Guy Kawasaki’s

Entrepreneurs, re-enchant the world!

There are people who see the workings of what Max Weber called the “disenchantment of the world,” a sort of inevitable sinking in their daily lives caused by an array of factors – good and bad reasons, from nostalgia for a Golden Age that may never have existed to disillusionment or dissatisfaction with a job. Meanwhile, there are those who believe in the possible re-enchantment of the world, creators and visionaries who want to make a difference – entrepreneurs. They want to enchant, and to share their visions of a better (or rather, bettered) world. As a result, they are able to withstand cynicism, skepticism, stasis, blasé attitudes, and resignation. This is the subject of Guy Kawasaki’s Enchantment.

The term “enchantment” evokes dreams and myths, and the apparition of miraculous fairies and omnipotent sorcerers. It represents the carefree joy of childhood, when everything still seems possible. We use this word almost inadvertently when we refer to the small marvels of our day-to-day lives: love at first sight, a baby’s smile and its first, tentative steps, or discovering something that previously seemed unimaginable. Almost inadvertently, we realize that the world around us, while giving us grounds for lament, is also rife with ways to fill us with wonderment in which we can abandon ourselves, as well as ways to make others do the same. For example, Skype, a practical tool in a business context, becomes a magical means of bridging divides when used to talk to a far-off loved one.

In order to enchant others, let yourself be enchanted

As adults, we are often reticent to let ourselves be enchanted, mostly because we are afraid to seem overly naïve or gullible. Instead, we fashion aloof personae, believing ourselves to be more intelligent when we protect ourselves with skepticism and condescension. But the more we live within the largely arbitrary confines of this dogma, the more we are limiting ourselves to the status quo, as we become unable to sense the vibrations of innovation stirring both in others and in ourselves. So begins the vicious circle of boredom in which so many blasé self-proclaimed “realists” are trapped: as they shut themselves off from the creative pulse that surrounds them, they are increasingly unable to imagine ways to transform the world that so dissatisfies them, or charm the people from whom they feel alienated. Numb to the sensation of wonderment, they are left with no means to amaze others. Tedium begets tedium, and only boring people are bored.

According to the recently deceased Yiddish poet Avrom Sutzkever (1913–2010), “Childhood alone does not age[1].” You should not allow the capacity to believe a good story that you had as child disappear if you want to be able to enchant others. Whether or not we are willing to admit to being taken aback, fascinated, or amazed by someone or something, allowing ourselves to be, means regaining energy and enthusiasm. We are able to look forward creatively and connect to the people that surround so that they can share in our breakthroughs or happiness. Enchantment is contagious. It is an indispensable starting point, although it is only a starting point: all the artistic interest in the world alone cannot and will not make a Van Gogh of anybody. Nor is it enough to be enchanted to become a great enchanter. Like in any art, the road to excellence follows a simple formula: 10% talent, 90% work. This book’s aim is to help readers in their approach and understanding of the 90%.

Construct your MAGIC

The strength behind any enchanter is MAGIC, or, in other words, his:

• Mastery: If you have ever seen Steve Jobs on stage, you will agree that he is incredible. This is not necessarily because he has the charisma of an actor, but because he is prepared beyond anything you can imagine.

• Authority: An enchanter knows what he is talking about; he is competent and strong. He possesses in his rhetoric what the Greeks called ethos (ἦθος): the quality that allows a speaker to capture the attention of his audience and to instill confidence by means of his credibility, his knowledge, and his moral competence.

• Generosity: An enchanter is able to convey a likeable image because his goal is above to give to his audience, and not to find self-validation or to force people to love and admire him. Instead, he transfers his own power to his public.

• Imagination: An enchanter sees and understands the environment of the people listening to him in order to overcome their reticence or skepticism, and to open their eyes to greater possibilities.

• Commitment: Enchantment entails a human relationship, either face to face, or by means of technology. Every enchanter dreams of making a lasting connection, or one whose echo is still present in the people he has reached, either because they still use the product he has showed them years ago, or because they still remember it fondly.

Hone your art

Every chapter of Enchantment is a guide that insists you work on your weak points while strengthening your strong ones. How do you smile? How is your handshake? And so on: these are small details about which you probably no longer think, as deeply entrenched in the definition of yourself as they are. Often, they are so much “in your nature” that they are no longer really in your current nature at all, but merely ghost remnants of what you were a decade ago. Remember that every new pair of eyes you encounter will look upon “you” subjectively as you are in the moment, and not with knowledge of who you once were. Perhaps you have become patronizing without fully realizing it; your smile is no longer a genuine gesture but a vague stiffening around your lips, or your handshake has become a limp motion without any real eye contact or warmth… It is as much work to create enchantment in oneself as it is to create it in others!

