6 Tips for Scaling A Business

1. Simplicity. Keep things as simple as possible. Every time you add complexity to your business model, processes or operations you will pay for it exponentially as you grow.

2. Cash Flow. Know how you will fund the next stage of growth. Nothing will stall a machine more quickly than it running out of gas.

3. Automate. Anything that gets done repeatedly should be automated. The more simple things are the easier automation becomes.

4. Focus. Only worry about the next order of magnitude of growth. Think in terms of doubles. What would it take to double growth. Don’t think past that.

5. Get the right people. Every magnitude of growth requires different personalities and skills. Make sure you have the right players for the next milestone.

6. Ask for help. Build connections of peers that have experience in the next stage of growth you are seeking and lean into them to learn from their mistakes and failures.

In-N-Out Burger: A Behind-the-Counter Look at the Fast-Food Chain That Breaks All the Rules by Stacy Perman

In-N-Out Burger: A Behind-the-Counter Look at the Fast-Food Chain That Breaks All the RulesIn-N-Out Burger: A Behind-the-Counter Look at the Fast-Food Chain That Breaks All the Rules by Stacy Perman

My rating: 4 of 5 stars

Perman does a great job telling the In N Out story. The privately held company has always kept their business close to the chest. Starting out in Baldwin Park in the San Gabriel Valley next to my wife’s home town of Arcadia our love story (link) kind of follows along the lines of In N Out. Expanding our family to the Southwest over time.

The book is a great for anyone interested in business. The Snyders were solid entrepreneurs with their “Quality, Cleanliness and Service” mantra. They refused to grow fast, but instead grow smart. The story involves multiple generations changing hands and what it takes to have business continuity in the face of tragedy.

Perman tells the story of the family as much as the business, revealing extremely personal details never fully explored in the public before. You can’t help but fall in love the matriarch and feel the heart break as the family goes through the tragedies of life. If you love a good Double Double and like to learn from business success, read the book. If you hate meat or old ladies stay away!

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Customer Delight : The Power of a Bendy Straw

What are you doing to make your customers happy?  What is the experience you are providing them that puts a pep in their step or has them remembering you long after you leave?  How are you wowing them?  I eat at the same place nearly every morning (Yoli’s Cafe).  The food is good and the service pleasant, but it is the little things make it my base camp.  Customer delight is in their bones!

The staff plays upbeat music on the radio in the kitchen just loud enough that you can faintly hear it in the dining room.  They regularly dance and sing to the songs in a playful way that reminds me of my sisters or daughters just having a good time with their friends.  They remember what I like to eat and drink and treat me like a kid brother that they can tease and tell stories with.  When I am busy and just need to eat and roll they support that too.

Bendy Straw

All that is wonderful, but they still find new ways to delight me.  This morning, a bendy straw.  Yes a bendy straw was put in my cup.   The server was almost giddy at sharing this new delight, encouraging me to be a kid and have fun with it.  Sharing stories of how other customers reacted to this new and exciting addition.  It might sound silly, but a damn bendy straw stirs up the ability to play and have fun.  Who doesn’t enjoy a bendy straw?  Sure it might cost 10 cents more per straw, but it sure as hell delivers more than 10 cents of delight.

Is customer delight on your mind? What is your bendy straw?  What 10 cents are you adding for your customers today?

Creating The Arizona We Want

I was recently named a Tech Titan by the Phoenix Business Journal. I was asked to speak on a panel with Jeff Pruitt, Craig Barrett, Wendy Jameson moderated by Patrick O’ Grady at the formal event unveiling the Titans. Here are some of the questions that came up.

The Arizona We Want

What are the biggest challenges facing the technology sector in Arizona?

Lack of talent. We think we have a lot of entrepreneurs, but that isn’t the same as the workforce needed to execute. Scaling a company to thousands of people in a year or two is an enormous task if you have to train every employee from the ground up. As our market heats up the lack of talent will only increase and so will the pain.

Lack of density. We are too sparse. People are not connected enough to allow for maximum serendipity. We have to start thinking of ourselves as a region with cores in various cities. No one wants to hear this, but it is a reality. The other option is embracing this and figuring out a way to make it an advantage.

Lack of culture\tolerance. We don’t have the essence of placemaking at our core. People love the weather and the outdoor activities, but we aren’t creating the attachment to physical place. Music and Art are poorly supported. Tolerance for view points outside those made famous by our politicians is limited in most areas.

Lack of leadership. We are a young state. We lack quality leadership in nearly every way civic, education and business. Those with experience aren’t connected to Arizona. Accelerating young leaders needs to be a top priority.

How are small technology companies being pushed to succeed in the state, and what more needs to be done to develop more technology companies.

