a box.

Celebrate the Company
You probably aren’t building Rome, but you are building a company and building a great one takes an army of people. I’m not just talking about the employees. It takes investors, customers, lawyers, partners, family members, vendors, etc. to make the journey a success. The reality is that most of the people involved in your company won’t retire in luxury from their involvement. The odds of success are so minute that most of them will walk away with nothing more than the memories of the journey.

As the leader, it’s your job to make everyone feel involved. No different than celebrating the people, you have to come up with ways for people to follow the journey, brag about your success, and create a deeper relationship with the company.

But what items do you celebrate?

The first way is to create public events everyone can attend. I still have goose bumps from standing on stage at my first Zumiez 100K. Despite being a public company Zumiez, an action sports retailer, puts on an annual two-day event that celebrates everyone involved with the brand. The founder and CEO get on stage to talk about the company, the successes for the year, and what is in store for next year.  All of the Zumiez employees are dressed in ridiculously awesome costumes and the top 10 sales people are rewarded with public recognition and massive gifts. The founder of every brand is invited to go on stage in front of thousands of people to personally say thank you. Athletes are invited on stage to give their own shout-out and engage with the employees. And everyone mingles together in a massive after-party.

Granted, a start-up can’t afford this. But then again, Zumiez has been doing this since they started some 35 years ago and I’m sure the initial event was not nearly the spectacle it is now. They have alway believed that everyone should be involved in the success of the company.

The second way is to celebrate small wins on a daily basis that go beyond your numbers. Items that are consistent with the company values is a great way to constantly remind people what is important. Just remember to be selective about which events are worth sharing outside of the company or you risk inundating people with victories that are hard to grasp if they aren’t living the battle with you everyday. Some ideas include:

• Document the journey. You are creating history and you can’t remember it without pictures, videos, and documents of what happened. It’s great material to pass on to people who weren’t there.
• Decorate the office with accomplishments. Putting up press clippings or customer quotes is a great way to remind people of the company success.
• Collect and pass around positive reviews. Third party acknowledgements are great bragging rights, especially from end customers and editors.
• Customer wins. Getting new customers is motivating, but just remember to let people know if you lose a customer too. No one likes to be bragging about your awesome new customer to find out down the road from someone else they are no longer a customer.
• Completing projects. Yes, product announcements are the easiest, but even celebrating the completion of small projects is important.
• Sharing prototypes. People love to see the new ideas being worked on so sharing visual work as it’s being completed is incredibly motivating.
• Successful events are filled with photos and stories people who didn’t attend would love to know about.
• Marketing campaigns, especially successful ones that move the needle are visual and help people grasp the message we are sharing with the world.
• Happy hour (yes, cliche) is still a great way for people to connect and share the projects they are working on.

It means a whole lot more when the whole company takes time out of their busy day to enjoy the milestones, especially if the celebrations are during working hours and outside of the office. And don’t forget to invite significant others, they are quietly the most important aspect of employee success.

Conclusion
Building greatness is hard and there may be a lot of days when you feel like you are going backwards instead of forwards. But that is part of the journey and helping people appreciate the ride is one of your most important jobs.

Yes, company updates give people the information they need, but feeling the momentum is even more important. Especially in the volatile world of startups, people need to hear, see, and touch success over and over and over again. It creates a wave of momentum that can overcome the setbacks you face along the way.

Get out from behind your laptop and help people enjoy the ride. Because when it’s over, your memories will be all you have to look back on.

Enjoying the Relationships is the fourth post in a five part series called “Enjoying the Ride.” Comparing a start-up to surfing, this is a simple guide to turn your grueling start-up battle into a more soul fulfilling experience by helping you battle the sets and pick the right waves so you can enjoy the ride.

“…You go through a lot. Physically, mentally, and so the friendships that are made in the big wave lineups run so deep…we love one another with the most respect that you could. ” ~ Greg Long (big wave surfer)

Relationships. The most volatile, unpredictable, but important part of the company you build. Unless you want to build a one-man show and sit in a closet, people will become incredibly important to your success.

