"Make Meaning in Your Company", Lecture by Guy Kawasaki / Garage Technology Ventures (2004

Video Lectures

Displaying all 16 video lectures.
Lecture 1
Make Meaning in Your Company
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Make Meaning in Your Company

Guy Kawasaki, founder and Managing Director of Garage Technology Ventures, believes that those companies who set out to make a positive change in the world are the companies that will ultimately be the most successful. He gives examples of the best way to make meaning: increase quality of life, right a wrong, and prevent the end of something good.




Transcript



The first thing I figured out and learned, sometimes the hard way, about entrepreneurship is that the core, the essence of entrepreneurship is about making meaning. Many many people start companies to make money, the quick flip, the dot com phenomena. And I have noticed in both the companies that I've started and funded and been associated with, that those companies that are fundamentally founded to change the world, to make the world a better place, to make meaning, are the companies that make a difference. They are the companies to succeed. My naive and romantic belief is that if you make meaning, you will probably make money. But if you set out to make money, you will probably not make meaning and you won't make money. So my first thought is you need to make meaning. That should be the core of why you start a company. There are three ways to make meaning. First is to increase the quality of life. My background is the Macintosh division of Apple Computer, and I can tell you with total certainty that we were not motivated by making money. We were motivated by changing the world to make people more creative and more productive. We were trying to increase the quality of life for the Macintosh user. And that was a great motivation. It kept us going through many many difficult periods. We were waking up in the morning thinking how we could change people's lives. A second way to make meaning is to right a wrong. This fish is going to die after jumping out, but to right a wrong means that you find something that's wrong in the world or you notice that's something wrong and you want to fix that. This might be particularly applicable to not-for-profits where there's pollution or there's crime or there's abuse and their very core is to end that wrong. And the third way to make meaning is to prevent the end of something good. You see something beautiful, something wonderful, and you just can't stand the fact that it's been eroded, it's being changed, it's being ruined. So I ask you as you start your companies, your not-for-profits, your churches, your schools, whatever you're starting, please have one of those three motivations, one or more of those motivations. If you don't have any of those motivations, I suggest that you rethink what you're doing. I think these three things are the key to starting a great organization.

Lecture 2
Don't Write a Mission Statement, Write a Mantra
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Don't Write a Mission Statement, Write a Mantra

Kawasaki talks about how mission statements, while touted as necessary for any company, often is not representative of the true meaning of the company. Instead, a mantra is shorter and captures the essence of the organization.




