Surviving Competition, Lecture by Jeff Housenbold / Shutterfly (2008)

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Jeff Housenbold: I think entrepreneurship is mostly a state of mind. It's a state of mind about, how do you create things that people haven't envisioned before? How do you aggregate the resources, motivate people, and then execute against that vision? It doesn't necessarily mean you have to go start your own business. I think the state of mind of entrepreneurship can happen in the largest corporations where I've worked at McDonald's and Citibank and Accenture. It can happen at the smallest of companies where I was employee 7 of a company called Raging Bull. That was founded by three 20-year-old college kids who decided to drop out after they raised a million dollars in funding. And so across that whole gamete, entrepreneurship is really about the state of mind of creating new products, creating new markets, creating new ideas, and then creating new businesses and capturing some of the economic trends from that vision and the hard work.

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Jeff Housenbold: And then a little company called CMGI. How many people remember CMGI from the bubble? They had invested in about 270 Internet companies. Everything from GeoCities to Lycos to AltaVista called and said, "Why don't you come join?" And so I went to a little startup, three kids, 20 years old. They did this as their summer project. They created an online finance community to compete with Motley Fool, Yahoo! Finance, and Silicon Investor at the time. And we, kind of, won. I mean, we beat the big guys because we were focused on a singular thing, knowing our customers better, having a vision which was leveling the playing field for the individual investor, right? So admission and envision larger than just making money. It was about, how does Joe on Main Street be able to invest with the same information that the big institutions have? How do we bring the cadre of a broad community together to allow for an interaction and exchange of ideas around stock picking to foster a better decision set by the individual investor? And we went from zero to 5 million users in 11 months and we had billions of page views. And, you know, everything was going public and rising a hundred dollars on the first day of trading back in 1998. And what was really interesting was as people were coming together about a shared interest of stocks, I started creating relationships that went way beyond it. And what we found was people were talking about what barbecue should I buy, what did you think about the sports team, you know, the Yankees winning, what do you think about this new bicycle, what do you think about this new cool PDA. And so one of the key things we did was listen to our customers, and that's another key lesson I think of success. And they said, "Well, we want to talk about stocks. And on Yahoo!, you got to wait through 25 postings before you get anything interesting about the stocks." So we quickly created this little button that said "off-topic." So the community would self-police themselves and say, "Hey, Joe. Take that off-topic. It's not relevant to the discussion about Dell as a stock." The second insight we had from our customers was if someone's coming on there and spamming or you're not interested in their comments, we had ability to block this user. And they seemed like simple things in today's world if you're grown up in an environment of social networking, but they were clearly pioneering at the time. It allowed us to foster community with very limited resources. We spent about $4 million in the whole lifetime in the company when people are raising lots of money and growing.

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Jeff Housenbold: I went on to run Internet marketing and business development, which was creating new ways to be able to bring people to eBay. And when I took over the group, Meg said, "You know what, it's about $30 million PNL and six people. And I think we got all of the people we're ever going to get on the Internet. Let's see what you can do." We took that from six people. That group is now about 160 and about $600 million budget. And when I left three years ago, we were getting about 65,000 new people every single day to sign up for eBay. And we did it because we used technology and we thought out of the box. And we were the first customers of Google AdWords. No one was doing at AdWords at that time and some of my experience from AltaVista, my relationships with Larry and Sergei allowed us to do that. We created the first widget, which widgets are pretty popular today. There's this little thing that we called the 'editor's kit' for this vast affiliate network, again, using the community to sell on our behalf and it pulled in real time. It read the page. So let's say you're on celebrity.com and you're on a page about Jennifer Aniston. It would read out these pages about Jennifer Aniston. It would pull real listings from eBay in real time and create with the picture, the price, the number of bids, and the ending time. So now, this vast affiliate network didn't have to do any work. They just have to go and deploy this and one line a code on their website. We created a database where no one had really understood direct marketing to this length where we could tell you what the search term was, what search engine it came from, what was the average bid on Google, and how should we dynamically change our cost per click in real time based upon what we know about the customer from its cookie, from its transactional information, from overlaying psychographic and demographic information, and being able to serve out unique pages in real time. And that proprietary data allowed us to manage a 13 million keyword portfolio in real time. And some of the secrets we got from listening to customers and entrepreneurial, you know, thinking out of the box was we realized that there's a bunch of young people in media buying on Madison Avenue who have to hurry up and spend their client's money at the end of the month. And so they ratcheted up the CPCs, right? And so one of the things we did was we ratcheted it down our spans in the last few days and the months while they were doing things that didn't have the right ROI. We also figured out that people used eBay at work, and so we looked at the lunchtime spikes. And so we actually ramped up spending on advertising across the entire Internet during lunchtime, so that's day parting and month parting. We looked at looking at the geocode and the ISP and serving up different listings depending on the proximity to where the shipping was to reduce shipping cost. So we did a lot of unique things that aren't about starting a business, but they're about entrepreneurial thinking, about how do you apply technology to problems. And the problem is, how do you spend money efficiently to get the right ROI to drive customers.

