The Oracle of Omaha

Warren Buffet, the second richest man in the world who has recently donated $31 billion to charity was interviewed on CNBC.

Here are some very interesting aspects of his life:

1. He bought his first share at age 11 and he now regrets that he started too late!

2. He bought a small farm at age 14 with savings from delivering newspapers.

3. He still lives in the same small 3-bedroom house in mid-town Omaha, that he bought after he got married 50 years ago. He says that he has everything he needs in that house. His house does not have a wall or a fence.

4. He drives his own car everywhere and does not have a driver or security people around him. 5. He never travels by private jet, although he owns the world's largest private jet company.

6. His company, Berkshire Hathaway, owns 63 companies. He writes only one letter each year to the CEO's of these companies, giving them goals for the year. He never holds meetings or calls them on a regular basis. He has given his CEO's only two rules. Rule number 1: do not lose any of your share holder's money. Rule number 2: Do not forget rule number 1.

7. He does not socialize with the high society crowd. His past time after he gets home is to make himself some popcorn and watch Television.

8. Bill Gates, the world's richest man met him for the first time only 5 years ago. Bill Gates did not think he had anything in common with Warren Buffet. So he had scheduled his meeting only for half hour. But when Gates met him, the meeting lasted for ten hours and Bill Gates became a devotee of Warren Buffet.

9. Warren Buffet does not carry a cell phone, nor has a computer on his desk.

Buffets advice to young people is to remember:

A. Money doesn't create man but it is the man who created money.

B. Live your life as simple as you are.

C. Don't do what others say, just listen to them, but do what you feel is good.

D. Don't go on brand name; just wear those things in which you feel comfortable.

E. Don't waste your money on unnecessary things; rather spend on those who are really in need.

20 Commandments for High Growth Startups

These 20 commandments for high growth startup businesses are complied from a list on the Web 2.0 (Entrepreneurs) grouping on Facebook and from listening to a series of podcast interviews with high growth entrepreneurs on Venture Voice. Enjoy.

1. Your idea isn't new. Pick any idea and at least 50 other people have thought of it. Get over your stunning brilliance and realize that execution is what really counts.

2. Slow moving, stealth startups suck. You're not working on the Manhattan Project or the first lunar mission. Get something out as quickly as possible and promote the hell out of it.

3. If you don't have scaling problems, you're not growing fast enough.

4. If you're successful (either as a business or in raising venture capital) don’t brag about it in the media. Success paints a target on your back. Rather stay under the radar as long as possible to avoid competitive action and law suites.

5. People will tell you they know more than you do. If that's really the case, you shouldn't be doing your startup. Get to know as much as you possibly can about your focus area.

6. Outsource effectively, or be effectively outsourced.

7. Your competition will inflate their numbers. Take any startup web traffic number and slash it in half (at least).

8. Perfection is the enemy of good enough. Leonardo could paint the Mona Lisa only once but you, Joe Smith, can launch a beta v1.0 followed by a beta v2.0 followed by a beta v2.1 and so on…so don’t be a perfectionist.

9. The size of your startup is not a reflection of your manhood. More employees does not make you more of a man (or woman as the case may be).

10. You don't need business development people. If you're successful, companies will come to you. The deals will still be distractions and not worth doing, but at least you're not spending any effort trying to get them.

11. You have to be messed in the head to start a company – it is much easier to work for someone else (and if you do it well your wealth to risk ratio is far more favorable) BUT entrepreneurs have all the fun and their decisions actually count.

12. You will have at least one catastrophe every three months. Get used to coming back from the brink.

13. Your startup isn't succeeding? You have two options: go home with your tail between your legs or do something about it. What's it going to be?

14. If you don't pay attention to your competition, they will turn out to be geniuses and will crush you. If you do pay attention to them, they will turn out to be idiots and you will have wasted your time. Which would you prefer?

15. Startups are not a democracy. Want a democracy? Go run for class president.16. People will think your idea sucks. They're probably right. The only way to prove them wrong is to succeed.

17. A startup will require your complete attention and devotion. And you thought your first love in High School was clingy? You can't take out a restraining order on your startup.

18. The best way to get outside funding is to be successful. Stupid but true. Most web based start ups don’t really need the money so avoid the temptation to take it. By the time VCs coming running you probably don’t need their money. Nurture your equity stake.

19. Stress and ambiguity are part of the game. Seize them, relish them and learn to thrive in a stressful, ambiguous state.

20. Frightening Terror. Overwhelming Joy. Monstrous Greed. Cutting Competitiveness. Embrace and harness these emotions – they are your new reality.

