Start Up Blog

Counter intuition, deal cutting and commissions

Posted in entrepreneurship by Steve Sammartino on April 22, 2014

I really like sharing my ideas with groups of people – so much so that I often get up on stage in front of large groups of people to to do this. After doing it for the best part of 10 years (usually in local startup events & for friend who work at large corporates) I started to get offered money to speak at events. Which is quite exciting. It’s a classic example of the wood chips generating a significant revenue stream on their own.  I’ve recently starting working with an agency to help me manage my speaking engagements. Again, these guys came to me through others who recommended me as a potential source of revenue to them – apparently I give good voice.

When we talked about how the agency thing works for their speakers the issue of commission came up. Surprisingly I was advised that I could pick my preferred commission to give to them. I could chose to give the agency a lower percentage commission if I wanted. I could give a commission of 10, 20 or 30 percent. I chose 30 percent. My dad once told me the easiest way to make money is to help other people do the same. To create a deal where there is enough in it for the other guy that they go to work for you. So I took his advice.

The principal of the agency then told me it was a good decision and that most people take more and but end up with less.

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Web startup principals apply to every kind of new business

Posted in entrepreneurship by Steve Sammartino on April 19, 2014

Recently I’ve been exploring the hardware space, especially now I’m deeply involvement in Tomcar Australia – a startup which builds cars.

I’ve become more focused on what we can learn in the web / software / mobile space, and apply it to the hardware space – startups which build actual physical things or any non digital kinda startup. Turns out much of it applies, especially given the open access technology and connected society has provided. I’ve recently written a couple of posts for the good people of Pollenizer on this subject.

This post – Beyond the screen – How non software companies can out learn the competition.

and this post – Hero 1 killer feature – How GoPro came from behind the technology curve. The stuff you don’t know about how GoPro got to where it is.

I think they’re both great posts for anyone involved in non screen stuff.

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The 3 directions pulling on us

Posted in entrepreneurship by Steve Sammartino on April 17, 2014

There are always three forces pulling on us which have a significant impact on our future.

Backwards – the pull of the past, the regrets, the waste, the mistakes and our history. The negative thoughts that tell us we’re not smart enough, not tall enough, not pretty enough, not rich enough, not connected enough, not disciplined enough. These are thoughts which steal our dreams by convincing us that it isn’t going to happen for us because of pattern of events which have already happened. They pull us backwards.

Sideways – these are the distractions which steal our short term focus and attention from what we should be doing. Our digital lives are full of these and can force us into a pattern of collecting dots instead of joining them.

Forwards – this is the pull that matters – the direction we want to take, and must take if we want to our hopes to come true. Maintaining a forward trajectory is best aided by having a deep purpose. Purposes gives us the tenacity to find the discipline needed. We must have and remind ourselves of our purpose frequently to ensure ‘forwards’ wins the battle of the 3 directions.

The future, which is forward, is going arrive anyway – it’s best we get there by facing in the right direction while the time elapses.

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Virtual Classroom

Posted in entrepreneurship by Steve Sammartino on April 16, 2014

The thing that we are fortunate with today, is that it is easy to catch up. If we haven’t been paying attention to the world we make our living in, someone usually has been. And of those people who have been paying attention, these days they are often generous enough to share what they’ve seen. If we’ll take the time to invest a few minutes with a sharp mind, they can teach us what took them years to uncover themselves. I recently happened upon two Youtube videos which do just that – albeit in different ways.

Then & Now

This keynote from Seth Godin is the best I’ve seen from him. It really is a master class in how to do a keynote. It provides the most compelling story about our exit from the industrial era and shift to the connection economy. If by chance you’ve not noticed the structural shifts in our economy in the past 20 years, this 55 minute mind boggle will get you up to speed. Given you’re a reader of this blog and that can’t possibly be true, please share the link with someone who you think will find value in it. Click here to watch.

Tomorrow

Tim O’Reilly is one of the great philosophers of our time. He knows how to see, he notices the long play, more than most I think. I often just type his name into Youtube and the word ‘interview’ after it. I then sort the Youtube search result by date to get most recent content. Every time I do this I find an astounding interview with him which provides deep and profound insight. That’s what I did yesterday and I found this gem. A discussion about the maker movement, and evolution in the web of things. The stuff that is coming in our technology world. Really leading edge thinking:  Click here to watch. (or listen as this has no important visuals)

In today’s world we can know anything, on demand from the worlds best thinkers. It’s the first time in human history this has been possible. There aren’t really any excuses for a lack of knowledge in our topics of interest. These days knowing or not knowing, has little to do with access and a lot more to do with effort.