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Jeff Housenbold: But I was my high school and my college yearbook photographer. And my wife and I, we have three little boys who are 3, 4, and 6 now. We spent $1,900 on Shutterfly the year before I even joined, and we used it. As I was stepping back, my wife has a work in MBA and she worked at Baine and was a mom. And we were busy, you know, duo wage income family, with friends and family geographically dispersed across the country. We were using Shutterfly to stay connected to people. We were using it as a creative outlet. My wife was a physical scrapbooker and I was a photographer. And were kind of characterizing and capturing life's events and we want to share our memories and tell our stories with people who are close to us. And when I looked at Shutterfly, I kind of said, "Wow! It's a photofinisher." It competes with Kodak and it competes with Snapfish and competes with Wal-Mart and Costco and Yahoo!. There's nothing really special and different about it. But as I expanded my perceptional map about what it could be, about a personal publishing platform and about a social expression vehicle for helping people stay connected, that became interesting to me. I ended up joining January of '05 and had been running Shutterfly for a little over three years and we took the company public five quarters ago. And when I first joined, we were about 10 points behind Kodak in market share. And now, we've passed them to be the market leader and we've expanded this notion beyond photofinishing to be really one about personal publishing and social expression, but we're doing it for relationships that are closer in. So people ask me, how am I competing with Facebook and Flickr? We're really not trying to. So if you think about these concentric circles, it's you and your immediate family, your close friends, your colleagues, people who you've had shared memories and shared experiences with, and then people who have shared interest, and then the Internet. And so let me explain a little bit about that, the last two. I have kids and my four-year-old plays soccer. I'm interested in interacting with the other parents on the soccer team because they're taking pictures of my kid scoring a goal. We're having a shared experience together. There are people who I want to have their relationship with. I may only want that relationship during the season. It may not last longer than that - the kids, you know, move on to other teams, but I want to interact with them. I trust them. I want to share my memories with them. I want to grab some of the content that they have captured with them. That's where we play. I'm not interested in meeting other parents of soccer-playing kids in America or the world. When you get into my target of demographic, which is the old guy with kids, I barely have time to talk to my wife, my best friend, or my family. I'm not looking to put a persona out on the Internet and see how it rocks and meet new people. I'm really looking to what tools can help me stay connected in this busy world where I'm on the cellphone reading the BlackBerry driving at the same time. And so there are other sites out there that are more about this expansive vision of meeting people with shared interest that go beyond any shared relationship. And then there's the entire Internet which are other types of sites as well. We're not trying to compete there. We're trying to compete where 75% of our customers are women. They tend to be highly educated, high disposable income. They tend to not care about technology. It's how does technology make my life easier, faster, better help me enhance my relationships. So it's not about what's the coolest new gadget, what's the newest widget, what's the sharing paradigm. And it's not about voyeurism. So if you think about YouTube, YouTube is a publishing platform, not dissimilar from radio or television where lots of content goes on, but it's made by a very small piece of the total viewership and then people view it and then they monetize it through advertising. Very similar to Flickr. About less than 1% of Flickr users generate more than 95% of the content. So it's few publish, many view, it's a different model sponsored by advertising. We're trying to make money for people who want to share their memories. They're going to pay for physical products, photobooks, cards, calendars, prints, mugs, mousepads, all those things. And we generated over $180 million of revenue last year in doing so where many of these social sharing sites haven't really made money. So you look at Slide, which is a great widget. I'm sure we all use one of their products - FunWall and other photo-viewing stuff. They have 80 million users with no revenue. All right. So as you think about what businesses you want to go into, think about, is it a business or is it a product and service? Because products and services, venture capitalists will give you money to go after products and services. They don't really scale over time. So are you creating a real business and are you creating new ways of doing things that makes people's lives easier, better, more fun, more interesting and can you generate revenue from them?