Sizzling Semler - Getting into the Mind of One of the World's Most Innovative Managers

One of the first business books I ever read was Maverick by Ricardo Semler - it was a GEM!!! If you have not read it then you must get your hands on a copy. Ricardo Semler took over the family business at the age of 20. By 26 he had a breakdown due to stress and overworking. He re-looked at the concept of work and management and over the next 15 years created the world’s most innovative, unusual workplaces. His thinking process and ability to execute are extraordinary. It is awesome just to get into his mind.

A week or so back he was in South Africa talking to 700 leaders in Joburg. This was another fabulous opportunity to be challenged by one of the most interesting leaders / managers of our time.

Are you doing anything different?
If successful business depends on innovation: "Why are automobiles made essentially the same way today as they were in Ford’s first assembly line 100 years ago?" Parallel parking is one of “ the stupidest things we do,” says Semler, “If we had a day, could we not by tomorrow afternoon figure out a way to make a car” that handles better in this common situation -- or, on a grander scale, escape from the “silly concept” of oil dependent transportation altogether? The problem, Semler figures, is that there’s “something fundamental about organizations and … leadership that makes it almost impossible for people inside a business to change their own industry.” Industries are based on “formats that are basically legacies of military hierarchies,” says Semler, which neglect or deny the power of human intuition and democratic participation.

Are you looking outside the industry in which you operate for the next big idea?
Bell Labs in the US keep records of all new technologies and they point out that less than 2% of new technologies that have disrupted an industry were created by someone from within the industry. When we are in an industry we get caught in a rut. We get into a situation where we just “learn to emulate” – if you lined up all the new cars coming off the lines of different manufacturers currently and took of the badges – in all likely hood you would not be able to tell the difference between many of the different makes of car – they all look the same because of mass emulation. Which ever industry you look at current incumbents are just emulating what’s already there.

Are you addressing the issues?
Why in a city with traffic problems like Jhb do we all try travel at the same time – at Semco in Brazil, where they have similar traffic problems, they calculated that the 4000 employees spend 1,1 million hours per year in traffic. Surly there must be better alternatives than 1,1 million wasted hours spent in traffic per year. So alternative solutions: working at a company location closer to home, flexible working hours to avoid having to travel at the peak times, setting people up to be able to work from home. With technology this is now a possibility.
Are you leveraging human intuition? The secret to successful management is to leverage the power of intuition – not just your intuition but the intuition of everyone in the organisation. A great tool is to ask “why?” 3 times in a row: · Ask why once and it is easy to answer· Ask why again (like a 4 year old would) and it becomes more difficult · Ask why a 3rd time to get to the real essence of the issue and discover new perspectivesThis is what is needed to really challenge ones thinking.

Are you taking care of peoples needs?
When people are young they have lots of time and good health but no income; when people are of a working age they have reasonable health, lots of income but no time, when people are old they have lots of time, no income and poor health. Think of a graph :

• Income is a bell shaped curve.
• Time is an inverse of a bell shaped curve.
• Health is downward sloping curve – starting high and dropping off
  

So Semco said to its people would you trade some of your income now to pursue some of things you love and dream about doing in your retirement. So you forgo 10% of your income now but on Wednesday you go and do what you dream about doing in your retirement thereby moving the income and time curve closer together. In other words Semco sold Wednesday back to employees who wanted to buy it back. He tells this story to prompt thinking about how we can rethink the workplace. This kind of thinking seems to make a difference – the average employee turnover globally is 22% per annum i.e. in 4-5 years, all employees have changed. At Semco the employee turnover rate is less than 1% per annum over a 14 year period.

Are you leveraging the power of small groups?

People only ever work effectively with another 9 or 10 people – it’s the reason battalions, church groups and sports teams are all in the regions of 10 people in size. What if you were to think of your organisations as 1000 groups of 10 people as oppose to 1 group of 10000 people? If you really think about it most people only ever really interact with about 10 people in the organisation on any one day. Groups of 10 offer people flexibility, intimacy, purpose within a team and sense of meaning.

Key message: THINK DIFFERENT

This world is not one in which we can afford to just copy stuff – too many people are doing that. We need to look at new ways of doing things – break with the past and as leaders explore unexplored domains.

Semler did a similair presentation at MIT earlier this year - you can watch it or listen to it over the web at http://mitworld.mit.edu/video/308/

Me Inc. – Your Personal Brand

Loyalty and seniority don’t carry much weight in the new economy. Today, a successful career depends on how others perceive you. This means getting ahead increasingly depends on creating, managing and punting your own personal brand.

Many people think branding is the domain of big business. The concept of branding has however evolved vertically. Brands now extend upward to countries and downward to individuals.
Branding is about creating a brand personality that people immediately associate with and creating a brand identity with which people form strong emotional connections, because it promises benefits of some kind or another.

