Book Short:  Virtuous Cycle

Danny Meyer’s Setting the Table: The Transforming Power of Hospitality in Business is a fun read if you’re a New Yorker who eats out a lot; a good read for entrepreneurs around scaling leadership skills as the business grows; and a great read for anyone who runs a serious customer service-oriented organization.  I’ve eaten at all of his restaurants multiple times over the years except for the new ones at MOMA (perhaps a few too many times at the Shake Shack), and while I like some more than others (perhaps the Shake Shack a bit too much), they all do have great hospitality as a common theme.

While there are a lot of good lessons in the book, Meyer talks about something he calls the Virtuous Cycle of Enlightened Hospitality that matches the general hierarchy of constituents or stakeholders in a business that I refer to at Return Path:   employees, customers, community, suppliers, investors.  His general point is that if you have happy employees, they make for happy customers, and returns for investors will follow.  While the specifics may or not be true of all businesses, I bet the first and last item are — especially for service-oriented businesses in any industry.  I wish we had a better handle on the Community aspect at Return Path, but we at least do an OK job at it, especially given the geographic diversity within the company.

(Note this was one of Fred’s favorite parts of the book as well from his review — nice to see a professional investor in agreement!)

Book Short:  Shamu-rific

I re-read an old favorite last night in preparation for a management training course I’m co-teaching today at Return Path:  Ken Blanchard’s Whale Done! The Power of Positive Relationships.  I was reminded why it’s an old favorite.  It has a single concept which is simple but powerful.  And yes, it’s based loosely on killer whale  training tactics.

Accentuate the positive.

The best example in the book is actually a personal one more than a professional one.  The main character of the book has a “problem” in that he chronically works late, then comes home and gets beat up by his wife about coming home so late.  The result?  No behavior change — and probably even a reinforcement of the behavior because, after all, who wants to come home and get beat up?  The change as a result of the new philosophy?  The wife thanks her husband when he does come home at a more reasonable hour, makes him a nice dinner, etc. which makes the husband WANT to come home earlier.

That’s probably a poor paraphrasing of the story, and as I’m typing the story out here, boy does it sound a bit 1950s in terms of its portrayal of gender role stereotypes.  Nonetheless, I think it makes the point well.

Try it out sometime at work (or at home).  Pick a behavior you want to see more of out of a direct report, especially one that’s linked to another behavior you don’t like.  Accentuate the positive.  Make the person WANT to do more of it.  And watch the results!

Book Short:  Legal Aid

The Entrepreneur’s Guide to Business Law, by Constance Bagley (HBS) and Craig Dauchy (Cooley Godward), while not exactly a page-turner, is a great reference book for even experienced CEOs. It’s pretty broad in its coverage of all major legal issues an entrepreneur will face, from patent law to firing employees.

Remember, you may make fun of lawyers on occasion or grips about their fees, but they DID attend law school for three years, after all. If nothing else, the $20 on this book will almost certainly save you at least 10x that in reduced legal fees someday, for something.

Boards That Lead, by Ram Charan, Dennis Carey, and Michael Useem, was recommended to me by a CEO Coach in the Bolster network, Tim Porthouse, who said he’s been referring it to his clients alongside Startup Boards. I don’t exactly belong in the company of Ram Charan (Brad and Mahendra probably do!), so I was excited to read it. While it’s definitely the “big company” version to Startup Boards, there are some good lessons for startup CEOs and founder to take away from it.

The best part about the book as it relates to ALL boards is the framework of Partner, Take Charge, Stay out of the Way, and Monitor. You can probably lump all potential board activities into these four buckets. If you look at it that way…these are pretty logical:

• Monitor – what you’d expect any board to do
• Stay out of the Way – basic execution/operations
• Partner – strategy, goals, risk, budget, leadership talent development
• Take Charge – CEO hiring/firing, Exec compensation, Ethics, and Board Governance itself.