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Jeff Housenbold: What am I looking for when I hire people? So first of all, I look for a functional expertise. An engineer needs to know how to code and head of supply chain needs to understand that. But way beyond that, first of all, I'd look for, what is the portfolio skill required to be successful? Particularly as an entrepreneur, I think one of the key things is to realize - and I made some of these mistakes earlier in my career - you don't know everything, and you can't do everything, and you're not good at everything. And so I think it's better to understand what are your strengths and amplify those versus taking what are your weaknesses and trying to make those modestly better. Now, there are some things you're going to have to have a minimum capability of. Communication is one of those. But if you're not the world's greatest strategist, don't try to go into a strategy role. Amplify your capability. So I look for someone who has healthy self-awareness about what are their strengths. And then I look for, how does that person's overall skills fit into the portfolio of skills needed for that position. And I believe in the right person with the right skills in the right job at the right time with the right attitude. And you have to have all of those. You can have the most brilliant individual. But if they can't get along with people and the job requires cross-functional collaboration, then it's not going to be successful. So at Shutterfly, we evaluate the people on both the 'what', what they do and what they perform and what results they get. But also on the 'how', how do they achieve those results. Is it consistent with our culture? I look for communication skills, both written and oral. You know, in this world of email and text messaging, written is in some way is becoming more interesting, though I have no idea what these three-letter things that my kids are already texting me is all about. I look for problem-solving skills, particularly under uncertainty and with incomplete information. In fast-paced environments where we grew 51% year over year last year and we're competing against little companies like Yahoo! and Kodak and Hewlett-Packard and Wal-Mart, we got to continue to execute really quickly. So you can't have paralysis through analysis. They've got to be fact-based decisions, but you've got to be able to make a decision under uncertainty. I look for someone who thinks out of the box and has thought capital and thought leadership. I look for people who are going to fit in from a culture standpoint. And I look for people who have intellectual curiosity. I don't care what functional role you're in: marketing, finance, operations engineering. I want people who want to tackle real tough problems. They get excited about finding those. But also I want them to do that in an applied and in a pragmatic way. So when we're interviewing, for example, software engineers, one of the questions I try to ferret out is, "Do you want to just work on real cool technology? Is that what get you excited?" And there's nothing wrong with that. Or, "Do you get excited by the application of your work and the technology and a lot of people adopting it?" And I found in the Valley that engineers fall into one of those two camps and sometimes they're not sure which camp they fall into, but you could kind of figure that out. And for us, we're not Google Labs or Xerox Park. We're not just thinking for technology in a broader kind of scientific way. We're looking for applied science. So I look for people who want to have an impact with their work. I also look for people who are going to be able to, again, deliver that 'how' through the cross-functional. One of the key lessons that I think as you age in your career and it becomes even more and more important is that mostly as you rise in the ranks of an organization, the most important skill to have is people skills. And if have to go back to business school again or if I was the dean at Harvard Business School, I would make everyone take three or four or five organizational design people, sociology, psychology classes. If you think about the venture capital role, what is it about? Identifying good talent. What are great businesses? Not the idea, it's about people who can execute. So it's about identifying talent. It's about conflict resolution. How do I get my idea across? How do I listen to you? How do I take that and synthesize it and make it a better answer? It's about motivating people to do more as a collective than they ever thought possible as individuals. So it's about inspiration. It's about interviewing skills. It's about firing. It's about giving feedback. It's all about people skills. I don't care what business you're in. I don't care what function you're in. So I look for people who have people skills and want to play as a team versus play as an individual.

