Monthly Archives: May 2012

Remember that Life’s a roller coaster

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Hey it’s my 30th b-day!

Every year on my birthday I had certain rules

#1 – Never work on your birthday

#2 – Get a great cowboy hat and wear it all day. Never stop wearing the hat

#3 – Start drinking when you want to, stop when you’re broke.

#4 – Hijack your friends and make them party with you, regardless of their plans, lives, or wishes contrary

These rules served me well between age 21 – 25. Then my quarter-life crisis kicked in, and I started a company with my bro.

So I amended the rules

#1 – Never work on your birthday  Make your clients party with you. If there’s a meeting onsite, they’re getting a beer. It’s my birthday – it’s a celebration.

#2 – Get a great cowboy hat OUTFIT and wear it all day. Never stop wearing the hat outfit.

#3 – Start drinking when you want to  the meetings are done, stop when you’re broke  your employees are broke.

#4 – Hijack your friends friends, employees, family, clients and make them party with you, regardless of their plans, lives, or wishes contrary.

Remember that Life’s a roller coaster – the ride’s more fun on the way down than on the way up.

Kids drink free! Happy B-day!

 

A + B does not equal C

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There’s a conceit that if you add two variables, that the product will always equal a third predictable variable.

In business, this is simply not true. If you take variable A, and add it to Variable B, then the two produce a by-product while simultaneously creating a feedback loop on each other and mutating the by-product.

Here’s what I mean

In the world of A+B=C  

Bigger Clients + Bigger Profits = higher salaries/benefits for all

In the world of A impacts B, which impacts each other to mutate C.

Bigger Clients + Bigger Profits =  a re-investment of profits towards hiring more staff and equipment which in turn generate creates the infrastructure to support Bigger Clients and stable base where profits can be made or lost. Initially, the ramp-up might actually be LESS profitable. It’s a calculated risk – one that if made correctly MAY lead to a by-product of increased overall employee compensation.

But the heavy difference between the two is the understanding that business is behavioral more than mechanical. And because it’s behavioral, there’s a level of unpredictability that we call “risk.” A+B can’t equal C because that equation is assuming that C is a predictable outcome. A+B = a % chance of C occurring and likely that other unknown variables will occur.

Moreover…….your variables don’t stay the same

Let’s say A = an employee. B = a project

A + B = $7,000 in profits

Well, the employee changes. He/She gets experience, has life challenges, becomes bored, becomes passionate, etc

So……….

A + B could equal…..$2,000 in profits. or -$8,000 or $12,000 in profits

In the end, business is more art than science. Using scientific/mathematic equations as the foundation of business-management doesn’t work, although they’re effective as tools for tracking progress. Hopefully we’re getting more people who realize that they’re dealing with a fluid art-form when they’re dealing with businesses.

 

Back from the Vegas convention!

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Sorry for the lag in the posts! I just got back from Vegas, demo-ing D&T’s latest product BuildersBidNetwork.com at the ICSC convention.

 

Here’s what I learned at the convention

1.) People tend to “trust” products over services. I think it’s because products have clear limitations, clear boundaries as to what they can/cannot do. Whereas with services, it’s a bit murky as to where the boundaries are.

2.) Every digital product I saw at the convention was Service as a Software (SaaS), in my book. Including BBN.

3.) The age of home-brewed tech is still not over. There’s a lot of great, weird new tech that people are selling….

4.) Big-boy conventions usually end the day with a happy-hour at someone’s booth. Drinks are straight legit.

5.) As expected, all the real selling happens before or after the hours of the convention, with personal meetings.

 

 

 

Post #3 Why civil unrest is inevitable if we don’t create jobs

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So here’s the quick sketch of reality in America:

13 million people without jobs (including the low participation rate)  – 8.1% unemployment rate in America

2 Trillion Dollars of Corporate and Private Sector earnings,  sitting on the sidelines, collecting no interest.

If you invested all 2 Trillion dollars into creating 13 million jobs, you’d have average salary/benefits of $153k/person. But better yet, the majority of the investment will bring back a higher return on investment that 0.1%. So the rich get richer! But not by much – perhaps on average 5-8% of their investment, while the middle and lower classes can see their lifestyle and salaries rise 1.5-3x whatever it is now.

Okay, so perhaps it’s unrealistic to invest all the money. But what about just 25%? $500 billion injected in startups, new projects, new technologies….which will beget others to take the plunge and pull in their sweat equity. Once the pump is primed there’s no stopping: innovation spurs competition, and in order for companies to stay current and not get left behind they’ll have to spend $$. Or they’ll end up like Kodak. Really, we just need a few industry leaders to make a few big splashes and show how “easy it was” to make the rest of the pack follow. We – the entrepreneurs, the corporate managers, the people – just need to say “yes” to unlock all that frozen capital.

Well, we also need good ideas,  well-educated specialists and a host of morally-sound leaders with long-term views.

