Recruiting Conspirators

Zero to One: Notes on Startups, or How to Build the Future by Peter Thiel is a good book. He offers new ways of thinking about innovation. Peter’s philosophy is that innovation starts by learning to ask questions that lead you to find value in recruiting. Below is an excerpt from the book:

Recruiting ConspiratorsZero to One.jpg

Recruiting is a core competency for any company. It should never be outsourced. You need people who are not just skilled on paper but who will work together cohesively after they’re hired. The first four or five might be attracted by large equity stakes or high-profile responsibilities. More important than those obvious offerings is your answer to this question: Why should the 20th employee join your company?

Talented people don’t need to work for you; they have plenty of options. You should ask yourself a more pointed version of the question: Why would someone join your company as its 20th engineer when she could go work at Google for more money and more prestige?

Here are some bad answers: “Your stock options will be worth more here than elsewhere.” “You’ll get to work with the smartest people in the world.” “You can help solve the world’s most challenging problems.” What’s wrong with valuable stock, smart people, or pressing problems? Nothing—but every company makes these same claims, so they won’t help you stand out. General and undifferentiated pitches don’t say anything about why a recruit should join your company instead of many others.

The only good answers are specific to your company, so you won’t find them in this book. But there are two general kinds of good answers: answers about your mission and answers about your team. You’ll attract the employees you need if you can explain why your mission is compelling: not why it’s important in general, but why you’re doing something important that no one else is going to get done. That’s the only thing that can make its importance unique. At PayPal, if you were excited by the idea of creating a new digital currency to replace the U.S. dollar, we wanted to talk to you; if not, you weren’t the right fit.

However, even a great mission is not enough. The kind of recruit who would be most engaged as an employee will also wonder: “Are these the kind of people I want to work with?” You should be able to explain why your company is a unique match for him personally. And if you can’t do that, he’s probably not the right match.

Above all, don’t fight the perk war. Anybody who would be more powerfully swayed by free laundry pickup or pet day care would be a bad addition to your team. Just cover the basics like health insurance and then promise what no others can: the opportunity to do irreplaceable work on a unique problem alongside great people. You probably can’t be the Google of 2014 in terms of compensation or perks, but you can be like the Google of 1999 if you already have good answers about your mission and team.

To-Do List

To-Do List

A to-do list is used to track real work that needs to be completed. Either a handwritten or digital list can be used. It’s best to take about 15 minutes at the end of each day to do a GTD “Mind Sweep”. Review all your emails and meeting notes for all your task/projects you are responsible for. Writing down all your tasks/projects on paper or digital list means you don’t have to try and remember them. It gets the task out of your head which helps reduce stress.

Paper and PenTo-Do List

A handwritten list is the simplest way to keep a to-do list. To get started, you will need paper – preferably a notebook – and a pen. I suggest the following format for setting up your page: day of the week in the upper right hand of the page, under the weekday put the month/day. List all of your tasks putting related subtasks under the task it belongs to.  Once the list is completed determine your priorities using a number system. Finally, write down the estimated time for completion next to each task listed. See Photo.

Digital

There are many options available for those who would prefer a digital to-do list. You could simply use your digital calendar to schedule tasks for each day of the week. However, there are many task management apps available some examples include: Remember the Milk, Wunderlist, Todoist. These can be used for planning by setting up due dates and reminders. Other great options are Evernote and OneNote for creating lists.

There are many benefits of starting a to-do list and journaling them. The ability to cross off items as completed can give you a sense of accomplishment. Keeping track/journal of your to-do list will help you to review your accomplishments. Additionally, journaling can be helpful in tracking actual time taken to complete a task. Try experimenting between paper/pen and digital to help decide which works best for you. I have been experimenting for years between paper/pen and digital. This year I’m interested in Bullet journaling; ask me about it.

 

Reference:

Remember the Milk

Wunderlist

ToDoist

Evernote

MS OneNote

Bullet Journal

How I Use Todoist And Evernote Together

Getting Things Done (GTD)

HBR: How Top Salespeople Land Hard-to-Get Meetings

Are you connecting with your customers for the long term or just for the sale? Below is a blog from the Harvard Business Review by Stu Heinecke.