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Jeff Housenbold: How do you continue to innovate and make sure that you have a sustainable business model as competitors are trying to encroach? And let me apply that in a Shutterfly context and then maybe bring in some other experiences. There are very few businesses that are inherently unique and have sustainable competitive advantage. Over time, things become imitable. People copy it. Toyota figures out how to make a better car than General Motors. Google figures out how to make a better search engine than AltaVista. Right. Things change over time. And I think great businesses and success, and then I'll talk about how we're doing at Shutterfly, is figure out what you're good at, figure out where you can make money, and focus. And so too often, I've been in companies or invested in companies where they try to be everything to everybody. In fact, I think part of what created eBay's slow down was we just kept putting feature after feature after feature onto the main eBay website. There were some people who wanted to do auctions and they tended to be more male. There are people who wanted to do fixed price, buy it now. Some people want to buy in quantities. Some people wanted different experiences and buyer, sellers and we just kept putting it on to the platform making it more and more and more complex. And the time to produce new innovations got longer and longer and longer because the code base got larger and larger in a key way and the UE and the complexity of it. And so when I first came to Shutterfly, we didn't really have points of differentiation. We didn't have a mission. We didn't have a vision. We didn't have a strategy. We didn't have the right management team. We didn't have the right corporate governance. What we had was a bunch of passionate people with the kernel of the right idea that needed to change the perceptual map from being a four-by-six company, which you can't necessarily win against Wal-Mart over time with their scale, and change that perceptional map. And so we're focused on knowing our demographic, which is again 75% females. They tend to have children. They're 25 to 55 years old. And they tend to be what we call the 'CMO,' the Chief Memory Officer of the family. They're the ones responsible for capturing and sharing and telling the stories. And so we set out on a path of how do we win and how do we differentiate, and we're doing it in a couple of ways. First of all, through what we call 'customer centricity.' So unlike all of our competitors, we don't downsample or compress your images. So if you take an image with a 5-megapixel camera, it's about a 1.4 megabyte size of the file. We actually upload and take that high-res original. Our competitors will downsample it to - like on Facebooks like a 200k. So you can't really make enlargements or crop. And if your computer crashes, your original resolution image isn't there. We also don't force delete. So at Snapfish, if you don't come back every six months and purchase, they'll delete your memories. We call them 'memories.' They call them 'photos.' They're people's memories and there has been Kodak and Snapfish have deleted people's wedding pictures, the birth of their kids because they change from Hotmail to Yahoo! Mail and they didn't have a bounce back service. And there was a big New York Times article about it. We don't force people to register, so you go to Snapfish. If you want to share pictures of kids at the soccer game, everyone has to register. So they talk about registered users. We talk about paying customers. So we have a 1-800 phone number as well as live chat plus email. Go try to find the phone number on our competitors' sites. We also have a 100% satisfaction guarantee. So we said we're going to be the premium player. And to do that, you've got to deliver a premium service and experience. That costs more, but you could charge more for doing that. In talking to our customers, they're fashion forward. They want to stand out from the crowd, and so they care about designs. So we have over 60 million combinations of fonts, layouts, backgrounds, designs, and book sizes, and so we're trying to diversify. Now, we don't overwhelm and tell our customers we have 60 million because they would be overwhelmed. But we allow for progressive discovery based upon us knowing something about them and them telling us something more about them. We've created a new form factor. By owning manufacturing, we're the only ones in the industry to own manufacturing. And when I first got there, I said, "Hey, we've got to get this manufacturing off the books." That's called 'hard assets'. I've come from six Internet companies where you don't own any assets and your return equity and your return on assets are even better. And we went out, we talk to people, and everyone was willing to outsource for us. They didn't have the quality, they didn't have the customer centricity, they didn't have the innovation, and they couldn't provide the service levels that I thought was important to support our premium