Apologies on the delay in posting, but….
I’m writing this in the Newark Airport on my way home to my 10 year high school reunion, to visit one of my startups I’ve been advising and working with, and visiting my family….I’d be lying if I wasn’t also excited for my In-n-Out and favorite Mexican food.
This completes the tri-fecta that is the search critera “NYC area airports” – La Guardia, JFK, and Newark. I feel like that’s one of the many requirements before claiming you are a “New Yorker”…not saying I am one yet, just saying it’s like a merit badge I can wear on my uniform now.
Having traveled to all three airports, my main decision for which airport to fly out of resulted from one data point: price of the flight. I’m sure this is similar for you when deciding on the flight.
The airport experience for each airport is fairly similar…thanks Virgin America and Jet Blue….and even TSA hasn’t been too much of a pain at the airports–even during holiday rushes. Sure La Guardia and Newark are smaller, but they also have fewer screeners, it’s called operations management people…
But what has been different is the travel experience to the airport, and more importantly, the travel cost to the airports. I may have chosen one airport over the other because of a ten dollar difference. Perhaps even $20 dollars. But what I’ve ignored in that is the calculation of time and more importantly the cost to get to the airport. For me on public transportation, JFK (each way) add $17.50 + 1.25 hours in trains. La Guardia is $2.90 and 40 minutes in a bus. Newark is $17.90 + 1 hour by train and (in this case) bus. Therefore, JFK and Newark should be handicapped by about $30 for their listed plane flights as that is the additional cost inherent towards picking those over the others. Conversely, I can take a cab or Uber Pool for about $20-30 dollars to La Guardia each way, which means I can have convenience one way to La Guardia for the same price as public transportation to the other airports. Or pay a $15-20 premium for “luxury” both ways.
Sure, I’m counting taking the LIRR to JFK and could take the subway the whole way….but the main point is that there is far more to consider than merely the listed cost of the flight, it is the total cost and experience of traveling.
This concept is similar to the term “total cost of ownership”.
The simple example of total cost of ownership is to buy a used car for much cheaper than a new car, but the used car keeps breaking down, needing repairs and so when you add those costs, it turns out that the total cost of ownership of the new car is actually less than the total cost of ownership of the old car.
In classic business history, the parallel is to how Xerox sold its machines and dominated the photo-copy industry. Their machines were more expensive, but repairs, service, and depreciation were much less than competitors. They framed their sales pitch based on the “total cost of ownership”.
“You don’t buy a Xerox machine just to have it, you buy it to make copies. The more copies you can make, the more valuable it is. If you do the calculations, Xerox makes copies 2 cents cheaper than our competitors. Here’s how…”
Now here’s the main point: The same thing can be said with taking investor capital.
In our class taught by Ed Zimmerman and Jonathon Chou of Lowenstein Sandler LLP and First Growth Venture Network, we discussed this concept with Brian O’Malley (Partner at Accel), Jonathon Seeling (Co-Founder, Akamai; former Chairman, Zipcar; Angel Investor), and David Karp (Founder & CEO of Tumblr).
Pretty stacked room to discuss this concept…
You can take the quick money to get your company started, it may be initially quicker to do so, but you’re not there to raise just that round. You’re not there to just get cash. As an entrepreneur, you are there to create the best possible investor relationship.
Because of optionality in venture (fact it’s better for them not to write you a huge check, but rather stagger it over time to see how you do), you will ultimately have to raise more capital. And, because of your limited skill-set and network, you will ultimately need to rely on others’ skills and network to hire the right people to scale. Who’s got access to a huge network of skilled people? That’s right, perhaps the people with money do…
…or they might not. A quick check in the mail may not lead to another (oftentimes needing to be much bigger). Taking the money can be just that, with no additional value add–or potential for reinvestment. It could mean cheating yourself out of the extra benefits that a strong investor can provide…the total cost of ownership of your investor.
You may be quick to scoff at turning down cash to keep the company going, the impetus is high to cash in and move on to “get back to building your company and you will focus on running out of money later when it happens”.
But just like picking which airport to fly out of, which car or copy machine to buy, consider your investors through the lens of total cost of ownership. It’s a long term relationship with multiple rounds of funding, with multiple value-added asks. If the investor does not have those value-adds, you’ll have to spend more time, energy, costs to get those same benefits.
Now not all self-proclaimed value adding investors do actually follow through with these promises, but that’s on them. What’s on you is to be aware of and have the foresight to plan your raise with the total cost of ownership in mind, not just the capital amount or term sheet.
So start considering things in holistic manners. It’s not just about your pre-money valuation. It’s not just about the cost of the Xerox machine. And it’s certainly not just about the price that Kayak.com spits at you. It’s about the total cost of ownership of your decision.
Knowing the total cost of ownership implied by your decision, is a life-long learning process, and perhaps one not fully groked.
But you can begin with this classic self-help book: Taking Charge of Your Life
Influence is one of the greatest experiences life has to offer. We all have the opportunity to influence someone else: their thinking, future, lives. The key is to develop the skills to do so. You can either do it casually/haphazardly…or do it on purpose. And…you can influence yourself.