There was an interesting nugget in the book as well called the Central Idea that I hadn’t seen articulated quite this way before. It’s basically a statement of what the business is and how it’s going to win. It’s about a page long, 8-10 bullet points, and it includes things like mission, strategy, key goals, and key operating pillars that underlie the goals. It basically wraps up all of Lencioni’s key questions in one page with a little more meat on the bones. I like it and may adopt it. The authors put the creation of the Central Idea into the Take Charge bucket, but I’d put it squarely in the Partner bucket.

Other than that, the book is what you’d expect and does have a lot of overlap with the world of startups. Its criteria for director selection are very similar to what we use at Bolster, as is its director evaluation framework. The book has a ton of handy checklists as well, some of which are more applicable than others to startups, for example Dealing with Nonperforming Directors and Spotting a Failing CEO.

All in, a good read if you’re a student of Boards.

I haven’t taken a poll to figure out the overlap between people who read this blog and people that bought the first edition of Startup CEO, but I’m guessing there’s a high degree of it. If you are familiar with the book, I don’t want to bore you with a recap of what I wrote, but I thought I would devote the next several blogs to new ideas in the second edition. First, the new cover art from the publisher is kind of cool:

The first question you might have is, “Why a second edition? Didn’t you say everything you needed to say the first time?” The answer to that is, yes, I did say everything I had to say at the time, and the first edition is pretty comprehensive as a field guide. But that was about a dozen years into what turned out to be a 20-year journey, and after we sold Return Path in 2019, I had time to reflect on all that happened. I learned a lot of new lessons between the first and second editions, we had a lot of first-time experiences, we scaled the company significantly, and we sold it. None of those things are, in and of themselves, worthy of a second edition, but collectively they help tell the story of startup to exit and tell it from a perspective of creating a sustainable business over nearly two decades. 

But there are other reasons, too, besides new lessons learned. Eight years is a lifetime in terms of changes to micro-trends, language, business in general, and the world around us. I wanted to update the book to make it contemporary so that it can speak to a new generation of CEOs. The second edition is more than a new cover and obvious updates on the number of employees or revenues. I added topics that reflect heightened responsibilities of CEOs around moral and ethical leadership in an increasingly transparent and socially conscious world. How do you navigate a politically charged and divisive society? For example, the State of Indiana passed a law intended to not force people to do things that contravened their religious beliefs but it had the side effect of legal descrimination against LGBT citizens. It was contentious, with rallying cries in business and society for one side or the other, and those same sentiments were found within our employee population. 

How should CEOs handle a situation that conflicts with their core values? There are no easy answers, but avoiding them doesn’t make the problem go away. 

Whether it’s the #metoo movement, high-profile failures of leadership like airline employees dragging customers off of planes, or something as simple as unconscious bias in the workplace, the best CEOs now need to approach their jobs differently. I didn’t write about that in the first edition, but the second edition has an entire chapter devoted to “Authentic Leadership” and provides guidelines and advice to help CEOs. The book went to press early in the COVID-19 pandemic and prior to all the protests around racial injustice surrounding the George Floyd killing, so nothing in it specifically addresses any of those issues.  In some ways, though, that may be better at the moment since the book is more about frameworks and principles than about specific responses to current events.

I also added a new section with several chapters on the ins and outs of selling a business. Startup exits are the important culmination of the startup experience and something that the first edition only briefly touched on. Obviously, I was still CEO of a growing company and although we had an opportunity or two to sell within those first years, we never pulled the trigger. The first edition talks about that process at a surface level, but the second edition has far more content and detail since we had completed a sale transaction. 

The first edition of the book has sold close to 40,000 copies as of the writing of the second edition, which blew me away when I tallied it all up. I’ve received many notes of thanks from readers all over the world for the book, and I’m glad that the content has proved useful to so many people, noting from some of the more critical reviews on Amazon that it certainly doesn’t scratch everyone’s itch. I hope the changes in the new edition add even more value to the lives of entrepreneurs and startup management teams. That’s really who the book is written for.