Transcript



The second thing I learned is to make mantra. Many of you have not yet been polluted by the desire to make a mission statement. The desire to make a mission statement comes because you have a graduate school, business degree, or perhaps you work for McKenzie for summer. Or something like that has ruined you. And so many, many entrepreneurs take it as one of the fundamental things they have to do is figure out a mission statement. So what they do is they grab the core team. There's somebody from marketing, from sales, from engineering, from production, finance, HR. And they go offsite and they craft this mission statement. And everybody has to put their two cents in because this mission statement has to be workable for employees, for shareholders, for customers, for the dolphins, for the purposes. In the ozone hole, all that has to be in a mission statement. So what I recommend is that you don't do a mission statement as a start-up because a mission statement usually ends up crap. It's too long, it's impossible to remember. It cannot even focus the company which is what it should do. Inevitably you will end up with the mission statement along these lines. "The mission of Wendy's is to deliver superior quality products and services for our customers and communities through leadership, innovation, and partnerships." How many of you thought that that was Wendy's mission statement when you bought a hamburger there? How many of you think you could go to Trixie or Beef working at Wendy's and ask them, "What's the mission of Wendy's?" And they can repeat that word for word. It's impossible. That is a $50,000 mission statement done by a consulting firm. I love Wendy's. Don't get me wrong, I love Wendy's. But the mission statement leaves a lot to be desired. By contrast, you should do a mantra. Do a mantra because it's only three or four words. It captures the essence of your organization. When you have a thousand employees or 10,000 employees and you can hire a facilitator or you can go outside and you can use McKenzie. God bless you! Write this mission statement. It will make you feel better. You can put it up in your annual report. You can post it in your cafeteria or whatever you want to do. But right now, as an entrepreneur make a mantra. Here are some mantras. First thing is. I think Wendy's proper mantra is "Healthy fast food". Three words, healthy fast food. Somewhat oxymoronic I must admit but healthy fast food is something very easy to remember. Another good mantra: FedEx. FedEx's mantra in my mind should be "Peace of mind". Because when you absolutely, positively want something in some place, you think of FedEx. The FedEx employee is thinking peace of mind for our customers. A third mantra from Nike, "Authentic athletic performance". Just do it is the slogan. It's the slogan for the customer. Authentic athletic performance is the mantra for the employee. That's what a Nike employee stands for, authentic athletic performance. And one of the best mantras is from Mary Kay, "Enriching women's lives". This is a good mantra because it worked for two groups, the customer of Mary Kay who buys the Mary Kay products and also the sales person of Mary Kay. It enriches both people's lives. So these are examples of mantras. And I would suggest to you that you come up with three or four-word thing like that. For me my personal mantra is empowering entrepreneurs. That's what I do. OK, now if some of you still have the desire to create a mission statement because I don't know why, because you've been ruined somehow. So if you have this great desire to do a mission statement rather than taking your team offside and going away for a day, and using a consulting firm, and crafting some 50-word thing, and wasting a lot of time and money. I suggest to you that you can kill two birds with one stone. All you have to do is go to the Dilbert Mission Statement Generator website. And there for absolutely no cost, you can get a mission statement like the one you want. Like, "We exist to professionally build long-term high-impact sources so that we may endeavor to synergistically leverage existing effective deliverables to stay competitive in tomorrow's world." See, that's a mission statement. I mean that's something you can be proud of putting in your annual report. Don't pay 50,000 for this. Just go to the Dilbert Mission Statement Generator website, OK?

Lecture 3
Get Up and Get Going!
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Get Up and Get Going!

Kawasaki explains that market research, focus groups, and test cases can bog down an entrepreneur and prevent her or him from completing the most necessary task - action! His advice to break the cycle is to think different, polarize people, and find a few soul mates.
Lecture 4
The New Business Model
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The New Business Model

The business model today is very different than it was before and during the boom, says Kawasaki. In order to write the best business plan possible, follow Kawasaki's steps: specificity, simplicity, and ask women. He believes that woman don't possess the killer gene that is inherent in men, and will be able to give better advice about a business model.
Lecture 5
Weave a MAT and Outline Your Priorities
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Weave a MAT and Outline Your Priorities

Kawasaki suggests creating a system of milestones, assumptions and tasks to keep your business on the right path and increase your chances for success.




Transcript



The fifth point is to weave a MAT which stands for milestones, assumptions, and tasks. I will use an ice hockey analogy although none of you, clearly, play ice hockey. Most hopefully some of you have ice skated. So when you ice skate or you play ice hockey, there's this thing called a Zamboni. And this machine comes out and then it shaves the ice and it lays down a sheet of water. So the ice rink, the ice surface is just beautiful, it's flat, it's smooth, there's no ruts in it, it's just a wonderful thing. It's just pure, wonderful, wide, virgin ice out there. OK. To a large degree a start-up is like that. When you start-up a company you don't have the crappy furniture, you don't have the employees that you found out were bozos after you hired. You don't have an installed base that's nagging you for bug fixes. You don't have the ugly logos that you designed one night. Your stationery doesn't suck at all. You don't have a crappy office in a wrong location. It's just pure virgin start-up. So what happens in this situation is there are so many fun things to do, like working on a logo. And working on your stationery and buying furniture and looking at commercial real estate. That your priorities get all whacked out. So this is about prioritization. The first priority is to create milestones for your company. Milestones are things like finish the design. Finish the prototype, first customer ship. A milestone is something that you would go home and tell your spouse, "Honey, we shipped today." A milestone is not, "Honey, we ordered furniture today." That's not a milestone. A milestone is something that increases the valuation of your company. Shipping increases the valuation of your company. Filing for a path in trademark does not increase the valuation of your company. Create the milestones, top priority. The second thing, the A is you need to write down your assumptions. The assumptions create the business model. How many sales calls can a sales person make? What percentage will be successful? How many calls will a customer call tech support? How much will it cost to provide tech support to the average customer? These things need to be written down and then they need to be tested. Because if you create a business model that assumes that you're going to get 1% of the people in China to be your customer and you can make 80% successful sales calls, you're going to have a flawed model. You need to test those assumptions. And finally the T is task. The task is stuff like rent an office. But a task is always used to either test an assumption or to complete a milestone. You rent an office when you need to finish your software because you need a place for the programmer. You don't rent an office because it's a wonderful fun thing to do going around looking at commercial real estate. So the order is, milestone, assumption, and tasks, a MAT.

