The recession is bad for everyone. But is it worse for arts organizations? Yes and no. “We are in tough times in the arts just like everybody else,” says Russell Willis Taylor, CEO of National Arts Strategies. “Access to capital has always been difficult, and it’s not going to get easier. Even rich people don’t feel rich right now. Sure, that’s a big problem. But non-profit arts organizations, just as any other organization, also have to take a hard look at themselves, reassess their strategy – because strategy, in its essence, is do less, and better.” Despite this grim landscape, Russell remains confident (“I am not worried, but indeed am confident about the future of the arts”), but is calling for action: “Organizations will have to focus. Pick the things you do best and do them better than anyone else.”
Meet Russell Willis Taylor: From for profit to non-profit organizations (NPOs): Faulkner said he loved Virginians “because Virginians are all snobs, and I like snobs.” Well, Russell was born in Virginia and she is definitely not a snob and that’s why I like her. She is first and foremost an amazingly hard worker with an impressive track record in both commercial and non-profit organizations. I suspect that NPOs ended up interesting her the most because they are a continual challenge: “The non profit sector has a different layer of complexity. When people come from the commercial sector, working with big numbers and tough deadlines, they tend to believe that an NPO will be a snap. You soon realize that when you have virtually no access to capital markets and you don’t measure performance in numbers only, it’s actually quite complicated to run a non-profit. What NPOs can learn from the for profit sector has to do with adequately supporting your endeavors, hiring people who are the right fit, aligning people’s skills to the task at hand, paying them decently… but I believe that the for-profit sector can learn from the NPOs that mission-driven organizations who really spawn value are the best businesses.” Wherever she has served, as the director of development for the Chicago Museum of Contemporary Art early in her career, as the initiator of the fund-raising department of the prestigious English National Opera (ENO) that she later rejoined as executive director, as a special advisor to the National Heritage Board in Singapore where she resided for three years, and since 2001 as the CEO of National Arts Strategies in Washington, D.C, she has successfully championed operational efficiency and organizational leadership, and one simple, yet powerful mantra: Make meaning!
Navigate inside and through this zoomorama (you can zoom-in/out the pictures and videos as well as see them in full screen). Note on 4/6/9: Temporary problem with the videos due to an unexpected change in YouTube policies. Zoomorama is addressing the issue.
Making meaning in a world that has changed: It’s not enough to simply state that NPOs must be run more like businesses. “‘What business do you have in mind?’ is the question I ask to many NPO executives,” Russell says. “Do you want to be run like Enron or Worldcom? What we do is help organizations contextualize information from the graduate schools of business and make it useful to people who are running NPO businesses. For some subjects, 90% is what you learn in an MBA program and 10% of it is need to be contextualized and for some other subjects, maybe 50% is what you learn in a business school and 50% has been customized to the topic at hand. This 10% to 50% is where an NPO brings a specific value – where it makes meaning. That’s the hard part, and where many traditional arts organization are having the biggest problem.”
In a good economy, a so-so company, whether it is commercial or non-profit can struggle along for years. But recessions often end up revealing a variety of undersides and flip sides, and dismembering business-as-usual attitudes. As unwelcome they may be, they are a time when companies can’t sweep latent problems under the rug and hope for the best – the best won’t happen miraculously. So how does this translate for the arts? “Although the arts in America are doing great,” Russell says, “lots of arts organizations are in a tough spot because they have to address several issues at once. They must determine what their optimal size should be, based on their financial resources, as well as redefine their market, and by doing both, define their goals.” A turnaround of sorts.
Financial resources are the most visible part of the problem. “A lot of NPO’s are undercapitalized. Most medium-sized art organizations (between $5M and $25M) would be tiny businesses in commercial terms. Many don’t have reserves. They don’t do pure income budgeting, they do project based budgeting. If you are in performing arts you have a really tough problem because you have to commit long before you have the revenue and signing contracts that are three years out to get the singers you want or the directors you want, for example, but you can’t always plan your revenue that way, and, as a result, these companies are very high risk businesses, inherently.”
This inherent risk can endanger NPO’s when combined with an over-provisioning or mis-provisioning of a given market, two issues that have been plaguing the arts scene well before the beginning of the recession and were often left unattended by organizations – which have kept doing basically the same things they did in the 90s’, i.e. what was done in the 80’s, i.e. in the 70’s (when NP Arts was a thriving young industry). And yet, over the last 10 years, commercial arts have changed significantly, sometimes pulling the rug out from under NPO’s feet: “The NP arts have been extraordinarily successful in establishing a national niche market and we thought that we had the moral high ground because what we do is of the highest quality. The finest commercial companies couldn’t enter that market because you couldn’t make money in it, so we were OK, but now with new technologies, new distribution systems, and with changing customer behaviors, commercial companies have found ways to make money making high quality products. Twenty years ago, a regional theater’s biggest competitors were other performance venues within a 100 miles radius; now its biggest competition is HBO. Vertically integrated companies have intensive marketing, spend a lot of money on a creative product, and realize the gain from it over a 3 or 4-year period. You can have HBO, you can have Sundance for films – there is a way to make money out of high quality products. You can now make profitable niche marketS in the arts. We used to view ourselves as the arbiters of taste and the only people able to provide non-commercial high-quality artistic products. It’s not true anymore. We can choose to stay on the ice that we occupy that is getting smaller and smaller, like polar bears with global warming, or we can use our creative intelligence to invent how to bring meaning to people. If not enough people want to come and sit in a symphony hall, does that mean that people are not interested in classical music? No. It doesn’t. The first symptom of an industry that is in trouble is when it blames its customers. When a symphony orchestra has trouble and we say that people are not appreciating arts, we are blaming our customers. It’s not the appetite for music that goes away. People only expect different delivery modes or different programming, and ultimately a better integration into the social fabric.”
The other meaning of the word recession: ceding back: The problems that NPO’s may experience during a recession are no different from the ones experienced by commercial organizations. “What we are seeing is what economists refer to across the globe in every market, not just the arts, as a brutal rationalization of the market and it’s not going to be fun for anybody, and I am not dismissing it. But no recession, no depression ever killed the arts. I think we are doing a lot better in articulating the unique value we add. For so long we have been talking about the instrumental benefits of the arts in order to get legislators, city council people, and federal government people, with the goal to make it OK to support us –and we need to get more comfortable with the intrinsic language again — talking about our work in a way that matters and doesn’t just refer to economic benefit. We make communities, communities of joy, of thought, of debate — it’s important work on its own terms.”
At a time of an economic recession, it is only appropriate to also remember the other meaning of the word “recession” as the act of ceding back. I would venture to say that arts organizations are not designed for the mere preservation of the arts or the employment of the people who run them – no more that commercial organizations are aimed at only pleasing its executives and a bunch of shareholders. The primary goal of an organization is to satisfy its customers and users, and reach out to them – i.e. ceding back their feel of ownership. That’s what multiple initiatives have been able to achieve well before our current recession. “Look at enterprises like Community Musicworks in Providence. Wow Are they amazing! It’s a quartet. They decided that they were interested in completely changing the quality of life of that 20% of the population in Providence that doesn’t know anything about classical music. So they opened a storefront school, and they work with the community. Sebastian Ruth is one of the most extraordinary, charismatic people you will ever meet. He is not charismatic in a big loud way. He is incredibly intense. They are incredible musicians. People get on the train from New York to see them. They are doing these concerts with the kids from the neighborhood who had never picked up an instrument before they went to see these guys. They are unbelievable. They are doing this because they believe that great art has the power to change lives. The quality of their work is superb. And of course look at El Sistema. The founder, José Antonio Abreu is an economist and amateur musician. When he founded the Social Action for Music, he believed that they only way to affect poverty was to make it possible to young people to create something of beauty. And his program is now probably the most successful social program in the world!”