brand. So we said, "Let's take manufacturing and turn it into a strategic weapon." So we have the lowest cost in the industry because we own manufacturing. There's no middleman. I went out and hired a bunch of PhD scientists in Image Science and we hired away people from Xerox and from HP, to people who make the machines we use. Right. And we've driven the cost down. We're the lowest cost-producer in the industry. We're also the premium player, so we have the highest prices. So we make a profit between those two where our competitors, to the best of our knowledge, have never made a profit and we've been profitable since 2003. The other thing is our focus on innovation. We've been the first in the market with many things. We launched on December 11th in 1999 and there has been over a thousand venture-backed companies in the space. Some from folks like Kliener, Sutherhill and Sequoia, name it. But they've come and gone because they haven't created a business model. So we were the first to market. We were the first with different sharing paradigms. We're the first with different form factors. We were the first with going to change in the user experience to use drag-and-drop and Ajax and making the user environment more friendly. And so in customer centricity, quality, design sensibility, innovation, I think those are some of the key ways that we continue to compete. Now, parts of the business is an arms race. For example, the four-by-six print, you could get a four-by-six print on your home printer, which is pretty good. Not as great as what we do or if you go to in store. It's a little more expensive. The quality is not as good. It's time-consuming, but you can't really win on the quality of a four-by-six print. You could lose. And so we see that as kind of parody and the industry grew about 15% last year on four-by-six prints. And even though we have the highest price by above 14%, we grew 34% our print business and it's because we wrapped it into that customer centric quality. So we used cardboard packaging, we then wrap it again. Our competitors are using paper and saving on shipping stuff. So we said we're going to be the Nordstrums in the industry. Snapfish has come out and said, "We're going to be the Wal-Mart." And Kodak is kind of stuck in the middle like Macy's. Servicing a broader range of customers selling a large SKU set and not really having a unique tone. So the brand that we're building through all those touch points is the fifth way we're differentiating ourselves because it's an arms race. People who had the same designs will copy our formats. They'll copy our form factors. They'll copy our new features and functionality. But we're constantly innovating and the way we do it is by involving the customers into the design process and doing iterative feedbacks.

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Jeff Housenbold: And what's important, I think, also as an entrepreneur is you've got to do research, but don't go build what your customers tell you what they want because often they don't have an expansive enough vision to understand where the market is going three years from now. That doesn't mean not to do in home studies and usability labs and ethnographics, all that is really important. But too often I've seen large companies kill ideas because the market research says no one wants that, and they won't pay for it. I've never sat in a focus group where if you asked, "Will you pay more, and if you want it freely, will you pay more?" All right. So as part of being entrepreneurial, you've got to say, "Okay. I've taken all this fax in. Now, where do I think that market is going and getting there before anyone else does?" Now, on the bricks and clicks combination, we went out and done partnership we target. So we offer our customers for those use occasions in which they need to pick up prints in an hour. We have a relationship with Target. Why Target? They have a shared vision. Expect more, pay less. They wanted a better experience, a higher end experience than Wal-Mart. They're about design. They're about selling brands. They're about customer centricity. And their demographic is primarily women who are a little more affluent than Wal-Mart's, and so Target has been a great partner for us in that way. The other thing is when we went out and did the research, 96% of people said they would like pickup at retail. But as an industry, only 7% use it. So it's kind of like saying, "Would you like any lock breaks on the car?" Sure. If you're going to give it to me. I'll take it. But since you can see your picture today on the camera or the capture device and you can see it on your screen, that urgency to get it the next hour. Because when it was in film, you took 24 or 36 pictures. And, you know, if you took any good ones, you have to go and develop them all. So there's a sense of excitement. You kind of get that afterglow of excitement right there on the computer screen, and so you don't need it very frequently in an hour. But it's a part of that customer-centric approach giving our customers choice.

