Why it makes sense to bake “good” into your business

Here’s an insightful snippet from Paul Graham, one of the partners at Y Combinator, on the dangers of excluding the good gene from your business:

“When you’re small, you can’t bully customers, so you have to charm them. Whereas when you’re big you can maltreat them at will, and you tend to, because it’s easier than satisfying them.”

The implication is that companies without the good gene baked in end up losing focus and abusing customers.

Instead, Mr. Graham suggests that by wiring benevolence into a company from day 1, a business can get big while staying friendly, customer-focused and successful (like Google, who’s tag is “don’t be evil”).

I think this is a nice idea, and a good one as well.

It also helps address the omni-present indie dilemma: at what point are we selling out? The neat answer is: never, as long as you stay benevolent and keep adding value for customers.

I would add that this works only if “being good” (in some form) is undertaken in a genuine way - in other words, one of 3-4 core values embraced by leadership and infused across the organization in a manner that fosters a healthy, benevolent culture.

I think it’s virtually impossible to reel good back into a business, once it starts slipping away (Starbucks, Jetblue), or to bake it in after the fact (Chase), so the advice here is to get started on baking good into your business, but only if it’s heartfelt.

Valuable insights and inspiration from Jerry White (Survivor Corps)

Start your day off right with this excellent Q&A on Guy Kawasaki’s blog titled “The Art of Survival: an Interview with Jerry White“. My favorite snippets, laid bare:

“We humans have an uncanny ability to reframe our thoughts and choose to find meaning in our scars. Thousands of survivors we have interviewed talk about growing stronger after a catastrophe. But they made healthy choices along the way; it was no accident that they rediscovered joy after debilitating loss.

…. It takes a village to survive emergencies, with help from the private sector, social sector and public sector. No single government agency or sector can do it all. We need our neighbors and civil society to come through for us. It is always a mistake to wait passively for bureaucracies and government agencies to “save” us.

OK, let’s take a breather… my copy/paste function is getting a work-out this morning!

Crimped lifestyle serves as the tipping point to re-boot America’s consciousness, communties and sense of purpose

Here’s an inspiring snippet from a recent post on WorldChanging (whose tagline is “change your thinking”) about the mainstreaming realization that America is broken, that something is seriously wrong:

“Common folks… are starting to understand that our ever-diminishing free time, the loss of sense of community, rising gas prices, the sub-prime mortgage implosion, and a whole range of other current societal problems are all pieces of a bigger puzzle. We’re starting to understand that all of this points toward a fundamental problem with the way America has designed and developed our communities over the past 60+ years. This shift in thinking among the American mainstream is beginning to bring about the popular and political will to rectify our past errors.”

While this may sound like a gloomy quote, I think it’s a hopeful one in that once enough people feel the negative impact on their lifestyle, they will realize that we have to make some bold changes in the interest of our collective well-being, leading to a flourishing of public/private partnerships designed to restore much-needed community (real community, not Starbucks-baked community) as the foundation for improving our quality of life.

Cutting through the clutter with a powerful Executive Summary

Entrepreneurs in today’s market should aim for the highest possible hit-rate when seeking to connect to with customers, partners, media, investors, etc. to avoid drowning in all the noise.

This ups the ante on effective digital packaging and communication. Introductory e-mails matter. Websites matter. Linked In profiles matter. Blogs matter… Having a powerful hook matters!

Successful entrepreneurs know this and have an uncanny ability to get people’s attention when it counts.

Even so, one place many entrepreneurs routinely fall short is the now ambiguous “executive summary”, an overused term which, like “vision” and “mission statement”, don’t mean much no more.

Valuable business/life insights from a big artist

What can an artist teach us about working across mediums, pushing boundaries, the importance of failure, enjoying the process and innovation? A great deal, it seems, based on this incisive obituary in today’s IHT by Michael Kimmelman on Robert Rauschenberg.

Excerpts:

A painter, photographer, printmaker, choreographer, onstage performer, set designer and, in later years, even a composer, Rauschenberg defied the traditional idea that an artist stick to one medium or style. He pushed, prodded and sometimes reconceived all the mediums in which he worked.

The process — an improvisatory, counterintuitive way of doing things — was always what mattered most to him. “Screwing things up is a virtue,” he said when he was 74. “Being correct is never the point… Being right can stop all the momentum of a very interesting idea.”

Q&A with Matthew Malin of Malin+Goetz

I’m delighted to run a little Q&A with one of my favorite emerging brands, Malin+Goetz. I first met the founders at a Women’s Wear Daily conference in Miami three or four years ago… we shared notes on PR firms, suppliers and industry trends. And then they kindly offered me a ride back to the airport. Be sure to check out the promo for IBC readers at the end of the Q&A!

Q. Hello, Matthew. So I guess we only got 1/2 of the “M&G” combo today? Never mind, let’s dig in. In essence, what’s M&G all about?

Making skin care uncomplicated and modern, starting with sensitive skin first.

Q. You make it sound so easy! Take us back to the genesis, that moment you both decided to commit your lives to this “project”.

There are two starting points: first, when Kiehl’s was sold to L’Oreal in ‘99 during my six-year tenure there overseeing global sales (as Nars was sold to Shiseido, Stila to Estee Lauder, Bliss to LVMH, etc). Then, two years later, after lots of research and planning (which was a rewarding process), we took the plunge. We wanted to establish a family business with a soul.