Russell is definitely optimistic: “People are going to be coming together for the kind of experience that the arts provide that doesn’t cost a lot of money but means a lot. I think the community is not simply a nice thing, it’s the only thing, and arts organizations have a premier role to play in creating the sense of community. There is a Starbucks at every corner. There is a Walmart in every town. But you know how you know where you are when all towns start to look alike. You know where you are by the art that is being enjoyed and created — that is what gives us that important sense of place now.”
I recently finished translating Guy’s new book, Reality Check, into French. It will be sold as La réalité de l’entrepreneuriat at the end of March, and is published by the Editions Diateino.
It is when you translate a book that you best realize that there is a lot to it. It is also a significant task as you can very well imagine, but I look at it as my “community service” for French entrepreneurs. Even if most of them read English, it is often easier to remember key messages in one’s native tongue. And it’s so pleasurable to see Guy, himself, in every single page! Let’s call this the charm of infinite recursion.
Many people write books to promote themselves and end up projecting a public persona that significantly differs from who they actually are. But Guy is Guy ☺ and this book the scintillating mirror of the person he is, a DICEE person, almost in the same fashion as he speaks of DICEE product.
Deep: Because of his exceptional observation skills (and memory), Guy has amassed an amazing experience – and is a jim-dandy (should I say, a guy-dandy?) of a correspondent and commentator of the Silicon Valley’s habits and fauna. Yet, this experience always converges towards one single goal: making meaning. Each of his books tells you of great people and great products.
Intelligent. Who had the idea of providing an easy-to-use vade-mecum to entrepreneurs before Guy? Nobody really. There are lots of great books on specific business aspects, but Guy had the charisma to stage all the do’s and don’ts in start-ups so clearly that entrepreneurs immediately understand that they have to go back to the drawing board (and to their PowerPoint), learn how to tell their story, and get to the bottom of things: does what I want to do “make meaning”? Guy’s personal mantra is to help entrepreneurs.
Complete. Guy is more than a great writer. A great speaker. A great blogger. A great twitterer. Are there so many Siliconites able to claim that if he twittered that he is flying to Istanbul, he would have a group of twenty people to talk to immediately? And in all circumstances, he is truthful. As famous as he is for being the Macintosh evangelist, he is also proud to remind people that Mike Boich was the first one and Alain Rossmann the third. He is immensely dedicated to assisting his friends as they go through terrible ordeals. And have you noticed his dedication to his four children and his wife?
Elegant. Guy’s interface is truly elegant. He is accessible. You don’t need multiple introductions to meet with him. It’s extremely easy to speak to him, because he likes to listen to people and sincerely cares about them. He is even too polite with the people who make a living… but would like him to speak for free. Incidentally, he is also quite elegant sartorially, as elegance is not simply the narcissist act of dressing well, but of dressing appropriately and in a way that does not distort interaction with people.
Emotive (Emotional?). No matter how often Guy has repeated this 10/20/30 rule, he remains equally passionate about his message. Same thing when he speaks of evangelism, about customers, about MBAs, about VCS, about polarizing products. Listen, when he says: “Stupid”… “Boy, I tell you…,” “I can’t tell you how good it feels…,” “It’s a huge mistake…,” “Never ever let the bozos drag you down…,” or “I want to be in first class Singapore Airlines for eternity.”
Navigate inside and through this zoomorama (you can zoom-in/out the pictures and videos as well as see them in full screen). Note on 4/6/9: Temporary problem with the videos due to an unexpected change in YouTube policies. Zoomorama is addressing the issue.
But maybe he is more than a DICEE person: He has a lot of humor, he is humble, he has no problem speaking about his mistakes, he is open to innovation, etc., and he has an incredible smile. Anyway, I like Guy. I was lucky enough to meet him for the first time in 1985. I did not know that he was so venerated in the Macintosh because I was coming from France – and I am glad because his “importance” did not distort my perception of him. I simply liked him because of what I saw of him (so much so that I hired him for the start-up I founded in 1987). So don’t ask me to tell you what his negatives are. I don’t know and I don’t think of the people I like in terms of pluses in one column and minuses in another – to make a good balance. Sure great people may have (what could be labeled as) “flaws,” but these alleged flaws are often just another plus. If they are bright, yes, they can be sarcastic when they speak of bozos. What’s wrong with that? If they were always too kind, would they still be bright?
Alltop, the first real online magazine rack – owned by Nononina, a company that he co-founded with two remarkable persons (and very dear friends of both of us): Will Mayall and Kathryn Henkens: http://alltop.com/
Update Sept. 3, 2009: Cory Pesaturo is the first American to win a World Accordion Championship for the United States in 25 years. The competition, called the 62nd Coupe Mondiale World Accordion Championships, is the most prestigious International Accordion competition in the world, and this year, was held on August 25-29, 2009 in Auckland, New Zealand. Below is my original February post:
Cory Pesaturo, 22, is the only student who ever graduated as an accordionist (2008) from the New England Conservatory (NEC), the oldest conservatory in this country, located in Boston. “I didn’t go to NEC to study accordion,” Cory says. “I had had fabulous teachers, such as Tulio Gasperini, and later, Lou Ludovico. I was 17, and I had already won several competitions. At that point, what I was looking for, was to become a powerful musician. NEC’s Contemporary Improvisation and Jazz departments are among the best in the world; they’re quite open about accordion and know that it’s becoming cool again, and they gave me fantastic training in multiple musical genres from folk styles to classical and, of course, jazz. Now, I am out there to help people enjoy the multiple facets of this instrument.”
Death and Transfiguration: There is a better way…
In music, just as in any domain, the entrepreneurial fearlessness starts with the strong conviction that “there is a better way…” Entrepreneurs innovate by bringing new ideas but also, and more often, by revisiting, challenging, or reframing established concepts, methods, or products. “I am kind of a rebel in the accordion world. Part of the tradition hampers the perception of what you can do with an accordion.” Cory says. “Some accordionists play the same tunes over and over again; worse, they play it the same way. The end result is that preservationists have almost killed what they loved most. I have to fight an old image of the accordion that’s ingrained in the mind of my parents’ generation – not my parents, thank God! This middle generation sometimes looks down upon the instrument. Their parents and grandparents liked accordion, but by the end of the 1960s, what people sometimes call the “Golden Age of the Accordion” was dying quickly. Although, to be fair to the middle generation in this country, their disaffection wasn’t completely unjustified because of the advent of rock and roll. The silver lining, though, is that my generation did not have the chance to hate the accordion since it was already dead, and, to us, it’s a new thing almost.” Because of this “death,” blinders are removed for Cory’s generation. “I tend to do all of the genres,” he says. “I play French. I play Italian. Spanish. Jazz. Classical. Romanian. Klezmer. Funk stuff. Zydeco and Cajun music, and I love to try anything. One day, Dick Contino, a accordion legend, told me that I had what was needed to bring back the accordion. It’s quite a task. But my mission is to do it, or at least significantly contribute to doing this in this country. I owe this to Dick, to my other role models, my friend Eddie Monteiro, extraordinary players of the past such as Charles Magnante or of the present, such as Ionica Minune, who is able to play at supersonic speed innovatively for ten consecutive minutes, and of course to the man who was the first to play jazz on the accordion Art Van Damme. My musical education at NEC in Jazz has enabled me to look at the whole accordion world with a different perspective.” There, Cory is also very passionate when he speaks of his three main role models in Jazz, Arthur Tatum (1909 –1956), Sten Getz (1927 –1991), and Bill Evans (1929-1980). “Basically, when you get into the Jazz world, you learn all the tools you need to do most anything…”
A glimpse at Cory’s talents: you can navigate inside and through as well as zoom-in/out the pictures and videos – and also in full screen.