How Top Salespeople Land Hard-to-Get Meetings

Richard Branson famously said, “Succeeding in business is all about making connections.” Mr. Branson surely has little trouble getting anyone he wants on the phone, but the rest of us could use a little help.

While I was researching my new book, How to Get a Meeting with Anyone, I asked the top 100 sales thought leaders in the world, “When you absolutely must reach someone who is very important but nearly impossible to reach, how do you do it?” What I discovered was a shadow practice that has been extremely effective at breaking through to critical contacts, but no one actually had a name for it.

I dubbed it “contact marketing,” and found it to be a surprisingly effective marketing technique. Based on my interviews, reported response rates averaged from 60% to 80%, with some campaigns actually hitting 100%. What exactly is contact marketing? It’s a fusion of marketing and selling, employing specific campaigns to connect with specific C-level executives and top decision makers. The idea is that you only need a few dozen of the right high-level relationships to change the scale of your business. Contact marketing can take many forms, but there are five takeaways you can use to make your own high-level connections:

Deliver something of value. Here’s your chance to stand out, to be audacious, and to create a meaningful connection. The objective is not to attempt to bribe someone to meet with you, but to deliver something that makes a difference to the recipient. It should express your brand personality but contain absolutely no pitch. Your first mission is simply to create a connection, to establish yourself as someone they’ll want to listen to. While you might use search results and social media postings to try to determine an executive’s specific challenges and desires, there are also some simple assumptions you can use to open doors, based on universal desires shared by most business leaders. We all want more success, recognition, and income, but we also want to do the best job we can and leave a mark. For example, I’m a cartoonist, and I’ve found that my cartoons can touch upon all of these markers in a very personal way. Sending a personalized cartoon, like the one below, has become a can’t-miss way for me to connect with virtually anyone, but anything that recognizes the recipients’ desires, helps them do their job more effectively, or enhances their business in some way can be highly effective.

Offer something of further value. As your request for contact is received, it’s a good idea to include something additional as a reward for taking the proposed meeting or phone call. Some campaigns split a gift in two — a remote-control model sent with a note explaining that the withheld control unit will be delivered during the meeting, for instance. Although this has reportedly worked, it can come off as being too pushy. A far better approach would be to offer relevant research, a white paper, or a free audit of some aspect of the target executive’s business when the meeting takes place, as a way to provide the incentive you may need to actually get the meeting. The point is to continually add value to the connection building between you in a way that helps the executive do their job more effectively.

Include the executive assistant. Many sales reps do their best to avoid, circumvent, or trick the executive assistants they encounter, but that is a fatal mistake. Don’t think of assistants as gatekeepers; think of them as talent scouts, always on watch for extraordinary opportunities their executives would otherwise miss. Once they’ve rendered assistance, be sure to thank them with a modest but meaningful gift. If an assistant has been helpful to me, I often send a card with one of my cartoons personalized in their name and a handwritten note of thanks. Whatever you send, don’t make it look like a bribe; a dozen roses is way too much, but a gift card for a few lattes is perfect. Just make sure it expresses your appreciation for their help.

Secure the meeting. Arranging a call or meeting can be painfully tedious as all parties attempt to coordinate openings in their schedules. You can either suffer the details or use one of many productivity tools on the market to get your meeting on calendars, such as Calendly, Assistant.to, ScheduleOnce, and TimeTrade. I recommend x.ai, an artificial intelligence agent that makes the necessary arrangements via email, from the initial request right on through to confirming meeting times on everyone’s calendars.

Connect, don’t pitch. Once you’ve gone through the trouble of arranging the meeting, it would be a waste to ruin it with a misguided pitch of your company’s product or service. So don’t do it. Instead, be ready to have an exploratory but informed conversation about an issue by researching news stories or mentions in their social media feeds. Share other cases in which you’ve helped companies in their industry gain new competitive advantages, but never start the meeting assuming your offer is right for them. Be human, explore, and have a conversation.

Here are two stories of how others have used contact marketing to inspire a few ideas for your own campaign.

Dan Waldschmidt’s swords. Dan Waldschmidt is an extreme athlete, an author, and one of the top sales bloggers in the world. But his core business is turnaround consulting. To connect with prospects, he scours the business news for stories of missed earnings estimates. When he finds one, he has a beautiful sword made with an engraved inscription in the target contact’s name. It’s sent in a fine wooden box with a handwritten letter telling the CEO he’s got his back in the next battle — but says nothing about his turnaround service. This offer has generated a near 100% response rate and numerous multimillion-dollar engagements while beautifully expressing the value Dan delivers and the personality of his brand.

