TSP059 | David A. Rosen – Transcription

Posted by John Livesay in Uncategorized | 0 comments

John:

Welcome to The Successful Pitch. Today’s guest is David Rosen, the CEO of TechX Foundry. He is all about what’s going on in innovation. In fact, he won Innovator of the Year around robotics, drones, and 3D printers. David talks about the need to really figure out which way are you going to manage your company. Is it through the product, is it through the process that you’re going to do, like what your culture is and what customer satisfaction is, or is it customer-centric and focused that way? When you can explain that to an investor, you automatically are able to set yourself apart from the other founders that are pitching. He said, “You know, you really need to have an a-ha moment or a so what moment; that’s the first litmus test when you’re pitching,” and what he does is help innovators innovate by saving them time and money. Enjoy the episode.

Are you a founder struggling with your investor pitch? Do you need warm introductions to the right investors to get your startup funded? Do you need a funding road map to get you there fast? All of this and more can be found in Crack the Funding Code. Judy Robinett, bestselling author of How to Be a Power Connector and on the board of Illuminate Ventures, and I invite you to our free Crack the Funding Code webinar. Simply go to judyrobinett.com – J-U-D-Y-R-O-B-I-N-E-T-T dot com – and click on the webinar tab to see how to tap into our network of investors around the world. There’s a link in the show notes as well. You’re only one click away from getting funded fast.

John:

Hi, and welcome to The Successful Pitch podcast. Today’s guest is David Rosen who’s the CEO of TechX Foundry, which was founded in 2013 and TechX is all about creating startup teams to build the most advanced innovation center for designing, prototyping, new tech hardware systems and software. I think there’s probably a great story in there about robotics but David also concurrently does something where he won Innovator of the Year for receiving awards for national manufacturing days so we’re definitely going to want to hear about that. As if that’s not enough, he also is involved with a company called Acrelic Group where he’s been providing leadership and coaching development, helping people get funded and knowing what is involved with M&A transactions. He sits on the board of more than five advisory boards and developed critical mass to get a company from 5 to 10 million to over 100 million in 5 years. David, welcome to the show.

David:

Thank you, John. I appreciate being here and look forward to our discussion.

John:

Yes.

I always like to find out how did someone like you get started? I mean, you’ve done so many amazing things and you’ve also been involved with Signal Lake, which is an adviser to them to a VC. Did you know when you were in college that this is where you wanted to end up or was it a happy accident?

David:

You know, I kind of just connected one opportunity to the next throughout my career but I’m kind of a bootstrapper and I’ve worked since I was 11 and a half years old without working papers.

John:

Child labor, right?

David:

So, I’ve always worked and I’ve been very fortunate and very lucky. I grew up in the Midwest in a farm town without any real network connections. I just had a good family and good parents who kind of told me I could do whatever I wanted to as long as I worked hard.

John:

How great is that? You know, you can never underestimate the value of being told, at a young age, to believe in yourself.

David:

I was very lucky where they told me to believe in myself but they also gave me the foundation to actually test that out as opposed to a little bit of overpraising which, I think, can actually end up putting you in the wrong direction. You think you can do anything but don’t understand that it takes work. That can be more challenging than having to work for it but —

John:

Right.

David:

Yeah, I’ve been working and I’ve gotten very lucky. I’ve worked for some great people in my life and I started working even when I was in college. I worked my last two years full-time because I was at Boston University but then worked in Harvard where I was kind of an IT guru helping the internal IT department put in PCs and systems to the various schools and colleges at Harvard. I found myself in the middle of all that.

John:

What an exciting place to be: Harvard and the beginning of the internet. That’s great. So, what is it like — let’s just jump right into one of these many jobs that you have. What’s it like being the adviser to Signal Lake, which is a venture capital? What kind of things that you see that they look for when people pitch them? What makes them stand out from other VCs? Any insights you can give on that would be really interesting.

David:

Yeah, what I like about Signal Lake, John, is I sold my last software company. I started a software company back in 2001 and it was an enterprise application for marketing and inside sales in sales. So I had to cut my teeth on really before AWS and a lot of the cloud services were there. We had to figure out how to provision ourselves. We’re in the cloud with our own tools and technologies but also used my foundation of understanding how large companies like to buy — so after I sold that software company about three and a half years ago, I started looking what to do next and I ran into Bart Stuck, who was one of the founders of Signal Lake, and Bart is a very interesting former Bell Labs thinker and very strong technical guy and, in my career, I’ve been involved in hardware and software evaluations and evaluation and assessments. Signal Lake is very technical in how they look at companies. They’re not looking at viral software application plays as much as they are looking for new industrial solutions to bring to market.

John:

So, they’re very specific, it sounds like?

