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I understand how this can be confusing. I previously said that I wasn’t as far behind schedule as it seems, and now I put up as book #8 a book that was released 3 weeks ago. Well here’s the truth; while Rework is the 8th book I’ve finished I am also in the middle of 3 books: Influence (for Negotiations and Conflict class), The Blue Sweater (for Social Entrepreneurship class), and The Four Steps to the Epiphany (for me). So yeah, maybe you can say I’m behind.

But anyway, on to the review!

This book is awesome. I mean, it’s not just that content is great, but it’s a bunch of 4-8 paragraph essays so you can pick it up and put it down any time you want. Or you can pour through it in two and a half hours like I did.

Now, this guy already did a super awesome job summarizing the book, even if he did steal my patented format of reviewing a book by highlighting your favorite passages. But as I was reading through that post (and it’s a good short read so go check it out) I realized that not a single one of these entries made it on my notecard*.

1. Ignore the real world

The real world isn’t a place, it’s an excuse.  It’s a justification for not trying.  It has nothing to do with you.

As someone who would routinely convince myself that what I wanted to do wasn’t worth trying, I really wish I’d seen this line like 4 years ago after graduating undergrad.

2. Start making something

Stanley Kubrick gave this advice to aspiring filmmakers: “Get hold of a camera and some film and make a movie of any kind at all.” Kubrick knew that when you’re new at something, you need to start creating. The most important thing to do is begin.

3. Build half a product, not a half-assed product

You’re better off with a kick-ass half than a half-assed whole.

4. Tone is in your fingers

The content is what matters. You can spend tons on fancy equipment, but if you’ve got nothing to say … well, you’ve got nothing to say.

Similar to the first highlight, I was awful about not moving forward on stuff a couple years ago.  I honestly spent a week debating between two hosting solutions once.  It was ridiculous.

5. Who cares what they’re doing?

They’re defining the rules of the game. And you can’t beat someone who’s making the rules. You need to redefine the rules, not just build something slightly better.

I have some stuff I’d like to say about this and something pretty cool that my dad is working on, but I’m going to give him another couple weeks to shore it up before I go and embarrass him.

6. Drug dealers get it right

Don’t be afraid to five a little away for free … You should know that people will come back for more. If you’re not confident about that, you haven’t created a strong enough product.

While I obviously became well acquainted with the freemium model at Flat World Knowledge last summer, I really like the focus here on the product strength. I think a lot of people take this for granted when trying to implement a freemium strategy. As Dave McClure said, “the FREE part is only a loss-leader for the MEE-YUM part.”

7. Skip the rock stars

Cut the crap and you’ll find that people are waiting to do great work.

The best part about working at Exel was definitely the freedom that Mark gave Aaron and I to develop pretty much any tool we wanted that we thought would help the operations. If only IT wasn’t so terrible to work with I’d probably still be there and we’d be cranking out 115% of KPIs all over the network.

This book has 88 short essays and two people who have never met picked 17 distinct entries as can’t miss favorites. If that’s not a high enough hit ratio to get you interested enough to buy it then I hope you have some book recommendations for me.

Rework

*On the notecard: I hate writing in books, it makes me feel bad. The system I’ve developed instead is that I use a blank notecard as my bookmark and then scribble down notes on it, jotting the page number and my thoughts. It’s an awesome way to keep track of my page and my thoughts, and lets me keep a little record to quickly refresh what a book was about. For the record, Rework was the first book I’ve read in a while that filled up both sides of the notecard.

So I’m not really sure if I’m allowed to say this, but like 8 people read this thing anyway so why not break the news?

Soneter, the non-invasive water meter company I’ve been doing some work with, is one of 10 companies that have been accepted to present at the Green:Net 2010 conference in San Francisco on April 29th. It’s pretty cool to know that the company will be presenting in front of people like Bill Gross, Vinod Khosla, and Paul Kedrosky.

Please feel free to follow them on Twitter (@Soneter) or check out the webpage, which will hopefully be updated to actually be useful in the next day or two.

Ha, I bet you thought I had quit reading huh?  Well no, I haven’t.  I’ve just been very lazy on writing posts about the books.

For my 7th book of the year, I chose Sun Tzu’s The Art of War. I always heard people talk about this book, especially about how it’s applicable to all different aspects of life.  Well, after my first read through (and it’s a super quick read at maybe 70 pages when you skip the long introductions people add in thousands of years later) I have to agree.  I took the approach of reading this through a business lens.

