A Friday series exploring Startups and the people who make them go. Read all If the Shoe Fits posts here

I only partly agree with Steve Wozniak’s recent comment.

“I think the money that’s been made has attracted a different kind of people looking at technology today and saying ‘Oh my gosh, I could maybe have a startup and make a bunch of money,'” Wozniak said. “And the ones that come out of business school, money’s the priority. For the ones that come out of engineering school, being able to accomplish and design things that didn’t exist before is their priority.”

Woz gives too much credit to the engineers.

It’s not just the biz school crowd that’s focused on the bucks.

The money bug has bit a good number of techies, too.

Years ago, no matter their role, people joined startups because they craved the bleeding edge, whether software, hardware or services.

This was true of both tech and non tech. In the words of Star Treck, they wanted “to go where no man has gone before” — or at the least go there differently.

Today the journey is more about getting rich and/or making connections for the future.

For decades I’ve told clients, “The person who joins your company for money/stock/perks will leave in a heartbeat for more money/stock/perks.”

That hasn’t changed, if anything it’s just gotten more so.

Image credit: HikingArtist

You hear it all the time, “build a product that solves your own problem.”

That’s exactly what JT Marino and Daehee Park, both software engineers, did when they quit their jobs to create mattress company Tuft & Needle, seeding it with $3000 from each each of them.

They didn’t take venture money because they wanted to build the company for the long term and borrowed the money they needed to grow.

“The reason why we turned them down all those times is because we figured it would change the way we operate as a company.”

Instead, Marino, 30, and Park, 27, took out a $500,000 loan, at a rate of 10%, from Bond Street, one of the new breed of alternative lenders, in order to keep control of the company and continue doing things their own way.

They built the business online — no showrooms and no salespeople.

No hassles returning a mattress you hate. And, perhaps most important, no gimmicks on prices, which range from $350 for a twin to $750 for a king.

They’ve considered other products, even developed a few, but with no investors to force them to expand, they are focusing on the mattress business.

Is it paying off? Absolutely, so no problem meeting their loan payments.

By its first year in business, Tuft & Needle had reached $1 million in revenues. And then it just kept growing, hitting $9 million in 2014, then $42 million in 2015. This year, Marino and Park expect revenues to reach between $125 million and $225 million, a three- to five-fold increase over last year. And, yes, it’s profitable.

However, recognizing that not everyone, especially older buyers, are comfortable buying a mattress online, they are opening their first retail store at 637 King Street in San Francisco (where else?) — first and possibly last.

“It could very well be our first and last store, or it could be the first of many,” Marino says.

That’s the priceless reward for bootstrapping.

Call your own shots, experiment as you choose and stay true to your values.

Image credit: Tuft & Needle

During the holiday media gift frenzy it is the truly wise who remember that the best gifts aren’t electronic or screen-dependent.

The very best aren’t paid for with money, either, but with a much more precious currency — time.

Time to love.

Time for friendship.

Time to play.

Time to talk and laugh together — F2F

Food cooked and shared together at (someone’s) home.

Not just during the season, but scattered throughout the year like diamonds on a velvet cloth or stars in a clear night sky.

Along with time, the most wonderful gift you can give a child is a love of books — real books.

Real because reading a printed page affects the brain in different and better ways than words on a  screen.

Whether your child reads or you read to them start with the books from Lost My Name, which creates personalized books using your child’s name.

Lost My Name — founded in 2012 by Asi Sharabi and Tal Oron — creates customised books based around a child’s name. The books are created and ordered online, then sent out to printing partners around the world. (…)  “As a technology company, we’re very proud to be innovating on one of the oldest media formats in the world – the physical book,” said Oron. “We think technology equals possibility. And possibility is the dominant currency in wonderful, nostalgic storytelling, where the book’s job is to inspire children to believe in adventure; that anything can happen if they imagine it. As screens become more and more seductive to children, there is an increasing need to inject more magic into books – to find new ways to spark their imagination.”

Even better are the books by Randall Munroe, former NASA roboticist, who specializes in science humor and whose 2014 book, “What If?: Serious Scientific Answers to Absurd Hypothetical Questions,” became an unexpected mainstream hit.

Munroe believes that anything can be explained simply using normal language and proves it in his new book (which is a good choice for anyone on your gift list).

“Thing Explainer: Complicated Stuff in Simple Words.” The oversized, illustrated book consists of annotated blueprints with deceptively spare language, explaining the mechanics behind concepts like data centers, smartphones, tectonic plates, nuclear reactors and the electromagnetic spectrum. In his explanations, Mr. Munroe avoided technical jargon and limited himself to the 1,000 most commonly used words in the English language. This barred him from using words like helium and uranium, a challenge when describing how a rocket ship or reactor works.