“…And the digital world helps it’s image to become cool as well.”
Like many accordionists, Cory owns several accordions. “We tend to collect a lot,” he says, “because each one has a different sound. My dad has become good at fixing them. One of my favorites used to belong to Charles Nunzio, one of the great pioneers of the instrument. He had studied with Pietro Frosini. It has a beautiful “wet” musette kind of sound – as opposed to a “dry” sound that is more for classical music. I love my Sonola, and, of course, my Roland. It’s a brand new innovation that came up a couple of years ago. A completely digital accordion. They have developed a new technology for the bellows, so it stays realistic for players. I can go back and forth from the acoustic to the Roland and it doesn’t affect my playing. The Roland has 800 accordion sounds on it. So you have anything you want. It’s MIDI capabilities open up limitless doors for any sound on the planet. But know that at Roland, they are not trying to take over the accordion world. They just want to give accordionists an accordion that they can do anything with, to sit next to the ones they already have. Guys in my age group love it and I can see that people of all generations relate very well to it. I am one of their US demonstrators so I currently travel around for them and participate in various trade-shows, and demonstrate the instrument to the accordion world. For example, I was at the NAMM fair in Annaheim.”
Hard work
In addition to practicing his accordion everyday, transcribing and arranging, Cory works like crazy. Taking care of business means building an audience, getting known by the people in the business of innovation who like music, by all sorts of players in the entertainment industry, the video game world – any world in fact. He plays everywhere, for an amazingly diverse audience, and he participates in a large number of festivals. He has recently recorded two CDs with George Garzone and his band “The Fringe”, and has been performing with them in the Boston and Providence region. He is an absolute fan of Formula 1 that he has watched since he was 2 years old. He is currently working on a Formula1 book/statistics that, he believes, will change the way people look upon the sports history and its champions – and his music is regularly played on Formula 1 broadcasts. And he has another hobby, also work-intensive. He is known to many as “The Snowman” for his meteorological work (he may be the only non-formally trained meteorologist TV guy in Rhode Island). His 2005 Atlantic Hurricane Season compilation (http://www.weathermatrix.net/tropical/2005records.htm) has been used by virtually everybody. He likes applied statistics “almost” as much as Accordion.
Cory is kind, easy-going, charismatic and fun to be with. No wonder he has lots of fans… including Bill and Hillary Clinton: “I had won a National championship in my age group when I was 12. My uncle sent a tape to the White House because they had amateurs play at Christmas time; they saw the tape and they liked it. They called me to go in; my parents and I went down and I played in a hallway in the White House; my dad kept pushing to get me to play right near where Bill was and he ended up asking me to play for him privately during a break. We hit it off and we have been friends ever since basically. I went back three more times and I have played for him and Hillary on 10 different occasions since 1999 till now.”
About some of the big names in accordion and jazz that I mention in this post: it is easy to find extensive information about all of them via Google. I also suggest that you listen to the videos posted on YouTube.
Eric Hautemont – he is a high tech guy with an MS in AI and Applied Maths, who decided to launch Days of Wonder, a board game company – yes a traditional board game company, just as if we were in Persia or Egypt back in 3500 BC, and this, in the heart of Silicon Valley. What about that? Even better: the company, started in 2002, is very successful and has been profitable basically since it launched its first product. The recipe: Talent, originality, experience, common sense, and ultimately, an authentic business acumen combined with a deep respect for customers.
From Ray Dream to Days of Wonder: Hard to “summarize” a friend. The first words that come to my mind are that he is hyper, enthusiastic, a sharp quick-thinker, rationally adventurous, funny with an abrasive sense of humor, conceptual and pragmatic. He speaks as fast as a policy debater (over 350 wpm), yet extremely clearly, and he is forever youthful. I first met him in the very early nineties. He had started RayDream, a lovely 3D Modeling software, originally on Macintosh. Then, he sold the company to Fractal Design of which he became the President. Early 1998, he started another successful venture, Ridge Ventures, a VC firm specializing in seed stage investments, that he maintained until 2005. “By 2002, though, I was already bored,” Eric says. “It’s not fun to be a VC. Yes, you can make a lot of money, not because of your performance, but simply because management fees have gotten huge. The whole system is broken. If it’s true that the return of a fund is an average of your investments, in practice, a very small number of companies yield a great return and the others are doomed to remain lame businesses that will never be profitable. These bad companies continue to get money because some of the VCs that have joined forces to fund these companies want to save face and maintain illusions to raise their next fund. Easy when you make so much money on management fees only. So the end result is that as a VC, you must play along with other VCs, all with different agendas, and you end up spending 90% of your time on the bad companies that will never go anywhere and 10% of your time on the great companies that do not really need you, anyway. They know their business much better than their VCs, whose experience is quickly outdated, if they ever had any real executive experience. Anyway, I was bored. It’s more challenging to be an entrepreneur, sure. But it’s also far more interesting.”
From high tech to board games: an entrepreneur is an entrepreneur is an entrepreneur: Gertrude Stein’s famous quote (“Rose is a rose is a rose”) meant that some things can elicit emotions just by themselves. For Eric, becoming an entrepreneur again was exciting by itself and he wanted to make it even more exciting by picking a domain that he had loved since he was a child: games and the Franco-Belgian school of comic books. “And I chose board games, because they are a lot more universal culturally speaking than most comics, at least those of the kind I favor. On top of that, long-time friends and colleagues in my prior businesses loved it too. Also, we had the same goal: build a real company, in the real world where the real performance tests were profitability and happy customers with whom you could truly bond. No matter how great a software company may be, customers do not have the type of emotional relationship with a CD Rom that they have with games made of wood and cardboard and lots of other nice and unique bits you can play with. Our 3D application was cool and we had a huge enthusiastic user base, but their engagement was not nearly as strong and infectious as what we see at Days of Wonder. First, when people play with their friends and family, they accumulate great memories. They play over and over. They speak of the game to other friends and other family members, both offline and online. And they speak to us, too! Our corporate blog was an instant hit. If virtual communities are great, real-world communities are even greater, and in our case, complement each other beautifully. In all cases, though, when you feel the atmosphere at the Essen Game Fair, which attracts 160,000 people in average, you realize how dry and impersonal the Comdex was even in its heyday.”
A glimpse at Eric’s world: you can navigate inside and through as well as zoom-in/out the pictures and videos – and also in full screen. Note on 4/6/9: Temporary problem with the videos due to an unexpected change in YouTube policies. Zoomorama is addressing the issue.
