Startup founder an ok guy

Industry onlookers have been left puzzled this week by the growth of a startup founded by a well-balanced, reasonable individual. Jermaine Dixon, 29, an MIT machine learning PhD, released his recommendation app after finishing his doctoral thesis, and has seen huge user growth, despite the fact that he is neither narcissistic nor arrogant.

Bill, his former college roommate, has expressed surprise at his success, wondering how he has managed to build a business despite the fact that he respects women, and doesn’t have an egomaniacal streak. “I mean he’s the cleverest man I’ve ever met, for sure,” explains Brandon, “but he has never sent me any misogynistic emails, not even one.  I’m not sure how he’s managed to build a business at all.”

His parents are as shocked as anyone, having despaired that his well-rounded social life would doom him from the start. “He worked incredibly hard, but he also managed to maintain friendships and family relationships, and was never snappy or rude,” reports his mother, Carolyn. “We’re just astonished, really.”

In terms of future plans, Jermaine plans to wait 12 months, then sell the business, giving most of the proceeds to charity.  However he did admit that he would probably use some of the money to buy a Prius to replace his 20-year-old station wagon. Our industry insider was relieved: “I knew it, a new car. What a selfish t***.”

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Machiavelli lives: Employee dodges printer scandal

With a remarkable sleight of hand, an Account Manager from Bristol has got away with not re-filling the office colour printer, even though the light was flashing.

Sally West, 34, says she thought she was rumbled when colleague Jane Wilson remarked that the Xerox never had any paper in it. “I don’t know, but her tone was quite accusatory,” she confided in HBR. “So I thought that it was best to play a defensive game, and feigned even greater outrage.”

That worked, initially, but Sally worried that she wasn’t out of the woods, so casually mentioned to Jane that she had seen Sales Rep Jim Foley fail to fill up in the past. “Jane’s the biggest gossip in the office, so word soon got round, and Jim was widely shunned at the lunch table. To be a non-filler is a pretty dirty word round here.”

So Sally lives to print again, but what has she learnt from the whole experience? “I suppose I should feel bad,” she explains, “but if I’ve learnt anything, it’s to deny everything. The best part is that I’ve never filled the printer up!”

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Business is War: Over the top

As previously discussed, the Hardly Business Review is a strong proponent of war as a metaphor for the business world. In this post, our resident historian brings learnings from the First World War to your modern-day business

The First World War was a human calamity of epic proportions, claiming almost ten million lives from 1914 to 1918, with trench warfare the best remembered mode of combat.

The definitive war of attrition, with two well-equipped combatants grinding each other down over time, trench warfare could in some ways be compared to today’s smartphone clash of the titans, or the daily battle for the consumer in supermarket aisles.

The trenches demanded the attention of the finest military minds of a generation, as both sides inched to get the upper hand, so it goes without saying that the modern business leader has a lot to learn from his military forebears.

The first change you can apply to your business is structural. If Field Marshall Haig didn’t need to be near the frontlines, then why on earth should you be anywhere near your workforce? Leadership from afar was a great success in World War I, inspiring great team loyalty, and it will likely benefit your business too. Move the CEO’s office to the Bahamas, and you’ll see a huge boost in morale.

You can also learn a lot from the hiring model adopted in the First World War.  The British Army instituted a “conscription” system in 1916, and saw an instant boost in employee numbers. If your business applies the same system to new hires, you will see significant sales growth, assuming constant revenue per employee. Don’t waste time trying to attract good applicants, just put in place a system where they are obliged by law and national duty to work for you and you’ll have no problems.

There are similar lessons to be learned for your HR department, once your veritable army of employees has been hired.  Today’s workforce is cosseted, with everyone bemoaning their work-life balance. The trenches, by contrast, were rife with disease, where the balance of interest was in terms of life and death. Today’s economy barely wobbled through the recession, while the men in the trenches went at it tooth and nail for five years.  The implication is clear: if you want a tireless workforce, worry less about personal development, and more about spreading cholera and dysentery.

What about implementing your strategy? Field Marshal Haig et al can also help you here too. While it may appear that speed of execution is crucial, the Generals of the Great War actually favoured a slow approach when going “over the top”, approaching oncoming fire in a measured and orderly fashion.  And while this tactic admittedly led to huge loss of life, the Allies did win the war (in the end). So stop worrying about first movers advantage, and adopt a snail’s pace. If it’s good enough for military men of yore, it’s good enough for you.

The final aspect of business strategy where the trenches can reassure you is innovation. In the land of technology, innovation is king, but what if none of your projects get off the ground?  What if all your new ideas fail? The key is not to worry, and to just try the same thing over again. Field Marshal Haig steadfastly believed, no matter how many times it failed, that  walking his soldiers slowly over the top would topple the German fortifications, and he was right (in the end). If it doesn’t work, it doesn’t mean it’s a bad idea, it’s just bad luck! If one advertising campaign fails, just run it again. If a new brand falls flat, give it another go.  It will surely work this time round.

So it is organisational change and strategic reassurance we receive, from these great military men. Heed this advice, and after four years and significant loss of life, your business will achieve its potential.