For book links and great comics (sample above; chosen for enabling holiday restraint) visit Munroe’s site.

Books are good for adults, too. Check out this month’s Leadership Development Carnival for critiques of books that run the business gamut from being a better boss to upping your game wherever you are in your career.

Another great thing about real books is what you can do when you are done reading them.

• Some you’ll want to keep for your own library;
• some you’ll share with friends, colleagues and those you mentor; and
• the rest can be donated to your local library.

Happy reading! Happy discovery!!

Image credit: Randall Munroe

A Friday series exploring Startups and the people who make them go. Read all If the Shoe Fits posts here

You build an app that is greeted with raves.

You have 15 million installs and counting.

You have 36 talented, motivated employees.

You raise 35 million dollars from top investors, including Draper Fisher Jurvetson.

What’s your next step?

You shut it down before you run out of money.

Why?

Because you can’t identify a viable business model.

In short, you can’t figure out a way to generate revenue.

That’s what just happened to Everything.me.

The startup had seasoned founders and did everything right.

The investors were smart, savvy and experienced.

But one thing slipped by everyone’s radar.

No clear, or even murky, path to revenue.

Not profit.

You can live without profits, but you die without revenue.

Lesson learned: no vision/business plan is complete without a viable way to make money.

Image credit: HikingArtist

The media loves making it a big deal when people leave companies, especially if

• they have been there a long time;
• they have a high profile/big title; or
• the company is one of the golden ones, e.g., Apple, Google, Facebook, Uber, Salesforce, etc.

Not counting layoffs or termination, why do good people leave good companies?

Actually, it’s not so much where they are leaving from as it is what they are going to.

No matter how great the company; how talented the boss; how good the career path; at some point people just want to see what’s on the other side of the mountain.

That isn’t a reflection on the current company/boss/career, it’s a reflection of the natural desire to challenge/test oneself in a new environment.

That doesn’t always mean starting their own company.

It simply means they found something attractive enough that they decided to pursue it — and it is rarely found in compensation..

One of the few constants I’ve found through decades of dealing with people in the workplace is that those who join a company for compensation (money/stock/perks) will leave for more compensation.
However, this is a concept that seems beyond most media understanding — or perhaps it’s not what the public wants to hear.

So the next time you see one of those stories, think “where is she going” as opposed to “why is she leaving.”

Would you hire someone who was fired?

Join me tomorrow for the reasoning behind the unexpected answer.

Flickr image credit: BK

Gallup regularly polls workers around the world to find out. Its survey last year found that almost 90 percent of workers were either “not engaged” with or “actively disengaged” from their jobs. Think about that: Nine out of 10 workers spend half their waking lives doing things they don’t really want to do in places they don’t particularly want to be.

Pretty sad, but what happened to bring us to this sorry state?

Not what, but who.

Disengagement was born in 1776 with Adam Smith wrote Wealth of Nations, became the father of industrial capitalism, and gave birth to the belief that “people were naturally lazy and would work only for pay.”

The more that philosophy was embraced over the centuries the more it became a self-fulfilling prophecy — in other words, people live up or down to expectations.

An excellent essay by Barry Schwartzauga, professor of psychology at Swarthmore College, provides great insight to how much damage has been done by this one assumption.

When money is made the measure of all things, it becomes the measure of all things.

To be sure, people should be adequately compensated for their work. (…) But in securing such victories for working people, we should not lose sight of the aspiration to make work the kind of activity people embrace, rather than the kind of activity they shun.

For decades, study after study and survey after survey have placed money (assuming a living wage) around number five on what’s important to workers.

How can we do this? By giving employees more of a say in how they do their jobs. By making sure we offer them opportunities to learn and grow. And by encouraging them to suggest improvements to the work process and listening to what they say.

Work that is adequately compensated is an important social good. But so is work that is worth doing. Half of our waking lives is a terrible thing to waste.

Autonomy. Challenge. Learning and growth. The chance to make a difference. Compensation.

If you want your people engaged then provide them reasons to engage.

If not, just pay them and don’t complain.

Flickr image credit: Airwolfhound

A Friday series exploring Startups and the people who make them go. Read all If the Shoe Fits posts here

This post is for all the male founders out there who don’t understand the fuss about diversity, especially gender diversity.

After all, why bother finding female talent when it’s so much easier to find male talent?