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Don’t create what you ran away from

Posted in entrepreneurship by Steve Sammartino on April 15, 2014

I’m betting that everyone reading this blog, either works in a business they helped build, or is planning to escape their corporate cubicle some time real soon. And the people who are planning exit from the big nasty industrial conglomerate they work for, are planning, most often – build a corporation. (Sounds a lot uglier than the word ‘startup’ – doesn’t it?)

Ok, so the irony is clear.

But the way to overcome the irony is to remember why we left our job / company in the first instance. It probably wasn’t because we weren’t earning a decent income. It probably wasn’t because our standard of living was too low. It probably wasn’t because working conditions were unsafe. No, it was about the culture, the excessive administration, the frustrations, the lack of creative input and the dehumanising elements which so often ensconce a large corporate environment. And so here’s what we need to remember:

If we succeed in building our own version of a ‘corporation’ people like us will someday come and work inside it. They too have the same desires and requirements in order to enjoy their work day. They too, will hope to leave someday and make their own version of a corporation. Given all of this, it’s best we remember not to create the thing we ran away from.

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Does the world need changed?

Posted in entrepreneurship by Steve Sammartino on March 26, 2014

It’s not uncommon to hear about an ambition startup or entrepreneur wanting to change the world. But does the world really need changing? Is everything we live in so bad that some of it isn’t worth keeping? Are we that limited in our thinking that change is all we can come up with?

Maybe what we really need to do is improve the world.

And sometimes improving the world might just mean keeping some things exactly as they are. Some traditions, physical locations, products, services, events and attitudes are just perfect the way they are. What might be needed is the fortitude and vision to maintain the things of great beauty we are already blessed with. Maybe that’s where the next important opportunity lies. Human endeavour, and startups for that matter aren’t all about change, and certainly not change for changes sake. They’re about problem solving and creating value for others.

Yes, I like the rain forests just the way they are.

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Random Soundbites

Posted in entrepreneurship by Steve Sammartino on March 25, 2014

In the past few weeks I’ve been in the audience a few times when some smart people have taken to the stage. The presentations were largely retail focused. As usual I took notes and thought I’d share some random soundbites from what they had to share. I haven’t got the sources for each quote, because I couldn’t write those down quick enough without losing the information. But the thing that really matters isn’t the exact figures, but the patterns they are part of:

  • 10 years ago car buyers used to visit the dealership an average of 6 times before buying a new car. Now the average 1.5 times. When surveyed about the cars they bought more than 90% of buyers knew the specs in more detail than the car salesman.
  • Retail Delivery Gap: Australian retailers believe their customer shopping satisfaction rates are 80%. When surveyed the actual satisfaction rates from shopper was 8%.
  • There are a significant amount of retailers who are now treating the customers as employees: Airline check in – Supermarket check out. This is all fine so long as it reduces friction and increases joy. It shouldn’t be the default approach, but a considered one.
  • Retailer measurement used to be all about foot traffic and transactions, now they can measure everything in between, before and after. But smart retailers will need to ensure they have permission and share the prize with those providing the data.
  • Big data is a bit like teenage sex: “Everyone talks about it. No one knows how to do it, and everyone thinks everyone else is doing it, but not many actually are.”  Not my quote – but made me laugh.
  • Advertisers need to get ready for revised TV. A television that knows who is watching it, what they’ve bought, where they’ve been and what they car about.  One that can serve up specific, permission based  and relevant content for a single person. 1 to 1 television creative executions – the TV’s can already do it – but it seems no marketers can?
  • The delineation between physical and digital is over – pointless and and us versus them zero sum game. The intersection is now mandatory, or even tables stages – it’s now phygital.
  • People like buying stuff, but not so much paying – but the money isn’t the pain point, it is the process and the friction they hate. Sellers need to get out of the way.
  • Network Survival: A network stays alive so long as it provides trust and reduces friction. What’s interesting is that friction is often reduced by routing the long way round.
  • The top 12 Australian retailers have $700 billion worth of currency convertible loyalty points on hand – a giant liability, or is it an asset?
  • The phone is now becoming the personal life controller. It is the new location for commerce – literally where the phone is: simple example is Uber.
  • We are entering the wallet wars era. The digital wallet as spruced about by Bill Gates way back in 1995 – every tech player, bank, payment system and hardware developer is in the battle.
  • Mobile payments growing at an astounding rate in e-commerce. In the past 2 years payments via mobile phone grew 57 fold in Australia alone.
  • Mobile provides a leap frog opportunity. Many players who missed the first web iteration, can now disrupt the disrupters by doing an amazing job on mobile - this game is still open.

