Seth Levine's VC Adventure

“Seth can’t take your call right now . . .”

I have a few pet peeves about personal business habits that I've joked about in the past (see How do you sign your emails and Where was that you went to school, for example). Here's another one that's been bugging me lately: outgoing voicemail messages

With apologies to my many, many friends who do this, it really bugs me when people have their assistant leave their outgoing voicemail message. I get it – you're busy; you're very important; you have an assistant; you don't really have time in your schedule to deal with things like setting up your voicemail. But really? Do you honestly not have the 30 seconds it takes to set up your own personalized outgoing message? Or is it that you just can't figure out how to do it . . . ?

And while I'm on the topic of voicemail, how about not setting your outgoing message to the automated "John Smith" . . . "can not take your call right now. I'm the guy who always gets tricked by this (often multiple times by the same person), thinks you've picked up your phone and starts a conversation with your voicemail before the systems completes the message and I realize I'm just talking into the air. It does not make me feel very smart . . . although I still feel smart enough to set up my own voicemail <g>

EOR

Explicit Behavior

Atul Gawande has an outstanding article in this week's New Yorker entitled "The Checklist" (full article available) that describes how explicitly defining the steps in complex processes (and then following those steps religiously) significantly reduces errors in certain intensive care procedures. Creating explicit checklists of steps for common ICU procedures resulted in far fewer infections and other complications and an unbelievable amount of money and time saved (not to mention the number of deaths averted). It's truly mind boggling and a great example of Occam's Paradox, which I wrote about a few years ago on this blog (for those of you who don't want to link through, Occam's Paradox is the idea that while the "challenges we face in life and business [may often be] complex – the solution to those challenges generally are not"). It's a reminder that in many cases making behavior explicit rather than relying on memory, intuition or guess work ultimately saves time and results in greater accuracy. As the article point out, airplane pilots figured this out a long time ago. Doctors are apparently just waking up to the idea. Perhaps it's time for the rest of us to start thinking about it.

When you know it’s not right . . . it isn’t

"When you know it's not right, it isn't."

A fellow board member said this to me a few months back and I wrote it down as something I wanted to remind myself of every once in a while. She was referring to the human tendency to act slowly in the face of clear evidence and in particular to venture capitalists' reluctance to be decisive. While I don't fully subscribe to the "Blink" theory on decision making, I find it excruciating when decisions are drug out unnecessarily. Don't do that.

How much is that meeting costing you?

So now that you are arguing for consensus at your meetings rather than arguing to win, how much is that tete-a-tete costing you anyway? Here's an amusing answer to that question. I just ran a hypothetical meeting with a VP Sales, COO and Director of Biz Dev. They couldn't agree on anything and our meeting ballooned into an hour long discussion. The grand total? $169.56. A waste of time and money . . . hypothetically speaking . . .

Arguing to win

Someone recently told me about being stuck in a group where people were arguing to win, rather than arguing for consensus. Whatever it was they were talking about didn't get solved and a bunch of people left the meeting annoyed. I've not heard anyone describe the difference in debating style to me in this way before and think it perfectly captures a huge distinction in the polar approaches some people bring to a group decision making process.

On the one hand, you're already right, don't want to hear about what anyone else says and your only goal is to get the group to make your decision. You probably don't hear a lot of what other people say, because you're too busy coming up with a response to the stupid point they just made rather than listening to their reasoning.

On the other hand, you want to make the best decision possible, don't have to be the smartest person in the room and realize that other people bring different backgrounds and experience to a discussion.

You tell me which one results in a better decision (not to mention overall experience) . . .

1980’s all over again

I've written a few posts about my general concerns over our economy (we save too little, have too much debt, etc.). I've received my fair share of feedback that outlined all the reasons why the world had changed, that certain leading indicators no longer mattered, etc. That's all wishful thinking in my mind – we live in a world of real and repeatable cycles. And while overall the global standard of living has gone up over time and the duration of our periods of growth have lengthened, our economy and the world economy is cyclical and generally speaking follows repeating (if not predictable) patterns.

With that as a backdrop, I was fascinated by a Merrill Lynch report (see 1980's Redux) which compares trends in some key economic indices today and from the 80's. While the world is without question a changed place (and thankfully the economic downturn in the early 90's was short-lived, relatively minor and followed by a sustained period of growth and prosperity) it's still wise to at least pay attention to history. Click through the link above – just looking at the graphs will give you the right picture.

One thing I hope does not come back is my late-80's hairstyle . . . attached here for your viewing pleasure (that's my sister with me in the picture with an admittedly big, but much more respectable, style).

StubHub Rocks

Brad put up a post last night about how tight StubHub is (see "StubHub Seriously Has Its Act Together"). I promised a post on my rockin' StubHub experience buying tickets to Game 4 of the NLCS in "Jumping on the bandwagon" so here goes:

The thing about specializing in a specific vertical is that if you get it right, the experience is worlds better than your generalist competitors. When StubHub was started conventional wisdom suggested that eBay had a lock on all things auction. But it turns out that there are plenty of very specific niches for which the eBay one-auction-fits-all model falls short. Ticket sales is clearly one of them. If you've ever tried to buy or sell tickets on an eBay auction you know exactly what I mean. Tickets to an event are a highly specialized good – every ticket is not the same (each seat is different and each venue is unique in its seat layout), events are time specific (i.e., they occur at a very specific date and time before which the ticket is valuable and after which the ticket has zero value), there are major logistical challenges with shipping around tickets and ensuring they get where the are supposed to get when they are supposed to get there, and there are significant challenges in dealing with last-minute purchases (transferring the ticket from a buyer to a seller hours or minutes before an event).