Reality Check was a sequel to The Art of the Start. Enchantment is simultaneously a third installment in the series and a sort of prequel. Honestly, if you have no desire to charm anyone, how are you ever going to successfully start a company? From where will you draw enthusiasm for the day-to-day realities of your corporation if you do not see that you must win over and connect with your employees, co-workers, and clients? If you do not let yourself be won over by them in order to renew your own energy and drive? With this in mind, this book is undeniably an important learning tool, rather than a diaphanous essay.

This book presents a set of techniques, which are not necessarily enchanting in and of themselves – the point is not to lull you with rose-tinted storybook fantasies. It is to dissect for you the mechanisms behind the process of enchantment. For instance, Kawasaki’s anecdote about his guests’ reaction to garbage cans at his home is not particularly enchanting (although certainly amusing), but it does bring home a key idea: anticipate people’s reactions in order to influence their behavior! After all, musk can be a revolting smell for many, but it is also the base of some of the most beautiful and attractive perfumes. In this case, the metamorphosis is in the way its parts play within the whole, the MAGIC of the perfumer who brings them all together.

Learn from the MAGIC of others…

… And, of course, start with Guy Kawasaki. He knows what he’s talking about. He is not a university professor orating conceptually on the art of influence or a psychologist dissecting the behavior of human test subjects, although he does draw from such research. He is a practitioner in the art of enchantment – I was struck by this the first time I met him, in 1986. I had just arrived in Silicon Valley, and I had never heard his name. I learned that he was a Macintosh evangelist in the United States, although I wasn’t quite sure what this was supposed to mean. (I was particularly puzzled by the religious connotations of “evangelism,” which was not a word used in this context in France at the time.)

And then, one day, I understood: watching him speak to a group of developers, noticing the way he mixed a genuine desire to win over people with a certain attentive nonchalance. He made telling his story an art form, with such mastery that there was never rigidity in his demeanor, his tone, or his style. He was not trying to impress for the sake of impressing. The focus, although on him, seemed to be guided toward all those who were listening. People came to him easily because they wanted to follow this enchanter. That day I understood how he had won over so many brilliant programmers and maintained their interest in Macintosh even after Steve Jobs’ universally traumatic departure in 1985.

When, the following year, I asked if he wanted to be president of the company I was creating. He answered me “Really?” with a smile – a genuine smile that caused little crows’ feet to appear at the corner of his eyes. Then, quickly, he agreed. But it was not until a few days later that I was really enchanted, when, upon reading a New York Times article, I discovered he was far more famous than I had ever imagined. Real enchanters don’t need to impose their power and renown; they own them and keep them through the elegance of their humility.

If you think I am too partial because I have known Kawasaki for more than twenty years, go hear him talk. You see dozens of individuals who have never met him take a seat in the room, and you see them leave different from how they were when they came in. They are smiling; they are happy. They begin to speak to the people around them. All of a sudden, they find something to share with the world. They have been enchanted, and they are ready to become enchanters in their own right.

David Cohen

The art of building a startup is analyzed through seven themes, and these are divided into key related topics.

1- Idea and vision: You start with an idea that, after prototypes and multiple iterations, might end up being quite different from what you anticipated in the first place. For your own good, be able to adapt (because no matter how much you fancy yourself as a game-changer and disruption-bearer, you have to solve a real problem for real people – see an earlier post I wrote about windmills with wigs). So beware of the “next big thing” and keep away from what David Cohen calls the “everythingitis:” offer something that people want, and if you see that things won’t pan out no matter what, close the show earlier rather than later, elegantly.

2- People: However romantic the idea of venturing out as a solo pioneer, put your ego aside, and look for co-founders – while pre-empting the disastrous impact of possible future disagreements with a prenup. Also, no matter how skilled you have become at hiding your personal flaws and insecurities, make it a principle to hire people who are better than you. Given that you are not infallible, learn to fire quickly (“Two strikes and you are out,” Brad says), but don’t turn into a tyrant: a company is a great team of complementary talents, as well as a managed network of relevant customers and evangelists.

3- Execution: That’s the nervous system of any startup and I am glad to see this very early in the book. If you are not an “execution machine,” you are just a dreamer and forget about your entrepreneurship dreams. You have to do everything faster than an established company and fall back on you feet as quickly as a cat. Trust your guts, be decisive, learn that a one-of-a-kind customer doesn’t create a market, and scale your business through replicability. You may find out that the company will not thrive. So fold it sooner than later. Learning through failures is a great reassuring American spiel (provided than you don’t start to believe that it can be a way of life).