Lecture 6
Know Thyself and Niche Thyself
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Know Thyself and Niche Thyself

Kawasaki talks about marketing and product design simplified. Kawasaki explains why this theory is all an entrepreneur will need to know about marketing. A simple chart illustrates his point - how to be the creator of a unique product or service and is valuable to a customer.
Lecture 7
Make a Great Pitch
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Make a Great Pitch

Making pitches is a way of life for an entrepreneur. Kawasaki provides his tips for ensuring each pitch is better than the last. His 10/20/30 rule for PowerPoint slides is essential.
Lecture 8
Who to Hire
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Who to Hire

Kawasaki explains that hiring infected people is the most important factor. Often, how a person looks on paper means nothing if they are not enthusiastic and ready to work hard. All of the experience in the world means nothing if they are not bitten and infected by the start-up bug. He also tells you how to avoid the bozo explosion, which only leads to layoffs, and how to apply the shopping center test to know if you're hiring the right person.
Lecture 9
Lower the Barriers to Adoption
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Lower the Barriers to Adoption

A successful product is easy for everyone to use, immediately. Flatten the learning curve, never ask someone to do something you would not, and recruit evangelists to spread your message.




Transcript



The ninth thing is to lower barriers to adoption. Here are the cases where you've created the world's greatest mousetrap, the nuclear power mousetrap. You kill mice better than anybody in the history of mankind. Mouse goes in there, there's a little explosion, a little mushroom cloud and the mouse is gone. You murder mice really well. You got the design from Lawrence Livermore or you stole it from Los Alamos, I don't how you got it. Somehow, you really murder mice well. So here are the barriers to adoption. First of all, your mousetrap is nuclear-powered. However, you need a PhD in Applied Physics to set the mousetrap. The learning curve is so high. It's almost as difficult as setting the clock on a VCR. It's that high, all right? The fundamental model, the metaphor that you should aspire to is you open the box, you plug in the cords, you go. That's what it should be like. You should not need a PhD in Physics to set your mousetrap. Flatten the learning curve. By contrast, if any of you buy a BMW, there's something in the BMW called an iDrive which is their interface for their electronics. If you take a two-hour course you will then be able to change the radio station. That is the antithesis of flattening the learning curve. Second point is, you never ask people to do something that you yourself would not do. You wouldn't go back to school to get a PhD in Physics to set a mousetrap. You wouldn't drive 300 miles to drop off a dead radioactive mouse. You wouldn't pay $250 thousand dollars for a mousetrap. Don't expect customers to do this either. The reason why there's a washing machine in this picture is because I have a positive example which is the Kauai Hyatt Regency. The Kauai Hyatt Regency, in every wing of the hotel there's a laundry room. That means there's one less guestroom. It means that people send out less laundry through the laundry system. Then if you went into the laundry room, you would see that the washers and driers are free. So at the Hyatt Regency at Kauai, they're not charging you to wash the clothes. That is a good example, a positive example of this theory. The third point is, you need to recruit evangelists. At the start of a company, you need to recruit evangelists. They're not stockholders. They're not employees. They see your product or service as a way to make the world a better place. There's no more higher leverage than recruiting evangelists. Evangelists view your product or service as bringing the good news. That's the Greek-based word for evangelism - - bringing the good news. It means that you had to have thought differently, that you jumped curves, that you're not just better, faster, cheaper. You're fundamentally different. That's what evangelists do. They evangelize and proselytize things that are fundamentally different and better. Having seen the example of, TiVo recruit evangelists. And Harley-Davidson have evangelists, and Apple have evangelists, and Netflix have evangelists. At this point in e-commerce and commerce, you would think that people understand when you have a great product or service, you will get evangelists. I don't think that people have quite understood that. When you have this great product or service, I'm telling you, go get your evangelists. Don't wait for them to bubble up. Don't wait years for these groups to form. Go get them. Go get them. You'll increase the leverage of your marketing sales tremendously by doing that.