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Jeff Housenbold: So because the way we make money today is physical-producing and we're a printer, we're using paper and ink, so how are we thinking about sustainability and environmental. One of the interesting things, let me start on the business side then I'll go to the environmental side, is going back 20 years ago, people were talking about two phenomenons. One was the paperless society. And if you look at HP's earnings, they sell more ink than they ever have. And by the way, I do think it's a vast conspiracy. How many people have ever printed in an Internet, gone to a page on the Internet, and hit 'print' and you get that second page that only has the header and there's nothing on it? Okay. I think that's a vast conspiracy by the print industry to sell more ink and paper, so I would start there because that's about a 40% reduction. But the paperless society has never really come about. Fact, with the access to information and the reduction in cost of personal printing, home printers, people are printing more and more. And so I think there's this notion of, you know, printing is just happening more. I was sitting with a 27-year-old portfolio manager at one of the largest mutual funds and he says, "You have the stupidest business model I've ever seen. I don't print. I take picture on my cellphone and then, you know, I look at it and I delete it. So you're going to be out of business in two years." I said, "Well, this is going to be a short meeting, isn't it?" And I said, "Hey, here's something I know. First of all, my guess is you're in your mid-20s." He said, "Yeah, I'm 27." I said, "I know you're going to get older. And if you'll lucky, you'll date. You'll get engaged. You'll have a wedding. You'll have children. You'll move out of your apartment, buy a home. You and your wife will want to decorate your home and what are you going to want to decorate with? Your memories. You're not going to want anymore put up that picture of the rock band or that supermodel. You're going to want to adorn your home with your memories and tell your stories." "And then something's going to happen. You're going to realize your parents are going to run your life. You have to give them a calendar of the kid's first poop, then his first walk and his first talk." And so we have a really good business model, so I'll come back in four years when you kind of get it and want to invest in it. Right. And so that doesn't address you at the environmental, but I believe there's a sustainable business model. But we're also not being ostriches and sticking our head in a sand and saying, "Okay. You know, the world around us isn't changing." So we were one of the first a couple of years ago. We created something called 'Shutterfly Collections.' So we give away to our customers two free URLs. So, for example, I have housenbold.shutterfly.com and it's an environment that's password-protected and my immediate family and friends have it. And it's a place where we could combine blogging with storing our pictures so we could look at each other's images. One of the things we do is vast amount of sharing, hundreds and hundreds of millions, you know, and billions and billions of images are stored with us and hundreds of millions are shared every year. And so we're cutting down in this notion of using technology where you could take 500 pictures on your 8-gigabyte card today and zoom in on the 40 or 50 you really like and edit, and only have to print the 40 or 50 you like versus in the old days, again, you would have to drop off or roll a film and print every single one of those. So we're allowing greater choice. In the old days also, you had to get in your car, drive to retail, use up gas, buy a roll film, come back to the store, use up gas, drop it off, come back a third occasion, pick up your prints. Now, the retailers love that because they filled your cart with a bunch of sundries you didn't really need on those three occasions. But just the notion that we do mail-ordered delivery to the home or to the office cuts down on a lot of that transport. And things like our electronic sharing and our collections and our new gallery where people could post their projects up online and you could share with each other and you could inspire each other's ideas. There's a lot of ways in which we're innovating to stay ahead. From a corporate citizenship and from green and from thinking about how do we reduce the waste that we create, one of the things is we reclaim all of the silver and the chemicals that we use in the process to make prints. And so as commodity prices have been rising, that's pretty good for us because we just recycle those items. We've also been working both because there's business benefits from cutting down on the amount of waste in terms of how big of a print do you use before you cut around it, how do you reduce errors in the manufacturing processes, the technology, the people training. So we've been on a jihad to, kind of, reduce the amount of scrap that's generated in our business. One, because it's good business. It saves us some margins. Two, it's just good for the environment. Other things we've done is a 470-person company. I realized we were spending hundreds of thousands of dollars giving people free drinks during the day. And so now, we've given out nalogene bottles and ask people to refill their water. We're doing recycling. We're going back and looking at and using certain recycled products, and now packaging instead of original bleached papers. So there are things we're doing. Again, it's just good for the environment. It's good because of our mission and it's to make the world a better place by helping people share life's joy. And part of the Shutterfly Foundation, the way we give back and focus on the environment, children, and education. But it's about innovation. It's about thinking out of the box again and finding that right balance as a for-profit business that are good things for the environment, good for our community of customers and employees and good for the environment.