While there are dozens of metaphors throughout the book, I really enjoyed the common one of the army as a body of water.  What I got from that is: water knows it’s place, it knows where it should be.  It runs down hills, through cracks, over rocks, whatever it needs to do to get to the lowest ground where it stays.  Sun Tzu says an army should act the same.  Know where you’re supposed to be and let the terrain (and enemy) lead you there.  Most importantly, and this is another common theme from the book, if the terrain or enemy or some other factor doesn’t let you get to where you want to be then it probably isn’t a battle you should be fighting.  There is a very strong focus in this book on understanding yourself, but also everything else in the ecosystem that will have a direct effect on you.  If all of that doesn’t line up for you, you need to rethink your plan of attack.

For a final few takeaways, here are some of the individual verses I liked the most.

III (Offensive Strategy) – 3

For to win one hundred victories in one hundred battles is not the acme of skill.  To subdue the enemy without fighting is the acme of skill.

To be honest, I’m not going to relate this one to business, although I’m sure some of you are smart enough to make a good comparison.  I just like it because it describes such a high level of self-control and ability to control a situation.

IV (Formations) – 3

It follows that those skilled in war can make themselves invincible but cannot cause an enemy to be certainly vulnerable.

No matter how good you are at anything, you cannot make the competition weak.  It doesn’t mean you will lose a battle with them, but it will be a much harder fight than you needed it to be.

VII (Maneuvers) – 11

Those who do not use local guides are unable to obtain the advantages of the ground.

Subject matter experts, baby.

VIII (The Nine Variables) – 17 through 22

17. There are five qualities which are dangerous in the character of a general.
18. If reckless, he can be killed;
19. If cowardly, captured;
20. If quick-tempered you can make a fool of him;
21. If he has too delicate a sense of honor you can calumniate him;
22. If he is of a compassionate nature you can harass him.

A very solid foundation of how to run a team, army, or a business.  What they mean in 21 is that you can lie about him and he will defend his honor with no regard to being a good general any more.

XI (The Nine Varieties of Ground) – 29

Speed is the essence of war.  Take advantage of the enemy’s unpreparedness; travel by unexpected routes and strike him where he has taken no precautions.

Somewhat relating back to the quote on formations, you can’t make an enemy weak but you can sure look for where they are weak and move faster than they can.  If you’re going to release a product to compete with the big guys out there, do what they don’t and do it in a way that they can’t react quickly.

Of the books I’ve read so far, this is the most likely to get re-read now.  I really enjoyed it and can see getting more out of it at every reading.  I would definitely recommend buying a copy.  Plus it’s like $8 brand new, and even cheaper used.

The Art of War

I hate politics.  I hate listening to politicians, I hate arguing about politics, I just hate every single part of it.

And yet, here I am talking about a bill that is currently moving through the Georgia House of Representatives.

Lance has a great post describing the reasons to support HB1001: The Angel Investor Tax Credit Bill.  It would be a great addition for the state of Georgia’s business community and hopefully open up more sources of funding for the companies around here.

Here’s the letter I sent to my representative today (with key points easily plagiarized from Lance’s post), I hope others will do the same.

Representative XYZ,

I am a 2^nd year MBA student at Georgia Tech and I want to urge you to support the recent legislation House Bill 1001.

As a passionate member of the start-up community, I believe that there are many Georgia companies who stand to benefit when this bill is passed.  Many promising start-up companies in Georgia, most of which have been created by graduates of Georgia colleges and universities, are at risk in today’s challenging economic environment.  Due to their business models and the inherent risk, the primary sources of capital for these businesses are angel investors: private individuals who take personal financial risk to enhance business and job creation in this state.

HB 1001 will keep angel investors active and help promising young companies get started and create jobs in our state.  It will also help to keep existing jobs here, rather than forcing them to move across the country to be closer to investors.  Competing states are benefiting from Georgia innovation as we’ve seen entrepreneur-graduates of our schools leave in pursuit of capital in other states.

Twenty two other states have been utilizing these investment incentives for years and those states have benefited from new business creation, new jobs and new revenue.  I believe HB 1001 will allow Georgia to do the same.