David:

Well, they’re very specific and they don’t mind looking at the potential that comes from highly complex technologies or products that are typically not consumer-driven but more industrial-driven.

John:

Interesting. But that still requires the founders to come in and pitch them even if it’s a complex product which, oftentimes I find, is even more challenging to take something so complex and be able to explain it to somebody in a way that they can simply understand it.

David:

Well, that’s the first litmus test. If it doesn’t have an “a-ha” or a “so what” for anyone, I don’t care how technical they are, it has to have some value and that’s the first litmus test, right?

John:

Great.

David: If there’s no economic value or if there’s no productivity value or if there’s no shifting change to a current marketplace then why just invest in technology?

John:

That’s great, and so many people fall so in love with their product that they don’t know how to talk about anything else, including themselves. What are some of the qualities you think investors look for in founders and what qualities did you have when you were an entrepreneur that has led to your success?

David:

You know, there’s three ways to look at managing a company. You can manage a company for its product, you can manage a company for its process, or you can manage a company for its customers and usually a company chooses one of those three dimensions to dominate how they think about their business. So, when you’ve got a product or a technology-driven company, you still have to think about it from the process or customer perspective but you’re trying to differentiate yourself based upon beating out the functionality and features of another solution but it still requires an understanding of the customer and my bias is always bringing the customer viewpoint in as opposed to looking at things from an internal perspective.

John:

Yes. I mean, I just want to talk about that for a second because it’s such an important point you brought up, David, which is if a company’s focused on engineering leading the way as opposed to being more marketing focused, then the engineers keep developing things and telling the marketing and salespeople, “Go sell this,” and the salespeople are saying, “Well, the customers don’t need it or want it,” so there’s all that conflict going on. So you’re saying if you listen to your customers before you add bells and whistles or develop something completely new, it’s a much easier way to manage your company, right?

David:

Exactly. Now, the customer is always king in my mind so I tend to focus more on customers before I focus on technology and product and, in my early days of my career, IBM might not have had the best solution from a technical perspective but the way they marketed for their customers, they always ensured that they made it clear about what their value proposition was.

John:

Right, I used to sell against IBM in the early ’80s with Amdahl and Control Data and I remember their acronym, FUD, fear, uncertainty, and doubt. If you bought anything that wasn’t IBM, they would point fingers and blame the other vendor. So, they ruled and got people to buy for a lot of variety of reasons besides the product.

David:

You’re exactly right, John, and the reality was the saying used to be you wouldn’t get fired by going with IBM.

John:

Right, and now, of course, I don’t think anybody really has that kind of dominance anymore, and what’s the second one? Let’s talk about your second way of managing the company, which is process. Describe to us the pros and cons of that.

David:

Well, that’s where you distinguish yourselves based upon how you go to market. It might be your culture of service, it might be your customer satisfaction, it might be the way you approach the market. McDonald’s is a great example of a process-oriented business. They have you thinking and they ensure that they deliver so that when you go to McDonald’s in Tokyo or you go to McDonald’s in Burma or you go to a McDonald’s in Chicago that the burger is — you know, their burger is always the same, their service is always the same, and their food is always consistent and that’s from a very strong process orientation.

John:

Got it. Starbucks is another example, I think, that does that worldwide. It’s great. Alright, so we have either being product-focused, process-focused, and then, of course, customer-focused, which is all about making the customer right. I would think, would Amazon be an example of a customer process or a based way to manage?

David: Yeah, they’re very effective at their process as well but they really mine the data of their customers to anticipate or to target which customers are going to be likely consumers of something next.

John:

Yes, if you liked this, you’ll like that. Well, I think just you giving us this insight, David, is so valuable. I’ve done many interviews and you’re the first person to spell it out like this and so for the listeners, the big takeaway is before you go pitch for an investor, figure out which of these three ways you’re going to manage your company so that you can articulate it to the investors and then get a sense of what your culture is and is not, right?

David:

Exactly. I think having clarity about which of those three is going to provide your success is very critical to your future as well.

John:

Because what I hear time and time again from investors is we really look to see how a founder thinks and are they flexible and so having these things thought out makes you stand out against all the other pitches they hear, don’t you think?

David:

Yes, I absolutely agree.

John:

Well, let’s hear about you winning Innovator of the Year. First of all, congratulations, and tell us what that was like and what did you innovate?