What difference does it really make? (click “Resources”)

Venture-backed companies with females as founders or executives are more likely to go public, turn a profit or be sold at a steep price (source: DowJones)

Globally, companies with diverse executive boards enjoy significantly higher earnings and return on equity. (source: DowJones)

Download the Report

The difference is money, stupid; it’s the money.

Hat tip to KG for sending me the link.

Image credit: HikingArtist

Do you find today’s world a bit strange?

I do. Not because of the technology or breakthroughs, but because so many people are trying so hard to live someone else’s life or spending incredible amounts of energy trying to force others to live their way.

I’m not saying they shouldn’t; it’s their choice and doesn’t require my approval or opinion — unless they are trying to cram something down my throat that chokes me.

I neither need nor want the safe, curated world described yesterday.

I’ve screwed up many times in the course of my life; three had disastrous, long-range consequences, yet without them I wouldn’t be me — and I like me.

I realize that there are probably many versions of me that I would like; each a result of choosing a different fork in my path.

What I wouldn’t like would be to live with the desire to be someone else.

We look at public personas with no knowledge or understanding of what went into creating each one or even if they are real.

The dichotomy between the inauthenticity of craving or controlling someone else’s life and the talk of living an authentic life is often hard to swallow.

Geno Auriemma, Coach of the Connecticut Women’s Basketball Team summed it up very well in an interview.

“I’ve always been fascinated by people who care so much about what other people are and what they do in their personal lives,” he told a news conference. “Like, how small-minded do you have to be to care that much about what other people are doing? Life is hard enough as it is, trying to live your own life.”

No matter how wealthy there is someone with more money; no matter how beautiful or handsome there is someone who is better looking; no matter how brilliant there is someone who is smarter or just better uses what they have.

So, whether at work or personally, be proud to be you. No matter who you are or what you do you have a spark that no one else has.

Image credit: Frank Vassen

Early last year I wrote, “Wealth addiction isn’t a case of wanting to get rich; it is a case of nothing is enough.”

From the outside, Mark Cuban is a good example. He considers the slightly-over-$30K gets per episode for Shark Tank too low, which makes one wonder what he gets to act like a fool in that (IMHO) stupid AT&T commercial.

He certainly doesn’t need the money, so why do it? Is it simply wealth addiction or something else?

Most likely something else.

The paradox of success is this: The mental wiring that enables a person to claw to the tippy-top of Corporate America or sports or entertainment or any other field that offers vast wealth is the same mental wiring that most of the time leads people not to retire before they have to — no matter what the diminishing marginal utility of money would suggest.

But there are those similarly wired for success who manage to miss the addiction and sidestep the paradox.

Four recent, high-profile examples are Patrick Pichette, the 52-year-old chief financial officer of Google, Patrick Willis, 30, a San Francisco 49ers linebacker, Jason Worilds, a 27-year-old linebacker for the Pittsburgh Steelers and 26-year-old Jake Locker, a Tennessee Titans quarterback.

These four are great proof that neither mental wiring nor predisposition eliminate choice.

Because it’s your mind, which means it’s under your control.

Image credit: DonkeyHotey

A Friday series exploring Startups and the people who make them go. Read all If the Shoe Fits posts here

Amongst all today’s hype about unicorns Andrew Wilkinson stands out as a beacon of light and a voice of sanity for many entrepreneurs.

Wilkinson is founder/CEO of two successful companies, Flow and MetaLab.

He launched Flow in 2011 and has been growing ever since sans outside investment.

Although he has had talks with angels and VCs over the years he has no interest in taking money and has been publicly vocal on the subject.

He talks about being a horse, instead of a unicorn.

Meanwhile, there are thousands of internet businesses out there, quietly making tens, and even hundreds of millions of dollars, who have taken the same path as In-N-Out. They don’t need to be first, second, or even tenth, in their space, and have instead chosen to focus on a small percent of a massive market. They answer to customers, not investors, and focus on making their employees, customers, and themselves happy.

While In-N-Out is Wilkinson’s model, you can look to privately held SAS for a unicorn-sized software model.

SAS was founded in 1976; in not-quite 40 years it has grown to 13,660 employees who produced $3.09 billion in 2014 from 75,000 customer sites in 139 countries.

Whether the drive stems from the demands of the investor world or the need for instant gratification, Wilkinson’s attitude is a breath of fresh air.

Raising venture money is a high risk commitment to go big or go home, and it isn’t for everyone. It certainly isn’t right for me, but neither is the surfer lifestyle business. I’m somewhere in the middle, with the Snyders of the world. I’m not a unicorn, I’m a horse.

Give it some thought or, to paraphrase an old commercial, “try it, you might like it.”

Image credit: HikingArtist