4- Product: Another great section, often tied to section 1. Despite efficient filters (Techstars accepts just 10 of the more than 600 startups that apply), “we find at least one-third of those startups are attempting to build a product that they want, or that no one wants, instead of what the market wants” the authors say. Don’t wait until you are proud of your own product, focus on what matters, obsess over the right metrics, and never forget that customers are kings.

5- Fundraising: Most companies come to Techstars with the goal of raising money. Well, should it be really your goal? Sure, you will learn more about the art of raising money, but also find out that you may not have to. Beware of angel investors who aren’t investors, find the right ones who care about the right things (in the end: it’s results!), and realize that bootstrapping can be a very efficient way to right-size your business.

6- Legal and Structure: This is not fancy, but key: form the company early and choose the right company structure – and default to Delaware. And even (some) lawyers can tell you that “lawyers don’t have to be expensive,” which doesn’t mean that you should select your brother in law to stay on the cheap side. Cheap is cheap – and sometimes very expensive.

7- Work-Life Balance: Yes, you will work around the clock. But at some point, you need to recharge your batteries. Various ways to do that, even though it’s hard to get your passion out of your mind.

Techstars is a great mentor-driven accelerator, and has become a meaningful part of the ecosystem in Boulder, Boston, or Seattle and will soon in New York City.  This is a replicable model, and the great thing about the whole initiative is that David Cohen has been very open about the results.

Entrepreneurs, read Do more faster + Guy Kawasaki’s The art of the Start and Reality Check as well as Steve Blank’s The Four Steps to the Epiphany, and you are sure of at least one thing: starting with your head on your shoulders. Good luck!

Dominique is the founder of Diateino, the French publisher of Guy Kawasaki’s The Art of the Start and Reality Check as well as of Seth Godin’s Tribes, three books that I translated for her. She had asked Guy to help her find the “best translator” for The Art of the Start. Guy having known me for a long time (we co-founded ACIUS – now 4D – in 1987), I was to be the designee. Writing books had been my favorite occupation until I started 4D in France, but sometimes Friendship oblige, and although I had the hectic schedule of running a company in full swing (Brixlogic), I agreed to undertake my first translation as a night-and-week-end activity.

What you “lose in translation” is made up for by what you actually gain: Dominique’s style on the phone (I only met her in person after the book was actually published) was a big part in my decision. She loved the book for the right reasons. She had attended the Stanford Professional Publishing Course and Guy Kawasaki had presented The Art of the Start. Of course, this was a “wow” experience for her, and when I asked her what impressed her the most about Guy, she responded that it was the ability of “a unique personality to deliver a truly universal message.” She was speaking of a dear friend in terms that resonated with me. She was not telling me “Guy is Guy,” a tautological statement that I have sometimes heard from clueless groupies or self-declared thought-leaders. Instead, she was positioning in just a few words Guy’s “competitive advantage” against the dozens of regular Joe’s who go at great lengths to be special and only end up spinning their personal idiosyncrasies. On top of that, I liked the fact that immediately after the speech, she had bought the book, read it and was advocating for its translation for a valid reason. She told me something around the following lines: “I understand English reasonably well. I believe I can say that I understood everything, except, maybe, for a few idioms or jokes here and there, but I also believe that even if many French entrepreneurs understand English, they can’t own the message as well in a foreign language as they would if they could read it in French. There is a difference between ‘understanding’ the words and being able to really ‘feel’ what they mean.” She was so right! We are so accustomed to think that many things are “lost in translation” that we often forget what we may also miss when reading a text in a foreign language: we don’t memorize quite as much or as easily as in  our native tongue; it takes us more time to extrapolate from what we read, connect the dots, adapt the message to our daily environment and eventually act upon that message. Yes, understanding a message is one thing, being able to live it is a whole different story.