Brands actually have no personality and no real reason to cause an emotional reaction in people. But they do, because it’s all about the power of perception: the perception that you are better off choosing one brand over another.

Everything people see, hear and feel about a brand matters. People do not differentiate between their experience of a brand in a company’s foyer or through media advertising. What they care about most is whether a brand affirms or misrepresents its promise to them during those interactions


The same branding principles apply to personal brands. Everyday your personal brand represents you in a number of ways, either working for or against you. Everything you say, do and portray leaves imprints on the people you interact with.


This means if you don’t take control of your personal brand, it will take control of you.
You need to find that strong and unique identity that is immediately recognisable as you, that creates the perception that an employer or client is better off buying you than someone else.
Celebrities like Oprah Winfrey, Richard Branson and Nelson Mandela have mastered their personal brands by defining what they stand for, what makes them unique and desirable and living their lives accordingly.

Although each of us already has our own personal brand, very few of us have actually sat down to think about what it is. We need to take stock of who you are; of what's clever and special about you, and what you offer as a person.
Ask yourself:

Who am I and what do I stand for?

What makes me unique?

What is immediately recognisable about me?
The success of any brand depends on how people feel about themselves when they interact with a brand. People brands are no different. It is what people say about you that ultimately determines whether they see you as someone who adds or erodes value, no brand statement is more powerful than making the people around you feel comfortable about themselves when they interact with you.
In ascertaining whether you add value or not ask yourself a number of challenging questions:

How do people perceive me?
Have I asked them?
Is that how I want to be perceived?
If not, can I change it?
If I decide to change it, what will I change it to?
Will I be able to live up to my new brand?


Be honest, because once you define your brand, everything about you needs to reflect this
In creating your personal brand, the 6 Ps of branding will assist you in defining your brand.

Purpose
Building a strong brand is about more than just making money. It is about serving a purpose; something you really believe in.
Action: Define your purpose. Remind yourself of your purpose – write it down, pin it up and talk about it as often as possible.

Passion
Great brands are fuelled by passionate people.
Action: Get excited. Capture people’s hearts and minds. Keep yourself energised, as your energy will be transferred to others.

Planning
Great brands don’t just happen; they are built over time according to a plan.
Action: Decide what you want your brand to be known for, consider what it will take to get there and then put a coherent plan in place to take you from where you are now to where you want to be. Be specific and deliberate in putting your plan together.

People
Great brands are built by teams of people who come together and feed off each other’s energy, play to each other’s strengths and work synergistically to make things happen.
Action: Work hard on fostering powerful relationships. Connect with those who want what you have. This does not mean sucking up, it just means that you, like any other brand, need brand advocates – people in positions of influence who appreciate your brand so much that they will advertise you.

Play
Great brands are built when people have fun.
Action: See the process of developing a brand as fun, engaging and energising. Life is short; play more.

Perseverance
Truly great brands are built through resilience and a willingness to solve a problem when things go wrong.
Quoting Robbie Brozin, the Founder and CEO of Nando’s: “There is a very, very, very fine line between success and failure…. It is about being constantly hammered and coming back from the hard times and low moments.”
Action: Personal branding is as much about distinguishing yourself as it is about taking yourself to new heights. Believe in yourself.

Insight-Humour-Insipration

I love the internet because with an explorative attitude one can get access to so many great learning experiences that have taken place all across the world. I recently came across a panel discussion from an organisation called THE CHURCHILL CLUB

The title of the discussion was:
No Plan, No Capital, No Model…No Problem: Companies that Defied What VCs Will Tell You

This is a brilliant, amuzing, funny, engaging discussion on how with a good attitude, some experimentation and some luck one can start a great business with no real plan and very little capital.

The panelists included:
Marcus Kazmierczak, Chief Engineer, Mayasmom.com
Markus Frind, Founder, PlentyofFish.com
James Hong, Co-Founder, HotorNot.com
David Lu, CEO and Co-Founder, Fanpop.com
Karen Northup, CEO and Founder, CoreFino
Moderator: Guy Kawasaki, Managing Director, Garage Technology Ventures

The discussion can be listened to as a podcast available for download via Guy Kawasaki's Blog

Wikinomics – How Mass Collaboration Changes Everything

In the last few years, traditional collaboration—in a meeting room, a conference call, even a convention center—has been superseded by electronic collaborations on an astronomical scale. Today, encyclopedias, jetliners, operating systems, mutual funds, and many other items are being created by teams numbering in the thousands or even millions. While some leaders fear the fast growth of these massive online communities or fail to understand the power of mass collaboration, those entrepreneurs and managers that leverage the power of the internet for information sharing and innovation are reaping huge benefits. Wikinomics explains how to prosper in a world where new communications technologies are democratizing the creation of value. Anyone who wants to understand the major forces revolutionizing business today should read and embrace the principled in Wikinomics.

