Archive for category: Book Club

While the book title, The 7 Day Startup, might make you roll your eyes a bit, the author’s premise is simple: it doesn’t take that long to start a business. And the most important knowledge you will gain will come after you launch. So launch!

We won’t be able to talk about the entire book in this review, but we’ll share some of the key highlights that any business owner can review, even one who is long past the days of starting up. Don’t be intimidated by the “7 Day” title. Dan just dedicates one day to various tasks to complete before launching.

Tasks to Complete Before Launching

• The Nine Elements of a Great Bootstrapped Idea?
• WTF is an MVP?
• Choose a Business Name
• Build a Website in One Day for under $100
• 10 Ways to Market Your Business
• Set Targets
• Launch

Evaluate Your Idea

For any business that you want to pursue, there’s an easy nine point checklist Dan has put together. You don’t need to excel in each of these areas, but you should have a decent answer for each one. If you already have a business, you can use these questions to identify weak spots in your business to prepare it for sale.  

Does your business…

Have enjoyable Daily Tasks? It doesn’t make sense to start a business that is going to have you doing daily tasks that you don’t enjoy. What will be your day-to-day tasks for this business?

Product/Founder Fit? What skills do you have, what are you most known for, and where can you provide the most value? If this doesn’t line up with your business, that’s a problem.

A scalable business model? Do you have the ambition to grow your business and will it easily accept that growth?

The ability to operate profitably without the founder? Remember that if you can’t leave your business for 30 days and have it grow in your absence, you don’t own a business, you own a job. If you can’t do this with your business or business idea, you’ll have difficulty selling it.

The qualities of a sellable asset? One of the qualities of a sellable asset is the ability to run without the founder. Others include:

• Product design
• Intellectual property
• Your team
• Website
• Recurring revenue

A large market potential? This is also often called “total addressable market” (TAM). You don’t have to become a national company, but you can’t be too niche.

Tap into pain/pleasure differentiators? What do your customers really care about? Does your business go beyond a “cool idea” and actually solve a pain they have or give them a pleasure they desire?

Have a unique lead generation advantage? This could be as simple as great content like blogs and videos or higher level strategies like webinars and courses. What is going to set you apart from your competitors?

Have the ability to launch quickly? If it’s going to take you a year to launch, you won’t be able to learn from customers as you go. Choose an idea that you can launch and modify quickly. When you start getting real data from paying customers, you can innovate and get the product perfect.

What’s in a Name?

Dan points out that many people agonize over the “perfect” name for their business. Instead, he has six questions that get to the heart of what matters: a name that works.

1. Is it taken? (Have you looked to see if the name is used in your state or country?)
2. Is it simple? (Will the customer get it without you explaining it, or is this about an obscure name that you are tied to?)
3. Is it easy to say out loud? (Will customers enjoy sharing it with friends?)
4. Do you like it? (This isn’t the same as absolutely loving it, but rather does it sit well with you?)
5. Does it make sense for your idea? (Real winners in this category include Chipotle, Google, and Dropbox)
6. Is it broad? (Remember to give yourself some room to maneuver as you build your company.  You don’t have to be very specific to start.  Bob’s Bakery might work just as well as Bob’s Bagels.)

Where are the customers?

“Without question, the biggest mistake people make is obsessing over their idea and not focusing enough on finding people willing to pay for their product.”

“The popular stories you hear about startup validation go something like this: 1. I created a website with a brief video. 2. It went viral. 3. I bought a yacht.”

This is a point Dan keeps hammering home over and over in the book. Instead of spending time perfecting your idea, find out if someone is willing to pay for it. Here, he uses the MVP (minimum viable product) term made popular by Eric Ries of Lean Startup fame. If you can’t find people who are willing to pay for a bare bones version of your product, why would they pay for the version you are cooking up in your mind? “You don’t learn until you launch,” Dan says.

Instead of having everything be perfect on launch day, just focus on being competent. There’s only room to improve from launch day.

So, as Dan says, go for it!

We’ve run into Bo Burlingham here on Book Club before. We’ve reviewed his groundbreaking Small Giants book and he was seen as a major source for Dan Andrews’ Before the Exit as well.

Burlingham characterizes this as an “end-up” book as opposed to a “start-up” book. Fascinatingly, there’s so much literature about starting up, but not too many at all, like Finish Big, about “ending up.” Yet it is true that all businesses at some point, must end for the owner, and the most successful ones end in an exit.