Entrepreneurship, a business and a cause: Making the decision to acquire the rights of The Art of the Start was an entrepreneurial act in itself. Dominique had been a legal analyst and consultant for twenty years, as well as the CEO of a legal publishing company when she decided to create a company to publish the books that she wanted to read. She already had a few titles in her catalogue, including a bestseller, Les Techniques du Succès (available in China and India), but “it so happened,” she said, “that The Art of the Start was something I needed as an entrepreneur myself. And I couldn’t possibly be the only person with such a need. Sure, there were a lot of books ‘made in France’ about creating a company, but there was nothing, similar to The Art of the Start– or to Reality Check. We have good books here, but somehow the entrepreneurship spirit is often missing or all the reasons why you can be enthusiastic about starting a business seem to be crushed by piles of warnings and explanations about French regulations, and tons academic recommendations.” Guy’s books are straightforward and uplifting. Dominique was well aware that she might face some challenge promoting an American book in a country inclined to wonder if words from the Silicon Valley could truly be heard in Marseille, Lille, Bordeaux or Brest – in short, in a country that invented the word “entrepreneur” in the 18^th century, yet also fathered Chauvin, a soldier in the Napoleon’s “Grande Armée,” whose existence is associated to the word “chauvinism.”

Dominique did win her fight and Kawasaki’s books have become the vademecums of thousands and thousands of French entrepreneurs who realize that they have the same dreams and the same needs as any entrepreneur anywhere in the world. Entrepreneurship is Dominique’s cause and helping others her goal – and because of her, I end up looking at translating a few great books as a way to give back to the country where I was born.

If you read French, take a look at Diateino’s interesting catalogue: http://www.diateino.com. If you do not read French, are a francophile or want to make a lovely gift, Diateino published a book in English Say Chic to Say it in French (published in the United States by Simon and Schuster).

Marylene Delbourg-Delphis

It is simply a great pleasure to step into a class of some eighty highly motivated students: when I asked who planned to start a company one day, at least half of them raised their hands!

The name of the course for which I was a guest speaker is “Leadership and Networking,” taught by Bob Lowry. One of the books that they are currently discussing in the course is the 1936 bestseller by Dale Carnegie (no relation with Andrew Carnegie): How to Win Friends & Influence People. Although it was published more than seventy years ago, this book remains a must read – and given that it still inspires modern authors focusing on both leadership and influence, it’s never a waste of time to leaf through pages that were groundbreaking at the time.

The theme of my speech was that starting a company is a lot about “winning people to your way of thinking.” To do that, you certainly have to think about all the rules that enable you to influence people, and in particular, you have to learn how to tell your story – and tell it to an ever-expanding audience. As you analyze your product idea, position your project competitively, define its features, you always end up addressing people. Because companies and products are created by people for people.

Where do you start? Read good books. The Art of the Start and Reality Check by Guy Kawasaki are the best ones. I also like Sramana Mitra’s series, Entrepreneur Journeys, because they provide portraits of entrepreneurs. Then, create your own story. Feel it. Live it. Discuss your project with those who are the closest to you, generally your family – because more often than not, they are the most likely to give you a frank opinion and support your efforts. If you want to create a five-wheel car, they won’t feel obligated to tell you politely that it’s “interesting.” Although it is possible that what you want to do is well above their head or their domain of interest or expertise, they will ask you the first hard questions (What’s the use of it? How come nobody had this idea before? Are you sure that people want this kind of stuff?). You have to recount a compelling story on why you, of all people, would be able to do something that nobody does or cannot do as well as you think you can.

The skepticism of people you trust may very well infuriate you, but will force you to hone your arguments – and if the topic is difficult, to express your hyper-sophisticated system in layman terms. This is not silly at all. Think of it this way: If you go public one day, you will have to offer a plain story to thousands of John Doe’s so that they buy your stocks. Incidentally, it’s also only if they have an idea of what you are talking about that your family will bear with the fact that you will work around the clock, take no vacation, live on a shoestring, etc.! One of the students, Tia, wondered if becoming an entrepreneur was putting a strain on personal relationships. To which I responded that it often does and that entrepreneurs have to be aware of it. To make good, though, I also added that personal relationships that collapse because of this, would most likely collapse anyway!

So, you have to position your story for your immediate environment. Then, you must extend your circle as you look for co-founders and early employees. Your story is again put to the test. They may ask you about the company’s roadmap and product delivery timeline. Then comes the circle of mentors and advisors, who may have (or preferably have) a prior experience in the domain that you try to tackle, and ultimately early adopters who really know what they need and will buy your concepts only it these serve a business they ultimately know better than you do. As you expand your audience and reach for people who are not waiting for you as a Messiah, your story has to become increasingly compelling, and your beliefs must turn into measurable results. Ultimately, the extensibility of your story and of your influence show whether or not you have a real business.

Some students in the room already have the idea for a business. One of them, Derek, sells Tshirts. “Why should I buy one?” I asked as uncharitably as I could. He hesitated a few seconds, but came up with a reasonably good response.