David:

Thank you. You know, I feel a little bit like Obama when he got the Nobel Peace prize two weeks into the job and I feel like, “Okay, now I have to innovate on something.” What’s interesting and what’s been very — what’s been driving me over the past few years is after I sold my last software company, I tried to figure out what to do next and what I found was that a growing increase in the investments going into tech hardware companies because I think there’s a lot of people out there with app fatigue and that software isn’t the only option going forward and between the four or five mega trends out there from the economics of manufacturing close to demand as opposed to manufacturing close to supply and raw materials and low cost labor that there’s an opportunity to reshore manufacturing because the US is still the largest demanding country in the world as far as I know and the fact that personalization and the demand for more unique products as opposed to, “I want one of the five million black cellphones that are being made,” people want a phone with their own picture on their back and a green ring around a red button that that supply and demand for personalization is, therefore, driving the need and demand for micromanufacturing, which plays right into smaller viands meaning an opportunity to manufacture again, locally and closer to the consumer with more personalized products so all these things are coming together around localized manufacturing and what I’m addressing is going after those opportunities, trying to make sure we’re not going to miss the next revolution in technology hardware systems and software manufacturing. You know, John, I can tell when you and I were growing up, we thought of IT jobs as the – and the white collar jobs of IT – as our nirvana and where the US was going to be going, correct?

John:

Mm-hmm, yes.

David:

We all felt that that was our wave and that’s what we were going to be good at and, in fact, during that period of time from the ’80s from 1986 to today, manufacturing companies in New Jersey, as just one example, went from 115,000 manufacturers located in New Jersey to less than 13,000 today and so those kinds of numbers are indicative that, yes, we are going to be an IT culture and we didn’t want to do manufacturing so we relegated it to offshore options. If we look at how we outsource our IT today, probably more than 50% of our IT is outsourced, right?

John:

Right, everyone thinks they can get it done cheaper, less labor costs and — well, that brings up a really great point, which is a lot of people think, “Well, I don’t need to have my tech CEO with me here in America. I can outsource that,” and I keep hearing from investors that they do not like that.

David:

So, you’re absolutely right. At some point in time, people have been outsourcing beyond the flesh and into the bone, which is a difficult thing to do. I know that’s a terrible analogy but —

John:

No, I get it. Let’s jump back to what you’re saying about personalization, which is what you won the Innovator of the Year award for. You know, I recently went to a Nike store and they allow you to customize your shoe on the computer. You know, what color laces do you want and then while you’re doing all that right at the store level. Talk about getting people to come into the store versus buying it online and then while you wait, that all magically happens so you walk out with a pair of — with the name on the tongue of your show if that’s what you want It’s amazing to see how that really is a big, big part of the trend in the future, I think.

David:

Exactly right, and that’s why I started TechX Foundry because I believe that if you look at the investment dollars from CB Insights, you’ll see that the market for hardware investments is growing faster now than the software investment marketplace and so if you also look at the new trends, New York is now the second largest market for investments in the world next to San Francisco or the west coast and Massachusetts is now number 3 so the New York metropolitan area where I’m located is right with the money backing from New York but very few companies, especially tech hardware companies, can afford to be located in Manhattan, especially now that the average cost of a condominium or the average sale of a house in New York is well over a million dollars again as the recovery’s turned in, right?

John:

Right. Well, there’s three areas that you do at TechX that I’m completely fascinated by and would love to have you talk about each one a little bit if you wouldn’t mind. One is robotics, the second is 3D printing, and the third is tech fashion. So, pick whichever one you want to start with and tell us a little bit about what you’re doing with those.

David:

So, there’s a common thread here and the common thread, John, is that all the applications, whether it’s robots that are being immigrated, robots and autonomous vehicles and even drones are all solving the same problems, right? They’re trying to interpret what’s in front of them in order to function and to do something, to accomplish something, they all need to sense whether something’s in the way or something needs to be moved and to know that a piece of grass is something to be avoided if you’re driving and so robotics and autonomous vehicles, they’re all multidisciplinary functions that integrate with software that are just going to grow in terms of number of opportunities out in the marketplace and so all these things require an ability to pull together everything from metalworking and woodworking to plastic molding and plastic forming to electronics and sensors and devices that sense things and tell a machine that’s moving to move away from it or to grab something that may be necessary and so what we’re doing with TechX Foundry is enabling people to have access to all those tools and technologies in a gym membership kind of model where you have to pay for the capital costs of that equipment. So, if you’re starting a robotics company today, you’re typically going to need a quarter of a million or a half a million dollars in technology equipment to get that business off the ground into upwards of millions of dollars and what we’re doing is we’re helping inventors and innovators and startup companies have access to those tools and technologies and eliminate those capital costs.

John:

Basically, helping innovators innovate?

David:

Helping innovators innovate but they can do it without capital cost. They’re going to do it much faster than doing it offshore because the other problem and challenge that we’ve heard from a lot of technology hardware companies is that they have three-week turnarounds from a design review before they get their next iteration or prototype iteration back and if you consider that you’ve got six or ten iterations before you come up with a prototype that you can validate, that’s potentially a half a year delay of time to cash or time working that you’re missing because you’re going offshore.