Key Lessons of Finish Big

The book is chock full of lessons for anyone even remotely interesting in building, running, and exiting businesses, but they can be divided into several large categories:

• Case Studies – actual stories of how businesses started and exited, sometimes with the names changed. These can either be major successes or catastrophic failures. In either case you often have the entrepreneur him/herself describing, through the author, each step in the process.
• Education – if you didn’t know about due diligence, financial ratios, stock vs. equity purchase and other vocabulary that surrounds a business transaction, Bo does an excellent job of weaving short explanations of these throughout the text. He assumes that you have some basic familiarity with business in general, but assumes a zero starting point for familiarity with the ins and outs of transactions.
• Choosing a successor and managing your people – one of the trickiest parts of a transaction is keeping confidentiality so that your staff can stay on task.  Perhaps even trickier is to find a successor to you so that a buyer can have confidence the company will not just survive, but thrive. Burlingham takes us through several scenarios, extracting key steps you should take along the way.
• End in Mind – a theme Burlingham keeps hammering home in the book is the idea of “think about your exit before it’s time.” The best time to think about your exit is during the time you start up. The next best time is at least 18-24 months before you list your business for sale. Here at Apex we’ve often maintained good relations with our clients for years before they listed their businesses, mostly because they wanted someone to keep them grounded in the realities of the market, and because they wanted to make the changes necessary to exit at a level they preferred.
• Mentorship – we may start the journey of entrepreneurship alone, but very rarely is the journey completed alone. Burlingham highlights the many ways that entrepreneurs can find mentorship, coaching, and help in their journeys.
• What happens next – by speaking with many entrepreneurs about the pitfalls of an exit – successful or otherwise – Burlingham challenges readers to think ahead to what happens after the sale too, not just focus on the numbers and delight of the exit.

There’s really no other book like Finish Big in the market. Only read it if you’re interested in learning about the right mindsets you should have in order to have a successful exit, which may very well be the most important financial event of your life. If you want to shortcut the reading, give us a call! We’ve got plenty of those stories amongst our treasure trove of brokers!

Many business books offer solutions or systems or case studies to make their point.  Very few offer a simple narrative with lessons gleaned on the journey.

Tony Hsieh’s Delivering Happiness: A Path to Profits, Passion, and Purpose, happens to be one of those books.  

It had no agenda other than telling the story of Zappos, and yet, when you tell the story of a company that gets acquired for a billion dollars in stock by Amazon ten years after its founding, no agenda is really necessary.  

The journey itself is a compelling narrative.

Pay Employees To Quit

Hiring is such a challenging part of any business that one would think that once you’ve got a new hire, you want to do your best to keep him/her.  Zappos agrees, but adds a twist.

During the training process, they offered a $2,000 bounty to anyone who quits during a certain time period, in addition to getting all pay/vacation time accrued.  

This worked so well in making sure the best people stayed (and the few short-sighted ones left) that Amazon created their own program after acquiring Zappos called Pay to Quit. This program allows full-time associates to take a $5,000 one time bonus to leave the company, but it means they can never work for Amazon again.

Instead of the focus being on bringing on warm bodies, it was on bringing on long-term players, part of a team, part of a family.

Customer Service That Matters

More and more companies are making it difficult for you to contact them if you have problems, questions, or just feedback.  Zappos chooses to go the other way, by plastering their 24/7 telephone number at the top of their website.

In the book Tony mentions at the time of publishing their longest customer call was 6 hours long.  They chose to focus on the relationship with each individual customer.

And when you are focused on relationships, you aren’t focused on metrics like quick turnover times on calls. You want every part of the buying experience to be fun and delightful, and Zappos lives that.

Giving employees the freedom to really represent the brand, as a partner of sorts, inspires them and rubs off onto customers, who go on to become loyal customers, right after they rave about you on social media.

A Culture on Display to the World

Tony would make a point of posting internal company emails and memos to a public blog. He did this only moments after sending them out to the company.  

He also compiled a culture book each year which was printed and distributed to all employees and was then made digitally available to the public.  

The only rule was that no one at the company could censor what each employee wrote. (which, by the way, was their own personal experience of what Zappos company culture was to them).

Culture can’t be made.  It can only grow by the environment created by the work you do together.  Being unafraid of sharing only adds sunshine to an already fertile project.

Dale Carnegie’s How to Win Friends and Influence People was the book that kickstarted the personal development genre that continues to grow every single year.  

While some have attacked some of Carnegie’s methods as “forced”, its continued selling power since 1936 speaks to the timelessness of the ideas between its pages.  

In this article, we’ll examine a few of our favorite ideas that are equally important in business and in our personal lives.

