Year End 2021: Send a Thank You!

As we close out another tumultuous year, I wanted to pass on some advice I got as a way to mark the end of the year: send a thank you!


Showing appreciation will let someone know you care. Ironically, showing appreciation also matters more to your happiness than to theirs.

I suggest making a show of appreciation a habit beyond the end of the year. If you're a leader, appreciation needs to scale with your organization. For every 10 team members, send 1 appreciation note per month.That way you cover the whole team with at least 1 appreciation note every year. More frequency is better but this is a minimum.

In business and in life, you get what you celebrate.

With gratitude!

Who Is the D?


One of the key lessons I've learned as a leader at LinkedIn is to clarify a key question before the end of a meeting:

Who has the D?

The "D" in this case refers to the Decision Maker in a RAPID framework.

RAPID is defined as follows:

  • Recommend
  • Approve
  • Perform
  • Input
  • Decide


In every process or decision, you need to know what role you and other members of your team play.

Are you there to recommend a solution? Are you there to propose alternatives? Perform actions? These are important roles.

But the most important of these is the D. What is the decision you need to make? And who can make the decision?

If no one, or alternatively, everyone, is a decision maker, you have a problem. 

For an example of the effects of lack of clarify in decision-making, look to Washington DC. While the US government demonstrates the brilliance of the Founding Fathers in balancing power, it's a disaster as a model for efficiency and running a business.

Make sure that by the end of every meeting you've clarified who is the D.  This will enable you and your teams to move forward. The alternative is risk-averse and distributed decision-making and a recipe for bureaucracy.

Here are some examples of where you can speed decision-making by clarifying the D:

  • In local markets, who has makes the decision to change prices or create promotions? Within what guardrails?
  • In prioritizing features, who has the decision-rights to cut a feature in order to hit a key milestone?
  • In hiring a new employee, who makes the decision to hire? Who makes the decision to fire? Do you have a "bar raiser" in your process who has the ability to block a hire?

There are hundreds of small and large decisions made by a business every day.

As your team grows, many decisions will be good ones, but many will be wrong in retrospect. Some will embarrass you. But if you don't know who made them, or who is empowered, decisions won't happen.

And no decision is worse than a bad one.

Dear Mr. President: It's a Beta!

I spent about 15 minutes listening to our Webmaster-in-Chief Barak Obama talking today about the new healthcare marketplace website.

What was his pitch? Here's what President Obama said:

  • It's slow, but it will get better! We have experts working 24/7.
  • It will save you money! If you wait long enough, you'll get a plan and get a great deal.
  • You can bypass the website! Use the 800 number. Callers are standing by.
  • It's better than the old way! Doing lots of paper really isn't fun. This way is simple and easy.
  • It's just politics! There really aren't problems. It's just lots of conservative blow hards who are making much ado about nothing.

I really can't imagine a business launching a website this complex for 200 million potential buyers all at once on a date-driven timetable. It just shows how government operates..or rather doesn't.

I'm glad the President is mad, and getting into the details. But this seems like a set of massively mismanaged expectations. Software doesn't get built this way.

Dear Mr. President: Please just call it a permanent beta.

Bill Gates Top Ten 2012 Books

Here's a list I wanted to share: Bill Gates top 10 books he read in 2012.

"I read some amazing books this year. Every one of these books changed my worldview, and I highly recommend them if you're looking for inspiring reading." - Bill Gates

  1. The Better Angels of our Nature: Why Violence has Declined by Steven Pinker
  2. Deng Xiaoping by Ezra Vogel
  3. The Quest by Daniel Yergin
  4. Moonwalking with Einstein by Joshua Foer
  5. Behind the Beautiful Forevers by Katherine Boo
  6. One Billion Hungry: Can We Feed the World? by Gordon Conway
  7. A World-Class Education by Vivien Stewart
  8. Academically Adrift by Richard Arum & Joshipa Roksa
  9. This Time is Different: Eight Centuries of Financial Folly by Reinhart & Rogoff
  10. The City that Became Safe: New York's Lessons for Urban Crime and Its Control by Franklin Zimring

Happy reading, and please share yours.


Neil Armstrong, Nerdy Engineer. And First Man on the Moon

Neil Armstrong's passing brings back his great achievement of being the first man on the moon. This giant step for mankind is something that anyone standing on Earth has to hold in awe. 

As recounted in Rocket Men, a masterful (and admittedly sometimes tedious) story of the Apollo program, Armstrong's fate as the first man off the ship, though, was controversial. Naval rules dictate that the commander is first to land, but the order of landing was debated until shortly before the mission.

Who was the "second man on the moon"? Buzz Aldrin. Famous, but not first.

Michael Collins remained in orbit. His contribution was substantial, and he shared a chance of being the first man on the moon. But he wasn't.