And I’m not just talking about employees, I’m talking about all the relationships around your business. The army of people you need to influence to believe in your vision, your products, and your leadership. I’m talking about editors, investors, employees, vendors, suppliers, retailers, family members, lawyers, strategic partners, athletes, customers and anyone who takes an interest in what you are building. All of them need to believe for you to create a successful company.

When you start, it’s easy to ask for help. If you are persuasive enough you may even find it easy to convince people to join, invest, purchase, etc. Your decision to constantly put the business in front of these relationships will always feel like the right thing to do. And for a long time people will put up with it, until they won’t. Once they believe your concern for them is shallow and that the only time you call is when you need something, their desire to help will be replaced with frustration, disenchantment, and even anger. People can sense if you aren’t genuine and your actions always speak louder than your words.

Changing this dynamic is hard, especially when it feels like you are short on time and energy to give yourself to everyone. Putting people first requires an incredible amount of vulnerability and a level of commitment that is more tiring than keeping everything surface deep. But what I can promise you is when you start putting people first the relationships get better. You begin to appreciate what you have and enjoy everyone for more than what they can do for the company.

Unintentionally, I know I burned a lot of relationships along the way. I was constantly battling with how much to give as I pushed forward with business first, people second. I figured that people would understand when I did what was best for the business in place of what was best for them. It is true that you will have to make very hard decisions about people, decisions that haunt your dreams and make your stomach turn inside out.  And it’s also true that no matter how much you commit to them people may hate you when you let them go. Relationships you thought would last a lifetime are ended in seconds, and that hurts.

At the end of the day, when the dust settles and your time with your company is over, you will realize that all you have are these relationships. How you treated them is all that they will remember. And the memories you shared is all that you end up taking with you.

Appreciating people is hard, but it’s worth it. It makes the ride so much better.

The following is a short guide to help you appreciate the relationships around you so you can better enjoy the ride.

Value People’s Time
You are running a business. A business that does need to generate revenue, profits, or investment capital to stay alive. That oftentimes needs you to make very hard decisions that you hope will keep the company alive to fight another day. Casualties along the way will happen, but it doesn’t mean people have to think you don’t value them.

One of the hardest lessons I learned was to value people’s time. I was always over-scheduling myself and justifying why being a few minutes late was okay, but don’t do it. There’s nothing more frustrating than starting a meeting late or waiting for someone to arrive when they asked for your time. Be early and prepared for the meeting and do the other person a favor by requesting the meeting days in advance along with a short agenda of what you want to talk about. Sure, some meetings need to happen the same day, but giving people a heads-up goes a long way. A surprise attack meeting from the CEO never goes well.

Once you have people’s attention don’t waste it. Be direct in your communication. Ambiguous, passive-aggressive communication is awful, especially in tough conversations that no one wants to be having. A direct approach may initially hurt people’s feelings, but they will appreciate your honesty. Not knowing where you stand or not knowing where they stand makes the relationships awkward, at best. Even if you need more time to think about a subject, tell them that. You aren’t expected to have every answer at your fingertips. Thinking about things is perfectly acceptable and a much more thoughtful way to go. Just don’t forget to follow back up and let people know where you stand.

If people provide introductions, treat them with utmost importance. People are always afraid to introduce you to people they know because how you treat their friends will be a direct reflection on them. Being polite, on time, and direct with what you want to talk about, will go a long ways towards people sharing relationships that may help you. If people offer an introduction don’t be afraid to say no or say why a time in the future would be better. It’s better to know the introduction would not be helpful than to make it and have it linger in email eternity.

Lastly, be sure to say thank you. That can range from a handwritten card, to an email, to looking directly in their eyes and saying thank you. The more thoughtful your follow up is about what you are thankful for only helps in keeping friends who will continue to support you. People recognize that when you start, you can’t pay with money, so do everything you can to repay them with gratitude.