Breaking in when there are many established companies…: When entrepreneurs tell you that they don’t have competitors, you instantly tell them that this may be because there is no market. If they tell you that that they are trying their luck in a field occupied by entrenched players, you don’t give them much of a chance either, unless they explain to you how they can flip legacy on its head or revisit conventional wisdom. “It’s clear that the board game industry is very traditional,” Eric admits. “To give you an idea of how traditional it is, Ravensberger was created in 1883 by Otto Maier in Ravensburg, Germany. Hasbro was started in 1923 by the Hassenfeld brothers, who had emigrated to the United States from Poland, and the grandson of one of the founders, Alan Hassenfeld, is still the Chairman of the company and was the CEO until a few years ago. The beauty of this industry, though, is that it is a traditional world. Our challenge was leverage this tradition, because as players, we love it, but we came in with new methods we learned from our lives in high tech. First of all, we automated our business processes from day one. We knew that we had to be extremely efficient for all the operational and logistical aspects of a business where you have to produce actual goods, and therefore are exposed to innumerable points of friction because of the wide variety of raw materials necessary to build a game, the number of manufacturers you deal with everywhere in the world, the shipments you continuously manage, and tons of other critical details. As enthusiastic as we were, we knew that we had to figure this out before anything else, to be able to focus on our core business, creating memorable games that people would love and were destined to become… let’s say… evergreens or games that would last, because they are appealing and endearing.
In reality, we wanted to get back to the tradition of beautiful and emotional games. As a result also, we took the somewhat counter-intuitive step – at least in the world of publishing where most companies live off a continued stream of new publications, each of whose success is limited but sufficient to keep producing new titles – of voluntarily limiting ourselves in the number of games that we would publish; from the get go, we bet that our scarcest resource wouldn’t be cash, but rather the time we had to do what we love with the level of craft and care required to succeed. This meant picking 1 or 2 new games a year, or even possibly zero, if none satisfied us. The commonly held belief that you should publish as many titles as you can hastily, crossing your fingers and hoping for the best makes little business sense when you take the time to think about it. What would Otto Maier or the Hassenfeld Brothers have thought of the fact that hundreds and hundreds of games are thrown on the market every year and discounted the minute they hit the shelves? True, there have never been recipes to make big hits in books, films, or board games. But random production is not the way to go either. Board games are consumer goods, but consumer goods with a high emotional content; so even if it is true that you never really know if people will like a game before they actually play with it, and even more complex, how well these games will create the dynamics between players that is a distinctive characteristics of any favorite board games, you have a better chance to find a real public if you offer games that are well though-out and well produced. We look at a lot of games, but we publish one or two per year, at the most. By the same token, though, because we do not flood people with new products, each new game or sequel of a game is an event, and people feel gratified when they buy a game with Days of Wonder on (and in) the box.”
Clearly the Days of Wonder‘s passion for quality is paying off! The company has garnered several multiple prestigious awards in a record time, and is thriving.
Ken Kaplan is the Broadband and New Media Manager in the Consumer and Social Media Team, which is part of the Global Communication Group of Intel. He embodies a new generation of PR: “Today, PR is not about messages, although they are in there. It’s about telling stories that connect to trends and that are helpful to people,” Ken says. “You tend to want a better laptop next time you want to buy one. At that point, we want to be there when you need it. We want to help you.” As I was listening to Ken telling me how passionately he loves his job during breakfast at Il Fornaio, I couldn’t help thinking that thanks to employees like him, Intel is more than “Intel inside,” it’s also “outside.” His charisma brings back the great words of one of the most amazing fathers of the Silicon Valley, Robert Noyce, who co-founded Intel in 1968 (after co-founding Fairchild Semiconductor in 1957): the focus of a great company is not “How do you relate to the rest of the world,” it is “How does the world relate to you.” How can you best do this? By having employees who are born media producers, of whatever kind this media may be – as is the case of Ken.
“Follow your inner moonlight…” Ken majored in philosophy, “almost by accident,” he says. He accumulated classes until he realized that he had enough credits to graduate. But he took writing too, and journalism, and mythology, and basically followed his heart, until he settled for his one and only goal, living in San Francisco, or more precisely, in North Beach to get into the Beat Culture, in search of both lost time and novelty. He wrote for North Beach Magazine for free – “but I was getting free books about Beat poetry,” he remembers fondly, and interned in 1991 at KRON, then affiliated with NBC, for 5$ per day. He was to stay at KRON for nine years; in his second year, he became their first publicist. “The experience I got there is invaluable. I was exposed to local news, documentaries, cable channel and, later, to the newspaper’s online component. I got to see all of that grow and, after a few years being dismantled, and I grew a lot from seeing that. I was able to work inside the newsroom, inside the cable channel and go downstairs to sit with the Web folks. I got serious know-how, especially I learned how to edit video, story-telling, how to write succinctly and I also understood real teamwork by learning how to deal with many different editors on your work.” All of this ended the day he received a call from a former executive producer at KRON, Larry Bozman, who had moved to Intel.
2000: Ken’s leap year: Ken’s life changed completely – or rather, everything he liked was restaged with a wholly different backdrop. He joined Intel and got married (with a beautiful Italian, Gabriella Bruni, currently a Ph.D. student in Classics at Berkeley) and was soon to have two children (Damian and Selene). Ken was not into technology and Intel was not looking for yet another technologist, but the computer chip company was looking for somebody who had good communications and relationship building skills, somebody who knew how the media works from the inside. “This was an exhilarating time that is so close and yet seems so far away,” Ken reflects. “The heydays of technology on television. In the late 1990s, CNBC was all over in the Valley. Local affiliates were reporting on technology every day. ZDTV had debuted in 1998 and became TechTV. In 2000, when I joined Intel, TechTV and CNET we’re covering technology as a lifestyle. We were very busy with broadcast media relaitons. Everybody wanted to cover technology.” Then, the bubble deflated: “Technology became not as important and was no longer leading the news. The local guys weren’t coming and doing live shots a couple times a week like they had done for the years prior, but something else was happening at the same time and it was big!”
A glimpse at Ken’s worlds: you can navigate inside and through as well as zoom-in/out the pictures and videos – and also in full screen.
Video, audioblogging, all-out blogging… and the PR metamorphose: “Everything was moving online and the big thing was video. So we started to put our B roll online, and here again, my background served me well. It was a new opportunity for creativity.” Then, podcasting came around. Although he was not a technologist (and maybe because he was not a technologist), Ken was on the lookout for anything that would serve his passion for helping people to tell their story. He had never met Dave Winer, but he knew instantly what audioblogging would bring even before the term “podcasting” was officially coined. “I had been doing work with radio; trying to get folks on radio, you have to get a story and help them to be good at telling that story. Podcasting was taking us into another realm – almost like TiVo. You get it when you want to. You can save it. Now, we could create stories that weren’t just for today, or this week, but something more evergreen. So we started using podcasting to give life to interesting stories from inside Intel and sharing them. First, we would just turn on the mike and turn it off and then we really started real production, often editing and making these podcasts better for the audience.”