The class is led by a real entrepreneur, a UMass alumnus, Bob Lowry. After college he didn’t know what to do and worked at various odd jobs until one day he spotted a “for rent” sign in the window of a place next door to a popular pizzeria in Amherst. He thought that a burrito shop would appeal to students, convinced his dad to invest $20,000, and four months later his first restaurant, Bueno Y Sano, was up and running. I tried the one he later opened in Northampton. I recommend it. I ordered a chicken quesadilla. Exactly what I expected. Simple, healthy and good ingredients – and a remarkable turnout at 3:30 PM! When he had his students’ average age (21), Bob had no idea of what he would do – if he would even be an entrepreneur. It’s the same for me (I was translating John Locke’s early works into French!). So when one of the students asked me how she could find a business idea, I simply responded that ideas usually come unexpectedly to people who are open minded. The important thing is to follow one’s passion and work hard.

Thanks to this wonderful class and to Bob! Just tweet a little bit more (congrats to @genuinejack)…

Marylene Delbourg-Delphis

For more information about Dale Carnegie: http://en.wikipedia.org/wiki/Dale_Carnegie and http://en.wikipedia.org/wiki/How_to_Win_Friends_and_Influence_People

For more information about Bob Lowry and Bueno y sano http://www.buenoysano.com/aboutbys.html

After an engineering degree in Applied Mathematics and a master in Computer Science from the University of Grenoble, Neil joined Bull, where he stayed 12 years, starting as a software development engineer and quickly becoming a “Large Systems Product Marketing Manager.” Moving in 1983 to Apple France was a radical change. The subsidiary had been started by Jean-Louis Gassée in 1981 and was garnering interest quickly. Of course, participating in the launch of the Macintosh in France was ten times more exciting than anything Neil had ever experienced. He was definitely in the thick of it as the Developer Services Manager, which entailed, among other tasks, promoting the Macintosh to third-party software developers and assisting software publishers in their marketing and distribution efforts in France. He was extremely busy, of course, but never behaved as the super-occupied guy that you have to beg to for a meeting. Just like most remarkable people, he had the art and the courtesy of making himself available and was never giving to anybody the impression that he was in a rush. Such kindness is invaluable when you are a new company and look at the manufacturer of the product on which you bet your life as a holy place! His technical background enabled him to analyze products carefully, ask very precise questions, and make relevant suggestions. Very relevant, as far as I am concerned. In 1985, I was walking with him in the yard of Apple France late in the afternoon; the company I had started, ACI (ACIUS in the US in 1987), was still quite small. We had published a game and a file manager, ABCbase, and had begun the development of the first graphical relational database. We didn’t have a name yet, and as I was telling him that we were providing a new dimension in the way to organize and present data, he suggested with his always soft-spoken tone: “Why not 4th Dimension?” And the product was named 4th Dimension – quickly nicknamed 4D by our users. Incidentally, the company also became 4D in 2000.

Marylene Delbourg-Delphis

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?

Marylene Delbourg-Delphis

More information:

Guy Kawasaki: http://www.guykawasaki.com; http://twitter.com/guykawasaki.

Read Guy’s blog: ”How to Change the World: “Audi–Like My Belly Button?” Life with Four Kids and an Audi R8″ http://blog.guykawasaki.com/2009/02/audi–like-my-b.html#ixzz09IK6uCPT (”Audi–Like My Belly Button?” Life with Four Kids and an Audi R8″)

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/

All the books written by Guy in English:

Reality Check: The Irreverent Guide to Outsmarting, Outmanaging, and Outmarketing Your Competition

The Art of the Start: The Time-Tested, Battle-Hardened Guide for Anyone Starting Anything

Rules For Revolutionaries: The Capitalist Manifesto for Creating and Marketing New Products and Services

How to Drive Your Competition Crazy: Creating Disruption for Fun and Profit

Hindsights: The Wisdom and Breakthroughs of Remarkable People

The Computer Curmudgeon

Selling the Dream

Database 101

The MacIntosh Way

Books in French: 

Editions Diateino:

La réalité de l’entrepreneuriat: 

http://diateino.com/imglivre/205_GLa_r_alit__de_l_entrepreneuriat.jpg;

L’art de se lancer: http://diateino.com/livres.php?livre=42

Edition First:

Affolez vos concurrents: http://www.efirst.com/XXXsearch.asp?recherche=Affolez+vos+concurrents&Image2.x=0&Image2.y=0

How bad is it for startups seeking financing? This is the title of a post by Jeremy Liew on November 24^th[1]. Well, it’s bad and as usual, Jeremy Liew says it pretty much like it is:

1. Angel financing had dried;
2. A slowing economy has reduced near term revenue growth expectations;
3. Venture Capitalists are focusing on their portfolio companies.