Gather the skills to help influence people’s way of thinking towards a product, enterprise, or for a better way of life.
To accomplish something, especially in lecturing/listening, you have to start with sincerity.
Ideas + inspiration.
If you want your life to change, that’s the source of it all.
Ideas
Everything (every good and new idea) you need is within reach. Finding is reserved for the searchers. We don’t find what we need, we find what we search for. Needing is not the prerequisite to getting value. (You don’t say to the soil, “I need food.” The soil will say, “bring me your seed, your life, or go somewhere else! Don’t give me your need.”) You can’t be a “needer”, you have to be a searcher. If you’ll search, if you’ll try, if you’ll go, if you’ll listen and do…ideas are within reach. And ideas are life-changing. There is nothing as powerful as an idea whose time has come.
A few daily disciplines makes a great deal of difference in one year, three years, five years.
Ten years from now, you will surely arrive. The question is where? We don’t wanna kid ourselves about where. We don’t wanna kid ourselves about the road we are walking.
Now’s the time to fix the next ten years. Sometimes you have to come to grips with reality. Big question: are you reading the books that are gonna take you where you want to go in the next five years? In order to get where you want to go in the next 5 years, you’re either reading the right books or you’re not.
Inspiration
Here’s what we don’t want to engage in: disillusion. Hoping without acting, wishing without doing. The key is to take a look, and say, “Where am I? What can I do to make the changes, to make sure that I can take more certain daily steps toward that treasure I want”
Which are:
- Mental treasures
- Personal treasures
- Spiritual treasures
- Financial treasures
It is WORTH TAKING THE TIME to pause and think about all these things
We could all use a little coaching! When you’re playing the game, sometimes it’s hard to see it all, so involve others you trust into this process.
Three Keys to Success
#1 Be thankful. To get more, you have to first be thankful for what you already have. Remove cynicism.
#2 Be eager to learn! No matter what you know, there’s always some more. Argue with all this stuff later. The key is to stimulate the mind!
#3 Be a good listener (focus!)
The Five Majors
The 5 Major factors to the life puzzle:
- Philosophy
- Attitude
- Activity
- Results
- Lifestyle
Philosophy
Simply what you know. So it’s important to know. And two more corrections on old clichés:
- what you don’t know WILL hurt you, and
- ignorance is NOT bliss.
Philosophy sets the course of your life…it is THE major piece.
Gather! What you don’t know will affect your economic future, the book you miss will make a difference in the legacy of your equities over the next months, years
3 types of philosophy
- Basic Philosophy: early life and place in family
- Expanded philosophy: having a place in society, giving some value
- Refined philosophy: the extra thinking, the extra studyine and debate
Attitude
You cannot escape the accumulated effect of the selection of your attitude.
“There comes a day in every man’s life when he must sit down at a feast of consequences.” ––Oscar Wilde
So one of the major things to check is, how do I feel? And am I on track or off track with my attitude?
Here’s an attitude to pick up:
“No matter what they pay, I always come early and I always stay late to invest in my own future.”
Questions of attitude to ask:
- How do you feel about your past?
- Let the past instruct you.
- How do you feel about the future?
- Life is affected by two major things: price and promise. It’s not easy to pay the price when you can’t see the promise.
- How do you feel about your community?
- You can’t succeed by yourself. It takes a community to build a society. It takes all of us to make any one of us to be successful.
- How do I feel about myself?
- Understanding self worth is the beginning of progress.
- What could you do? What could I become in terms of value?
- What could I do in the marketplace, enterprise, family, love, home, experience, friendship?
- If I’m operating at 20%, what could I possibly do with the other 80%? DO I HAVE IT IN KNOWLEDGE, WORTH, EXPERIENCE?
Activity
If you want to influence and help people, here’s a key: success is a doing. You’ve got to actually do it.
Activity is a HIGH PRIORITY.
Important question: what is your philosophy on activity? How much time are you going to spend doing?
- We’ve all got to have a philosophy of activity. Your philosophy on activity will affect the rest of your life. Not to think so is naïve.
- Make rest a necessity not an objective.
- The reason for life is enterprise, productivity; to see what you can do.
- Whatever your hands find to do, do with all your might.
Ant philosophy: it’s simple and it’s good
- Ants never give up.
- Ants think winter all summer.
- Ants think summer all winter.
- Ants gather all they possibly can.
It’s not about the amount of money, what’s important is the full extent of your reach–how much you extend yourself.
- The only way to feel maximum good about yourself is the full extent of your reach.
- What should you do? All you can! Books? All you can! How many skills? How many people should you touch? What all should you engage in?
- Why not go to the max? How tall does a tree grow? As tall as it can.
Our choices: To be all, or to be part.
- You can choose to be less than your were designed to be, or you can choose to be all of it.
- What most messes with the mind: Doing less than you can, being less than you could be, trying less, less enthusiasm…it damages our minds and our self-image.
Results
The name of the game.
The quest is 1: what we can become, and 2: what we can accomplish. We want to become skillful enough to do rewarding things with our life: influence, productivity, activity, results, economics, social, spiritual.