NoWait app launch. The founders of the NoWait app, which allows you to put yourself on the waitlist of your favorite restaurant from anywhere, used Contact Campaign as the basis of their entire launch strategy. They targeted the CEOs of 30 top restaurant chains with a brilliant campaign that used personalized videos delivered on iPads in custom NoWait packaging. Their highly targeted approach allowed the company to focus on the people who could do them the most good, using a minuscule $30,000 marketing budget to achieve their objectives. As a result the NoWait App is already used by more than half of the targeted chains.

I’ve always used my own cartoons to connect with great effect, but you don’t have to be a cartoonist or send expensive gifts to break through to important contacts. Just produce a contact marketing campaign that makes you stand out as someone the recipient really needs to get to know. Do your research and figure out the sweet spot between what your future client needs most and why you’re the best person to help them reach their goals.

 

HBR: Focus on Keeping Up with Your Customers, Not Your Competitors

Who’s controlling the sale you or the customer? Do you have a customer-driven journey for your company? Below is a blog from the Harvard Business Review by Mark Bonchek and Gene Cornfield.

Focus on Keeping Up with Your Customers, Not Your Competitors

Every company these days seems to be either contemplating or pursuing digital transformation. Most cite the need to keep up with disruptive and well-established competitors. But perhaps this focus is too narrow. We believe the greatest challenge to companies today is not keeping up with their competitors, but with their own customers.

One reason is that individuals are transforming to digital faster than organizations. Think for a moment about people as tiny enterprises. They’ve redesigned their core processes in the area of procurement (online shopping), talent acquisition (marketplaces), collaboration (social networking), market research (peer reviews), finance (mobile payments) and travel (room and ride sharing). Have you reinvented your core processes to the same degree?

Customers’ expectations are also more liquid and no longer based on industry boundaries. Customers – whether consumers or business buyers – don’t compare your customer service to that of your competitors, but to the best customer service they receive from anywhere. The same is true for their expectations of your web site, mobile app, loyalty program, branding, and even social responsibility.

So how can you keep up with your customers? You have to start thinking like them.

Customers don’t think in or; they think in and. You have to transcend trade-offs.

The adage used to be that you could pick any two combinations of “cheap, good, or fast.” But today’s customer doesn’t want to make tradeoffs. They want it cheap, good, and fast. As leaders, we are accustomed to thinking of business being about making tough decisions between competing objectives. But we need to think more like our customers. Instead of focusing on how to make tradeoffs, we need to focus on how to transcend them.

Some of the tradeoffs that are most suited to digital transcendence are:

  • Big and small: Combine the speed, agility and creativity of being small with the scope, scale and influence associated with being big.
  • Complex and simple: Manage the systems and processes to run a global business while creating simple and elegant experiences for customers.
  • Global and personal: Achieve universal consistency and reach around the world while delivering relevant, tailored interactions to every customer.

Customers want to be empowered, not controlled. You have to act with empathy.

Business used to be about getting customers to do what you wanted them to do. But customers don’t accept this any more. They don’t like to be told what to do. They want relationships based on reciprocity, transparency and authenticity. If you want to keep up with your customer, you can’t be focused on getting them to do what you want, but instead on helping them do what they want.

This evolution from control to empowerment means a change in the basic building blocks of customer engagement.

  • Funnels used to be linear processes that moved customers from one stage to the next. There was no going back until a sale was either won or lost. Now these funnels have become Escherian journeys, fluid, customer-led and multi-dimensional. It’s not about capturing and converting towards a transaction, but connecting and collaborating around a shared purpose.
  • Channels used to be pipes connecting you with your customer, carrying carefully crafted messages to passive audiences. Now they are experiences connecting customers to their own desires, and communities connecting customers to each other. It’s not about promoting the features and benefits of your product, but building empathy and understanding of each customer’s intent – and helping them achieve it – as part of an ongoing relationship.

Customers don’t think in straight lines. You need to be non-linear.