What does this tell us. Just that there is so much happening, and no matter what business we think we are in, we are all in the startup business now.

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Understanding it later

Posted in entrepreneurship by Steve Sammartino on March 24, 2014

I’m a slow learner. It’s rare that I fully understand things the first time I hear about it. This might even sound ridiculous, but some things I first heard about in primary school and secondary school I’m just starting to comprehend now as a middle age man. Political, social and philosophical lessons I got front teachers, family and friends. I really think that our brains work super hard on everything, all the time, in the back ground while we are busy with the stuff of life.

I had one of these moments yesterday. I was reading this article on bitcoin, which was discussing the genius behind the Blockchain method, referring to the back end complexities and how it might provide a model for a more independent peer to peer based internet. (Well, that’s what I think it was about). The point is that half way through the article, I was like – wow, most of this stuff is way over my head – it must be for smart techie head coding types. But I read it to the end. I’ll probably read it again, and I’ll read the other articles it links to inside of it….. Maybe I’ll understand it in a few years. The point is I’ll leave that to the smart parts of my brain I don’t have personal access to – the secret bits it keeps Steve outside of. I’m sure it’ll come up with something if I leave it alone.

In complex times, this is type of situation is set to become more common. Times when our initial understanding is vague. We shouldn’t let it discourage us. We shouldn’t let it make us give up and stop reading or trying to comprehend it. What we ought do instead, is trust that what we need to know will reveal itself, so long as continue to take in the data and we are patient.

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The successful company lie

Posted in entrepreneurship by Steve Sammartino on March 20, 2014

When anyone is looking for a new job, the company they worked for starts to matter more than ever. Society seems to have a default position to want to employ people who come from big name companies. When assessing potential employees the first thing we look at is where they have worked before. The thinking being that if they have worked for a successful company, then they are part of that success. A contributor, someone who knows how to win, someone who has already been vetted, if you will. But what if the opposite of that was true?

What if this employee from the successful company was hiding inside the deep and wide corporate infrastructure?

What is this employee was riding the wave of the hard work already done by those who came before them?

What if they were claiming the work of projects with a zillion participants?

What if they were better at internal company politics, than actually creating any true market value?

What if they never had the freedom of independent decisions and never actually did anything, and but worse, never made any mistakes either?

When we start to ask some of the question above (and there are many more) we start to see how flawed the ‘successful company mantra’ is. In real terms they’re the easiest place to ride career coat tails. Maybe we should instead be looking for people who’ve worked at crappy companies with poor reputations. Those struggling to stay alive, the fringe dwellers, or even those that failed. The irony is not lost on me that startup land reveres and respects failure, as a key learning mechanism, yet recruiters only ever what to employ people who came from a stable of success.

We need to think back to some of the best lessons we’ve had in our lives. Forget the corporate crap for a second and just consider the art of learning. We’ll find that mistakes are key. That when the scars run deep so do the lessons. When things go very wrong, we vow never to do it again and have the personal experience to know when to change course. We know the warning signs and what to look for. We spot the problems much quicker. Surely the same is true for where we work. We’ve all had superiors who just don’t get it. Bad bosses who taught us more about leadership than the good folk we worked for. And we’ve all seen ‘what not to do’ by working somewhere that consistently stuffs things up.

Success breads success? Well I’ve worked in some of the worlds most successful companies, I can tell you that they are often still filled with chickens, they are never an eagles only zone. Mind you, with size everything mathematically gravitates towards average – eventually. It’s a physical fact. So the larger the organisation, by definition the larger number of average employees it has. The real question isn’t if large company X has a better calibre employee than small company Y, the real question is what filter bubbles are we letting hide great people from us?

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Trade Secrets

Posted in entrepreneurship by Steve Sammartino on March 4, 2014

Once upon a time simple forms of industry knowledge were a significant competitive advantage. The little things we knew about our industry from working in it mattered. We had to earn expertise over long periods, and the release of that expertise to prospective customers. We traded in trade secrets. But now those days are coming to a close.

In a market where anyone can know anything about an industry (from the worlds experts) with just a few key strokes, then we need change our view on what creates an advantage. Knowledge of products, prices, places, who does what and who owns what are all knowable. We are quickly approaching a market of perfect information. And when everyone can know everything, and prices quickly level out, the only thing left is trust. And a great way to build trust is by sharing trade secrets. By being generous with our knowledge well before we want to do business with anyone. We need to share what we know so others can navigate the market and reduce their risk.

When it finally comes down to doing business, customers have a much higher probability of trusting those who gave them the most trust first.

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