John:

That’s lost revenues, that’s competitive market share. There’s all kinds of issues that you’re fixing there.

David:

Exactly, first to market, all those issues. So, one, minimizing capital’s an important aspect for a tech hardware company, two, minimizing the amount of time it takes to develop a prototype is critical. The other thing is when you prototype offshore, you’re also losing out on the knowledge gained during the process of prototyping. So, if you are — and I know one of the 3D printer companies is experiencing this today because they – Solidoodle made its first product here in the US and they went to their version 2 and they made it outside the US and they’re subjected to a six month delay because the manufacturer that they were working with had, one, some problems and, two, a much larger customer came in and consumed the manufacturing space for their products and put the other thing on hold.

So, here you are with an order of 10,000 units and you’re not working with somebody who just got a big order from somebody 10 to 50 times your size and you just got pushed aside to get that order done for the other customer. You’ve got 2,000 out of your 10,000 units and you’re told, “Tough luck. It’s going to take a while.”

John:

Right. Wow.

David:

Manufacturing locally, people don’t know that there’s a lot of local people who can help whether they’re in Massachusetts or whether they’re in New Jersey or whether they’re in Ohio or Indiana. A ton of companies that the ones that have survived in manufacturing are very good at what they do and very efficient in what they do, they just don’t market themselves well so you don’t know how to go find them and that’s what needs to happen in terms of innovating that supply chain and I’m bringing this story background to innovation and my Innovator of the Year award.

John:

I love it. Yeah.

David: I didn’t mean to not answer that directly but how I got there is part of the reason why I got that award because I’m starting to bring more companies into local manufacturers who are having successes on developing products locally and mitigating their risk, reducing the capital to market, and increasing their time to market, which are three important aspects any tech hardware startup or any innovator, inventor who wants to get a product to market.

John:

Those are such great lessons for everybody to keep in mind when you’re pitching to get funded or running your own business. It’s really, really helpful.

David:

And how you’re managing those three things as well, right?

John:

Oh, yes, yes. It’s all about execution. That’s the other big thing that investors seek all the time and do you have any suggestions on how to prove to potential investors that you and your team are the right people to execute an idea?

David:

You know, that’s a very good question and I don’t want to sound pedantic or rote but sometimes you find startup teams of people who have barely had to manage their lunch money as their biggest responsibility before they start their companies, right?

John:

Right.

David:

So, when you take a team of two people and you now ask them to add a third person to the equation, sometimes that becomes one of the most difficult challenges and that’s where startups and founders have to really step aside and understand what are they truly bringing to the table in their startups because it’s one thing to have great inspiration and perspiration to bring something to market, but at some point in time, you’ve got to divide and conquer and you’ve got to collaborate and we’re not always being brought up in a collaborative atmosphere today.

John:

Well, you can’t do everything yourself and almost everybody brings passion and inspiration and sweat equity so you need to differentiate yourself with your skill sets being complementary. That’s what you’re saying.

David:

Exactly, and you know, the other thing, for a startup team is to always put your ego aside and that’s very hard to do when part of what’s gotten you to where you are today is your persistence and belief.

John:

Well, it’s confidence without arrogance is the way I like to look at it.

David:

I think that’s a perfect way to put it, John.

John:

Okay, great. David, is there any book that you would recommend founders to read either about business or even life?

David:

You know, I wish I was a — you know, as a bootstrapper, I haven’t always been the most academic and yet, I’ve been able to go at par with some of the top academics in the world and have some really strong debates and conversations but there’s a couple of things that come to mind: one is Lean Startup. I’ve spent half of my career advising the tech – the tech 200, tech 300 and so I’ve adapted to the phased gate array investment processes that are put into place and I bring, again, more of a market viewpoint to that strategic thinking in terms of identifying new markets for large companies to get into or for different ways to look at the portfolio businesses that they have and figure out which ones belong and which ones don’t belong. But, at the same time, Lean Thinking and The Lean Startup is starting to really break through the new ways of working and bringing technology businesses to market. I sat down with the CTO of GE appliances about a month and a half ago and GE is one of the founders of the 9-box and the strategic thinking methods that have been ingrained in companies for many years, right?

John:

Right.

David:

And they now have partnered with a MakerSpace because they realized that the 24 phased gate array process of going from a good idea to marketplace has to be changed and radicalized.

John:

Wow, if GE needs to partner and collaborate, everybody does is what I’m getting.

David:

Exactly. I mean, they had one of — the CTO said, “Why are my engineers spending time between 5 o’clock and 3 in the morning working at this MakerSpace across the street from us? And what they found was that one of their engineers devised a new product that could be applied to their refrigerators and was able to crowdfund $250,000 for that new product to make, I think it was square ice cubes and he said, “You know what? I’m not going to care about the intellectual property and I’m going to give this engineer a royalty for bringing in this product to market and we’re going to add this product to our product line.” Now, that’s not the GE I knew of the past.