Thank you for your time

Ryan Anderson
MBA Class of 2010
Georgia Institute of Technology

Now that your wife has a job it’s time for you to become more gainfully employed.

This has your name written all over it.

Captain of the Sludge Boat

btw, rumor has it that Will Bynum is suiting up again for the game tonight, so expect a repeat.

Last Friday I went to the finals of the Georgia Tech Business Plan Competition.  While I wouldn’t be participating, 5 of the 7 teams had MBA students involved so I had to go and support my friends.  Plus, it’s not every day you get to sit behind judges like Sig Mosley and just listen to them riff questions at people trying to raise money.

So, after sitting through 4 hours of presentations/questions here is my list of the good questions each team fielded.  I also linked to the companies’ websites, if they have one, in case you are interested in more information on them.  What I learned here, more of these guys need websites.

NanoShield (catheter coating)
-Have existing companies in this space shown a willingness to acquire or license from new entrants?
-What are the issues your solution does not solve?
-Talk more about your pricing and how you came up with what it should be.
-Are you trying to raise any other money besides grants, the plan is unclear? How much and when?

Medivity (endoscope utility to reduce surgery complications)
-What’s the story on the company formation and how did you get involved?
-Who decides what gets bought for the endoscope?
-How long is the sales cycle?
-How much money would it take to get to the initial adoption stage?

AlpZhi (microlens manufacturing)
-What does “a great deal of interest” mean?
-Can you expand on that alternate applications you mentioned?
-How do you get from here to the first set of customers?
-How did you come to an NPV for the company?
-Are the potential customers set to take advantage of what you offer?

viaCycle (bike share/rental solution)
-What is patentable in your design?
-You’re using a European model as predictive of US adoption. Why do you think you can overcome the obvious cultural differences?
-What was the adoption cycle of similar programs (ZipCar)?
-Are you set up to capture and analyze the behavioral data and commuting patterns of your users?

Belle Curves (shape enhancing sports bra)
-What stops people from creating third party inserts cheaper?
-How many did a competitor sell previously?
-Why plan to enter the retail market is those distribution channels lower your margin?
-Why the decision not to pay yourselves and dive in full time?
-Have you trademarked the names?

Agile Genomics (bio-informatics software)
-How do you handle customer support for the users?
-What is the penetration of competitors’ software in the market?
-What is your insight into competitors’ pricing strategy and changes?
-There are great approaches outlined, but no plan for introducing them or costs.

Pneumera (pneumonia diagnosis device)
-Why can’t you sell through channels other than hospitals, like physicians’ offices?
-The key to your exit strategy is the strength of your patent, talk to that.
-The “first 50″ hospitals you mention, what/where are they and what percentage of the market do they make up?

Overall some pretty good stuff. It certainly gave me some insight as to what kind of questions people want more information on around here (funding plans, intellectual property).

Also, congrats to AlpZhi for winning the competition. I guess drinks are on Greg next time we go out.

http://www.ajc.com/sports/georgia-tech/former-georgia-tech-football-347323.html

I will swear to you with everything I have in me that, in the six years I would say I was friends with Reuben, he was nothing but a great person

Cisco unveils ultra-fast Internet technology

The new technology, known as “CRS-3,” is a network routing system that will be able to offer downloads of up to 322 Terabits per second, according to the company.

Translation: Well in Cisco terms, the router will be able to provide download speeds of 1 Gigabit per second for everyone in San Francisco, download the entire printed collection of the Library of Congress in 1 second and stream every movie ever created in less than 4 minutes.

Awesome.  Maybe this will make my iPhone connection not quite as crappy.

Every Monday at 7:30am there is a breakfast meetup at St. Charles Deli, a restaurant connected to the Georgia Tech College of Management, where a handful of local entrepreneurs get together and just talk about whatever.  It’s not an invitation-only event, you just have to be interested in the space and find the time to show up.  There are usually about 8-10 of us that come and people stick around until as late as 9:30.

Last week there was a very small turnout; it was initially just Paul Freet and myself.  The way the breakfasts had broken down thus far I had never really had a chance to talk to him about much, so this was a great chance to just ask questions and get answers.  We talked about what I’m working on, the iPad (I’m more bullish on it than he is), and his work with the GT VentureLab.  Since he does a lot of work with early stage companies now, I asked him “what is the biggest problem you see when working with these companies?”  His response can be paraphrased as:

Lots of entrepreneurs are too stuck on their ideas.  They think that whatever they come up with is a great idea and fall in love with it, even though it sucks.  The idea is to find a great idea and then work your ass off.