I believe at this point we have more incubators, collaborative spaces and angel groups than we do actual entrepreneurs. Excuses shouldn’t be accepted anymore. What is missing?

Experience. We lack “smart” money. We don’t have the “pay pal mafia” or “Tony Hsieh’s” that have been there and done it in the new economy to invest in the next wave.

Cohesiveness. Arizona is fiercely independent. Every cowboy wants to own the gold mine. I think this is a by product of our land development mindset. Everything is fear and scarcity based. Instead of trust and abundance based. Arizona needs to learn to work together.

Workforce Development. The need for a digital blue collar exists. Think of operations at Paypal, Go Daddy and Yelp. They require technical literacy but not advanced technical knowledge for a lot of their positions. We need to have programs in place to transition people through the entire chain of technical opportunity.

Education. We need to be fast tracking technology the same way we do healthcare professions. High school students should be graduating with enough skills to be workforce ready or primed to fast track through university. Arizona could lead in this category. Hello EVIT and WESTMEC.

What are the biggest opportunities available for Arizona technology companies?

Climate. Creatives like to get out and explore. Arizona is primed for outdoor activity 300 days out of the year and is a great base camp to explore the entire Southwest. We can not under estimate this asset. We need to stop gutting our state park system and instead INVEST heavily in our open spaces.

Young. Arizona may be 100 years old but it didn’t really start attracting people until the 60’s when air conditioning became mainstream. We are a mere adolescent compared to other states. This means the business leaders of today will define the future of Arizona. It will be difficult work, but will offer significant rewards to those willing to pioneer.

Affordable. The cost of living here and doing business here is just hard to beat. We need to leverage it while we still have it.

Family. Despite what the overall numbers say, most of the suburbs have fantastic school systems. Neighborhoods are safe. We are well positioned for raising families. We should recognize and embrace that.

Cities such as Boston and Austin have been successful in developing an ecosystem for technology companies, both in terms of developing them and recruiting them. What can those cities and others show Phoenix about developing its own ecosystem?

Culture. Culture. Culture. Boston was at the center of the creation of this country. Austin has made a point to be weird. They are willing to be unique and embrace their DNA. We should be willing to do the same.

Tolerance. Tolerance. Tolerance. To be blunt we are the laughing stock of the world in this department. We need to stop judging, oppressing and silencing those that aren’t like us. Ideas and execution need to matter more than appearances.

Sense of place (Density). People need to be able to identify with landmarks, neighborhoods and memories. We need to engage people and make a mark on them. Transportation plays a part in this.

Define a better tomorrow. We need a deeper university system. More research, more private options. See education above.

Boston had deep pockets (Venture Capital). Austin had Dell and University of Texas. Portland, Seattle, Boulder and Las Vegas are all rising. We need to use our unique attributes to differentiate ourselves.

What do you see as the role of groups such as the ACA, GPEC and cities in developing technology companies?

Arizona Commerce Authority (ACA). They need to be influencing legislation. Help implement everything listed above.

Greater Phoenix Economic Council (GPEC). They need to continue recruiting and doing site location. They need to be fostering/amplifying what is already happen. They need to drive density cluster activity without picking winners/losers.

Cities. They need to provide the infrastructure for success. They need to emphasis place making and strengthen their downtown cores. They need to build talent hubs and provide migratory growth patterns for high growth companies.

How do you bring together the different sectors of technology, from software and hardware to everything from aerospace, renewables and green, together to speak with a unified voice to further the future of technology in the state?

Technology is technology. Stop trying to specialize. Load up with smart people. Create the right envirnoment and get the hell out of the way.

Talent. Everyone needs it. Focus on that. Unify on making sure that a pipeline of quality talent is here for years to come.

ACA has outlined a strategy that focuses on aerospace, entrepreneurs and renewables in its approach. Are there other legs to the stool that need exploring?

Stop picking winners. Let the market decide. Help existing clusters.

Richard Florida says it well. Technology. Talent. Tolerance. The three T’s. ACA get on that. Help stop stupid policy and encourage good policy.

I am ready to make Arizona better. Are you? What are your opinions? What is the Arizona We Want?

Sunday Book Review : Do More Faster by Brad Feld

Do More Faster: Techstars Lessons to Accelerate Your StartupDo More Faster: Techstars Lessons to Accelerate Your Startup by Brad Feld

My rating: 3 of 5 stars

Some great content in here, but I just don’t care the format that much. It seems like some of the stories are rehashed or similar too often. Mostly, it seems to propagate the startup mill mentality. That doesn’t seem too concerned with doing valuable things, but rather obsession with starting above all else.

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Shoes Make a Girl Feel Sexy, What are You Selling?