So what will happen if we DON’T do this? If the capital just stays frozen, and the unemployed stay unemployed, and the gulf continues to widen? Well, then the incentives to do good work will be misaligned. The American Dream is about social mobility, and with capital locked in the 1%, social mobility stops being possible. It’s as simple as that. The social cohesion in the country will fray even more; being able to relate to each others’ viewpoints will dwindle, political parties will continue to polarize, and we will be facing some sort of civil unrest (potentially an escalation to civil war). It’s a historical cycle – every time in history the haves vs the have-nots gets too strained, there’s a revolution and it gets messy. Think  of France in the 18th century, Russia in the 19th (and 20th) – the only way China avoided a civil war in the past 20 years is that they have a HUGE emphasis to discourage dissent, by whatever means possible.

That’s what I think. I don’t think anyone can honestly say we should keep lurching from crisis to crisis, and putting on the band-aids on society. If anyone plans on living in America for the next 20-45 years in relative peace, we need to step up the initiative and create jobs, together.

 

USA is in the top right corner.

Post #2 – The Job, Jobs, and Jobbers

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So once you convince people/corporations with money to do what they already want to do, then you need to hire people to do those projects.

Here’s where you hire people. The people you’re going to hire are young, they’re social-media aware (they’ve been using it for all their adult lives, after all), and they are eager to learn new jobs. Which is GREAT, because most of the in-demand jobs of 2012 didn’t exist 5 years ago. Think I’m crazy – then tell me who was hiring a social media manager back in 2007? Who was developing iPhone apps? Oh wait – Facebook’s only been relevant for the past 3 years and iTunes started allowing indy developers to submit apps back in 2008.

So you’re in charge and as such you have 3 things to do

1.) convince locked-up money to flow again (talking about corporations)

2.) train up your team

3.) have a plan in place for the company, the team, and yourself

 

The first point we talked about in Post #1. The second point – training your team – is tough. Basically, you’re an around-the-clock teacher. Look into skillshare.com or codeschool for a myriad of classes to help yourself and the team, but primarily you’re going to be training people after-hours, off the clock. This is exhausting but essential. Investing in your people will pay off in two ways: 1.) they’ll do things *your way* and 2.) it solidifies trust and loyalty. The difference between consulting and a business is the ability of the owner to train up and hire others, not just himself/herself.

The third point is to have a plan for your people. You need a 6-12 month roadmap for people, even if that roadmap never comes into fruition. If you don’t have a vision for that person’s future, they probably don’t have much of one for your company….so don’t bother hiring. The roadmap should have goals, milestones to achieve those goals, and a listing of challenges that are on the road in front of the milestones. This is the same vision to have for yourself and your company.

I am going on the assumption that you’re not a “fail-fast” start-up where you’re constantly experimenting, hiring, and pivoting. I really hate failing – fast or slow.

 

Next post we’re going to talk about why it’s important to job-create, and why in the next few years we need to do it PRONTO

 

And more people keep quitting......

 

 

HOW TO CREATE JOBS {POST #1 “The Current Landscape in America”}

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Post #1: The current landscape in America (or anywhere in the modern world, really)

In 2009 New York was going to hell in a handbasket. Century-old firms were gone within a few weeks – Bear Stearns, Lehman Bros, etc., the stock market was in a free-fall, people were talking about the end of world, MSNBC was on a doom orgy for 11-months straight.  I don’t have to tell you, you were there. So in the middle of all this catastrophe, Dom and I decided to quit our jobs and start a new company.

Why?

Because here’s the thing: in the recession of 2008-2009 in NYC had very peculiar characteristics. For one, a lot of the people who got fired were highly-skilled, high net-worth professionals saddled with debt and unable to move away for a variety of reasons. So all these highly-skilled, high net-worth people, concentrated in a dense city, had nothing to do…

Cue in boredom.  And with the idle hands, came out an explosion of start-ups and meet-ups. Gilt Groupe, Thrillist, AOL, Wanderfly, a sh*tload of financial data-mining products, so many weird e-commerce platforms and products (what the heck is Kickstarter?!)  And then social media, which was ramping up in popularity, came on big-time right around 2007 – 2009. Media giants found a disgustingly-cheap way to get engagement with their customers. Why spend $150k on a billboard on a highway that may or may not get conversion, when you can spend $20k and DEFINITELY get engagement with thousands of Facebook/Twitter fans, all who are talking and all whose behavior is trackable? App creators like Zynga jumped into the platform and made millions. And then..mobile dropped, and with mobile (iOS, Android, HTML5) the market surged again. Everyone saw iPhone apps as a new market to make money – again, people with some vision and a bit of code made millions.

So if you look at the tech landscape as a Yukon gold rush, think about this: who makes all the money in the gold rush? A few lucky prospectors (entrepreneurs), the mining giants (Big Media, gaming companies), and the general stores that sold picks, axes, and all the equipment (re: digital studios).