Smile

At the time Carnegie wrote this book he didn’t have access to the overwhelming number of studies that have been done over the years that back up his advice to simply smile.  

Smiling has been shown to improve mood, lower blood pressure, create a stronger immune function and lead to pain relief, among many other astonishing effects.

Furthermore, customers don’t usually register complaints along the lines of, “So and so smiled too much” or “was in too good of a mood.” Smiling is the simplest way to indicate to someone that you’re happy to be there with them.

Become genuinely interested in other people

Sometimes we get caught up in the regularity of business transactions and fail to take the time to get to know people on a personal level. But people prefer to do business with those they know and trust, and it’s sometimes surprising how little we may know about some of our most vital and important clients. It’s a good practice to try to learn something new about clients each time you meet with them.

Be a good listener

In a world filled with digital noise, listening is becoming more and more of a lost art and requires so much more attention than it did in Carnegie’s smartphone-free era. Listening to customers is the easiest way to ensure that you not only fulfill the obvious needs but uncover the not-so-obvious ones too.

Someone’s name is the sweetest sound in any language (to them)

The great failing of many of us is to fail to listen and pay attention when people introduce themselves (see “Be a good listener”). But beyond that, those who are “good with names” weren’t given some magic pill or genetic advantage.

They use strategies like Carnegie outlines in his book, like associating the name with a funny image, repeating it back to yourself silently several times after hearing it, and then using it at least once or twice in the conversation so as to imprint it.  

“Being good with names” takes work, but it’s work that is deeply appreciated and remembered, and will help you stand out in your business dealings.

Give honest appreciation

Mark Zuckerberg famously wrote a thank you note to someone each day of the year for a whole year in order to remind himself of all he was grateful for.  

While you don’t necessarily have to commit to something so significant, it’s important to ask yourself – when was the last time I thanked a colleague, an employee, a vendor, or a customer?  

Genuinely thanked them – taking the time to write them an email, or even better, a handwritten note, to share your appreciation? When you do it for no occasion at all it will be particularly impactful, and you will be influencing people to pass on that gratitude.

Many business books have the same formula:

• Identify a problem
• Show your unique way of solving the problem
• Do so within 300 pages or fewer

This means that there’s a predictable comfort with such books. But it also means only a very few go on to become truly meaningful and useful long-term beyond fads of, oh say, throwing a fish around or asking where someone’s cheese might be.

That’s what’s so surprising and powerful about Extreme Ownership: How US Navy Seals Lead and Win, by Iraq veterans Jocko Willink and Leif Babin.

It manages to tie together a compelling (and real life) narrative about modern warfare with leadership principles and actual case studies of those principles being successfully applied. It’s a book that you’ll want to go back to time and again.  

Twelve Principles

The book has 12 chapters, each of them dedicated to different principles, like “No Bad Teams, Only Bad Leaders,” “Decentralized Command,” and “Discipline Equals Freedom,” a catchphrase that became so popular on Jocko Willink’s podcast that came after the book (unsurprisingly titled Jocko Podcast) that it led to a follow-up book which describes Jocko’s personal life philosophy.  

But the most important chapter, and what sets up the rest of the book, is Chapter 1: Extreme Ownership (this is something we’ve discussed in a previous article). 

The short definition of Extreme Ownership means having a solution-oriented posture towards failures or missteps instead of pointing fingers.

It’s a powerful principle and one that works all the way up and down the chain of a business or any organization. It will change the way your organization works.  

If the response to a problem or failure no longer becomes “Who can we blame?” but rather “How can we prevent this from happening again?” employees will feel supported and everyone will be oriented towards solutions rather than blame.  

A revolutionary idea (for business, at least) inside an atypical business book. Pick it up for the lessons in leadership, come back to it for the humanity that animates it.

The “No Bad Teams, Only Bad Leaders,” chapter is also powerful, as the lesson was derived from SEAL training in which, during a 6 boat race (each boat manned by 6 men), Jocko swapped the leader of the team that was consistently winning (the SEALs had to paddle the boat a certain distance from shore, capsize it, then empty the water out, get back in, and paddle back) with the team that was consistently coming in last.  

Soon thereafter the team that was coming in last started coming in first. The men who were in the boat that was originally finishing last just needed a leader who knew how to motivate them.

Personal Responsibility

The appeal of this book is particularly strong in our society which is so desirous of true, strong leadership. It’s a book that never lets up and never takes the easy way out.  

Leadership isn’t something you achieve, but something you earn every day, and it’s always done best by building your team the right way….by showing them how to lead with humility and engagement.