“Ethically-produced” will become the norm, soon enough

The Wall Street Journal ran a piece today about social responsibility asking, ‘Does being ethical pay?‘ (subscription required). There are a couple of bits worth repeating here. The first is a succinct definition of “ethically produced” goods:

“For our purposes, “ethically produced” goods are those manufactured under three conditions. First, the company is considered to have progressive stakeholder relations, such as a commitment to diversity in hiring and consumer safety. Second, it must follow progressive environmental practices, such as using eco-friendly technology. Finally, it must be seen to demonstrate respect for human rights — no child labor or forced labor in overseas factories, for instance.”

This definition underpins a broader shift towards a more conscious/benevolent capitalism here in America, which comes as a welcome change after a long, myopic focus on profit only…

Mix it up to spark personal growth and innovation

Here’s an illuminating snippet from today’s IHT about the importance of forging new habits to foster personal growth and innovation:

“… Brain researchers have discovered that when we consciously develop new habits, we create parallel synaptic paths, and even entirely new brain cells, that can jump our trains of thought onto new, innovative tracks.

Rather than dismissing ourselves as unchangeable creatures of habit, we can instead direct our own change by consciously developing new habits. In fact, the more new things we try — the more we step outside our comfort zone — the more inherently creative we become, both in the workplace and in our personal lives.”

IBC recommends | Venture Hacks for entrepreneurs

Here’s a tip while you chew on that chocolate croissant: if you’re an entrepreneur raising money for your startup/emerging brand (from VCs or angel investors), spend some time on Venture Hacks.

The straight-up funding tips at Venture Hacks are spot on and will save even finance-savvy entrepreneurs lots of headache, time and $$.

I also recommend the site for angel investors seeking practical investing tips and insights into both the entrepreneur and VC mindset.

What’s your apple pie?

Recently I was sitting with a friend having lunch in a café in Amsterdam (a “café” in the French sense, not a coffee shop in the Dutch sense).

It was a cute little place in the Jordaan neighborhood…

Why am I telling you this?

Here’s why: about half-way through lunch we noticed lots of slices of apple pie, topped with whipped cream, being served to the café’s eager patrons.

Literally, everyone in the place (except us) was wolfing down apple pie!

Of course we had to try some, and it was excellent. Well worth a 20 minute bike-ride through the pouring rain.

Turns out people come (or bike) from all over Amsterdam, rain or shine, to this little café, mainly for the apple pie.

Have you ever noticed how every great business has an apple pie?

Now you knew this was coming: what’s your apple pie? I think it’s a productive question to think about and answer…

Nau is dead. What does this mean for the “green style” market?

Wow. Nau, darling of the green apparel sector (judging by the torrent of media coverage since its launch about a year ago - WWD, Coolhunting, etc), is dead. This, according to one of my favorite marketing/brand blogs, murketing.com. A quick visit to Nau’s website confirms the news.

I first heard of Nau when one of the founders made an presentation at the Lohas 12 conference one year ago. Lots of pizzazz. Very impressive. Attendees couldn’t get enough. One year later, with dream-team management, tons of buzz and a large chunk of capital raised ($20mm? $40mm?), they’re gone.

What happened?

Six lessons learned, from a business master (Pat McGovern, International Data Group)

I’m trying to mix up my media diet these days and recently rediscovered the Financial Times web site. I must say, the quality of the FT’s articles is excellent, giving the Wall Street Journal and New York Times a run for their greenbacks any day of the week.

For example, there’s an excellent article today by Richard Waters with some incisive business tips from Pat McGovern, the 70-year old founder & chairman of International Data Group, one of the world’s most successful publishing concerns. Here are the key takeaways (with verbatim excerpts):

Don’t undersell yourself

“Double your price, make it $80,000, and then people will take it seriously”.

Stay focused on (and as close as you can to) your customers

“When we presumed our competition knew what the market wants and we imitated them, we typically had problems.”

How do you think?

I used to be much more of a linear thinker — how to get from point A to point B in a straight line, marching down the bullet-points on a page, taking a single line of attack to find a solution to a problem - you get the idea. Maybe it comes from my experience as an investment banker coming out of college?

Why breakfast meetings?

I’m a big fan of early morning breakfast meetings, typically scheduling 3-4 a week with other entrepreneurs, clients, advisers, colleagues and investors (although I try to avoid meetings on Monday).

For the most part, it’s quality time.

People often ask: why breakfast? Ten reasons:

1. The conversation is better (better listening, better perception, better thinking)
2. I get to ride my bike down the Hudson early in the morning
3. The one-on-one social interaction is a great way to kick-start the day…
4. … and build meaningful relationships
5. I can arrive early to start reading the newspapers, pretending I’m on vacation for 20 minutes…

Bringing finance in from the cold

Are you keeping your finance team out in the cold? Or neglecting the finance function altogether? Many emerging brands do so, intentionally or not. Why does this happen? Probably because emerging brands are creative-driven by nature, and “creative folks” often to think of finance as boring, difficult to understand and/or antagonistic in some way to the creative process. So they keep finance at a distance.

This “us” versus “them” approach is immature and needs to be done away with. We are all creative people. The best finance person is as creative as the best graphic designer or software programmer. Smart indies learn this lesson early in the process, embracing finance as an equal, collaborative partner - they welcome the support, information, discipline and healthy tension that a good finance department provides.

So what steps do these creative-driven companies take to move down this path of having a healthier relationship with finance? Probably a mix of the following, for starters: