Entrepreneur

Samuel Logan - Guest Post: Tactical Retreat

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Author’s note: this post is about Brigadoon, an annual gathering of entrepreneurs and thought leaders in the Wasatch mountains of Utah. I’ve written it for those who have attended the event, or plan to in the coming years.

I’ve just completed a full week of retreat, rest, and reflection in the Wasatch mountains of Utah. It is the fourth time I have made an annual journey to attend Brigadoon at Sundance. Since my first visit, I fell in love with the idea, with the people I met there, with the location, and with the ideas. Since my first visit, I have not attended another conference, nor have I had much interest. Since the first visit, I have looked forward to returning to this summit of ideas and excellent conversation. These past four years have been a memorable experience. An indelible mark remains on my heart. But I’m not going back to Sundance next year. Before I tell you why, I want to share four things I have learned over the past four years of attendance, of presenting my own ideas, of conversation and shared experience, and of retreating to the mountains of Utah to take a deep breath.

  1. Ideas appreciate in value over time: I first attended Brigadoon to deliver a keynote on The Future of Information Trafficking. It was a wonderful opportunity to synthesize several disparate ideas I had been following and cohesively present them to a room of smart, engaged professionals who shared my own level of curiosity and desire to find a higher level of professional acumen. It was my best effort to inject into the gathering some big ideas and begin a conversation. I had no expectation for a return on investment, but by the end of our time together, I was overloaded with new concepts, new points of view, new angles of looking at the same thing, discovery of concepts I had never considered, connections I had never made, and — in short — more ideas than I could process. I realized that the return on investment (ROI) for Brigadoon was not driven by an opportunity to meet someone who might become a client or an investor. The ROI was in ideas. Over the past four years, I have implemented plans, policies, and programs based on many of the ideas I captured while sitting in the Redford Conference Center listening to someone — who I would have otherwise never discovered — share his or her perspective on life and business. To this day, I hold a bank of ideas in reserve. They appreciate in value as my own ability to unlock what they mean for me and my business grows.

  2. Conversation holds longer than a moment: One of the qualities of a true friendship is good conversation that transcends time and distance. Our best friends are the people who never change, and who can pick up where we left off, even if years have passed since the last encounter. As we age, our list of friends shrinks until we are left with only a core group of true, trusted relationships that most of us can count on one hand. It is a law of aging and relationship that we are all forced to obey. Yet Brigadoon is an exception. There is something about Sundance that suspends reality. There is something about this extended moment that the attendees of Brigadoon share together, if only for a brief while, that marks each of us. My first time at Brigadoon left me with more ideas I could handle and use; it also left me with a short list of new friendships that, though young and based on little more than a shared experience in the Wasatch mountains, would become part of a conversation that held for years, not just a moment.

  3. Relational Equity: In the start up world, we often talk about equity. There’s sweat equity. Us founders are keenly aware of this type of equity; never count the cost! There’s equity as applied to the value of shares in a company. This is what an investor purchases hoping for a return in the future. Brigadoon taught me something about relational equity. This is a quality of fair and impartial treatment of one another. All walks of life, liberty, and the pursuit of happiness attend Brigadoon. There are red and blue states. There are red and blue companies. There are Atheists, Christians, Jews, Muslims, Hindus, and more than a few Mormons around. But there is no tension. No argument. I’ve always thought a sign of intelligence is the ability to rise above the baser sense of emotion and belief — indeed to suspend some of that stuff — in the higher calling of unity and relationship, even if for just a few days in Utah. Do this again and again, and it’s no wonder that relational equity builds between people who would otherwise not cross paths. I like to call these encounters, especially in those moments when a one-on-one conversation transcends time, happy collisions. Brigadoon is full of them.

  4. People are people until they’re not: Most encounters we have with other humans are transactions. Usually there is a phone, a POS system, or an Internet connection between us. Our desire to dive deeper into the worm hole of our own digital avatars matches the pace at which technology has replaced real relationships with binary code. Not in Utah. Brigadoon is tech savvy but decidedly analogue. There are no power points, and never will be. The presentations are more toastmasters than not. Faces and hands provide animation, not CGI. And while we do often talk about bitcoin, distributed ledgers, machine learning, and broad vs. narrow artificial intelligence, it was all pencil and paper, with a fireplace in the backdrop, not a screen. Brigadoon attendees are forced to be real. We can’t hide behind laptops or cell phones because there is really no Internet or cell phone connection to speak of. Even if there were, you wouldn’t want to because the person across the table, or standing in front of you, just said something you never thought you’d hear. Rapt attention was the involuntary response. Or, she told you something more personal you never thought you’d say yourself — I’ve rarely laughed and cried in such succession within such a short amount of time. Or someone just explained something to you that you never thought you would understand (like blockchain), while leaning against a bar sipping club soda with a twist of lime. People are just people until they’re not. Brigadoon has always been and will always be a place where masks are removed, reality takes hold, and the attendees give themselves to the moment, where the mountains set your do not disturb mode not a swipe on your hand held device.

I know what you’re thinking. I’ve waxed romantic. And maybe I have a little. But for a good reason. I’m not going back; it’s bittersweet.

So I’ve laid bare before you the top four reasons why I love attending this retreat (yes, I’m not calling it a conference). Why am I not going back?

I’m not going back in 2020 because I want you to have a chance to experience what I’m talking about. I’m not going back because I can thankfully attend a Brigadoon Salon dinner and hug my old friends. Finally, I’m not going back because I want to spend my time and effort in working with Brigadoon’s founder and ambassadors to develop something special under the Brigadoon brand in Scotland (stay tuned).

And I’m not going back because I don’t need to go to Utah to achieve all those things you just read. We can all do everything I described above on our own, in our own space. As the founder of Brigadoon often likes to say — with a little tongue in cheek to spare — “go start your own retreat!” But we always say we don’t want to because he already did. And the truth is, we probably couldn’t do it better. So hat’s off to you, Marc A. Ross, and thank you for a good run. I loved it.

See you in Scotland.

Did you know? Under the Sea + Pitch Decks + Sleepmore + K-beauty

The ocean is the new farm: Farms under the sea could feed the world in 2050 (video): http://bit.ly/2SQzde0

30 legendary startup pitch deckshttp://bit.ly/2SMNA2C

Stomach-churning challenges: Greenhouse gas emissions from livestock are presenting the food industry with many challenges. Here’s one: gassy cows. “Burping cows are more damaging to the climate than all the cars on this planet,” Barclays said in a report.

Sleepmore in Seattle: A study in Seattle shows the power of starting the day later. The study is already having an impact. School boards in Orlando and Philadelphia are already looking at this example to see if it should make similar changes. In France, backed by advocates pushing the study’s findings, Parisian teenagers will be allowed an extra hour’s sleep before school in a move to improve their health. 

South Korea’s cosmetics industry takes aim at the super young: WP reports, the effort by the industry — known as K-beauty — to reach out to girls as young as 4 is stirring concerns that touch on many core social debates in South Korea, a country that is famous for its exacting beauty norms and has one of the highest rates of plastic surgery in the world.

Does a Coach or CEO matter?

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When it comes to management, the answer is an unequivocal no.

Soccernomics, the beautiful book written by Financial Times Columnist Simon Kuper and University of Michigan Professor Stefan Szymanski, makes the convincing case that "it turns out that coaches and managers simply don't make that much difference."

When studying years of soccer matches, the authors conclude that "the vast bulk of managers appear to have almost no impact on their teams' performance and do not last very long in the job. They seem to add so little value that is tempting to think they could be replaced by their secretaries, or the chairman, or by stuffed teddy bears, without the club's league position changing. The importance of managers is vastly overestimated."

How can this be?

As a culture, we laud coaches and CEOs for their superior management skills. Give them deity-worth reverence. Put them on the covers of magazines, see them interviewed on television repeatedly, and even some nations elect them to the top government job. 

The Great Man Theory of History happening in real-time.

What really matters are the players and the employees. The market makes this clear.

Johan Cruyff, the famous Dutch international soccer player who went on coach FC Barcelona to four straight La Liga titles and a Champions League title, said simply, "If your players are better than your opponent, 90 percent of the time you will win."

Those that can perform a specific task repeatedly, with few flaws and consistent enthusiasm are treasured and well compensated by the market. Often there is a shortage of the best talent, and there is massive competition to secure their services. 

You see, soccer teams have perfect market information on thousands of players. It is clear who on the pitch can play and who can't. Either you can play soccer, or you can't play soccer. Either you can perform the task at hand, or you can't.

Soccer players more or less get the job they deserve.

However, when it comes to coaching this is not the case. The market for managers does not work well. Many of the best managers rarely get proper attention while numerous managers who add no real positive value continue to get promoted to better-paying jobs.

You see this off the pitch as well.