New media, and even more importantly, new delivery channels have changed the style and even the nature of PR. It’s not about shoving information into the head of journalists or people. “Of course, we still write press releases, but press releases have a simple core purpose: here is what happens, how it happens, here is where you get more information. PR becomes interesting for both PR people and its audience, when everybody can engage in the story. “Now, we all get the real voices. It’s awesome to hear the story from the person that experienced it. So if we have an engineer who was really key and instrumental in shrinking a transistor and all the challenges they went through – it’s geeky, but hearing it from the guy who really struggled and did it with hundreds of people around the world, that’s fascinating.”
Getting people to edge of the company: Since 2005, Ken has been an advocate for “getting people to the edge of the company,” to use an expression he first heard from his friend Jeremiah Owyang, who is now at Forrester. PR pros who are control freaks are becoming a thing of the past: “The old PR school was all about having only specific people on the edge. It wanted to control the message. In a world where everybody can get any information about virtually anything, what does “control” really mean? Nothing. Today, PR are not simply people whose job it is to regulate information. Our job is to evangelize our company as well as we can. The more well-informed experts we get to edge of the company, sharing their passion for Intel and real-life experiences, the better. Also, and as importantly, our job is to listen to people.That’s why engaging with them is what we do. We are not working with IT experts or OEMs only, but also with everyday people who are using our technology. They can be a source of inspiration when they share interesting ways they’re using technology and even hearing what they’d like their computers to do better. Today’s social media is a two-way street. We all are participants.” Ken is well aware that corporate blogging has its challenges, that putting too many microphones out there can also generate some noise, but he is also confident that solutions can always be found when needed, especially when there is a culture of trust and openness inside a company.
Contrary to common belief, many large corporations such as Intel, and through employees such as Ken, are extremely well versed in all media and social media and have embraced them wholeheartedly – and often more sincerely than multiple mid-sized companies or even start-ups. The reason for their ability to soak up innovation so quickly and so efficiently? The quality and the strength of their internal corporate culture enable them to trust their employees and leverage their skills, creativity, humor and their kindness.
Marylene Delbourg-Delphis
http://en.wikipedia.org/wiki/B-roll“: “B roll” also refers to footage provided free of charge to broadcast news organizations as a means of gaining free publicity.
I have known Hamid Farzaneh for quite a while. Great resume with such former positions as COO of Genesis Microchip, co-founder of Motion Sense (a MEMS controller), Executive Vice President of Sales and Business Development at Silicon Optix Inc. He is now the CEO of DisplayLink. We rarely speak of business, as he is always involved in domains with which I am not that familiar. But for some reasons, I recently wanted to know what Displaylink was really about. Really cool technology!
Six monitors at once for one PC or one notebook: Simple idea, right? Just imagine that instead of accumulating open applications on your notebook or your desktop when you are at the office, you could display your Excel, your PowerPoint, your email, your Word, your Internet browser on different screens, see all your applications at once, and drag and drop data across them transparently with no need to switch and click like a maniac to reach any of them… Or if you are a photographer, what if you could display different versions of a picture to better see them all at once?That’s what DisplayLink enables. Simply watch this one-minute or so video to get a feel of what I am talking about:
Presentation by Dennis Crespo, Executive VP, Marketing & Business Development
Using multiple applications comfortably: All the main concepts of an optimal user interface for the desktop were defined in the 1980’s by Apple, and incrementally improved since then, by Apple and most other vendors. Over the last few years, the increasing popularity of small devices has again placed usability and comfort of use in the limelight. However, while miniaturization had led to new significant improvements, and economies of scale have made displays increasingly inexpensive, little attention has been paid to the ergonomics of multiplying the viewing surface at the office or at home as we use several applications. This is what DisplayLink addresses, enabling substantial productivity improvement.
Sure, the ability to organize a virtual desktop over several monitors is not new per se, but is hardly accessible to most of us – and existing technologies do not permit to scale to a multi-screen environment from a thin, small and elegant notebook! Key to the unique power of the DisplayLink’s network display technology is that DisplayLink allows to connect video monitors to desk- and laptops via USB, the most universal and the simplest plug-and-play way to connect to any peripheral. In other words, DisplayLink replaces the VGA analog standard that IBM introduced back in 1987 as well as the DVI digital protocol, which both are point to point, where a monitor is a slave to the desktop. It also spares users from having to add graphic cards that are expensive, power hungry, and often require an IT specialist. And none of these former solutions will let you connect a notebook to several monitors (typically up to six), of various sizes and resolutions. Forget about graphic cards there! Now how can DisplayLink so transparently leverage the power of USB? Because of a lot of smart software and a new chip. The company’s Web site provides a short overview of the technology. http://www.displaylink.com/products.html
The alchemy of innovation: Innovation is the epiphanic encounter between several things, good timing, technology acumen, authentic chemistry between people, and even luck to name of few. The fact that the sales of notebooks have overtaken those of desktops only exacerbates the need for this type of solution. “I am sure that there are companies around the world that have tried, but they may not have tried the right way and at the right time,” Hamid Farzaneh says. “However, the fact that you have the right timing is not enough,” he adds. “You also have to solve serious technical challenges. Some innovations are only permitted by a unique combination of skills that are not customarily found at once – especially in start-ups. DisplayLink combines software competency, hardware competency, and chip competency. In theory, you could do something resembling what we offer through software only using VNC (Virtual Network Computing) or more modern incarnations, but the latency would be too high. You wouldn’t be able to move from one monitor to another naturally. For a good user experience that exceeds what can be achieved with traditional VGA or DVI connectors, it is critical to feel that moving the mouse or windows across monitors is fast and smooth, as if any of the screens was directly linked to the computer. In order to get this level of performance, again, you need the competency in terms of understanding software at the operating system level, networking and communications, and know how to do build cost-effective powerful chips.”
You want DisplayLink today! Yes, you can get it today. The company has been delivering on its promise in a record time. At the 2008 Consumer Electronics Show in Las Vegas was considered as “the most killer technology of all because of how practical it is,” by InformationWeek. At the time Samsung and LG were already building the company’s technology into their displays. A year later, the company’s technology is broadly available in a variety of products such as monitors, docking stations, projectors, mini personal displays or adapters, all easily linkable over USB to a notebook or to a desktop PC. The most recent introductions were an HP USB docking station, a Samsung “Sidekick” monitor targeted at notebook users for secondary or tertiary displays, an IO Gear wireless adapter kit (for displays or projectors), a Nanovision 7” monitor linked and powered by USB or USB to VGA or to DVI adapter that are offerd under many brands such as eVGA. These products can be found online or at major retailers such as Frys’ and most sport the label “DisplayLink Certified” that signal the best performing devices. A long list of companies offering products with DisplayLink technology can be found at the company’s web site: http://www.displaylink.com/shop.html
A Jew Among the Indians: this year’s BMOP’s winning composition: The Boston Modern Orchestra Project (BMOP), a major orchestra dedicated exclusively to performing, commissioning, and recording new music, presented its 11th annual Boston ConNECtion concert on January 17th at Jordan Hall (Gil Rose, conductor) featuring works by William Thomas McKinley, Michael Gandolfi, Peter Maxwell Davies, John Heiss, Kati Agócs, and Matti Kovler’s Cokboy – A Jew Among the Indians. Right after she saw this final version of Matti’s piece, my daughter, Sophie Delphis, sent me an enthusiastic email, of which this is an abstract: “I have seen Matti’s piece in a number of transformations this past year: with piano, with a small group of non-classical musicians, and now with an orchestra. In this third version, the wider palette of sounds available to him has apotheosized his vision. The reaction I hear from the majority of people about him, and specifically this piece, is their surprise at the broad range of sources that find themselves into his music. It is certainly not every young, contemporary composer who has the knowledge and the courage to explore both “schmaltzy” and abstract motives, and incorporate them so easily into the same piece. It is only fitting then, perhaps, for Matti to work with a large ensemble, wherein the breadth of soundscape can corroborate the breadth of his material. Cokboy is in many ways an epitome of Matti, the man: sensitive, Romantic, part mystical, part comical.”