I have four older sisters, yet I discover new things about women all the time.  While I have known that women love to shop, I never really thought about the motivations behind it.  Recently while visiting New Orleans with my wife, we were walking the French Quarter and she was shopping for new shoes.  I noticed that she was exceptionally happy.  Her step had a bounce and her smile was similar to a young child opening Christmas presents.  For the first time I was intrigued as I thought about why does this happen.  So I posed the question on twitter, why do women like to shop for shoes so much.

The answers back from women in my twitter stream were amazing.  Most notably was a response by @ninky “shoes make a girl feel sexy”.  Further dialog revealed that no matter what a girl is feeling about herself that putting on pretty shoes has the ability to instantly alter that.  Holy shit, Batman.  Now I understand why designers can sell shoes for over $500 a pair (and purses).  Because they are not selling shoes (or purses), they are selling the feeling and dream of being a princess.

This makes me ask the question.  What the hell are you selling?  What is the purpose of what you are selling?  What feelings does it illicit?  What change in life or emotion does it have? Are you selling shoes or the feeling of being a princess?

Entrepreneurs Put Capital to Work for Economic Growth

It doesn’t matter what country, society or region an entrepreneur operates within.  They will put capital to work to help stimulate the economy.  As part of Global Entrepreneurship Week the anchors at Gangplank decided to embark on a social experiment.  We realized that we are lucky to live a part of the world where access to capital is fairly easy found, to pursue our ideas.  We understand that is not the case across the globe.

We decided to use KIVA to create the Global Entrepreneurship Week Challenge.  Our first target was Jones Matagaro Nyamasege from Kenya.  He was looking for $1,000.  Our mission was to get him fully funded and get the Gangplank KIVA team to get $2000 into the system.  Amazingly within the first 24 hours we already had Jones fully funded.  We started with a second selection, Noel Pandero from the Philippines.  He was funded within a day.  We are now looking to fund Ruben Fernando from Bolivia.  Help us out and join the challenge!

Passion Fuels Greatness. Apathy Fuels Mediocrity.

Borrowed from Sir Ken Robinson‘s 2010 TED talk.  There are two types of people in the world.

  1. Those that simply endure what they do.  Can’t wait for the weekend.
  2. Those that love what they do.  Their work is who they are.

To do great things I think it is important to surround yourself with people in the second category.  Personally, I am finding it demoralizing to work with people that don’t love what they do.  Life is too short.  If you are miserable, quit what you are doing and find what inspires you. I hope there is a double rainbow in your future.

Failure Does Not Equal Humiliation

CEO of Local Motors John Rogers said “We make you feel wanted and we make you feel knowledgeable.” today while talking about how they treat their customers. James Archer brought up “On making people feel knowledgeable, I’ve often wondered about the “fail culture” at GP. Humiliation leads to not trying?”

My response is that a community is fundamentally broken if it equates failure to humiliation.  A truly collaborative and innovative community sees the act of trying the impossible and the journey of getting there as thing to be proud about.  The resulting success or failure is merely a by product of that journey.  Gangplank is not encouraging people to fail.  It is encouraging people to try things beyond their comfort level.  Be Dangerous.  We talk about failure because it is important that we have a culture where it is OK to fail.  That if you try and fail you will not be shunned, ridiculed or humiliated.  Instead you will be picked up, dusted off and sent back to try again.

We need to find the sweet spot between supportive and cheer leading.

Arizona Economic Development Can’t Seem To Get It Right

It looks like Arizona Legislature is trying to get business friendly.  I applaud that they are trying to do something.  I just think they don’t get it.  Why is this state hell bent on simply attracting a multi-billion dollar manufacturing/production facility of a multi-national corporation?  Don’t get me wrong we should be willing to do this.  However, this should not be our ONLY strategy as it is not fruitful long term.

The best way to build an economic base is to support the local companies that already choose to call this their home.  As they rise on the success scale they will give back far more to the community than a production plant of a foreign company that simply employs people here.  Most importantly the executives of a company take the lion share of the income generated.  Having those executives native and supportive of Arizona means that they will invest back in spades.  Simply look at the PayPal mafia model for how this works.

So while House Bill 2250 seems great to attract companies doing $150 million in construction and adding 150 jobs by cutting their property taxes from 20% to 1% for 10 years, it doesn’t help build the real future.  It really only helps deals that are already under way.  Instead let’s get serious.  Let’s cut property tax for ALL owner occupied arizona businesses  from 20% to say 10 – 15%. (Offset this by raising Residential Property taxes which are FAR TOO LOW)

If you must keep it to only those reinvesting dollars in a property.  Lets make it reasonable.  $250,000 (instead of $150,000,000) and employs at least 10 people.  Don’t cut it down to 1% instead cut it to say 10 – 15%.  If you want to be serious about the economy you have to be serious about small business.  End of story.