Some the great case studies and examples in Wikinomics:

How Wikipedia, the online encyclopedia, has created a phenomenon in the world of knowledge sharing.

How Boeing design and build plans using a global network of outsourced partners

How Amazon open up their website backend code to developers all over the world so that they can experiment to develop new innovative tools for Amazon. When such tools are developed and applied, both parties benefit. Amazon by having the most innovative retail website and the developer by earning revenue off transactions resulting from the tool he or she developed.

How clever innovators are mashing together different web applications to create value – e.g. mash together Google maps and a hotel review website so that you can see the different classes of hotel in a city on a Google Map

How the opensource software development movement continues to thrive and produce great products. How IBM supports this movement vigorously for the value that they get from it.

There are many more great examples in this rich, well researched book. It will get all business leaders thinking how these principles can be applied in their industry.

P.S. The book inspired me to run an entire MBA course via a wiki – cutting out all paper and hardcopy files and facilitating sharing between students. See gibs-mba-entrepreneurship.pbwiki.com

More cool (simple) tools for entrepreneurs

I love it when people design products that are (1) very USEFUL, (2) SIMPLE and easy to use and (3) they allow you to try them for FREE.

Here are some cool products that I have been using recently to help me get organised, stay up to date and be in touch.

1. BRILLIANT COLLABORATIVE "GETTING ORGANISED" SOFTWARE - 37 Signals

37 Signals is a company I read about in Time Magazine and then I heard an interview with the founder, Jason Fried, on Venture Voice. The philosophy of the small but impactful organisation is to make this simple, to strip out the clutter and unnecessary stuff and just give us what we need in (1) project management software (2) collaborative work spaces (3) CRM software (4) organisers. The software is VERY cool - especially for business people and entrepreneurs working from dispersed locations. The company also has a pretty interesting book called "Getting Real" that captures their "simplicity" philosophy and a blog of their internal musings that is worth checking out. If you are an entrepreneurial team wanting to get more organised - check out 37 Signals.

2. CREATING A WIKI - PB wiki
I recently created a wiki for an entrepreneurship programme I was running. This gave the opportunity to quickly and easily set up a participative workspace where I could communicate with students, students could communicate with me and we could as joint group build and share ideas to make the programme as meaningful as possible - see gibs-mba-entrepreneurship.pbwiki.com . I was able to do this because PB wiki made it so easy. It is quick, easy and free to set up and start playing with a wiki. Ideas for entrepreneurs: (1) create your own internal knowledge bank using a wiki - enable all people in the organisation to contribute i.e. create a "wikipedia" for your business (2) plan a holiday, event or strategy session using a wiki - allowing everyone to contribute and share ideas and insights See the course wiki I created for an MBA trip to the USA: gibs-mba-usa-westcoast.pbwiki.com (3) use a wiki as an internal "open source" communication tool - have general queries in the organisation posted to a wiki (instead of emailed to a few individuals) and encourage others to respond.

I LOVE the simplicity of both these tools. Why not give them a try*.

*PS - I am not getting paid to "endorse" anything - just wanting to share what I think is useful.

Marc Andreessen - The High Tech Startup GURU

Marc Andreesen co-founded Netscape and sold to America Online in 1998 for $4.2 billion; he co-founded Opsware (formerly Loudcloud), a public software company with an approximately $1 billion market cap; and now Ning, a new, private consumer Internet company.
he has also been exposed to a large number of internet / technology startups as a board member, angel investor, advisor, venture capitalist.

This series examines the intricacies of building a high-tech startup business in a brilliantly insightful way. Each one of the five articles is very well written with so many gems of advice.

Part 1 looks at he UP-side and DOWN-side of being an entrepreneur (with a wonderful video at the end to illustrate an analogy.

Part 2 looks at how one can and should respond when a potential funder of a new business says NO. It has a great section toward the end on risks in a startup and how to mitigate those risks (a must read for every entrepreneur looking for funding)

Part 3 looks at how to reach the funders. It is not as simple as just slipping a business plan in the mail and waiting for a response. If you do that you will go NO WHERE, EVER. Marc tips on reaching VC's are the kind of insider knowledge you won't read in text books.

Part 4 analyzes what really matters in driving the success of a start up - TEAM, PRODUCT or MARKET. Marc looks at these factors and ideas from different angles and view points.

Part 5 looks at dealing with Moby Dick (i.e. the unpredictable animal of a big companies). How to start up firms manage the erratic and unexplainable behavior that emanates from large organisations.

These blog posting of Marc Andreessen really rock - if you have any interest high-tech start - please read them (for your own good).