Jeremy Liew ends his piece on a more positive note: there will be “better times ahead.” When? I would not bet that it is any time soon. So, brace for the worst (you can only be pleasantly surprised, after all), and bootstrap! If you have already secured a first round of financing, consider putting on the bootstrapper’s boots and live as if no second round was to come in the near future. So, here is my two cents piece of advice for today:

Build the leanest possible organization

If you are an early startup with little to no money (your credit card and the charitable contribution of your loved ones), get people to work for equity. Given that not everybody can live on love, fresh air and savings, find a bunch of friends or friends or friends who have a day job and are committed to working with you from 6:00 PM to 10 PM during the week and most of the weekend. These 30-40 hours are about half the number of hours that an employee must put on in a startup. My friend Bernard Gallet, one of the most brilliant programmers (and CTO of several companies) I had in my career, also reminds you that you should not discard what companies such as Rent-A-Coder or Elance offer for a reasonable fee if you have a small budget. Do not expect them to design your product, of course, but they can be a useful resource for specific capabilities that do not require access to the entire source code, interfaces or utilities. Also leverage the huge amount of open source available out there! The end result is that if you really believe in your project (and make others believe in it), you will be just fine. Make sure, though, that your employees’ partners (or your own partner) embrace this lifestyle. Otherwise, you are in for counterproductive tensions and conflicts that can be deadly for startups.

No matter how tiny the team may be, operate as a full-fledged company with regular coordination meetings and a pervasive sense of accountability: Have a real board of advisors, a real board of directors, a bookkeeper one or two hours per month (lots of startups tend to neglect this aspect because there is not much to compute, which is a bad idea), and a corporate attorney (you do not need much either, but be always clean and many good firms differ payments for young startups). Also, immediately buy all relevant domain names and trademarks even if your headquarters are your basement.

Remark: If you are a funded young company, even if you have a decent cash runway (I recommend six months at all times with virtually no new sales), also live the lean life, even if you believe that the company is not threatened. In fact, it is a perfect time to resume a pre-funding spirit (most of what I say above and below applies), refocus energies and remove people you feel are not busy 150% of the time. If your runway is less than six months, reduce your headcount and your expenses so that you remain constantly at this security level. I neglected to do this in one of the companies where I was the CEO and I did regret it. The risk that you will be overwhelmed by customers’ demands is extremely low.

The landscape is likely to worsen. The companies that will win are the ones that will outlast their competitors, not the ones that believe that they must “grab market shares” as if there were no tomorrow (such frantic mindset can be a sure method to jeopardize tomorrows actually).

Generate revenue

It has become customary to create an early product, show “some” traction and then look for money to move the company forward. What if you simply delayed your exhausting quest for VCs or angels and spent your time actively generating some revenue? Finding money to fund actual growth, even when it is modest, is easier than looking for money to fund ideas or prototypes.

You may scratch your head because this is not the strategy you envisioned. Think twice. For example, if you planned to create a base of millions of users considering that there are “metrics” other than cold, hard cash, be open to an about-face. Why not forget, at least temporarily, about the alternative metrics or potential buyers interested in acquiring rolling eye-balls or targeted bustling social networks? Acquirers are also impacted by the recession and will be less prone to buying you for zillions. Their most reasonable strategy will be to let your assets smoothly wind up into their hands for peanuts. Remember, in a bad economy, the whole point is to last constructively. So make money!

Stop thinking of business models that do not yield immediate revenue. The most prosaic modus operandi for start-ups or young companies is to be opportunistic – call this a “multi-pronged business model” if you want to sound less of an earthling. True, some VCs may look at this approach somewhat warily, but not all of them. VCs who have created companies before the Internet bubble will respect you, be interested in seeing how you fare under tough circumstances, like your sense of survival, and might be open to assist you faster than you think (if you want them to do so). So how do you make “opportunistic” revenues? Here below is a reminder of the two simplest methods for you to discuss with your labor camp’s pals:

• If you are a traditional software company, scale down the number of features planned for the first release and sell consulting services associated with the alpha/beta version of your scaled-down product. It’s a good deal for everybody. Your customers get something adapted to their needs, and you learn from them what they actually need (which may be slightly different from your initial grand vision). You will also come to the conclusion that your product should be more user-customizable than what it is currently. Become a “product company” only when you feel you have reached a reasonable level of sales predictability. For complex pieces of software, selling training is also a very good way to generate cash. Stay away from the big deals that take forever to negotiate (unless you are paid for consulting services during the same time). Remember, you want cash now.