Be a Great Listener
It means you have to be present. Having your computer open, auto-updates buzzing in your pocket, or half thinking about something else means you aren’t giving people the attention they deserve. If you don’t have time for the discussion then don’t start it.

Getting good at listening takes real effort. Yes it’s hard to turn off all the extra thoughts floating around in your head, but the more you practice turning them off to really be present the better you will get at it. To be good at listening it starts with eye contact. People can tell when your mind is bouncing all over the place because your eyes will be doing the same thing. A friend once taught me the best way to make eye contact is to focus on one of the person’s eyes. It sounds creepy, but it will help your mind settle down and focus.

Then to actively listen you must be engaged with the speaker. It doesn’t mean you have to speak, but show enthusiasm. Show it in your face, your energy, and your body language. When it is time to respond, return the same energy they brought. Build up on their idea instead of tearing it apart.

Even if you are three steps ahead of the person presenting, it doesn’t matter. Telling them the answer or taking the pen out of their hand leaves a bad taste in people’s mouths. I used to do this all the time and the only person who felt good about it in the room was me. Sadly, a pen in my hand leading the discussion on the whiteboard was my way of listening.

In my recent time off I have been taking an improv comedy class. Partly to put myself in the most uncomfortable situations possible, but partly because the laws of improv are the core to great team building. If you ever watch great improv the acting team builds upon itself. The first rule of improv, “yes…and”, dominates the conversation as you take someone’s idea and add to it. You never cut it down or tear it apart. The conversation may flow in a different direction than you first thought, but as trust builds with the team you can take the initial idea and run with it. Something I look forward to being better at with the next company I build.

Being a bad listener is just being lazy.

Learn to Empathize
I’m sure we have all read the stories about Steve Jobs and his lack of concern for everyone else. If your creative genius is anything close to his then okay, maybe you can get away with it. But for the rest of us, learning to understand people from their perspective is critical to improving the relationships around us.

Empathy is the basis of great user research as you try hard to understand the problem from the user’s perspective. You are constantly putting yourself in the customer’s shoes and trying to understand what they are trying to do that they can’t do.

What makes empathizing so hard is it goes against our natural intuition, which is to convince people our point of view is right. Especially as entrepreneurs we spend so many hours defending, that we often fail at accepting another perspective and because we are so attached to our own point of view we often confuse it with our own identity. And so sometimes empathy can be very difficult because we get nervous that if we put ourselves in someone else’s shoes to see their (different) point of view we might lose part of our identity, we might lose part of our “Self.”

There are two scenarios I experienced a lot. 

The first is something goes wrong. As a leader you will receive information that no one else will have. Often incredibly conflicting, it is easy to make assumptions based on all the opinions and lack of facts around you. But I challenge you to start with the people and not just ask them what happened, but understand it from their perspective. Put yourself in their shoes to understand how they approached the problem, the resources they used, how they are feeling about it, and really why the result is different than you expected. It may take several discussions to actually get down to the root cause, but it’s a much better approach than making an assumption about why.

The second is predicting what people will need. This is much harder and can take years of practice. The better you understand people around you, what motivates them, make them happy, or what they need, the better you can predict this. Providing solutions before they need them is like creating great products people didn’t even know they needed until they tried it. I have a very long way to go to get good at this.

Surfers do this in a very basic way. They look out for each other in the water. Like a brotherhood, they never give up helping a surfer in trouble, no matter how long it takes. Most of them have been there before and instantly they can understand what it’s like. An unspoken language many of us never experience in the business world.

Create Depth to the Relationship
As the CEO, your job isn’t to be friends with everyone. Often figuring out how far to go with each relationship is a constant battle. Yes, you want to build camaraderie with your team, investors, partners, etc. but you do need to make it clear where the line is.

With that in mind there is a lot more to life than just work. Often I was so focused on the company, it was the only thing I would think about and most of the time the only thing I would talk about. I loved talking to everyone about business and rarely drifted off to new subjects. It’s okay if you aren’t caught up on the latest pop culture, but you can talk to people about life outside of the company.