To keep up with your customer, you have to let go of linear thinking. Customers today expect you to be where they are, deliver what they want, when they want it, and how they want it. If they’re browsing your website on their laptop, they will expect that when they next come to your site from their mobile device or tablet, or talk to a sales person in your store, branch or call center, you will pick up right where they left off. Business has become like that old game of Twister. You have to be flexible if you are going to win.

This requires rethinking and redesigning core disciplines:

  • Strategy has to go beyond analyzing markets, making plans, and forecasting the future. Strategy also has to build capabilities, transform culture and architect for constant change.
  • Campaigns have to be more than one-way communications for one-time responses. They need to initiate and expedite personalized journeys as part of ongoing conversations.
  • Personalization needs to go deeper than looking simply at what someone buys. It needs to be based on the subconscious motivations of why someone buys, revealed through real-time analysis of a wide variety of data sources.
  • Social can’t be treated merely as a channel for distributing messages. Done right, it’s a context for building genuine relationships that demonstrate how much they really matter.
  • Loyalty needs to be more than accumulating points for rewards. To be genuine and enduring, loyalty needs to be reciprocal. If you want their loyalty, you have to be loyal in return.
  • Operations need to go beyond the efficiency of the company to the efficiency of the customer. How can you optimize to help customers get more for their time and effort, not just their money?

It’s a significant shift in mindset and practice to reorient from keeping up with competitors to keeping up with customers.

We suggest getting started by assessing where you are.

  • How does your transformation compare to your customers? In what areas are they moving faster or slower than you are?
  • Who is setting your customers’ expectations? It’s probably coming from outside your industry.
  • What kind of relationship do you want to have with your customer? Are you trying to get them to do what you want? Or figuring out how to help them do what they want?

Next, look at where to focus your attention.

  • Which tradeoffs do you need to transcend? We mentioned a few above. Others include speed and scale, consistent and nimble, high-tech and high-touch.
  • Where is linear thinking getting in the way? Review the disciplines outlined above and see which ones will have the most impact on your customer experience.

Creating sustainable advantage is more elusive than ever. The new game is designing customer-driven journeys across touch points to help them achieve their intent, and to create more multidimensional relationships. To win this game, stop thinking about just keeping up with your competitors, and start thinking about keeping up with your customers.

 

HBR: Build a Great Company Culture with Help from Technology

Are you making sure employees are challenged, motivated, engaged, and know that they are contributing to the overall success of the company? Below is a blog from the Harvard Business Review by Ashley Goldsmith and Leighanne Levensaler

Build a Great Company Culture with Help from Technology

Culture, and how to build and sustain one, is one of the toughest challenges for managers, especially in today’s fast-paced, highly competitive organizations. Every organization wants to create a culture that works from a set of core values, where everybody is on the same page about what’s important, where the company is going, and how it’s going to get there. But what happens when the external competitive environment — and the direction of the company — changes? And what happens as advances in technology constantly change how customers and employees expect to interact with your company? How do you manage the evolution of your company’s culture, and hold on to what makes you great, even as you change and grow?

Here at Workday, these questions have been central to our existence from day one. We were founded in 2005, and our cofounders, Aneel Bhusri and Dave Duffield who were both already highly successful entrepreneurs, understood that any successful culture would be built on a core set of values. For us, those values are employees, customer service, integrity, innovation, fun, and profitability. We are certain that our high customer satisfaction ratings and top spot on many best-place-to-work lists come from our early recognition that culture permeates every sales call, every employee interaction, and every product innovation.

As a provider of cloud-based finance and HR applications designed to help companies change and grow, our customers rightly expect us to lead by example. At the same time, we listen closely to our customers’ business challenges and successes — which in turn helps us change and grow.

While we hold on tightly to our core values, we strive to keep evolving our culture to meet the changing needs of our employees and customers. Perhaps not too surprisingly, technology plays a central role (after all, we’re a technology company). But if you asked most people to list the things that create and maintain a strong company culture, chances are they wouldn’t list technology. We’ve found that you can’t create a culture just through values, new processes, or an organizational restructure. Those things are necessary, but we like to think of values as the beating heart of culture, processes and organizational structure as the brain, and technology as the nervous system that makes sure heart and head are working together to move us forward.