• If you are a webware company, try to set your sight below the B2C castles in the clouds and look at the landscape with your feet on the ground. Most innovative B2C webwares can also be positioned as B2B2C products and, thus, have a stronger reach and value within a B2B2C architecture. Look at it this way: 1) You don’t have the money to “buy” users; 2) virality is not always miraculously fast if you are not a celebrity and 3) ad-generated revenue are notoriously slow to come because of 1) and 2). So if your product is of interest to users going to your site, it should also of interest to users going to other sites that already have users. In short, if your product is useful, you will find customers. You may even find customers who will pay you for consulting services to help them design (technically and strategically) an optimal integration of your widget within their environment.

• In both cases, also look at niches – roughly speaking, at markets that seem unglamorous, may only be a few hundred millions dollars opportunity or even much less, and are allegedly of no interest to VCs (which is not necessarily true). The reality is that there are customers there that could need you and your ideas even in tough economic times (and possibly because of the recession). You will be able to refine your product away from the noise, later consider other “niches” and get larger when you feel that you have the financial stamina to scale – then, VCs will believe you when you tell them that your platform transparently spans multiple industry domains).

Peter Yared? I met him… arghh… almost twenty years ago. He was a 4D developer during his time at IDS. I lost track of him while he was Prograph and later at JRad Technologies, an enterprise Java tools company that he founded in 1995 and was acquired by NetDynamics where he stayed – until the company was in turn acquired by Sun. There, he occupied a number of positions (CTO, Application Sever Division, Researcher at SunLabs, CTO at Liberty). We reconnected through a common VC friend who had asked him to take a look at the platform of a company I was running. Our paths soon crossed again in a cryptic world for techno-freaks: he was in the “grid” genre and I was in the native implementation of XML Schemas. Maybe we always happened to do a number of cool, hair-raising stuffs at the same time after all – while webifying on separate tracks for over a decade.

His new venture is pretty neat – iWidgets. A great name too. The product enables publishers (even you and me, but also and much better for Peter’s company, large corporations) to distribute content to social networks. Yep, if you want to share that you are a fan of characters on CBS programming with your friends within your Facebook, MySpace or your iGoogle, you can. Or more generally speaking, if you want to add a third dimension to your two-dimensional Web space, iWidgets is the way to go. Think of it as a way to create stories inside stories and traverse viral channels.

iWidgets navigates in the same waters as two other companies, MuseStorm and Sprout, hotter ones, though. iWidgets is more than just cute “ready-to-use” stuff; it is also a development environment – I hate to use this expression these days, as it seems to imply that it is difficult, although it isn’t at all.  iWidgets allows you to create, customize and fully configure widgets to display content, text or media, the way you want (with the right look and feel within any given environment).  In short, you create native widgets, not strange in-laws slated to mar the family picture.

Peter is a “serial entrepreneur.” Sure, I agree with Guy Kawasaki in Reality Check that the label “serial entrepreneur” is double-edged. Yet, some of them are able to ward off the risks of self-serialization: when they do not hesitate to jump into new domains, are able to learn fast because talent is not so much to already know, as the ability to know what you don’t know, get up to speed quickly – and stumble upon the thing that not too have figured out. This creative adaptability may actually be Peter’s most permanent feature; he was born in Switzerland from a Lebanese Maronite father and a Jewish mother from Brooklyn, also lived in Turkey, Austria (speaks German), England. Incidentally he speaks French much better than what he says he does (this was his native tongue), and to end with his personal journey, he is anchored in San Francisco for good!

Marylene Delbourg-Delphis

http://www.iwidgets.com/

Reality Check: The Irreverent Guide to Outsmarting, Outmanaging, and Outmarketing Your Competition

Probably because of the downturn, I have never been asked as often as this year if it is useful for entrepreneurs to have an M.B.A!

Entrepreneurs are, almost by definition, “francs-tireurs,” (literally meaning “sharpshooters”), in other terms “guerrilla fighters” operating separately from the regular army. (Incidentally, this French word appeared in the English vocabulary as early as 1808.) By contrast, many M.B.A folks often appear to look more like operatives inside the regular, that is corporate, army. Does this mean that an entrepreneur with an MBA is an oxymoron, then? No. Think of it this way: Bernadotte was an independent-minded private who became one of the top Napoleonic Marshals, then broke ranks to go his way before rejoining them – until he chose to be his own boss again and turned into the founder of the current Royal House of Sweden. This analogy suggests that the entrepreneurship and MBA streaks may perfectly coexist within the same individual, and that one or the other gaining the upper hand may just be a matter of circumstance or context.