According to a Wall Street Journal analysis of data from MyLogIQ LLC and Institutional Shareholder Services, among S&P 500 CEOs who got raises last year, the 10% who received the most significant pay increases scored—as a group—in the middle of the pack in terms of total shareholder return.

Similarly, the 10% of companies posting the best total returns to shareholders scored in the middle of the pack in terms of CEO pay, the data show.

Quoted in the Wall Street Journal, Herman Aguinis, a professor of management at George Washington University School of Business, reinforces this point, “Stars are often underpaid, while average performers are often overpaid.” 

The disparity between CEO compensation and performance appears to persist over more extended periods as well. Professor Aguinis analyzed the earnings of more than 4,000 CEOs over the course of their tenures against several performance metrics and found virtually no overlap between the top 1% of CEOs in terms of performance and the top 1% of highest earners. Among the top 10% of performers, only a fifth were in the top 10% in terms of pay.

On and off the field more coaches and CEOs are more sun god and head of public relations, less visionary executive. 

The forte of best-paid coaches and CEOs is often not winning matches or generating more revenue, something frankly they have little control over, but keeping all the various constituencies united behind them. Hence why as a culture we frequently prize charisma over competence.

Chris Tomlinson, a business columnist for the Houston Chronicle, penned recently, "There is also no shortage of CEO candidates and little competition for them. Few companies need CEOs with unique skills, and boards tend to buy charisma rather than skills anyway. The general economy and market forces within an industrial sector are far more accurate predictors of a company’s performance, regardless of how much the CEO earns."

All of that being said, I do think thought leadership and vision matter immensely, regardless of how it pays.

Leadership is different from management, but that's for a separate post.

-Marc A. Ross

Marc A. Ross is the founder of Brigadoon and specializes in developing winning communications, content, connections, and commerce for entrepreneurs and thought leaders.

POTD: A16z Podcast: Creating A Category, From Pricing To Positioning

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What do Klennex, FedEx, and Coke all have in common?

All three products are now universally used to describe a whole suite of competing and secondary products or services.

Kleenex is the word for numerous paper-tissue products.

FedEx is the word to for all overnight delivery.

Coke is the word for hundreds of soft drinks available.

Simply put, don't copy, create. 

It is better to create a new category where you can set price than try and improve a category where the price has already been established.

Creation means there is less competition and more riches to be had.

In this episode of the a16z podcast, general partner Martin Casado, who helped create the category of “software-defined networking” and Michel Feaster, CEO and co-founder of Usermind, who previously defined the category and discipline of “technology business management,” share their insights, in conversation with Sonal Chokshi. 

Category creation is all about creating a net new problem and a net new solution to that problem. This matters because if you create a category, you can set the price, the market size, and set the buying environment.

Of course, this isn't easy. You are asking customers to say yes to something that is new, possibly unproven, not trusted, or well known in the marketplace.

Speakers in this podcast suggest, "it isn’t just about making a dent in the way companies work and changing what people do every day… it’s about setting the price. And with that, comes creating the concept in people’s heads, defining the value, and setting the rules of the game."

As Henry Ford said, "If I had asked people what they wanted, they would have said faster horses."

Sometimes you need to create and lead.

For me, I find pricing to be the biggest challenge of running my business. And frankly, I have done a horrible job. From underpricing service offerings and products due to lack of confidence, knowledge, and experience. Coupled with working in categories with well-established rules and competitors selling "Kleenex, FedEd, and Coke."

When it comes to pricing so far, I have made every mistake.

From these failures, thankfully I have acquired new knowledge. I am firmly committed to the idea that setting the price point is vital because I want to guide the customer to what is good and what is bad. I want to control the customer from having the ability to make a comparison. I create the category. 

Simply put, being an entrepreneur and thought leader.

To do this, you need to execute these two things: First, you have to create the concept in the customer's brain - you need to get the customer to think about the problem and realize you have the solution. Second, you need to set the value by setting the price.

Creating an environment where the customer sees the world differently, recognizing there is a problem, and leading them to your tool to solve this irritation. That's the winning sales cycle.

Think like a storyteller and use narrative: Frame the problem, then make it top of mind, and finally set the value (price) to fix the problem.

Reinforcing with the marketplace that your differentiator is the right way to go - how you solve this problem is unique, better, and different and your unique, better, and different is defensible against the competition. 

Ultimately you want to create a buying environment where the customer sees you as the only solution to the problem, and there are compelling reasons why it is you.

When you realize business is a long game, and you can build a model that lets you survive long enough, coupled with teasing apart the signals from your first customers, and finally nailing some key moves early by setting the buying requirements… you can win.