Hat-tip: Blackadder

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Paul’s Pet Insurance gets off to a bad start

Local businessman Paul Whitaker has not had an enjoyable 2014.  Paul is the MD of Paul’s Pet Insurance, a small pet insurance business in the North West of England.  Historically, springtime has been business-time at PPI, as that is when the company starts its telesales campaign. However this year, the company has not seen the usual seasonal uptick in new business.

“We’ve kicked off the campaign, just like we always do,” reports Paul, “but the response has been a lot more frosty than usual, and we just can’t work out why.”

Numerous members of the sales team report being instantly shouted at down the phone by irate consumers, despite the company’s tried and tested friendly opening line, “Got a pet? Hi! Let’s talk PPI!”

Paul thought it was bad luck at first, but after trying a few potential customers himself, he soon became downcast. “Before I’d even mentioned our excellent canine cover, people I’d never spoken to before told me to stop harassing them, and one man even called me a scam artist! I’ve never been so insulted in my life.”

Paul is not one to give up easily, however. “We’ve had a few knocks, but I’m optimistic that it will get better,” says Paul.  The team even has a new recruit to help them with their efforts: “My cousin from Nigeria is visiting, and he’s a genuine Prince! If he can’t help us make a few sales, I don’t know who can.”

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Where is your actual business?

In my work as a Venture Capitalist, I come across a lot of startups, across a wide range of sectors. While the businesses I see are incredibly variable, the meetings I have with them are often almost exactly the same, opening with a bit of preamble, followed by much discussion about the company’s business model.

This is a pet peeve of mine. In all my years in the industry, I have never worked out why so much time is spent on models of businesses, instead of working on the actual thing.  What are these models good for, and why do we keep creating them when there is a business to be run?  In the very wise words of Derek Zoolander, why are we building tiny businesses for ants?

That is not to say that the business world is the first sphere of human endeavour to make this mistake.  Just look at biology, where people have wasted years of research on evolution, despite the fact that it’s only a theory. I could sit here making up theories all day! Yet scientists continue to beaver away on the basis of some historical figure’s half-baked idea, proving that some habits are hard to break.

So how can you avoid this business model mistake? The only way is to go out and do it! Don’t tinker in the toy shop – build your business to scale, and do it straight away. If investors ask about your business model, point them to your business actual. They will have no choice but to be convinced.

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Book Review: Money

People are suddenly into economics, apparently. A Piketty pandemic has swept across the printed press, the blogosphere, and most importantly the bestseller lists, following the recent publication of Thomas Piketty’s “Capital” in March. As is so often the case, what started with admiration swiftly turned to admonishment, when some data issues came to light, courtesy of the FT.

Notwithstanding the recently raised question around data integrity, Piketty’s “Capital” is still very much on every business-minded person’s reading list, and it is most certainly on mine.  However according to Mr Amazon, the book weighs a hefty 640 pages, which seemed rather a lot for a bank holiday weekend.  As a result, I chose to square up instead to Capital’s predecessor, “Money”, by Martin Amis, a mere welterweight at 400 pages. I felt that Mr Amis’ effort on the subject of all things pecuniary would stand me in good stead when I came to address Piketty’s even seriouser tome on the same.

I am afraid that I was gravely disappointed.  Far from being a pithy primer on money matters, “Money” was largely about some chap called John Self, whose expertise with the green stuff seems to have been primarily in disposing of it, as opposed to leveraging the high levels of return on capital in order to gain further share of overall wealth (which Wikipedia reassures me is Piketty’s centrale treatise).  What rot!  This became pretty evident in the first few pages, but I assumed that this Self character was some sort of vignette on what not to do, and that the serious economics would soon kick in.

I was let down once again.  We followed John from strip-club to dive bar to brothel and back again, with not a peep about supply, let alone demand, excepting of course demand for a whole range of vices, from booze, to drugs, to pornography.  Meanwhile the invisible hand was nowhere to be seen, though Mr Self’s extensive experience of hand-jobs was very well documented.

Quite why Mr Amis chose to write an economics textbook in such a fashion I do not know, and I am afraid that as a result I must award him two stars.  If he ever feels the urge to dip his toes in financial waters again, I can only direct him to the ever reliable “Business Writing For Dummies”, and wish him the very best of luck.

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Tesco removes sweets from the checkout

Tesco recently announced that it will be removing sweets and confectionery from checkouts in its stores, after a survey showed significant customer support for the move.  This has been met with approval by the Public Health Minister Jane Ellison, as well as by various health groups.

However Lily Simpson, 8, Director of children’s think tank Kidz, feels that Tesco did not sufficiently canvass children in making the decision.  “In many ways, the sweets at the checkout were one of the last bastions of children’s confectionery, the perfect opportunity to slip something into mum’s shopping trolley.  Now that’s gone.”

Lily is of the opinion that this is part of malicious larger campaign against children’s taste buds.  “Sweets are delicious,” she explains, “and now we just can’t get our hands on a Dairy Milk for love or money. Our vending machine at school is a flavour-less hole, thanks to that blasted Jamie Oliver, and now this!”