Getting to know what people are passionate about helps you be a better leader. Learning what motivates people, where they like to travel, what makes them happy, what they like to do when they aren’t slaving away to make the company stronger, etc. goes back to empathizing and helping you understand where people are coming from. You won’t get to know people by constantly being in meetings or by only connecting with them at happy hour. Learning about people can happen in small increments during the day, at social events, or even at lunch.

Lastly, please don’t ask about their life to just ask. If you don’t care or you don’t intend to care then just talk about business. People can tell when you don’t care or even worse when you don’t remember personal things they shared with you.

Conclusion
Building a great company is hard. Building it alone is depressing. Learning to put other people first is something I constantly battle with, but I believe it will not only make me a better leader, but more importantly it will make the journey so much more enjoyable. No different than the level of commitment surfers have in the water to protect each other, putting other people first will create relationships that last long beyond your company days.

Image Credit: Rickbucich via Creative Commons

Doing Less is the third post in a five part series called “Enjoying the Ride.” Comparing a start-up to surfing, this is a simple guide to turn your grueling start-up battle into a more soul fulfilling experience by helping you battle the sets and pick the right waves so you can enjoy the ride.

Doing Less. People talk about it, but how do you actually do it? I mean, how are you expected to do less when the workload doesn’t stop and your company is David taking on Goliath?

It’s incredibly hard, especially when speed is considered so important in taking the hill and challenging your competition.

At Contour I sucked at this for a very long time because as the CEO, doing less is largely determined by the CEO, and my natural tendency to outwork everyone meant I valued quantity over quality. My unrelenting drive demonstrated to everyone that I believed time was free and therefore unlimited. Even if people complained they couldn’t get everything done I figured they would do what I did, work more hours.

I fell into this same trap when I started surfing. As soon as I got past the break I was quick to chase the first wave that came, regardless of my probability of catching it. I figured the more waves I went after the better my chances of catching one. Instead of waiting to pick the right wave for me, I went after everything as if I could do it forever. But quickly I realized I spent a bunch of valuable energy paddling only to miss the wave and get pounded by the whitewater of the follow on one.  The number of waves I caught decreased and instead of having fun I realized how much work I was doing. Being patient to wait for the right wave became an exhausting lesson to learn on the board.

Over the years at Contour it became more and more evident that in order to do better work, everyone had to do less, myself included. People were tired of producing work they knew could be better, which only amplified with more people, more meetings, and growing to-do lists.  Our culture of do first, think second made it hard for everyone to figure out what was and was not important.

It took me a long time to understand this, but doing less doesn’t mean you will be less successful, instead I think you can be more successful because you won’t waste a bunch of money redoing the work, you won’t have frustrated employees, and you won’t create a culture of “it’s good enough.” But in order to actually do less you have to be more patient and much more tenacious about prioritizing your time. Instead of thinking that time is free, treat it as the most valuable and expensive resource you have. The most expensive cost in a business is the people, so don’t waste their time.

The following is a short guide to help you prioritize your time so you can do less, but better work. Doing great work is a big part of enjoying the ride.

Benjamin Franklin’s daily schedule.

How Much Time Do You Really Have
If you step back and look at your day, it will shock you how few hours you really have to do quality work. Assuming you want to deliver your best work over multiple years, let’s look at how many hours you really have in a day:

• You sleep ~ 7 hours
• Getting ready ~ .5 hours
• You eat three meals ~ 1.5 hours
• You commute to and from work ~ 1 hour
• You exercise on a regular basis ~ 1 hour
• You have family or personal time ~ 2 hours
• You answer inbound requests (like email) ~ 3 hours

Throw on top of that a crazy travel schedule, kids, unnecessary meetings, and unplanned opportunities and you really have less than 8 hours of your day to really think.  Which to most people would seem like a lot of time, but when you are running a company there is so much demand for your time that you end up dividing your eight hours over a variety of random subjects across multiple people. And when you run out of time you start justifying why cutting down on family time, sleep, working out, personal time, and meals is more important than taking care of yourself.