(I hope that, while I know the words aren’t exact, I kept the spirit of the response correct there.  I’m sure that if I didn’t hell will rain down upon me here shortly.)

I was originally a little skeptical because, I mean, how could you work on an idea you didn’t love and still see great results?  That seems like a bad way of going about things.

But I’m beginning to feel like I was a little shortsighted.  The idea isn’t to necessarily to sacrifice a love of what you’re doing for the best opportunity to make money, but the fact still exists that you can’t iterate every idea into profitability.  You can still identify a need in an area you’re passionate about and move forward after validating that a need exists.

Maybe the idea is to be passionate about building a business, not necessarily the business you originally pictured in your mind.

What do you think?  Am I making any kind of sense here?

Also, if you’re in the Atlanta area, you really should stop by these breakfasts.

I haven’t written much here lately.  I’ve been writing so much stuff between class assignments and outside business stuff I’m doing that I just couldn’t find the time or energy.  Well, all those class papers are over now so let’s open up the floodgates.

The topic for today: staking people in life.

VentureBeat had a post today titled Entrepreneurs offer their life’s future earnings for an investment.  The basic premise is people were offering to sell a small portion of their life earnings (typically 1-5%) in order to get cash up front.  One 26 yo girl is profiled who is trying to sell 6% of her future earnings for $600,000 to help pay off debts and start a new venture, valuing her future stream of income at $10m present day.

This idea is similar to the staking economy in poker.  Unfortunately the Poker staking page in wikipedia is woefully short, so I’ll do my best to explain it in a little more detail.  I’ve been on the receiving end of a few stakes and bought a percentage of others’ action a couple times so, while I’m no expert on the inner-workings like sheets is, I can offer a little experience.  In a staking agreement, I offer to pay your buyin to tournaments (you can get staked for cash games too but let’s stick with this) and then I take a portion of any winnings you get.  Usually these agreements last for a longish period of time since the world of tournament poker sees huge swings, and it’s also common for there to be a payback clause where the staker takes close to all of the profits until all previous buyins have been paid off before they split the remaining winnings at a predetermined percentage.  There’s obviously a lot more you can talk about here, but that should cover the idea in enough detail for the rest of this post.

So, given that, it’s not surprising at all that one of the founders of a fund currently offering to buy a percentage of promising young workers was champion poker player and Georgia Tech graduate Phil Gordon.  If you can identify a talented young performer and have capital available that they lack, it can be a great deal for both people.  Also, I like that they offer a buyout option for everyone so that you aren’t stuck with a lifetime debt if you want to get out of it.

Is it possible that people could get screwed with this system?  Certainly.  Over time people have shown a remarkable ability to consistently use things that should be beneficial (hello credit cards) in harmful ways.

More importantly, I like this idea because I have developed a couple business ideas around this same idea.  It would be wrong of me to not give a little credit to Bill Simmons here for his meme of “I wish I could buy stock in X” where X is something like “the Patriots falling apart this year as Randy Moss goes into ‘I don’t care’ mode.”  However, instead of that, I want to buy stock in John Wall’s future earnings.

Coming out of school, Wall is looking at something like a $5m/yr rookie contract and sponsorships that probably get him to about $7-10m/yr initially if he gets a shoe deal like I expect.  Meanwhile, you have to expect that his next few contracts and endorsements are going to be HUGE.  Max contract big.  Looking at a couple $60-100m contracts and various endorsements spread out over a 15 year career (obviously all optimistic projections) that’s probably somewhere around $200m in present value.  Actually, it’s probably not even close to right, but humor me.

What if he could sell 10% of his future revenue stream on a stock market and suddenly have $20m in walking around money?  That would be AWESOME.  It’s legalized gambling, wrapped up in unrealistic price inflation by hometown fans!  Similarly, you could do that for music acts.  What if Bruno Mars could sell a profit percentage of his first CD to raise money to get it produced himself?  Automatic democratization of the music industry, and no more predatory tactics by the record labels trying to milk an artist for everything they can.

So yeah, I love this.  I’m also open to receiving stakes