Vision of the Baal Shem in America:I heard the first version, and I was pleased to find out that a fan posted the latest version on YouTube (see below). Despite the limitations of this video shoot, I am confident that you will get the right feel about this great piece. It is a symphonic poem where the composer recites a part of Jerome Rothenberg’s extraordinary poem, Cokboy. A displaced Jew is transported into a whole different world: “saddlesore I came/a jew among the indian/vot em I doink in dis strange place.” Discordant sounds hit his discombobulated mind where a mish-mash of times, things, and peoples richochet off the image of his grandfather, until this image itself merges into the Baal Shem’s presence. The Baal Shem wearing his shtreimel unites with the old-new world (“the local all thought he was a cowboy/maybe from Mexico/ “a cokboy?”/no a cowboy.”), and reconciles humans among themselves (“we will watch the moonrise/through each other’s eyes”) and with the spirit. The way Matti intensely and humorously mingles Hassidic chanting within the movie-style theme that progressively builds through the piece is simply stunning – as is his peaceful classicist postlude in which all the displaced people of the world may heal and communicate.
Note: As you listen to the music, you can navigate inside and through as well as zoom-in/out the pictures and the text of Cokboy – and also look at this zoomorama in full screen.
Meet with Matti Kovler: Matti Kovler, 28, was born in the Soviet Union and spent his childhood in Moscow, where he started to play the piano and write small pieces. When he was 10, his family emigrated to Jerusalem and he encountered the Hungarian-born composer Andre Hajdu (who studied at the Paris Conservatoire National de Musique under Darius Milhaud and Olivier Messiaen). By his late teens, Matti was already a successful composer and had an opera already staged, Ami and Tammy, inspired by the story of Hansel and Gretel. Following his army service in Israel, he received his bachelor’s degree from the Jerusalem Academy of Music and Dance (working with Menachem Wiesenberg and Michael Wolpe). He earned his master’s degree from the New England Conservatory (NEC), and is currently working towards his Ph.D., also at NEC. His teachers and mentors in this country include John Heiss, Anthony Coleman, and Michael Gandolfi, to name a few. He was a Tanglewood Fellow in the composition program in Summer 2008.
Many high-tech entrepreneurs bootstrap their companies. Artists bootstrap their entire existence and live from their ability to express themselves – and can do this quite successfully. This is the case with Matti, who makes a living as the current director of the NEC Children’s Choirs, teaches privately piano and composition, receives scholarships and gets commissions for his compositions, the latest one being the commission of a large scale vocal orchestral work from Carnegie Hall for the Osvaldo Golijov and Dawn Upshaw Workshop (to be performed on May 9 &10). His goals? To work even more and be able to create a touring company one day.
Sophie Delphis & Marylene Delbourg-Delphis
More about Matti Kovler:
http://www.myspace.com/mattikovler: This site offers an earlier version of A Jew Among the Indians as well as Shoresh Nishmat, performed at Carnegie Hall’s Weill Recital Hall during a concert celebrating Israel’s 60th anniversary, as well as his Clarinet Quintet. Upcoming performances include his string orchestra piece Nineveh, scheduled to premiere in Boston on January 31, 2009.
http://www.mattikovler.com: More compositions are offered on this personal site, especially Enosh, a rock opera, and the The Escape of Jonah, an oratorio that was performed at the Jerusalem Music Center in June 2008.
More about Jerome Rothenberg: Born in New York in 1931 from Polish-Jewish immigrants, Rothenberg is certainly one of the most prominent American poets, and an amazing translator and anthologist. He is the author over seventy books. For details see:
Incidentally, for high-tech readers, he is the father of Matthew Rothenberg, who worked for Ziff Davis for a number of years and is now the Director for editorial and content at The Ladders (http://www.theladders.com).
It’s great to live one’s life in the fast lane, and even better to do so with a sense of purpose. This is what I like about Frederic Kerrest. Entrepreneurship is his passion, and everything he does is aimed at honing his skills to become an effective entrepreneur.
From engineering to sales: “I didn’t like talking to computers all day long. I preferred speaking with people”. After six years as a student in Computer Science at Stanford, and employment as a software engineer at Applied Materials, WebTV Networks, Sun Microsystems and Moai Technologies, the entrepreneurship virus hit Frederic, who co-founded an IT Consulting firm with Stanford pals in Argentina, Brazil, and Mexico. This was a challenging, but successful, two-year experience in the midst of the Argentine economic crisis and clearly a fantastic way to learn what the real world is made of. At only (or already) 24, what was he going to do next? Go learn a little bit more about a growing business. He joined Salesforce.com as a sales engineer in 2002, when the company had 125 employees, and he left as a business development manager in 2007. By then, Salesforce.com had become public and had 2,000 people. “Great company, I made some fantastic friends and learned a ton, but after a few years my ‘education’ there was starting to slow down. I had won a couple sales awards, I started the wireless and OEM programs and was managing them successfully, but, by the end of 2006, I wasn’t feeling challenged to my full potential. It wasn’t the same to wake up and get to work in the morning. The company had gotten big and grown up and like all such situations, the job functions started to shrink.”
Why an MBA, and why at MIT? Multiple reasons. He says, “I wanted a change of pace from NorCal and to see what the MIT/HBS/Boston ecosystem was like, to develop a new set of smart friends, to build a new network of partners and professors. Also, although I had learned a lot by transitioning from engineering to sales, I felt I needed to solidify my academic credentials, get an education in finance, and generally speaking, structure what I had learned on the job.” Frederic’s experience at MIT met his expectations, and after only 18 months there, he admits that he feels “more loyalty to MIT than to Stanford.” He points to the MIT $100K Entrepreneurship Competition – which over its 20-year history has spawned successful companies like Akamai Technologies, Zipcar and Guitar Hero – as a perfect example of the entrepreneurial fabric inherent at MIT. “The $100K has enabled me to sharpen my entrepreneurial tool set immeasurably, both as a successful participant and as the competition’s lead organizer. The competition has forced me to focus my ideas and to understand how to build a team, a product with a truly sustainable competitive advantage, a differentiated marketing plan and realistic financial forecast, and all of the other aspects that are essential to a successful startup venture.”