As a founder you spend your early years running around making everything happen, but as your idea grows into a real company you are supposed to transition from doing less to thinking more. A transition that actually requires more mental capacity than when you ran around making sure remedial tasks got done.

In order to do great work you first need to have energy and enough time to really dive into it.

Group Your Schedule
Everyone organizes their day in different ways, but in order to do better work the first step is better grouping of your schedule. Jumping from subject to subject is hard, especially if you don’t leave yourself enough time to mentally transition.

Personally, I found the thinking in 7 Habits of Highly Effective People to be a great way to organize my week. I would sit down every Sunday and think about what I needed to accomplish for the week. Then I would organize my days so I had a few hours before lunch and a few hours after lunch to accomplish these tasks.  I would then do my best to keep team meetings and appointments to the beginning or end of the day so I had the rest of the time to myself.  If I needed to have back-to-back meetings with different subjects, I found that using a 10-minute break to go outside to get some fresh air helped me clear my mind so I was ready to jump into the next discussion.

In a recent New York Times article, Tony Schwartz talked about energy renewal during the day. The research he cited supports a cycle of 90-minute work sessions, followed by rest cycles during the day. “Human beings aren’t designed to expend energy continuously. Rather, we’re meant to pulse between spending and recovering energy….Working in 90-minute intervals turns out to be a prescription for maximizing productivity. ”

Even when I successfully blocked out my day, I found the hardest part was turning off email and social feeds, especially when my phone has auto-updates turned on. My most productive days happened when I limited these distractions to three times per day, when I had the proper time to provide thoughtful answers.

 Of course, when I got tired I reverted to my old ways of filling my schedule with random meetings and discussions. I had spent so many years covering way too many subjects that deep down I probably missed the breadth, so when I couldn’t add any more value thinking, I resorted to doing. A habit I should have replaced with taking a break, instead I just kept plowing through my day.

The framework I used for my weekly schedule.

Prioritize Your Workflow
How often have you sat down and started working by opening your email?

Prioritizing your work based on your inbox is a quick way to become overwhelmed and before you know it you have wasted the valuable thinking time you have.  I always found email to be a horrible form of communication, especially when people value the quantity of emails they send versus the quality of them. I used to send way too many emails, especially when I was tired and instead of using the limited creative energy I had, I wasted it on half thought-out messages.

If you prioritize your work from the most important to least it will help you and your team realize the unimportant stuff that isn’t getting done. Part of being able to enjoy the work is not feeling overwhelmed by a bunch of small tasks that really don’t matter in the end. So if you never finish your list it’s a great way to go back and tell your team what isn’t getting done and why.

I always found the best people were great at estimating how long the work would take and communicating why something wasn’t getting done. 

Kill Random Meetings
Learning to say to no random meetings is something you should start very early in your culture. Once it becomes a habit, the habit only gets worse with more employees and shared calendars. You don’t want to create a culture of arguing about why you personally don’t have to attend the meeting, but early on you want to agree on what types of discussions are worth scheduling people’s time for.

Jason Fried with 37 Signals is a huge fan of this and he does a great job in “Getting Real“, explaining why meetings are toxic and why people need alone time to think. If not, your employees will start working from home so they can get real work done and avoid all the meetings.

I found there were two types of meetings worth having.

The first are update meetings, which are best served by short scrum like meetings that last a few minutes and update everyone on what is going on. This can be much harder when you have people calling in from different time zones, but updates should be short and sweet. A monthly update will probably be a bit longer, but regardless they should be concise and give people the information they need.

The second are group discussions, and they should really be reserved for creative sessions that require multiple types of inputs. These are not update meetings, but instead should be reserved for the few times you need to get a group of people together to discuss how to solve a problem or for creative brainstorming. Otherwise you are wasting a lot of money when you have multiple employees sitting in a room adding little value. And people need to get over feeling hurt if they are left out of a discussion. Creating a short agenda and being selective about who should be in the discussion and why is important.