Perhaps all this randomness was part of the reason for Armstrong's behavior after his great feat. Armstrong was a self-described "nerdy engineer." After a year at NASA, he moved to teaching and eventually retired to a farm. He seldom spoke in public.

Maybe Armstrong wanted to symbolically demonstrate the one small step was the work of hundreds of thousands of men and women. Taken in contrast to the leaders of today, who often act as if they alone are the source of success, this legacy speaks loudly.

Armstrong's legacy is enormous and it indeeds leaves giant steps to fill. But remember Aldrin and Collins too. And all hail the nerdy engineer! 

LinkedIn for Business

I want to congratulate Optify's Jennifer Wong on a great presentation about optimizing LinkedIn for business. 

LinkedIn has been rapidly improving their pages for business. Optify was early in building a company page on LinkedIn but the new features enable much, much more.

If you haven't done this yet, take a look at the presentation and get to work. If you're a B2B marketer, you can't ignore LinkedIn.

Facebook and Liquidity

Another headline on Facebook today: early stage investors selling shares

Venture capitalists have a charter to invest in private companies. When those companies go public or get acquired, VCs either distribute or sell the shares to their limited partners. Limited partners can choose to hold the shares or sell.

VCs often get to sell shares earlier than employees. They also usually drop off the board at an IPO, or soon after, to avoid restrictions on insiders.

There are exceptions, usually when a company is a category leader with enormous potential. But most of the time it's considered more effective for a VC to focus on finding the next Facebook than growing Facebook itself.


In my experience, most VCs are not good at public company investing in part because they overestimate the potential for a company. VCs like value, but they are not value investors.

Insider selling conflicts with what public company investors want to see. Hedge funds want management and board members holding stock. It's worth noting the irony that hedge fund managers and most people on Wall Street get paid in cash, but that doesn't change what they want in others.

I don't fault Peter Thiel for selling. He's made a huge gain for himself and his fund. He's held Facebook shares for many years. But there's no question the optics, with Facebook stock down dramatically from the IPO, are terrible and will leave a taint on startups going public for years to come.

Managing Expectations

The financial headlines have been dominated by the collapsing stock prices of Groupon, Facebook and Zynga.

Listening to the pundits, with few exceptions, reasons given for the declning prices range from uncertain business models, trading blunders, mobile users, dependency on advertising, problems with churn in the saleforce and on and on.

What's missing from the discussion? Share prices reflect expectations. The problem with Facebook's IPO, potentially the most promoted in history, is despite its incredible franchise and powerful momemtum, expectations for Facebook are even larger.

210375-Royalty-Free-RF-Clipart-Illustration-Of-A-Retro-Black-And-White-Businessman-Gesturing-Up-To-The-RightSilicon Valley is the best in the world at funding dreams that can change the world through technology.

Wall Street is a mechanism for modeling those dreams again financial statements. If dreams and financials don't match, look out below!

Where's the potential for overdelivery? Yahoo, a company that surprised investors with Marissa Mayer as CEO. ServiceNow, a B2B company that few consumers have heard of. LinkedIn, with multiple revenue streams including subscriptions, advertising, and software licensing. Small cap public companies trading for barely more than cash.

The problem with managing expectations on Wall Street is they keep going up...until you fail to meet them. Then expectations, and share prices, collapse. And collapse again. At some point, the cycle starts over.

This is the story of the 2000 Internet bubble. Many VCs sold shares in Aquantive and Amazon at the low. This capitulation was the sign of the bottom.

Why is expectation setting hard?

  • Incentives. Entrepreneurs selling a company or trying to get funding want to get the most value possible. Managers selling a project to the CEO make optimistic assumptions to get the project funded.
  • Incomplete Information. As Daniel Kahneman explains in Thinking Fast and Slow, the brain's initial reaction to information is to make conjectures based on what's there ("What You See Is All There Is" or WYSIATI), not what's possible.

  • Overconfidence. Related to WYSIATI, leaders are prone to overestimate their ability to know the future. If you have to commit to 90% certainty of an outcome, the range of possibilities is much larger than most people realize.

How do you set better expectations? 

  • Under-promise, over-deliver. This is the basis of great performance in any field. The US Olympic men's 4x400 team got the silver medal and was disappointed. Oscar Pistorius completed the race and was a hero. Success is not an absolute but a relative measure.

  • The Black Swan. Imagine the important factor no one else has considered. What if your top reseller goes out of business? What if a competitor gets acquired by your largest partner? Remember that you are prone to overestimate the probability that the future will be more of the same.

  • Use System 2. "System 2" is a reference to Kahneman's work. Your first assessment of a set of facts may be directionally right. But you need to adjust your thinking to reflect the probability of that outcome. The mind does not intuitively do statistics. Take time to do the math.

Setting expectations and beating them consistently is very, very hard. Incentives and the brain work against predicting the future accurately.

If you're an investor, make your own assessments. Invest where you know others don't see the potential.