Hey, DOM & TOM’s a digital studio…at a time when social and mobile spiked, and all the talented highly-skilled people had the freedom to dream about making new wealth other than finance and consulting. But all gold rushes end eventually, right?

Well, there’s another set of clients who have missed out on the massive tech surge, who are now (2011 and onward) coming back to the marketplace, and who have deeper pockets than anyone before them. For the sake of broad strokes, let’s call them “Corporations.” All the major corporations out there have massive marketing and tech budgets, and departments whose teams had their budgets slashed to nothing. All this time they’ve basically sat on the sidelines while social and mobile surged by them. Don’t get me wrong – Priceline, Hearst Media, Viacom did dip a toe in the markets. But it’s nothing compared to what they WILL be doing in the next 5 to 10 years.

Think about it: what happens to the VP of Marketing, or the VP of IT, who used to generate and implement their ideas yearly? Well, they didn’t stop having those great ideas. They shelved those ideas, year after year, implemented the smaller ones, and waited for the day that they’d get their budgets back….

And that time has come. Corporate profits are higher than ever. They’re sitting on piles of cash and they want to start getting more on their investments. The people who can create jobs in this country will have to do so by convincing all the money that sitting on the sidelines (roughly $1.5 Trillion in private funds in America alone!) to jump back in and invest in America Inc. Those people will be visionary, they’ll be tech-savvy, and they’ll be young.

More to come on Wednesday, when we go into the nature of these people, the true job-creators, and the employees that they’ll hire.

As always, please feel free to comment or share. Please note that this is Post #1 of a 3-part post “HOW TO CREATE JOBS”. For more information please click on the link http://www.tomtancredi.com/2012/05/05/how-to-create-jobs-preamble/.

 

Woops - as of Mar 2012, it's more like $2 Trillion that corporations are sitting on, getting a 2% return on their money...

HOW TO CREATE JOBS! {Preamble}

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Hi friends,

I’m working on a series of posts that I’m going to tentatively title:  How to Create  Jobs. 

It’s a 3-part post that will be published next Monday, Wednesday, and Friday.

Post #1: The current landscape in America (or anywhere in the modern world, really)

I’m going to do a cursory dive into what I saw happening in 2009, when I first coFounded my company with my brother , where we are now in 2012, and what we’re facing in the next three-to-five years. Disclaimer: I’m looking into a tech-specific sector of the economy, but I have a theory that by 2020 most of what we consider “the tech industry” will be so pervasive in the other industries that it’ll be  meaningless to distinguish the “true” tech industry from any other industry. But that’s for another post.

Post #2: What it takes to create a job, and keep them

I’m going to talk about the talent pool we have right now, what it takes to actually create a job, and how to make sure that job will last. I’m focusing on people in their 20s and 30s, and not worrying about skilled/unskilled labor in their 40s-60s.

Post #3: Why it’s the #1 priority for EVERYONE to job-create immediately

I’m going to make the claim that the inequalities of modern society, specifically in America with the 1% pitted against the 99%, can be solved by radical job-creation in the marketplace, which will better re-distribute wealth  than any other tax or stimulus program from the government. And why if we fail we’re probably heading towards severe civil discord the likes which we have not seen in 175 years.

This is a topic I am sincerely passionate about. I encourage as many of you reading in the next few days to comment, share and participate in any other way you deem fit.

 

We are on the right track, but we can do better

What little I know about Leadership…

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This is all I know about leadership

1.) Leadership has a sense of gravity to it. If you think of Leadership as an element, think of it as one of the denser elements like Tungsten or Gold (or Osmium!). If placed at the top of an organization leadership will flow downward throughout the company. If it’s stuck at the base, or somewhere in the middle, the odds of getting this element to the top of the organization is going to take massive amounts of effort.

2.) Leadership can’t be delegated, like a role or new job assignment.

3.) If there’s a lack of Leadership people will try to fill that void as best they can, and if they can’t they’ll leave for somewhere else where Leadership exists.

4.) Leaders generally have a lot tough choices but most of the time they’re making a lot of boring choices.

5.) Leadership is based in trust, clarity of purpose, discipline and imagination (sometimes humor)

6.) Leadership is essential to running anything for any duration of time.

7.) Leadership is a lonely trade and the best leaders in history were very lonely people. Ironically, they were also very empathetic to people around them.

8.) Leaders will be criticized no matter what course of action they take.

9.) Leadership is encouraged in sports and business, and rarely in theater, writing, or music. No wonder the Arts suffer systemic problems with programs, particularly in funding.

10.) There is no unified plan to raise, train, and prepare tomorrow’s Leaders in America. I wonder if that’s the marketplace working at its finest or if we’re screwed.

 

Tools of the trade for anyone trying to make friends and influence people....