Make it Clear When You Are Available
Early on I thought part of my role was being available to everyone, all of the time. An open door policy is great for people thinking you are accessible, but terrible for getting real work done and forcing people to think before they bring you questions. Most of the time I would say “Sure, I’m available” and then after the discussion it would take me several minutes to restart from where I left off. Even worse, I was half present, which probably made the discussion a waste of time for both of us.

An important part of your job is letting people know when you are and aren’t available. People will have questions and random requests, but it’s important to let them know when is a good time to bring you these requests and when it isn’t. Signals that help people know this can be headphones, a closed door, changing your Skype status to unavailable, and turning off your phone.

This goes for everyone in the organization, but if you do get interrupted, politely let people know you are busy and when you are free to connect.

Enjoy the Work
Building a company is an incredibly unique opportunity. It is something you will only do a handful of times in your life, so don’t take it for granted.

Discovering a real problem in the world that you happen to be passionate about is rare. Turning that opportunity into a real company is then no small matter, so when you are battling the waves on a daily basis don’t forget to enjoy it. Being able to dive deep into thinking about how to make your company, product, experience, culture, etc. better is a lot of fun.

Because when it’s over you’ll wish you had taken the time to enjoy every moment of it.

Image Credit: SURF&ROCK via Creative Commons

Staying Mentally Fresh is the second post in a five part series called “Enjoying the Ride.” Comparing a start-up to surfing, this is a simple guide to turn your grueling start-up battle into a more soul fulfilling experience by helping you battle the sets and pick the right waves so you can enjoy the ride.

“There’s the most extreme consequences in big wave surfing. The idea that you could go out there and possibly drown and die…It’s tragic when it happens, but it’s also sign you were living and taking those chances in life. That’s the greatest feeling in the world.” ~ Greg Long (Big Wave Surfer)

Being an entrepreneur is a choice. Going to work everyday is a conscious decision.  No different than choosing to surf the world’s largest waves you are choosing to navigate a group of people through extreme conditions with the hope of making the world a better place.

So if I’m choosing to do this, why am I so mentally exhausted, stressed out all the time, and deeply afraid that I’ll let everyone down?

Because learning to manage your own psychology is the hardest part of running a company. Constantly overcoming the fear of failure is incredibly hard, especially with mounting expectations from your employees, investors, and customers. The more you succeed, the harder your job becomes. Rand Fishkin touched on this recently in a blog post about the expectation to give 100% of yourself and why it is so hard to run a growing business.

No one wants to fail and if you aren’t mentally prepared for the battle ahead it can crush you into the ground like a gigantic wave.

In running Contour, the only way I survived was by brute force. I didn’t give up. But it doesn’t mean I didn’t almost drive myself or the company off the cliff on several occasions. Not having preconceived notions became my saving grace and finding an outlet other than Contour was the only thing that kept me sane.

Being on the sideline for the first time in a decade is allowing me the opportunity to think about the mental transitions I was going through. They were gigantic, especially for a twenty-something-year-old trying to figure out life while pretending he had everything figured out as a leader. It is true that you will experience things you can’t predict, but I have come to believe that you can prepare yourself mentally to handle the ups and downs so you can actually enjoy the ride.

The following is a guide of how you can be better prepared on a daily basis.

Admit You Have No Idea

“There are a lot of variables of the ocean you can’t control.” – Greg Long

The very nature of a start-up is that it’s built on a series of assumptions and predictions about the future. Assumptions that can be so interconnected that if one thing changes, it has the potential to disrupt everything you have built. This can turn team momentum into disappointment, looking as if you would lie to them about the predictions of the future.