Here are some places to go to pre-order the book:

• Directly from the publisher, Wiley
• From Amazon
• From Books-a-Million
• From Indie Bound 
• From BN.com

I have a limited number of free copies of the book that I can send out, and oddly, they are only print copies since the book publishing ecosystem hasn’t figured out an efficient way for authors to distribute free Kindle copies of books yet.  As a bonus incentive for reading all the way to the end of this post, I will be happy to send a free copy to the first 5 people who comment on this post on the blog and ask for one.

Book Short:  Just One Minute

What The One Minute Manager does for basic principles of management and goal setting, The One Minute Manager Meets the Monkey does for delegation.  Both are blessedly quick reads (the classic “airport” book), and Ken Blanchard really nails some of management’s most critical components with simplicity and grace.

I’m a fan of the One Minute Manager school, and it does work well for some of the basics, but it has its limitations in terms of how broadly it can be applied.  My colleague Whitney McNamara‘s words in an email to me a few months back say it all:

OMM has actually been useful.  I have to agree that it’s got a bit of a “Jonathan Livingston Seagull” mystical simplicity thing going, but as you say, simple is sometimes what works best.

It’s really strong in that the basic lessons are at root so simple that they’re easy to forget about day to day…having them articulated in a similarly simple way, so that they stick at the top of mind easily, is nice.

The other side of that is that it presents such a simplified, best-of-all-possible-worlds sort of scenario that I did sometimes find myself wanting to set fire to the OMM’s office building and scream “let’s see you deal with *this* in 60 seconds, buddy”…but on balance a pretty good experience. 🙂

In the end, it’s not that good management is easy — but it can be quick and relatively painless if done well and regularly.

Book Short:  Great Marketing Checklists

Trade Show and Event Marketing:  Plan, Promote, and Profit, by our direct marketing colleague Ruth Stevens, is hardly a page-turner, but it is a great read and well worth the money for anyone in your B2B marketing department.  That’s true as much for the event marketing specialist as the marketing generalist.

The author brings a very ROI-focused approach to planning and executing events – whether big trade shows or smaller corporate events, which are becoming increasingly popular in recent years for cost, focus, and control reasons.  But beyond events, the book has a number of excellent checklists that are more general for marketers that I found quite useful both as a reminder of things we should be doing at Return Path as well as ways we should be thinking about the different elements of our B2B marketing mix.

Some of the best tables and charts include:  strengths, weaknesses, and best applications of trade shows vs. corporate events; comparative analysis of marketing tools by channel (this was great – talks about best applications for all major tools from events to newsletters to search to inside sales); 12-month exhibitor timeline for trade shows; a great riff on bad booth signage vs. good booth signage (hint:  don’t make the visitor do the work – be obvious!); business event strategic planning grid; pre-show campaign and post-show follow-up checklists; dos, don’ts and options for corporate events; a great section on qualifying and handling leads that extends well beyond trade shows; and several good case studies that are show-focused.

Thanks to Ruth herself for an autographed copy!  Team Marketing and sales leaders at Return Path – your copies are on the way.

Book Short:  Fables and Morals

Courtesy of my colleague Stephanie Miller, I had a quick holiday read of Aesop & The CEO: Powerful Business Lessons from Aesop and America’s Best Leaders, by David Noonan, which I enjoyed.  The book was similar in some ways to Squirrel, Inc., which I recently posted about, in that it makes its points by allegory and example (and not that it’s relevant, but that it relies on animals to make its points).

Noonan takes a couple dozen of Aesop’s ancient Greek fables and groups them in to categories like Rewards & Incentives, Management & Leadership, Strategy, HR, Marketing, and Negotiations & Alliances – and for each one, he gives modern-day management examples of the lessons.

For example, in the Wolf in Sheep’s Clothing, the lesson clearly is to strike while the iron is hot, or that a good plan executed today is better than a perfect one that’s too late.  Noonan gives the example of Patton’s capture of Messina, Sicily during World War II.