The fact that there are successful entrepreneurs with no MBA does not mean that they succeeded because they do not have an MBA, and failures of businesses started by MBA holders cannot be attributed to their having one.  In the same fashion entrepreneurial instinct does not equate with managerial and financial acumen, MBA does not necessarily mean lack of creativity. 

So, here are my two cents of the day:

- If you have started a company or participated in the early days of a startup that didn’t get to at least $5M in revenue and want to eventually have the option to build a career within larger corporations, you may want to consider earning an MBA or an Executive MBA. Put yourself in an employer’s shoes. How can s/he have a clear idea of what you know or don’t know? Why should anybody buy the idea that you will learn everything on the job? An MBA title does not entitle you to anything specific, true, but it shows that you are familiar with the basics.

- If your undergraduate studies are in liberal arts, and your first job is in a high tech company (large or small), earning an MBA may actually give you the confidence to one day become an entrepreneur.  “My undergraduate studies were music and political science. An MBA enabled me to understand the workings of business and gave me a toolkit to better assess opportunities. It also gave me the opportunity to make the switch from an early career in consulting to an internet start-up, and to my current executive director position in a non-profit music festival and school, The Walden School  (www.waldenschool.org),” Seth Brenzel says. “Moreover, the network of professionals at business school, who come from a wide variety of backgrounds and who have gone on to careers in varied industries, is invaluable to me personally and professionally.”

- If you have been involved with a number of successful startups (I tend to old-fashionably believe that some of them should show profitability), enrolling in an MBA program may be superfluous. Yet, I recommend that you strengthen and formalize your practical business experience and identify the blind spots that could jeopardize future entrepreneurial endeavors. You do not want to be a serial entrepreneur embarking in serial mistakes. Buy a few “Portable MBA”-type books. You will enjoy them far more than you think because they will place your experience in a wider context. Of course, also read all the great books of the latest seasons.  Guy Kawasaki’s recent “Reality Check” of which I spoke earlier this month is definitely one of them. Yes, I know Guy is not exactly pro-MBA, but don’t forget that he has one!

What the Best MBAs Know

The Portable MBA, 4th Edition

Reality Check: The Irreverent Guide to Outsmarting, Outmanaging, and Outmarketing Your Competition

- If you are a foreigner, going for an MBA at some point or another in the United States may accelerate your understanding of the American business culture. This is something that I did not realize when I started my first company in 1987. Had I thought of it, I think I would have considered an Executive MBA, which might have saved me some adjustment time. Eliot Ingram, one of the founders of ClearAdmit*, a consulting firm advising MBA applicants on the most effective way to present themselves as they seek admission to leading business schools, reminded me of an interesting study conducted by a student research team at Duke’s Master of Engineering Management Program: over half of Silicon Valley startups have one or more immigrants as a key founder**. Entrepreneurs from all over the world bring their creativity to this country. MBA courses may ultimately help all of us speak a common language and belong to the same world of success. Why not?

*MBA Admissions Blog: http://blog.clearadmit.com (daily updates and admissions tips);
MBA Admissions Wiki: www.clearadmit.com/wiki (latest reports from the applicant community)
; Clear Admit School Guides: www.clearadmit.com/guides (in-depth research reports on the leading schools).

**http://www.pratt.duke.edu/news/?id=963

Marylene Delbourg-Delphis

Guy Kawasaki just gave me “Reality Check.” It is a sequel to “The Art of the Start”. Contrary to most sequels, it is an extremely good one. “The Art of the Start” became the starting point of a discussion between Guy and entrepreneurs, and among entrepreneurs – reality-checking the “Art of the Start”. Great interactive relationship, except that it ended up being somewhat volatile as relatively few people browse through the archives of even the most active blogs. “I grew frustrated with the shortcomings of blogging, which I began to do in earnest in 2006 with my blog How to Change the World,” Guy says. “I quickly learned that people rarely scroll past the home page of a blog or search for previous material.” I am glad Guy took the time to restage piles of comments (huge enterprise!) into this crisp 460 pages new desk-and-bedside guide for entrepreneurs. To the point, loaded with invaluable tips, thought provoking, and entertaining. I love Guy’s free, sometimes abrasive, style. Just as I did with “The Art of the Start,” I’ll tell all the entrepreneurs I help and/or mentor to read “Reality Check”. They will save thousands of dollars and we will get in the thick of things on day one.