- How are you doing now?
- Should we be expected to double our value in a reasonable amount of time? YES!
Part of life is a numbers game.
- It’s important to go from 5 to 10 in reasonable time.
- How many books should you read to become adequately prepared to debate the major life issues for the next 10 years?
- Doesn’t it make sense to know how many books that looks like? What books they are?
- How many pounds overweight should you be at 20? NONE.
- Well, we do tend to drift, that’s human.
- Which is why: Mid-course corrections might be necessary, but make sure you make them!
Life can be so empty without measurable progress.
We must get on problems and the challenges, lest we yield too easy to the things that can leave us empty instead of full, and leave us with pennies instead of fortune.
One of the major reasons for looking at results is to see what might be wrong with activity, philosophy, or attitude.
- Don’t mistake movement for achievement.
- Disciplined activity is like birth-pains.
- Values were meant to be costly.
- The only way to appreciate a value, is to know its cost!
Lifestyle
How you choose to live, how you design your life. Some people have learned how to earn well, but didn’t study lifestyle. Got the money, but not the joy.
Lifestyle: Figuring ways to live uniquely. Learning to live well. Finding ways to bring joy, pleasure, excitement, appreciation, and awareness of how unique life can be.
Happiness in not an accident, it is an art.
Lifestyle is not an amount
Culture is not an amount
Sophistication is not an amount in an account, it is a practice, an art.
Understand the difference between trinkets and treasures.
Skills of Leadership
Masterful Communication
If you wanna get good at communication come, you have to be aware of doing it every day as a practice session of getting better, so when the real important occasions arise, you will have the gift and you’ll have the syle and the sharpness and the clarity the substance and the emotion.
Of all the skills to learn, this one has got to be up front.
There is magic in good communications!
Words can give life, can formulate ideologies.
Being successful is not doing extraordinary things, it’s doing ordinary things extraordinarily well.
Preparation
- You gotta get ready!
- Just like you get ready for life (elementary school, high school, college),
- To get ready for good communications, you have to take part of your day, part of your week, part of your year, to get ready for the next one.
- Research
- Don’t get caught telling more than you know because of lack of preparation
- 99% of what you need to know needs to be done on purpose
Key words for preparing for communications
- Interest – Take a new interest in life. “I’m gonna be more interested in this day. I’m going to see if I can get more from the day”
- Life – develop a sharper focus on life
- People – learn people.
- Fascination – beyond interest. You gotta know more than just what appears. What makes it tick? What is going on? How and why?
- Learn to try turning frustration into fascination!
- Sensitivity – to communicate well, and to touch people in a wide range and from a wide range of exp, you’ve got to have felt the experience
- Be moved with compassion (like Jesus was moved)
- If you don’t at least try to understand or experience the darker sides, the other sides of life, you’ll end up shallow
- If you do your homework in sensitivity to gain a wider experience than your own, that value will show up in communication
- Deliberately go where experiences beyond your own touch your life to get somewhat of an education to the contrasts of life, and it’ll educate your spirit and mind. That extra worth will start showing up in your words and they’ll be weightier, they’ll be heavier.
- Let the experiences touch, affect you, educate you and give you a broader range of emotional wealth and worth, it’ll show up in your words…and you’ll be able to touch and reach people you couldn’t before.
- What experiences could I make sure that I engage in that’d give me a broader range of understanding of human contrasts
- (Working) Knowledge
- Deliberately gathered knowledge: ideas and knowledge that is revisited and reviewed…go back through one more time to see if you can find the extra meaning, the extra depth, the extra value. Working knowledge!
- Library!
So…have something good to say.
Learn to say it well
Repetition! Repetition with purpose.
Sincerity – from the heart, with noble intent, with a desire to bring value.
Brevity – Keep it brief. Key to being brief is personal development.
Style – Be a student, but don’t copy style (how to people speak well?) Borrow bits and pieces and make them your own (genuine) style. Important to study your own style
Vocabulary – Saying it well is proper choice of words. There is a relationship between vocabulary and behavior. Vocabulary is a way of seeing. If you cannot see well, you can imagine what a deterrent that is to the good life. The words we know are the only tools we are able to interpret and express what’s going on inside, what’s happening outside. So have a dictionary.
Actions are no substitute for words. A gift of flowers say something, but don’t let them do all the talking.
Read Your Audience
Be conscious of what’s going on with your listeners.
Intensity
The power of what we say: Part is words we chose, the greater part of the strength of what we say is the emotions that are loaded into the words.
There is no greater power than words loaded with emotion.
I take a pin and throw it at you, and you’ll feel it. Or I can wire it to the end of an iron bar and drive it through your heart. The pin is the words, but the iron bar is the emotion.
Putting more of what you are into what you say, there’s no telling how your audience can be touched, what miracle can be wrought.
Learn to measure your emotions.
A cannon gets the rabbit, but afterwards there’s no rabbit left!
Identification:
Make a study of your own life – Take your experiences, the stories: as you take a more thoughtful approach, use the intensity of your experience to weave into the next conversation interaction
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