And in The Hare & The Tortoise, where of course the moral is that slow & steady wins the race, Noonan gives the example of how New York Knicks coach Rick Pitino inspired Mark Jackson, who was chosen 18th in the NBA draft, to win the rookie of the year award in 1987 by helping him gain confidence by building on his strengths.

All in, a good read, even with that painful reminder that the Knicks used to have a decent basketball team.

Startup CEO (OnlyOnce- the book!), Part IV – Book Launches Today!

My book is officially on sale on Amazon and iTunes today.  The full detailed outline is here if you’re interested, and the link to buy it is here.

This is very exciting.  I had been saying for a while that I had no idea whether 50 people would buy it or 5,000, but the publisher (Wiley) tells me we had over 2,000 pre-orders, so that’s a great start, at least.

So thanks to those 2,000 brave souls, and anyone else who buys it as well.  I hope you enjoy it and look forward to your feedback directly, via OnlyOnce, via the #StartupCEO hashtag, via a rating/review on Amazon, or via the Startup Revolution web site.

I hope to get back to more regular blogging soon.  As you hay have noted, I’ve been more quiet than usual the last six months while writing the book.  But I have lots of great posts stored up…

I was excited to read Launchpad Republic: America’s Entrepreneurial Edge and Why It Matters, by Howard Wolk and John Landry the minute Brad sent it to me. I love American history, I love entrepreneurship, and I’m deeply concerned about the health of our country right now. I have to say…on all fronts, the book did not disappoint!

The authors make several points, but the one that sets the tone for the book is that like our country’s origins and culture in general, entrepreneurship is itself rebellious. It’s about upstarts challenging the status quo in some way or other with a better way to do something, or with a new thing. The balance between protecting private property rights and allowing for entrepreneurs to fail and to disrupt incumbent leaders is what makes America unique, especially compared to the way European business culture has traditionally operated (consensus-oriented) and the way China operates (authoritarian).

I loved how the authors wove a number of business history vignettes together with relevant thru lines. Business in Colonial times and how Alexander Hamilton thought about national finances may seem dusty and distant, but not when you see the direct connection to John D. Rockefeller, IBM, GE, Microsoft, or Wendy Kopp.

The book was also a good reminder that some of the principles that have made America great and exceptional also underly our successful business culture, things like limited government, checks and balances within government and between government and the private sector, and decentralized finance.

Without being overly political, the authors also get into how our political and entrepreneurial system can and hopefully will tackle some of today’s more complex issues, from climate change to income inequality to stakeholder capitalism.

At the heart of all of it is the notion that entrepreneurs’ creativity drive America forward and are a leading force for making our country and our economy durable and resilient. As a career entrepreneur, and one who is now in the business of helping other entrepreneurs be more successful, this resonated. If you’re a student of American history…or a student of entrepreneurship, this is a great read. If you’re both, it’s a must read.

Reboot – The Fountainhead

Happy New Year!  Every few years or so, especially after a challenging stretch at work, I’ve needed to reboot myself.  This is one of those times, and I will try to write a handful of blog posts on different aspects of that.

The first one is about a great book.  I just read Ayn Rand’s The Fountainhead for (I think) the 5^th time.  It’s far and away my favorite book and has been extremely influential on my life.  I think of it (and any of my favorite books) as an old friend that I can turn to in order to help center myself when needed as an entrepreneur and as a human.  The last time I read it was over 10 years ago, which is too long to go without seeing one of your oldest friends, isn’t it?  While the characters in the book by definition are somewhat extreme, the book’s guiding principles are great.  I’ve always enjoyed this book far more than Atlas Shrugged, Rand’s more popular novel, which I think is too heavy-handed, and her much shorter works, Anthem and We The Living, which are both good but clearly not as evolved in her thinking.

As an entrepreneur, how does The Fountainhead influence me?  Here are a few examples.

• When I think about The Fountainhead, the first phrase that pops into my head is “the courage of your convictions.”  Well, there’s no such thing as being a successful entrepreneur without having the courage of your convictions.  If entrepreneurs took “no” for an answer the first 25 times they heard it, there would be no Apple, no Facebook, no Google, but there’d also be no Ford, no GE, and no AT&T
• One great line from the book is that “the essence of man is his creative capacity.”  Our whole culture at Return Path, and one that I’m intensely proud of, is founded on trust and transparency.  We believe that if we trust employees with their time and resources, and they know everything going on in the company, that they will unleash their immense creative capacity on the problems to be solved for the business and for customers
• Another central point of influence for me from the book is that while learning from others is important, conventional wisdom only gets you far in entrepreneurship.  A poignant moment in the book is when the main character, Howard Roark, responds to a question from another character along the lines of “What do you think of me?”  The response is “I don’t think of you.”  Leading a values-driven life, and running a values-driven existence, where the objective isn’t to pander to the opinion of others but to fill my life (and hopefully the company’s life) with things that make me/us happy and successful is more important to me than simply following conventional wisdom at every turn.  Simply put, we like to do our work, our way, noting that there are many basics where reinventing the wheel is just dumb
• Related, the book talks about the struggle between first-handers and second-handers.  “First-handers use their own minds.  They do not copy or obey, although they do learn from others.”  All innovators, inventors, and discoverers of new knowledge are first-handers.  Roark’s speech at the Cortland Homes trial is a pivotal moment in the book, when he says, “Throughout the centuries, there were men who took first steps down new roads armed with nothing but their own vision.  The great creators — the thinkers, the artists, the scientists, the inventors — stood alone against the men of their time.  Every great new thought was opposed.”  In other words, first-handers, critical thinkers, are responsible for human progress.  Second-handers abdicate the responsibility of independent judgment, allowing the thinking of others to dominate their lives.  They are not thinkers, they are not focused on reality, they cannot and do not build
• The “virtue of selfishness” is probably the essence of Rand’s philosophy.  And it sounds horrible.  Who likes to be around selfish people?  The definition of selfish is key, though.  It doesn’t inherently mean that one is self-centered or lacks empathy for others.  It just means one stays true to one’s values and purpose and potentially that one’s actions start with oneself.  I’d argue that selfishness on its own has nothing to do with whether someone is a good person or a good friend.  For example, most of us like to receive gifts.  But people give gifts for many different reasons – some people like to give gifts because they like to curry favor with others, other people like to give gifts because it makes them feel good.  That’s inherently selfish.  But it’s not a bad thing at all
• Finally, I’d say another area where The Fountainhead inspires me as a CEO is in making me want to be closer to the action.  Howard Roark isn’t an ivory tower designer of an architect.  He’s an architect who wants to create structures that suit their purpose, their location, and their materials.  He only achieves that purpose by having as much primary data on all three of those things as possible.  He has skills in many of the basic construction trades that are involved in the realization of his designs – that makes him a better designer.  Similarly, the more time I spend on the front lines of our business and closer to customers, the better job I can do steering the ship

One area where I struggle a little bit to reconcile the brilliance of The Fountainhead with the practice of running a company is around collaboration.  It’s one thing to talk about artistic design being the product of one man’s creativity, and that such creativity can’t come from collaboration or compromise.  It’s another thing to talk about that in the context of work that inherently requires many people working on the same thing at the same time in a generalized way.  Someday, I hope to really understand how to apply this point not to entrepreneurship, but to the collaborative work of a larger organization.  I know firsthand and have also read that many, many entrepreneurs have cited Ayn Rand as a major influence on them over the years, so I’m happy to have other entrepreneurs comment here and let me know how they think about this particular point.

It feels a little shallow to try to apply a brilliant 700 page book to my life’s work in 1,000 words.  But if I have to pick one small point to illustrate the connection at the end, it’s this.  I realize I haven’t blogged much of late, and part of my current reboot is that I want to start back on a steady diet of blogging weekly.  Why?  I get a lot out of writing blog posts, and I do them much more for myself than for those who reads them.  That’s a small example of the virtue of selfishness at work.