For us, giving our people tools that empower them to work how they want to work — in everything from finding their next career opportunity, to hiring their next employee, to making data-driven day-to-day business decisions — is critical to holding on to the integrity of our culture in a fast-changing environment. This culture of empowerment has helped keep the company true to the core values on which we were originally founded. Here are the main components of that culture, and how they work:

Democratization of information. In their personal lives, people have become accustomed to having access to any piece of information they want at a moment’s notice. This hasn’t always been the case in the workplace. Data was usually kept in the hands of a select few, and extracting and using that data in a meaningful way was a long, painful process. But modern enterprise technologies and applications are pushing access to data and information to the front lines.

One area we see this playing out is within our own HR organization. At Workday, managers don’t have to spend valuable time with HR discussing headcount or status updates on new job openings — they already have this information at their fingertips. Instead, managers can spend their time with HR talking about how to get top performers to the next level, keep people who are at risk of leaving the organization, and align workers to meet business objectives. They can focus on creating value for the business by mobilizing talent.

Another area where this plays out is in hiring. When it comes to recruiting for fast-growing companies, talent acquisition needs to be efficient without sacrificing quality. Our managers can see all interview, resume, and references information in one place from any device, anywhere. Whether sitting on a plane or walking between meetings, a manager can immediately see the hiring team’s feedback and decide whether to move a candidate forward with a tap of their phone.

It’s good for any company to be able to make faster decisions based on immediate access to data, but it’s also good for the candidate — no repeated requests for a resume or work samples, no making them wait longer than necessary for news about next steps. And, with the race for top talent, speed-to-hire is crucial. And this says something to a candidate about our culture right from the start: We move quickly and we respect your time.

This democratization of information also enables greater transparency, which is critical to sustaining a positive culture. For example, we conduct online chat sessions that provide employees with the opportunity to ask our top executives whatever questions are on their minds. This is done in the spirit of keeping employees informed and is at the center of everything we do.

Culture of opportunity. Another area we’re passionate about is creating what we call a culture of opportunity. We’re not about stringent policies or old-fashioned career paths. We’re about being transparent about new positions and opportunities that exist within the organization and then providing the tools and information our people need to pursue them.

For example, we are rolling out a tool that will give employees a personalized view of positions within Workday that are a good fit for them based on the actual movement and success of other employees who held similar positions. Besides a real-time glimpse into the vitality of the company and how it’s evolving, it’s an employee-centric view of possible career paths.

An employee can not only see what moves others have made, they can also reach out and connect to those specific individuals to talk with them about their experience. With a tap you can introduce yourself to set up time to connect or simply ask a question.

And as mentioned earlier, we listen to and learn from customers. Adobe, for example, often “pulses” its employees to get quick feedback on their experience. We were inspired by this approach when we built a tool that we use to ask one or two simple questions that can be answered via any device in a few seconds such as, “Has your manager talked to you about your career goals in the last month?” Our aim is to quickly and easily capture employee sentiment so that we can calibrate our efforts to reinforce our culture.

Performance enablement. For us, performance enablement is an evolution of the traditional performance management process that stresses regular, ongoing feedback, and takes an employee-centric approach to helping our people thrive. Several of our customers, like Ellie Mae, are passionate about this approach as well and have set a great example to follow.

Measuring an employee’s impact is more efficient and ultimately more effective thanks to tools and technology that allow us to regularly capture and aggregate real-time information.

The annual review process at some companies is not very transparent — and, there can be demoralizing surprises. It can also be demoralizing to only receive feedback once or twice a year. We now expect managers to have regular check-ins with their direct hires, ideally on a bi-weekly basis.

It doesn’t make sense to only flag areas for improvement once a year, and more often than not, an early course correction heads off bigger issues. By the same token, there are many positive behaviors, such as suggestions for process improvement or innovation, which might not get immediate feedback in a more traditional environment that are important to encourage.

From a manager’s point of view, regular check-ins give more visibility into not just their team, but how their workers are interacting with other parts of the organization.

In the end, our goal is to hire and retain the best people in order to provide the best service to our customers. To do this, we need to keep our employees happy, make sure they are challenged, motivated, and engaged, and know that they are contributing to the overall success of the company. We want to keep learning, adapting, and listening to our people as we grow. We know that technology is most effective when it’s designed to support and encourage the behaviors and processes that lead to innovation — and we believe that this is what will continue to foster our great company culture.