If you're a CEO, a manager or board member, question your first reaction. Plan for the Black Swan. 

I'm passionate about behavioral economics and welcome your thoughts.

Six Rules for Writing: 1984

Credit to David Pesikoff at Triangle Peak Partners for highlighting what George Orwell wrote in his six rules for writing. Orwell was the author of the one of the greatest works of fiction, Nineteen Eighty-Four. Here are Orwell's rules:

  1. Never use a metaphor, simile, or other figure of speech you are used to seeing in print 
  2. Never use a long word where a short word will do 
  3. If it is possible to cut a word out, always cut it out 
  4. Never use the passive when you can use the active 
  5. Never use a foreign phrase, scientific word, or a jargon if you can think of an everyday English equivalent 
  6. Break any of these rules sooner than say anything outright barbarous  

The novel has continued meaning as we listen to the doublespeak coming out of Washington and Brussels. Nineteen Eighty-Four was also the inspiration for Apple's breakthrough MacIntosh commercial.

For business writers, especially those in marketing, following these rules would do a world of good. Confusing the buyer is appealing, but in the long term confusion never works. Breakthough ideas do.


Top 10 Startup Lessons

Startup Lessons! Since my Startup Day presentation on VC funding I've gotten more questions about fundraising and building a starup. Here are what I've boiled down to what I'll call my Top 10 Startup Rules. Credit to Madrona Venture Group, TPP, Sequioa Capital, mentors and others who have influenced my thinking along the way:

1. It’s all about the product. The demo is the PowerPoint

If you want to show something to VCs, you'd better have a demo. Invest in sweat equity before you try to ask for real dollars. I realize this rule may not apply if you're a succesful serial entrepreneur or rock-star CEO. Otherwise you have to demo.

2. Being early is the same as being wrong

You have to hit the market at the right time with the right product. Another way of saying this is as follows: make sure the market is ready for you before you scale up you burn rate. This is now called the Lean Startup. How many pivots can you make before you run out of cash? Do your market validation on a very lean budget. Only when you know it's working do you ramp up the team.

3. Fast beats perfect

Get the product to market. Don't overbuild for scale until you know someone is interested in what you're doing. If you have the idea, so do lots of other people. You don't have to be first - think of all the storage startups that failed before Dropbox. But you have to get it out there and innovate.

4. It’s better to sell to a large number of small customers than a small number of large ones

This one I'll admit is a bias. Some people like selling big deals to a few customers. But if you want to grow quickly the best way and keep growing is to find a product that lots of people need around the globe. The Internet is the world's largest distribution system for great ideas. If you have one, you'll find out quickly.

5. Build a product that's inherently viral

Some products like Dropbox (file sharing) and Docusign (online contracts) are inherently viral. Just by using the product, you add more users. Then they add more users. This is the scale effect of social networking that means potentially exponential growth. If you don't have it, work on how to make it part of your offering.

6. Never stop iterating on your business model. Success is a million tiny improvements

I heard this from the CEO of Constant Contact. Particularly in SaaS, you have to resell the user every time they get out their checkbook, and they'd better be happy to do it. There is no rest for the weary in technology.

7. The most important milestone is when you are out of cash

If you don't know when you run out of cash, you need a new CFO. You should know what milestones you need to achieve to get to the next financial milestone. This doesn't mean everyone in the company needs to be thinking about cash all the time; it makes them distracted. However, in a startup there's a risk that big company people don't generally understand: going out of business. Know this and act accordingly.

8. Hire people who know not only what to do, but when to do it

I heard this from a very successful CEO of a startup that grew into a successful public company. If you hiring a branding expert, you'll get branding. If you hire a startup marketer who knows how to put all the parts together to go from a 1-person team to CMO, you're more likely to get the right results at the right time. In a startup, there's little time to learn on the job, so you'll probably get what some has done before. Expect it.

9. Fundraising takes longer than you think

Fundraising windows open and close. Sometimes fundraising is easy and sometimes it's hard. In terms of planning, though, assume the worst. Investors have time on their side. You don't. Also, assume that if you're the CEO, fundraising is going to be a big distraction, but your team has to be able to execute while you're away. While you're fundraising, the strategy and plans you have in place are likely the plans you'll get.

10. Small decisions early have large impact later

This one comes from experience. When Optify was getting started, it was 2008. We bought some nice office furniture from a company that raised a lot of money and went bust. The furniture was a great deal. The problem was, when we grew, we had to buy more - at retail!! The lesson is, small patterns early become an invisible pattern that is very, very tough to change. The first year sets the stage for how you operate for a long time.

Bonus: Know what makes you successful

Know what you want to do well, make it available for sale, and outsource everything else. Amazon does this extremely well. Is your data available through APIs, both internal and external? Are you spending your time on benefit programs, or product plans? For CEOs: if you're running a web company, don't delegate the product. In a web company, the product is the company. 


Comments? I'd love to hear what you think.