Lecture 10
Seed the Clouds and Watch the Sales Grow
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Seed the Clouds and Watch the Sales Grow
Lecture 11
Be a Mensch
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Be a Mensch

Kawasaki shares some of the qualities that he believes entrepreneurs, and everyone else, should have. In order to be a mensch, a person who is widely respected and trusted, one should help those who cannot be helpful in return, do the right thing in the right way, and pay back to society.
Lecture 12
Funding Choices
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Funding Choices

Kawasaki talks about two examples of early-stage funding, bootstrapping and venture capital, and the benefits and drawbacks of both. Ultimately, he believes that too much money is worse than not enough money, and that both methods can be successful of a smart approach is taken with the funds that are received.




Transcript



Yes it's very difficult to raise money and so the probability is you won't raise money so in some sense, people may never raise money and they'll bootstrap forever. However I think the attitude of bootstrapping, that you don't buy $800-chairs, that you don't run Super Bowl Commercials, is something that should be in the DNA of a company. You should always be a bootstrapper, or even if you have 10 million dollars in the bank. And so, I think having watched the dotcom phenomenon, that too much money is worse than too little. And that if you look at the great companies they never really raised boat loads of money. Yahoo didn't. Google didn't. These kinds of companies, they either you know, who knows looking backwards, they were either lucky and found a business model that took off right away or they fundamentally had something that was so viral, so spreadable by evangelism that they didn't need to pour big bucks into it. So, you know on the other hand, if you're offered venture capital I would take it. I would take it, because living off soy sauce and rice isn't that much fun, but that's for a precious few who can take the money, or who can get the money. And if you do get the money but then, I suggest that you not spend it because it just warps you. And I have been warped by raising capital for Garage. We have a lot of money raised and so it warped us. And that's one of the mistakes I made at Garage.

Lecture 13
How Do You Find Evangelists?
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How Do You Find Evangelists?

If a product or services is worthwhile, then evangelists will come to you, says Kawasaki. He believes that if you are having a hard time finding someone to spread the message about your product, then you may need to re-evaluate your product or your goals. Build something great, and the evangelists will be there.
Lecture 14
How Do You Find Soul Mates?
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How Do You Find Soul Mates?

Kawasaki believes that often soul mates are found within your existing social network, but there is danger in that as well. Close relationships outside of a business environment can lead to promising more than can be delivered. Kawasaki explains that it is a tricky process, and can be difficult if a soul mate is not fulfilling their duties.
Lecture 15
The Career Path to Becoming a Venture Capitalist or an Entrepreneur
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The Career Path to Becoming a Venture Capitalist or an Entrepreneur

Kawasaki believes there are some lessons one should learn before becoming a venture capitalist or entrepreneur. One thing to avoid is the "Morgan Stanley disease." Investment banking isn't the best way to learn those important lessons -- instead join the sales team of a large company and learn from the bottom up.
Lecture 16
Experience Is Overrated
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Experience Is Overrated

Kawasaki's viewpoint is not one shared by the majority of venture capitalists. Kawasaki sees the best candidates for a successful start-up are young engineers with no business experience.