John:

No. I love it. What a great story to end on, you know? It’s all about collaboration and innovation and the desire to make a difference and express yourself will keep us all at the forefront of leading interesting and creative and successful lives.

David:

And that new thinking and new ways to identify new products and bring them to the market quickly, there’s good value propositions behind them and testing them through crowdfunded methods or other methods is going to be a more pervasive way to look at product innovation, even for the largest companies.

John:

Fantastic. David, how can people follow you on social media? What’s your Twitter handle?

David:

I’m @DavidARosen at Twitter. I’m @DavidARosen at TechX Foundry. company/techx-foundry in LinkedIn. I’m @DavidARosen on LinkedIn and at techxfoundry.com on the web.

John:

Fantastic. It’s been a pleasure having you. Thank you for sharing your innovation and your insights. You are quite an inspiration to everybody.

David:

Thank you, John. I hope I wasn’t too inspirational but I’m very passionate about what I do and I’m very lucky to be around some great people in watching a new revolution of what I think is manufacturing 4.0, which is going to drive a lot of great opportunities for US manufacturers to go to market in the US and to take their products elsewhere.

John:

I’m excited to see what the robots and the 3D printers bring to all of us. Thanks again, David.

David:

Thanks, John. Be well.

John:

You too.

Thanks for listening to The Successful Pitch Podcast. If you like the show, please go to iTunes and write a review and encourage your friends to write reviews too. It really helps get the word out. You know, people say that the longest distance is between someone’s mouth and their wallet. People can tell you they’re going to invest but when it comes time to write the check, they don’t do it. So how do you get people to say yes and then follow through? Visualize yourself on the left side of a riverbank and you have to cross the river and on the other side of the river is where the funding happens.

So, first, you make up your idea and then you make it real and then you make it reoccur. Once you start dipping your toe into the water to get to funding, that’s where I can help. I get you across that river faster than you would on your own with a lot less frustration that you will get when you hear a bunch of no’s and you don’t know why. So, if you want some help getting funded faster with less frustration, go to my free funding webinar, sellingsecretsforfunding.com/webinar and sign up and get in depth information on how you can get funded fast. Thanks.

TSP058 | Bob Burg – Transcription

Posted by John Livesay in Uncategorized | 0 comments

John:

Welcome to The Successful Pitch podcast. Today’s guest is Bob Burg, the coauthor of The Go-Giver. In his book he talks about the five laws. The first one is value, giving more than you take. The second one is your compensation is based on how many people you serve and help, and finally your influence is of the ability to make others take action and feel good about it, being authentic, and then finally how receptive are you to receiving the good that’s out there.

He said investors invest in people they know, like, and trust. Your ability to have empathy is really a key part of getting people to know, like, and trust you. He said if you’re looking to make sales and get investors and get people to join your team, you should seek happiness because that is really what everyone’s looking for, so you need to look at what makes somebody else happy, what is happiness for them because it’s all relative, what happiness to you may not be happiness to others, and finally realizing people’s resources are limited like their time. So make sure that you’re giving is a good use of their resources and it’s going to make them happy. Enjoy the episode.

Are you a founder struggling with your investor pitch? Do you need warm introductions to the right investors to get your start-up funded? Do you need a funding road map to get you there fast? All of this and more can be found in “Crack the Funding Code.” Judy Robinett, best selling author of “How to be a Power Connector,” and on the board of Illuminate Ventures, and I, invite you to our free “Crack the Funding Code” webinar. Simply go to Judy Robinett, J-U-D-Y-R-O-B-I-N-E-T-T dot com and click on the webinar tab to see how to tap into our network of investors around the world. There’s a link in the show notes as well. You’re only one click away from getting funded fast.

Hi and welcome to The Successful Pitch podcast. Today’s guest is Bob Burg. Bob has some really interesting insights for us today. He ask the question, “Can a subtle shift in focus really make that big of a difference in your business?” He says yes. Bob is the author of a number of books on sales, marketing, and influence for the total book sales of well over a million copies. His book The Go-Giver coauthored with John David Mann has sold over a half-a-million copies and translated into 21 languages. It’s been reissued in a new expanded edition with a forward by none other than The Huffington Post founder, Arianna Huffington. Bob is an advocate supporter and defender of the Free Enterprise System, believing that the amount of money one makes is directly proportional to how many people they serve. Bob, welcome to the show we’re delighted to have you here.

Bob:

Well thank you John, I am just so delighted to be with you. Thanks for having me.

John:

Bob, your book The Go-Giver, first of all I just love the title that instead of the go-getter, it’s the go-giver. Can you tell us a little bit about how’d you come up with that great title?