Enter StubHub who seems to have this process completely wired.

I hadn't even thought of trying to go to game four of the NLCS until the morning of the game when my wife suggested that I try to grab tickets and take my dad. I've used StubHub before so I quickly headed over to their site. I hadn't seen the cool mouse-over stadium map that allowed me to quickly figure out the range of ticket prices and seating options available (all without clicking and backclicking, which is a major pain). Three clicks later I had purchased 2 seats to the game about 30 rows up behind 1^st base. StubHub has ticket pick-up offices set up near many major venues. In the case of downtown Denver they use a temporary space in LoDo to distribute tickets bought too close to event time to ship them around via FedEx. I arrived right as the office opened and was a little dismayed to see about 200 people already ahead of me. But dealing with large numbers of people descending on a single venue and attempting to pick up their purchased tickets is clearly something StubHub has figured out. Five minutes later I had my tickets in hand and was off to dinner with dad. I watched throughout dinner (which was at the restaurant next door) as the StubHub line snaked around the corner but moved steadily for the 90 minutes. I wouldn't be surprised if 5,000 people (about 10% of the stadium) purchased their tickets through StubHub for this game (they even had computers set up in the pick-up office for people who had procrastinated their purchase until game time).

All I can say is wow. . .

“Everything just works”

On a recent trip to Chicago I had the chance to visit Dick Costolo, former CEO of FeedBurner and now proud employee of Google. Brad and I took Dick out to a congratulatory dinner. Before we went out Dick gave us a tour of Googleplex Chicago. As we walked around the impressively decked out office (200 inch screen in the presentation room? Wow!) he told us how smoothly the operations ran at Google. "Everything just works" he said, demonstrating the video conferencing system. On top of that, the systems in the Chicago office are exactly the same as the systems in every other office. Learn how to do something in Chicago and you know how to do it in Palo Alto, Boston or Munich. Most of the offices even have the same look and feel. While it may be a bit formulaic, it's productive. And clearly Google is all about maximizing the productivity of its staff. That . . . as well as the fact that they actually had a working video conferencing system that required no IT staff to actually set up a video feed . . . is pretty impressive.

Here's a (really fuzzy) picture of Brad and me in the lobby just before leaving:

Peripheral vision

One of the great challenges of business in general and smaller, fast growing businesses in particular is figuring out the balance between near term focus and long term vision.  While all companies become slaves to the calendar (striving for quarterly sales targets, specific product release dates, etc.) too many never look up to see where they are really headed.  I'm not talking about making sure you have the latest IDC report on your industry on your bedstand, I'm talking about having a meaningful understanding of your business, you competitors and spending real time focusing on how and where you are going to take your company.

The typical paradigm for this is wrong, in my estimation – and most companies that I've seen are missing the boat.  Companies spend almost 100% of their time focused on the here and now and designate only discrete periods of time on future planning (their annual strategy session, at the board meeting where they review their next year's plan, etc.).  To borrow an analogy from mountain biking (sorry – cycling season is in full force and it's on my brain), companies need to be focused on where they are headed, as opposed to where they are, and use their peripheral vision to avoid current obstacles.  In cycling you look up trail – focusing not on what you're riding over at the moment, but what you're about to come upon (and by the time you're there, you're focused on the next thing).  The faster you're moving, the farther ahead you need to be looking (because it's on you before you know it). 

Management teams that get this right are consistently engaged in conversation about the future of their company and industry.  Product strategy discussions are broad and include not just product management and engineering but executives from across the company.  Feedback from customers is not siloed in sales, but is shared across an organization.  These companies have regular time set aside for execs and employees to spend unstructured time together taking about what's working in their business and what needs improving; what customers are asking for; what their competition is doing; what the trade press is writing about; what would be 'cool' to include on their product wish lists; what's not working in the business; etc.

This activity doesn't replace knowing where you are (your peripheral vision is important) but better informs where you are by knowing (really knowing) where you are headed.

Patent sanity

Brad has a nice series running on patents which I've enjoyed a lot (I think the existing patent system is completely hosed, totally ineffective and open to blatant abuses of power – see this post from Jason for the perfect example).

Well today, there's a glimmer of hope that change may be on the way as the administration and it's head patent policeman Jon Dudas announced the intent (note the gap between intent and action, but at least it's a first step) to reform the patent system. While I generally like the idea of requiring patent filers to include more information on why their invention is 'novel' the gem for me in today's announcement is the idea of opening up patents to more of a peer review. What a novel idea – have people who are actually in a particular field help determine whether an idea is truly novel and therefore patentable. In a system where the average patent is looked at by an examiner for about 7 hours before being approved (and where the default behavior seems to be "assume this is novel until proven definitively otherwise) far too many patents which are both obvious and not particularly original are being issued.

While I don't think software patents will ever be outlawed, perhaps the PTO will someday go the next logical steps and more significantly tighten up the requirements for issuing a patent (and issue far fewer patents) and completely abolish method patents all together (ok – I'm deluding myself on that last one). I'm hoping today's announcement is a step in that direction.

If you have a minute and are looking for a laugh, check out this list of patents actually issued by the PTO – I particularly like the electrified table cloth (to keep bugs off your table, of course). Why didn't I think of that one?!?

Thanks to Brad for pointing me to the article – I'm sure he'll have his own post up about this move in the right direction when he gets back from a few days unplugged.