Frederic considers that he was not only able to acquire a theoretical literacy he felt he needed, but also to expand his knowledge in two favorite areas, sales and entrepreneurship in general. He raves about a course offered by Howard Anderson, the founder and former president of The Yankee Group (http://www.yankeegroup.com), who also co-founded Battery Ventures (http://www.battery.com): Technology Sales and Sales Management (http://entrepreneurship.mit.edu/entre_courses.php#15387). Frederic believes that this may still be the only real technology sales class in any of the top five or ten business schools. This class is part of a still relatively new program called Entrepreneurship and Innovation that leads to an MIT Sloan Certificate in Entrepreneurship & Innovation in addition to the regular MBA degree (http://entrepreneurship.mit.edu/E_and_I_electives.php). One of the highlights of this program is the January five-day tour of Silicon Valley for first year students, in which Frederic enthusiastically participated again, but this time as lead TA, helping to manage the 70 participating students – a trip reported by the local edition of ABC News: http://abclocal.go.com/kgo/story?section=news/local/south_bay&id=6592297
As Frederic puts it, “you don’t need an MBA to start a company, but getting an MBA from MIT Sloan not only doesn’t hurt, but can strengthen your determination to become an entrepreneur while providing you with tools that might take years to acquire otherwise. In last year’s class, out of 370 students, 25 started or were part of the founding team of a company – which is a much higher number than you’ll find at Harvard. This year, there will be about the same number of entrepreneurs in my MIT Sloan graduating class. The Harvard entrepreneurs hang out with us at MIT. We have built a good ecosystem and we all meet at a bar in Cambridge. It’s fun and energizing.”
What’s next? “I will start a new software company, in Northern California. I have a number of different ideas that I am working on and testing. I have started to put a team together. It’s a great time to be an entrepreneur. The whole world is falling apart; there are lots of great people ready to start fresh, and change the world. Obviously recessions are not good, but this is also a necessary time to weed out companies that shouldn’t be in business in the first place. It’s a great opportunity. Look at Cisco, Sun Microsystems or Google – they were all started during economic downturns.”
I have worked with quite a few entrepreneurs. Honestly, I have no doubt that Frederic will succeed. I met him a few months ago when he was a Summer Associate at Hummer Winblad Venture Partners (http://www.humwin.com). This job is more complex that one would think. You are in the awkward position of having to sound credible to both the entrepreneurs who visit the firm, and to the venture partners that sponsor your internship. I noticed that he was definitely more than your typical associate through small, yet revealing questions, focusing around execution and goal measurability. Good sign also: he wasn’t pontificating about “sales models” in general, but wanted to know more about the actual selling to customers. I look forward to telling you one day what the product will be about!
Marylene Delbourg-Delphis
For more information about the MIT $100K Entrepreneurship Competition: http://www.mit100k.org/
When I first met Lara Druyan in 2000, she had just started as an associate at Allegis Capital (http://www.allegiscapital.com). At the time, I was advising a great entrepreneur, Ismael Ghalimi, the founder/CEO of Intalio (http://www.intalio.com), and we tested the company’s new pitch on her. The concept of a “Business Process Management Platform” was still somewhat cryptic for most people back then, but she got it almost instantly. Although we wanted to think that it was because we were good, Ismael and I came to the conclusion that it was because she was especially sharp and quick-witted. A former business product manager at Silicon Graphics (http://www.sgi.com) and investment banker at Merrill Lynch, this young Harvard MBA was probably the person who grilled us the most relevantly about our technology that summer! My most striking first impression of Lara was her knack for setting the stage: she was not going to take any crap from entrepreneurs, but clearly also, she was not going to serve us any VC crap, either.
When VCs must be creative and entrepreneurial…
From the standpoint of entrepreneurs, the notion of a “creative” or “entrepreneurial” VC tends to sound like an oxymoron. Not so, though, when you look at the overall VC landscape. The ones who operate within the top ten VC firms basically see the 100 or so companies that suddenly pop up around a domain, acquire some smattering of knowledge by hearing their respective pitches, and are able to pick the one or two that are most likely to make it. For all the other VC firms, the game is different. They are faced with two options: follow the trend identified by the top ten VC firms and find the pearls they missed, or look for something special, off the beaten track. Lara consistently goes for the latter. And that’s why, as a VC, she has to be imaginative and entrepreneurial. The start-ups she considers often require deeper upfront investigation and are usually more technology intensive, as is the case with her current deals, companies such as Apprion (http://www.apprion.com), Autonomic Networks (http://www.autonomic-networks.com), Rosum Corporation (http://www.rosum.com), and Packet Design (http://www.packetdesign.com). They are also equally exciting, and she obviously loves them. They don’t sell cool “ad network” or “digital media” stories, yet they still offer solutions to real-life problems and anticipate new needs. “I certainly feel closer to their entrepreneurial spirit,” she says. It is this entrepreneurial spirit that made her want to become a VC: “I love entrepreneurs and I really wanted to help people build businesses. And I like being an investor. There is no better job in the world, because you’ve got to figure out where the technology is going. You meet terrific people and if you are lucky enough work with them, you can try to build terrific companies with them.” As a VC, Lara is definitely part of an extremely small club: a survey of the National Venture Capital Association shows that women in partner level roles in venture funds represent only 5% or 6% of VCs! And given that there are more women in life sciences than in tech, the tech club might be narrowed down to 3% or 4%. Incidentally, while Lara is, unsurprisingly, regularly invited to speak at major universities, she has never been invited to do so (yet) by any of the female colleges in this country! Go and figure out why! Are they waiting for her first to go through two or three face lifts…?
A wonderful role model for young women…
Lara is 41 years old. Just as any entrepreneur, she works about 10 hours per day. She is the smart workaholic type, but she remains today the omnivorous and voracious reader and learner that she was as an undergrad in Economics in Chicago, where she also took as many classes in history, literature, or advanced biology as she could. As we were chatting recently, she was telling me with enthusiasm about Anand Mahindra’s remarks at the Harvard Centennial Business Summit last October, on the need for always expanding out of one’s field to be able to really see things with which you believe you are familiar from a new or fresh perspective. Lara does not only talk the talk, but walks the walk, and tells you in the same breath about her love of liberal arts, the value of culture, Jeffrey Toobin’s The Nine: Inside the Secret World of the Supreme Court, Bill Tancer’s Click: What Millions of People Are Doing Online and Why it Matters, and of a scary article by Michael Pollan in the New York Times Magazine on how much oil it takes to produce a calorie of food in the United States! At no time, however, is she pontificating. She has a lot of humor, even when she posts chilling reminders on her Facebook at 9:44 PM in the Peter Russell’s World Clock. (Before you get to bed, look at it: http://www.peterrussell.com/Odds/WorldClock.php)
You could call Lara a bright, straightforward, free-spoken, unguarded, and considerate “Renaissance woman,” if you like formulaic summaries. Does she know it all? No, because she is also the caring mother of three-year-old twins, who have minds of their own and the negotiating skills to say “no” until things come their way. Any guesses where they got those traits?
Eric Benhamou started to teach at INSEAD, one of the world’s leading business schools, in 2003. He recently completed his fifth year. “I am just beginning to get a feel of what it is to be a professor there, and every year, I enjoy it more,” he says.
You have an impressive arsenal of degrees, and one of them is a Master of Science from Stanford University’s School of Engineering. How did you end up teaching MBA courses at INSEAD?
It was a coincidence because I did not go to the INSEAD. I had met Gabriel Hawawini, then Dean at the school, and he talked me into teaching there after a casual comment I made in a cocktail party about considering something like that. What I found interesting is that when you have to really teach something, this is when you have to figure out whether you know something or not.
What is the focus of your course?