The minute you admit “you have no idea what is going to happen,” is the moment a huge weight gets lifted off of your shoulders. Instead of feeling you have to have all the answers you can galvanize a whole organization into helping you think about solving the problems the company faces. Instead of becoming plans of stone, they become plans that adjust to the actual conditions at hand. And instead of everyone feeling like you let them down, they can pivot to think about how to solve the new problems.

No doubt “change” in a start-up adds an incredible amount of stress on the organization and the individuals involved. But no different than surfing, the only thing you can count on is that the ocean constantly changes. Admitting you have no idea which way it will change, not only lifts the collective stress off the organizations, but shifts everyone’s mentality to helping understand the changing tides.

Turn Off the Distractions
You know that anxious feeling you get when you can’t stop touching your phone in anticipation of the next tweet, email, text, Skype, Facebook, or phone call? The small rush of excitement you get in anticipation of figuring out who reached out and why?

It’s called not being present.

And when you aren’t, you miss the ride, your work suffers, and people don’t want to be around you. Your significant other probably calls you out the most, but being present is one of your most important jobs. Yes, communicating is an important part of your job and there are times when checking email, twitter, etc are part of your day. BUT, you already have an incredible amount of inputs coming in on a minute-by-minute basis so turning off your twitter feed, closing your email, and putting your phone on silent will enable you to be present. If you have issues you can’t stop thinking about then write them down and leave them there until you have time to come back and deal with them.

Especially two hours before going to bed, turning off all the electronic distractions in your day will help you sleep so you can be fresh to tackle the day ahead.

Find Someone to Talk to
Figuring out who you can and can’t talk to is a painful process to go through. Even more painful is to learn that if you talk too much people start losing confidence in your ability to lead.  Especially if you don’t have any other outlet than the people involved with your business.

It was 2008. My mom had just passed away from 15 years of fighting breast cancer, I recently broke up with my girlfriend of three years, and the economy was tanking. I was a train wreck ready to hit the wall at a hundred miles per hour. I had no idea I even needed help and instead I bottled everything up and pushed the train even faster. Putting in more hours and taking on more responsibility than ever. And then I got lucky. Into my life walked someone who taught me how to open up. She became someone I could talk to about everything I was going through. Someone who didn’t judge me or try to answer my questions. She just listened.

Every entrepreneur needs someone they can talk to. It doesn’t have to be a significant other or even a friend. It can be a professional, but most importantly find someone you trust, who listens well, and understands how to deal with complex relationships. Brad Feld talks openly about professional help for entrepreneurs in his recent book, “Startup Life – Surviving and Thriving in a Relationship with an Entrepreneur.” Brad has worked with a lot of start-ups and is a strong believer that entrepreneurs need someone to talk to, especially a professional who is focused 100% on helping them talk through the challenges they face both with the company and their personal life.

Bottling everything up only compounds the pressure you are under.

There Is Life Outside of Work
Running a company is incredibly lonely, but it doesn’t mean the rest of your life has to be. My family would find it ironic I’m not admitting this, but there are people who care about your well being outside of work. People who aren’t looking for you to constantly be on or lead them. People who just like being around you and care a lot about you.

Spend time with your friends, family, and significant others. You let them in your life at one point because you enjoy them, so go enjoy them.

When we start a company one of the things we believe is it will give us an incredible amount of flexibility to work where we want, when we want. Instead we replace that dream with working everywhere, all the time. Part of unlocking your own creative energy is enjoying life’s pleasures. It is okay to go ride on a powder day. It is okay to go surfing in the afternoon. It is okay to take Friday off to hang out with your family. Taking time off to make life less predictable is one of the best ways I have found to stay fresh.

I wish I hadn’t spent my twenties behind a laptop.

P.S. There is a great interview of Greg Long, infamous Big Wave Surfer, talking about fear and how he overcomes it to surf the largest waves in the world. It is 20 minutes, but it’s not only inspiring, but very related to the challenges of building a company. (http://vimeo.com/channels/surfprevention/51117940)

Image Credit: Nathan Gibbs  via Creative Commons