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Jeff Housenbold: Here are some pieces of advice for being successful in any business. First is have what I call a 'rabbi.' And it doesn't need to be the CEO or senior executive. Have someone in the organization who has a propensity for mentorship who wants to see you succeed either because he or she is going to succeed as you succeed or because they have that inclination to do so. And I don't believe that there is anything really truly unselfish. There's this notion I call 'selfish unselfishness.' So when you go to a food bank and you serve turkey dinners on Thanksgiving, you're helping people. And that's unselfish, but you're gaining satisfaction, and that's selfish. So if you play on that symbiotic relationship, find someone who has enough distance from you in terms of career experience and level that they're willing to mentor you and you won't be threatened. So have a rabbi. I think the second thing is do what interest you. If you really love consumer brands and you're retail, you go to a semiconductor fab, you're going to be bored. So do what really interest you. The third thing is go where the money is made in the company. So if it's a sales-driven organization, go to the sales group. Understand where the money is made. Is it through the services? Is it the products? Is it a particular product line? Is it through new products or nonproduct rate? So go where the money is made. The next is solve your boss's and your boss's boss's problems proactively. So you're going to be given a set of things to do and think about how they relate to the greater problem that people are trying to solve, and then be proactive to go above and beyond what is asked of you to solve your boss' and your boss's boss's problem. The next thing I think is go where there's tremendous growth or complete turnaround. Because those environments create great opportunity for accelerated progression in one's career. If you're in an industry that's grown 6%, it's going to be hard because people above you aren't going to be moving up. If it's characterized by 6% growth, it's unlikely it's an innovative industry in market. So go where there's tremendous growth or disruption or disintermediation or complete turnaround because that's an opportunity, particularly at a young age. Don't care about title, particularly in your earlier stages of your career. Too often I interview people and they're haggling over, is it a senior director or a director type? Be a sponge. Figure out where you want to be. Have a plan where you want to be three, five, 10 years, right, and figure out what are the skills and the opportunities that you need to get there and be a sponge. Go around people where you can learn from. Go in a culture that you feel like you can fit in. If you're about openness and teamwork and you go into a hero-driven or a cowboy-driven culture, you're not going to succeed. The politics will crush you and vice versa, so find a culture that fits you. And then realize that success is driven by putting yourself in the way of opportunity enough times that you get lucky, right? So all of you by definition are smart. You wouldn't be admitted to Stanford, right? What's going to distinguish you? Because I bet 90% of you were in the top 10% in high schools. But only 10% of you are going to be in the top 10% of Stanford. What's going to distinguish success is, are you going to work harder than other people, are you going to be proactive, are you going to get out of the way of your ego, are you going to take chances? And when opportunity does knock, open the door and then also realize that your smarts is the ante and luck is really what rings the cash register.

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Jeff Housenbold: Probably the biggest mistakes I made early in my career and I think a lot of first-time managers make, this is not delegating effectively. You want to do a good job. You kind of like to be in control and you just go and do it instead of building your team up. And success is really not how smart you are, but how can you get people to do what you want. And you don't have to be the smartest person to do that, so delegate effectively, build great teams. There are times, particularly early in my career, where I let my own ego and my ambition get in the way of my own success. So step back, find people who are going to tell it to you like it is. When you're not wearing any clothes, people are going to say, "You know what, I want to let you know this is what's going to take to succeed and let me help you get there." And then also realize it's hard when you're in any particular, kind of, period in life. It's not about the money because every study you can read is money doesn't drive happiness, right, and that life is really short. If we're lucky, we'll live until our 80's and 90's. But too often, life ends before that. And so make sure you're creating balance in life, having good friends, good family, spirituality, and then also feeling good about what you're doing every day. And that's hard, right? Because we're all ambitious and hardworking, but make sure you find time for the balance in life.