 

Work like Teddy Roosevelt

Deep Work: Rules for Focused Success in a Distracted World by Cal Newport is a must read and one for your bookshelf. It helped me understand the difference between deep and shallow work. Below is an excerpt from the book:

Work like Teddy Roosevelt Deep work.jpg

 

If you attended Harvard College during the 1876-1877 school year, you would’ve likely noticed a wiry, mutton- chopped, brash, and impossibly energetic freshman named Theodore Roosevelt. If you then proceeded to befriend this young man, you would’ve soon noticed a paradox.

On the one hand, his attention might appear to be hopelessly scattered, spread over what one classmate called an “amazing array of interests”– a list that biographer Edmund Morris catalogs to contain boxing, wrestling, body building, dance lessons, poetry readings, and the continuation of a lifelong obsession with naturalism (Roosevelt’s landlord on Winthrop Street was not pleased with her young tenant’s tendency to dissect and stuff specimens in his rented room). This latter interest developed to the point that Roosevelt published his first book, The Summer Birds of the Adirondacks, in the summer after his freshman year. It was well received in the Bulletin of the Nuttall Ornithological Club- a publication, needless to say, which takes bird books quite seriously-and was good enough to lead Morris to assess Roosevelt, at this young age, to be “one of the most knowledgeable young naturalists in the United States.”

To support this extracurricular exuberance Roosevelt had to severely restrict the time left available for what should have been his primary focus: his studies at Harvard. Morris used Roosevelt’s diary and letters from this period to estimate that the future president was spending no more than a quarter of the typical day studying. One might expect therefore that Roosevelt’s grades would crater. But they didn’t. He wasn’t the top student in his class, but he certainly didn’t struggle either: In his freshman year he earned honor grades in five out of his seven courses. The explanation for this Roosevelt paradox turns out to be his unique approach to tackling this schoolwork. Roosevelt would begin his scheduling by considering the eight hours from eight thirty a.m. to four thirty p.m. He would then remove the time spent in recitation and classes, his athletic training (which was once a day), and lunch. The fragments that remained were then considered time dedicated exclusively to studying. As noted, these fragments didn’t usually add up to a large number of total hours, but he would get the most out of them by working only on schoolwork during these periods, and doing so with a blistering intensity. “The amount of time he spent at his desk was comparatively small,” explained Morris, “but his concentration was so intense, and his reading so rapid, that he could afford more time off [from schoolwork] than most.”

This strategy asks you to inject the occasional dash of Rooseveltian intensity into your own workday. In particular, identify a deep task (that is, something that requires deep work to complete) that’s high on your priority list. Estimate how long you’d normally put aside for an obligation of this type, then give yourself a hard deadline that drastically reduces this time. If possible, commit publicly to the deadline-for example, by telling the person expecting the finished project when they should expect it. If this isn’t possible (or if it puts your job in jeopardy), then motivate yourself by setting a countdown timer on your phone and propping it up where you can’t avoid seeing it as you work.

At this point, there should be only one possible way to get the deep task done in time: working with great intensity- no e-mail breaks, no daydreaming, no Facebook browsing, no repeated trips to the coffee machine. Like Roosevelt at Harvard, attack the task with every free neuron until it gives way under your unwavering barrage of concentration.

Try this experiment no more than once a week at first- giving your brain practice with intensity, but also giving it (and your stress levels) time to rest in between. Once you feel confident in your ability to trade concentration for completion time, increase the frequency of these Roosevelt dashes. Remember, however, to always keep your self-imposed deadlines right at the edge of feasibility. You should be able to consistently beat the buzzer (or at least be close), but to do so should require teeth-gritting concentration.

The main motivation for this strategy is straightforward. Deep work requires levels of concentration well beyond where most knowledge workers are comfortable. Roosevelt dashes leverage artificial deadlines to help you systematically increase the level you can regularly achieve-providing, in some sense, interval training for the attention centers of your brain. An additional benefit is that these dashes are incompatible with distraction {there’s no way you can give in to distraction and still make your deadlines). Therefore, every completed dash provides a session in which you’re potentially bored, and really want to seek more novel stimuli — but you resist. As argued in the previous strategy, the more you practice resisting such urges, the easier such resistance becomes.