Meanwhile the healthy replacements at the Tesco tills have not been well received: “I swear to god if my mother tries to give me another pack of dried nuts I will scream.”

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Unilever selling Ragu and Bertolli for £1.25B

FMCG Giant Unilever has announced that it will be selling pasta sauces Ragu and Bertolli for £1.25B, putting yet more pressure on the average consumer’s shopping basket.

“I don’t know how we’ll cope,” worries Jane Saunders, 37.  “First the price of bread went up by 10p, and now this. We’re really going to have to cut back on the bolognese.”

The big supermarkets were baffled when Unilever first approached them.  “It seemed like a big jump to us,” reports a Sainsbury’s insider, “particularly as the price of a jar of Ragu was previously only around £1.80.  We managed to negotiate them down from £1.5B per jar, but they wouldn’t budge from £1.25B, and we had to pass the higher cost on to the consumer.”

This is not the first big price jump in recent months, with Burton’s raising the price of their Cadbury’s Fingers and Jammie Dodgers to around £350M a packet. It remains to be seen how much price inflation the average household can withstand.

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Junior Sales Rep’s ducks very much not in a row

A junior Pharmaceutical Sales Rep has found themselves in hot water after admitting that they didn’t understand a key piece of business terminology.  Sam Watkins, 21, was making notes in a team meeting, when his manager emphasized the importance of “getting their ducks in a row”.

“I’m not sure what came over me, but instead of just writing it down, I piped up and asked what that meant,” explains Sam. “I immediately wished the ground would swallow me up.”

His colleague Phil witnessed the awkward moment: “You really do hate to see that from a new hire. Just Google it later! Managers spend their whole time saying strange business things, you’ve just got to get used to it.”

Meanwhile Sam’s manager was slightly put out by the question.  “I mean, what do these kids learn in university these days? Next he’ll be telling me he doesn’t know what synergy is!”

As a result of his misstep, Sam is currently undergoing a remedial crash course in business jargon. “At first I was skeptical,” he reports, “but now that we’ve dealt with the low-hanging fruit, we’ll soon be back in the black.”

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VP goes back to the classroom

Business Leaders in non-Business Places (BLiNBP) is a programme aiming to spread business insight and expertise, by placing prominent members of the business world in non-business areas. This is John’s story.

John, 45, is VP of a Fortune 500 Company, with more than 20 years of management experience, and multiple books on business strategy to his name.  A keen supporter of the programme, he took 4 weeks out of his busy business schedule to work as a nursery teacher at Bilstock Junior School, responsible for a class of 15 pre-school children.

“I wasn’t fazed at all upon arriving,” reports John.  “I have taken over business units of more than 100 grown adults, so the idea of taking over a class of toddlers was child’s play, if you’ll excuse the pun!”

John swiftly put into action the principles that he had applied in his business career, generating a list of KPIs, carrying out a SWOT analysis on each member of the class and identifying key learning milestones that would need to be met.

As is always the case when a new leader comes onto the scene, there were some hurdles to be overcome. “A lot of the team-members kept asking where their mothers were, which was pretty unprofessional,” John explains. “The previous Team Leader even appears to have had a mid-afternoon nap policy, which was a huge waste of class time.”

John soon put these issues to rights, and felt that great progress was being made. “Words learned per day was up 37%, and we were soon counting up to 20,” reports John. “I was quite smugly satisfied with the changes I had managed to enact in just one week.”

However soon it became clear that all was not well. Despite the colourful nature of the classroom, Google this wasn’t. John was very concerned: “It was apparent in week two that morale was not high, and that soon trickled down to negatively impact productivity.  Sean wasn’t even able to distinguish between turquoise and sky blue!”

John was at a loss for what to do, having been so high after week one. What had gone wrong? What was wrong with his 5-day plan?  It was only when he was sitting down with Jessica, previously one of the class’s most precocious performers, that it became clear.  “We just want to have fun,” sighed the 4-year old.  “Miss Richards used to let us have fun.”

“It was a kind of Eureka moment for me, really,” John recalls. “I had gone full speed ahead with my plan without even considering our overall strategy, what business we are actually in. I was acting like we were a Learning company, when we are really a Learning through Fun company. I had forgotten half of what we were!”

Having had this realisation, John quickly went about bringing the fun back to the classroom. Toys were brought front and centre of all learning activities, and nap-time was back on the agenda. The change was instant and profound. “Laughter returned to the classroom, and our KPIs went through the roof. Sean even started writing Haikus!”

The four weeks quickly passed, and it was with a heavy heart that John left Bilstock, with the irony being that the teacher had very quickly become the student. “I like to think that I brought some new things to the classroom.  My “Always Be Colouring” initiative, for example, was a great success,” said John. “But the lessons that I have learnt at Bilstock will stay with me for the rest of my career.”

John was quick to put in place his new learnings upon returning to his job, redefining his company’s go-to-market strategy.  “I had forgotten how important it was to remember what business you are in, I had to hear it from the mouths of babes. We have changed our strategy, and have seen dramatic growth as a result.”

John is still in touch with his class: Jessica is now a non-Executive Director on the board of his company. He naps regularly, and has “never felt better. It’s like an afternoon energy boost!”

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