Bob:

Well when John, a day with me and my awesome coauthor, and really the lead storyteller of the parable. He and I want to come up with a name that – you know, I had a little bit of a pattern interrupt to, but in a sense. So I think in any marketing message I think that – well the title of a book is sort of what the headline of a sales letter, and you want to draw people in. You want it to be a little bit different and a little bit distinct. So The Go-Giver was a title that people who are in sales or business, entrepreneurs, they look at that they say, “Wait a second, I have to be a go-giver.” Then the subtitle of the story about a powerful business idea. How does being a go-giver – what does that have to do with the business. So yeah, we did it for that reason, and of course, it did it that the message needs to be congruent with the title which we hope it is, and so the basic premise, John, is really nothing more than shifting one’s focus from getting to giving. In this case when we say giving, we simply mean constantly and consistently providing value to others, and that doing so is not only a nice way to live life, but it’s a very financially profitable way as well.

John:

Can you explain a little about what you mean? There’s actually five laws in the book and value is one of those laws about – when you give value to someone, you’ve had a great example about an accountant giving value to someone but people walking away happy that they got value and paid someone, and of course the person is also making a huge profits. It really is a win-win, isn’t it?

Bob:

It is, and that’s why when you first hearing these laws, these five laws, are somewhat counterintuitive in nature. So the law number one, the law of values says your true work is determined by how much more you give in value than you take in payment, and when you first hear that it might sound a little bit like hey, how do you stay in business doing that? It sounds like a recipe for bankruptcy, give more in value than I take in payment. But as you said obviously both parties win big. So we simply have to understand the difference between price and value. Price is a dollar figure, it’s a dollar amount, it’s finite, it is what it is.

Value on the other hand is the relative word or desirability of something to the end user or beholder. In other words, what is it about this product service concept idea that – or opportunity – that brings with it so much worth or value that someone will willingly exchange their money or their time or their energy or whatever it happens to be, for this value, and they feel great about it while you make a very healthy profit. In the example you talked about with the accountant, is simply very easy to get our arms around because we can imagine we hire an accountant for a thousand dollars to do our taxes. His price is a thousand dollars. What value does he give in return? Well, through his years of study in learning his craft, through his practice again and again through his desire to make our experience with him outstanding and he learns our business, he learns our needs, our wants, our goals, what we’re looking to accomplish through his services, and he’s able to actually save us. Let’s say $5,000 in taxes. He also saves us countless hours of time which enables great value because it frees us up to do what we would rather do and what we’re more productive doing. He also provides us with the security and peace of mind if knowing it was done correctly. We see here that while again price is finite, value is both concrete in terms of that $5,000 savings that’s pretty easy to get, but also to get our arms around, but also value is conceptual. When you think of that peace of mind, that holds probably more worth or value to someone that even the money they save. So what he did is he gave us more in value than what he took in payment, so we feel terrific about it and he made a very, very healthy profit which he should. The reason it happened is because his focus was on the right place. His focus was not on the money, his focus was on providing us with a super valuable experience. This is why we say that money is an echo of value. It’s the thunder to value’s lightning, meaning simply that the value must come first and the money you receive or the funding you receive or whatever is simply a direct result of – a natural result of the value you communicate or provide.

John:

I love that Bob. We’re going to tweet that out from the show – money is an echo of value. What you said is so valuable for our listeners from two samplings. Number one, to get customers because investors want to see traction and they want to see that you’re getting some customers and the best way to get customers is to provide value over and above the price be by solving the problems that they are needing to be solved which is both getting your taxes done let’s say, but also that peace of mind that you eluded too, because this desirability factor, I talk about all the time that you need to become irresistible to investors and give them a good return on their investment, and the best way to do that is to show value which is just what you walked us through in such an elegant way. Is there one piece of advice Bob that you received before you even knew anything about being a go-giver that was a difference maker for you?

Bob:

Well when I first started in sales about probably 35 years ago, I remember when I was first starting to get my legs and starting to produce, I was a little bit like Joe in the book, I had a lot of potential but my focus was on the wrong place, and I remember coming back from a selling appointment in which no sale took place, and I remember expressing anger at the prospect for not getting it, for not understanding why it’s a good thing for him and I, and it’s funny because this wise old kind of grizzled veteran — but I remember he said two things. One he said, well, Burg said, “When the shooter misses the target, it ain’t the target’s fault.” Meaning it wasn’t up to the prospect to get it, it was up to me to communicate value to him in a way that he felt it to be of value, because remember, value is always on the eyes of the beholder, it’s not what we believe as a value and it’s not what we believe they should believe is a value. It’s how they see it. We need to see it through their eyes.