The title of my course is “From start-up to Fortune 500,” and its subtitle is “Lessons in management and governance.” Over the years, I figured that what would be the most valuable to teach is a practical perspective on creating, building and growing high-tech companies. INSEAD has a very good reputation as a strong academic institution, and, as most top business schools, was short of practitioners. I can’t teach people in advanced finance or theoretical strategies, but I can teach them about practical cases which I have lived through, and I can make them feel what business is really like. As I was building the plan of my course, I came to the conclusion that I should focus on the times when a business is in crisis, because you always learn much more under such conditions than when everything is going well. Also, having been on the receiving end of many lectures, I don’t like when people tell me about their great accomplishments. I prefer to hear about their failures and what they learned from them. So I decided to approach my subject by focusing on the failure mode and on failure modes that I personally experienced and where I was not necessarily at my best.
Can you give two typical examples of such “failures,” one in a start-up, one in a Fortune 500 company? Let’s start with start-ups…
A funded start-up can have a bunch of VCs on its board and the Board is often dysfunctional. VCs don’t know how to function as Board members, nor do they know how to coach the CEO. There are hidden agendas between the venture firms and oftentimes, the CEO is caught in the crossfire. One VC supports the CEO and another VC wants to fire him/her. This happens much more frequently than people suspect. I was caught in a situation like this when I was relatively new as a venture capitalist and I found that it was too late for me to make a difference, because I had failed to raise the bar on governance and the level at which I expected directors to operate. By the time a crisis hit, it was too late. I could not appeal to best practices and best behaviors, because they had never been upheld in the company. From this example, I teach about the importance of setting the right type of governance at the various stages of the life of a company. Even when you have a small fast-moving start-up, it is still important to have a real Board, a Board that is disciplined, and someone has to take the leadership of that Board. It can be the CEO, but it can also be an experienced Board member.
And in a Fortune 500 company?
Most examples are true regardless of the size of the company, but yes, I also teach about the biggest mistake I made as the CEO of a Fortune 500 company. In 2000, when I was still the CEO of 3Com, my Board became very impatient about growing the shareholders’ value at the same pace as the young high-flying startups. They were criticizing the company for not executing as well as Cisco in the enterprise market, and basically wanted to deconstruct the business: “we like this, we like that, but we don’t like this piece of it, so we think you should get rid of it.” My gut was telling me this was the wrong thing to do because we could not just separate out the large enterprise piece without contaminating the whole business. However, I wasn’t sure exactly how to build my case. I handed the matter over to very smart McKinsey consultants who threw in a whole bunch of interesting analyses that validated the Board’s perspective. My gut was still telling me that there was something missing, that this approach was too simple, too simplistic, and failed to take into account the synergies between the businesses, but I could not explain my position forcibly. So I basically gave up under the pressure of smart but under-informed board members. I should have said instead: “I am the CEO. I set the strategy. I disagree. I can’t prove my case with numbers but my judgement tells me we should stay in this business…” That mistake proved to be costly, because we proceeded with the sale of that large enterprise business. It created such a fracture in the company that it caused it to go into a tailspin. It turns out that this happened at a time when I had already planned to retire from my job. So I said to myself: “well, I may not feel great about this decision but if everybody else, included my appointed successor, does, so who I am to just say “no”? I have to live with it. I’ll go and set this in motion.” This proved to be a very costly mistake and from this I derive a key lesson I teach my students. If as a CEO, you don’t feel completely 100% comfortable with a strategy, you cannot execute well. All your instincts have to be in line; if they are not, it’s better to press the Pause button than the Go button. You must think about it until it feels right. You can hire a group of McKinsey business consultants to support any point of view. They will come up with interesting arguments, they will develop them cogently with great slides, but ultimately, you’ve got to lead from the guts, as Jack Welsh used to say, and if the guts don’t respond, you are not in a position to lead.
How do you see teaching versus mentoring?
The way I approach my course, it’s very close. The reason why students take my course is because they expect that. Many students come to my course for mentorship. They value the experience of a practical perspective. Basically, at the end of the course, students have a flavor of what it’s like to grow a company through different stages and understand the typical failure modes that are looming at each stage. I try to integrate this human dimension in every situation. For example, when I teach a case study, I explain who the actors are, what their backgrounds, and what their basic personality traits are, so the students can anticipate how they will behave in a similar situation and make intelligent analyses. It typically comes home when the students see that the people who teach the case, actually lived the case and are not just professors who pick a case from the Harvard Business Review. I teach very practical things, such as how to create a dashboard. I give them five companies and tell them to imagine that they are the CEO of one of them and need to present at the next Board meeting a dashboard that the Board members will understand. They have to prepare it in 5 slides, no more. So at the next session, I ask for 10 volunteers to present the dashboard and we critique them. They see how I would react and they see it in real time. This is what they expect. The people who take my course have a very high propensity to start a business. When I ask them: “Do you expect to start your own business in the next 5 years?” More than half of them do. Also, 10% of them are already true entrepreneurs who go to INSEAD to prepare for their next start-up, and about 20% of my students plan to take over a family business at some point.
Who are your students?
There are about 50 of them. I always spend a few minutes in the first session to know more about them and I keep some stats. The demographics have not changed all that much over the last five years. The average age is 29 when they start. By the time they graduate, it’s 30. It’s more senior than the MBA course at Stanford or Harvard. It is a diverse group. This year I had students from 13 countries– which is fairly representative of the overall population at INSEAD, because they have a recruiting policy such that no single country will represent more than 10% of the enrollment. This ensures a level of diversity that I could not get in other top business schools. And I get countries that are hard to get, such as Uzbekistan, for example. I even had a student from Papua New Guinea. This is not like at Stanford where you have primarily Americans, Indians, and Chinese.
Given that a major advantage of business schools is to be able to build a business network, how valuable will it be to build a geographically diverse network?
It’s a good question. It turns out that it will. First of all, persons from a small or less developed country may very be the ministers of commerce or industry one day. And also, if they do not go back to their home country, they are likely to become very successful in mainstream economies somewhere. These people are bound to be very successful. The school is not super-old, but it’s old enough to have a solid track record, so you know where these people are and how far they have been able to go.
What do you learn from teaching?
I have learned that even when you know something, for example a case that you teach every year, there are always angles that you have overlooked or that only come out through discussions with people who bring a fresh perspective. When you walk into the classroom, you have to be humble enough to realize that you have not answered all the questions yet.
Why would you recommend INSEAD?
First, of the top business schools, it is probably the best return on investment. It is a very intense 12-month program rather than a more typical 18-month program. The salaries after graduation are very comparable worldwide to the salaries of graduates from other to the top business schools. And yet, you invest far less in time, in money and opportunity cost. Secondly, it is a great human experience. Harvard, Stanford, or Columbia are US business schools with foreigners attending. INSEAD is truly a global business school – where speaking three languages is a requirement, even though all courses are taught in English.
The recession is bad for everyone. But is it worse for arts organizations? Yes and no. “We are in tough times in the arts just like everybody else,” says Russell Willis Taylor, CEO of National Arts Strategies. “Access to capital has always been difficult, and it’s not going to get easier. Even rich people don’t feel rich right now. Sure, that’s a big problem. But non-profit arts organizations, just as any other organization, also have to take a hard look at themselves, reassess their strategy – because strategy, in its essence, is do less, and better.” Despite this grim landscape, Russell remains confident (“I am not worried, but indeed am confident about the future of the arts”), but is calling for action: “Organizations will have to focus. Pick the things you do best and do them better than anyone else.”