After a few months of deploying this strategy, your understanding of what it means to focus will likely be transformed as you reach levels of intensity stronger than anything you’ve experienced before. And if you’re anything like a young Roosevelt, you can then repurpose the extra free time it generates toward the finer pleasures in life, like trying to impress the always-discerning members of the Nuttall Ornithological Club.

 

How to Sell a Products

Zero to One: Notes on Startups, or How to Build the Future by Peter Thiel is is a good book. He offers new ways of thinking about innovation. Peter’s philosophy is that innovation starts by learning to ask questions that lead you to find value in Sales. Below is an excerpt from the book:

How to Sell a ProductsZero to One.jpg

Superior sales and distribution by itself can create a monopoly, even with no product differentiation. The converse is not true. No matter how strong your product—even if it easily fits into already established habits and anybody who tries it likes it immediately—you must still support it with a strong distribution plan.

Two metrics set the limits for effective distribution. The total net profit that you earn on average over the course of your relationship with a customer (Customer Lifetime Value, or CLV) must exceed the amount you spend on average to acquire a new customer (Customer Acquisition Cost, or CAC). In general, the higher the price of your product, the more you have to spend to make a sale—and the more it makes sense to spend it. Distribution methods can be plotted on a continuum:

Personal Sales

Most sales are not particularly complex: average deal sizes might range between $10,000 and $100,000, and usually the CEO won’t have to do all the selling himself. The challenge here isn’t about how to make any particular sale, but how to establish a process by which a sales team of modest size can move the product to a wide audience.

In 2008, Box had a good way for companies to store their data safely and accessibly in the cloud. But people didn’t know they needed such a thing—cloud computing hadn’t caught on yet. That summer, Blake was hired as Box’s third salesperson to help change that. Starting with small groups of users who had the most acute file sharing problems, Box’s sales reps built relationships with more and more users in each client company. In 2009, Blake sold a small Box account to the Stanford Sleep Clinic, where researchers needed an easy, secure way to store experimental data logs. Today the university offers a Stanford-branded Box account to every one of its students and faculty members, and Stanford Hospital runs on Box. If it had started off by trying to sell the president of the university on an enterprise-wide solution, Box would have sold nothing. A complex sales approach would have made Box a forgotten startup failure; instead, personal sales made it a multibillion-dollar business.

Sometimes the product itself is a kind of distribution. ZocDoc is a Founders Fund portfolio company that helps people find and book medical appointments online. The company charges doctors a few hundred dollars per month to be included in its network. With an average deal size of just a few thousand dollars, ZocDoc needs lots of salespeople—so many that they have an internal recruiting team to do nothing but hire more. But making personal sales to doctors doesn’t just bring in revenue; by adding doctors to the network, salespeople make the product more valuable to consumers (and more consumer users increases its appeal to doctors). More than 5 million people already use the service each month, and if it can continue to scale its network to include a majority of practitioners, it will become a fundamental utility for the U.S. health care industry.

 

Selling to Non-Customers

Your company needs to sell more than its product. You must also sell your company to employees and investors. There is a “human resources” version of the lie that great products sell themselves: “This company is so good that people will be clamoring to join it.” And there’s a fundraising version too: “This company is so great that investors will be banging down our door to invest.” Clamor and frenzy are very real, but they rarely happen without calculated recruiting and pitching beneath the surface.

Selling your company to the media is a necessary part of selling it to everyone else. Nerds who instinctively mistrust the media often make the mistake of trying to ignore it. But just as you can never expect people to buy a superior product merely on its obvious merits without any distribution strategy, you should never assume that people will admire your company without a public relations strategy. Even if your particular product doesn’t need media exposure to acquire customers because you have a viral distribution strategy, the press can help attract investors and employees. Any prospective employee worth hiring will do his own diligence; what he finds or doesn’t find when he googles you will be critical to the success of your company.

 

Everybody Sells

Nerds might wish that distribution could be ignored and salesmen banished to another planet. All of us want to believe that we make up our own minds, that sales doesn’t work on us. But it’s not true. Everybody has a product to sell—no matter whether you’re an employee, a founder, or an investor. It’s true even if your company consists of just you and your computer. Look around. If you don’t see any salespeople, you’re the salesperson.