The other thing he said is this, he said and this is one of the big game changers for me, He said, “Burg if you want to make a lot of money in selling, don’t have making money as your target. Your target is serving others.” He said “Now when you hit the target you’ll get a reward.” The reward will be money and you can do with that money whatever you want but never forget the money is not the target itself. It’s only the reward for hitting the target. Your target is service.

John:

That’s so great, especially for investors who are looking for the big billion dollar idea, something that’s going to hit it all the park. It’s all about how many people can you serve with this new product that you’ve come out with that you need funding for, and it’s the more people you serve, the bigger potential the market size is right?

Bob:

Exactly.

John:

Then you’ve also touched on something which is so important, which is empathy. Seeing something through somebody else’s eyes, right?

Bob:

It’s so, so very important. Empathy is defined as the vicarious experiencing of another person’s feelings, and we can say well isn’t that just a fancy way of saying put yourself in the other person’s shoes? And it might be, except for the fact that most of us have different sized feet. In other words, we all come from our own different way of seeing the world, our own beliefs, our own experiences. So while sometimes we’ve had similar experiences and we can understand how they feel, and when that’s the case by all means communicated that to them. There’s other times we really don’t know how they feel, and to say otherwise would be disingenuous and it would be counterproductive. So when displaying empathy, it’s not necessarily that you know how they feel, but you’re communicating to them that you understand they’re feeling something, and that that something is distressful to them and you’re there to help work with them through it.

John:

Yes, just that ability to not make everything focused on yourself, and having empathy for the customer, and most importantly if you’re pitching an investor, if you have empathy for the investor who is sometimes hears four or five pitches a day, that alone will set you apart from all the other people that are pitch being pitched.

Bob:

Ah, isn’t that true?

John:

One of the lines in your book is where you and John write a – the big question is does it make money? And while that’s not the focus, you’re saying it’s just a bad first question. Can you expand on what the first question should be if making money is a bad first question?

Bob:

Yeah, well the protege in the story was having at first of course a little bit of difficulty understanding some of these counterintuitive laws. He said to Ernesto, the restaurant tour he said, “So you’re saying asking people if it will make money isn’t a good question?” and Ernesto said, “No, asking if something will make money’s a great question. It’s just a bad first question. The first question should be, does it serve?” and that’s the key because if it doesn’t serve and when we say does it serve we also mean, is there a market for it? Because you can have a fantastic product, okay? But if there’s no – first of all if it doesn’t serve in someway nobody’s going to want it, but if it’s not marketable, if you can’t find the way to connect the benefits of that product or service with the needs, wants, or desires of the marketplace, it’s not going anywhere. So first, focus on does this serve a need and is it a need that people want served? Then you’ve got to decide, can I create that desire and need? Certainly, there’s many times you can, but there’s other times that you can’t so it’s always a question you’ve got to look at. So while we ask that question, it’s a good first question — a good question is not a good first question for the task that it serves that’s meant in one way that that’s just a good attitude to have. In another way it’s also meant to say, “Hey, you’ve got to ask that question first.” You’ve got to find out if there’s a need. Don’t even worry about making the money from it until you know it’s a buyable product or service worth investing.

John:

The classic example for me is Uber, right? It clearly is serving a need that didn’t people have – didn’t exist because wouldn’t it be nice to not have to wait in line for cab, or know who your cab driver is, or not to have money on you, or all those things, right? When you have that – all those problems solved with oh, can we serve this market and then oh, we can make money then I see the flow completely. Let’s talk about mentorship because nobody get’s funded doing this alone. In fact, a lot of investors really encourage people to have co-founders and get the right advisers on their board, so you really, I’m sure, are the great person to ask about mentorship and how do you find advisers and who are really mentors.

Bob:

Oh well it’s a great question, and it is a question that many people want to know, because – for the reasons you mentioned and let’s face it, it’s just much easier to navigate the road map to success if you have someone who’s been there and done that, and is willing to work with you and take you under their wing or whatever. One thing I suggest to people is don’t try and find a mentor by simply going to people who you admire and say, “Will you mentor me?” because –

John:

Yeah, it’s too direct, right?

Bob:

Right and it’s not something that’s going to appeal to them. It’s almost like saying, “Hey! Will you take your 40 years of experience and just let me have it all for free.” I mean it sort of comes across that way. So, but I think it’s very appropriate to connect with someone – ask if you could ask them a specific question, let them know you’ve admired their work, you’ve studied their – that you’ve read their books or you’ve studied their work. You would like a few minutes if it wouldn’t be inappropriate to ask them a question, a very specific question or two and that you’ll be very prepared, and to let them know – in other words you’re letting them know you respect them and you respect their time, you’re not asking just for something without committing to something yourself. Then, of course, send a handwritten thank you note and maybe make a small donation to their charity that if you can find, yeah. So, and then whenever you can’t connect them however you can. You never know what product your service they need or who they need to – so obviously you can’t provide the kind of value to them that they can to you, but you can sure communicate that you want to be able to do that. I think what happens is when you respect them and their time, you can then ask something else if you need to and you can ask permission, you can encrypt the scope a little bit in a very legitimate way, and eventually you develop, just like any relationship, you develop a mentor/protege type of relationship.

John:

I like what you said so much, the whole concept when someone says to you, “Oh can I take you out for coffee and pick your brain?” That doesn’t even sound fun, does it?

As opposed to what you said is, I have a specific question I want to ask you, and then you show respect that you’ve done your homework on who they are, and what you’re suggesting is even one step further which really sets you apart which is even if you’re just a founder that doesn’t have a lot of experience or a lot of money at the beginning but you can certainly afford a small donation to that person’s charity who gave you some time and if that kind of human connection is going to really further the relationship in a way that is again, all about value.

Bob:

Exactly.

John:

Great, great stuff. You make a point that I think we should spend some time with which is this whole concept of The Go-Giver philosophy is completely congruent with human nature. So I’d love to have you tell us more about what that means.

Bob:

Sure, and that’s such a fantastic point to bring up. There’s nothing – and I think sometimes when people hear go-giver they kind of get this image on their mind there, “Oh! Just give and give and great magical things will happen.” That’s magic. It actually makes very – The Go-Giver philosophy makes sense in a very practical way. We understand that then I remember one of my great teachers, Harry Brown, who wrote a whole bunch of books on investing, economics, and politics. He also wrote a fantastic book on sales which was really much more about human nature. He was a great student of human nature and he understood and respected human nature, and he didn’t expect people to be anything they’re weren’t. As Harry says, there are three basic principles and one of them is, everyone seeks happiness, okay. Now they seek in their own way. He would define happiness as a mental feeling of well-being, and we can take it there or we can have different definitions but, basically, it’s what is going to make a person feel good about themselves when push comes to shove. It doesn’t necessarily mean you gorge on two boxes of Oreos because you’re hungry and that’s going to make you happy, no! That might decide you want more long-term happiness by not having two boxes of Oreos, you know what I’m saying? But we all choose what we believe has the best chance of making us happy.

The second principle is happiness is relative. People understand happiness differently. What would bring happiness to one person would be absolutely meaningless to someone else, or might even cause them unhappiness.

John:

Yes. I love getting example of that for me personally is a – I don’t know, I have lots of friends that they maybe are happy when they go camping, and to me I couldn’t think of anything more miserable.

Bob:

I’m the same. Exactly. I was just thinking as you were saying that. How many people love to travel. I travel because I speak but I don’t like it at all, and if I could be totally just home and never leave the house or certainly, my town or at the airport, I’d be happy as can be with that. Okay, but many people they love travels, and so the worst thing we can do is expect other people to see happiness the way we see happiness.

Then the third principle, because the first one everyone seeks happiness. Number two: Happiness is relative, right? We all see it our own way. Number three is resources are limited. Now that doesn’t mean that we don’t live in abundant world. Of course, we live in an abundant universe, but we all have limits in certain ways. We all have limited years to live, we all have the same limited hours in a day, minutes in an hour, seconds in a minute what have you. We all have a limited knowledge of limited energy. We all have a limited amount of talents. You know what I’m saying? So what happens is what Harry says, what I buy into totally is that people are going to make decisions based in their mind if it has a greater chance of they’re being happy based on how they value happiness and constrained by their perceived limited choices. So as a go-giver, remember your focus is on bringing value to them. You understand that value is always on the eyes of the beholder, right? You understand that your job is to find what makes them happy and give it to them. As Harry says so many times in sales, people say, “How do I motivate a buyer?” And the answer is you don’t motivate a buyer, they’re already motivated. Your job is to find out what they’re motivated by and then assuming your product or service connects with that motivation, now you’re able to have a sale. So everything about the go-giver says it’s not about you, it’s about the other person. It means you’ve got to find – it means no one’s going to buy from you because you have a quota to meet. It means that they buy from you because they believe they’re more likely to be happier by doing so, than by not doing so.

John:

For our listeners, it’s such a great message because instead of trying to figure out how do I motivate an investor to give me a million dollars, you take a step back to your research and say, “What has motivated this investor in the past to invest in?” What kind of person do they invest in? What kind of industry are they interested in? What kind of person are they interested in? And that completely shifts your pitch as oppose to me, me, me.

Bob:

What a perfect way of saying it. You know, Dale Carnegie in his classic – How to Win Friends and Influence People. What I believe his underlying premise about the entire book is when he expressed in the sentence ultimately, people do things for their reasons not our reasons.

John:

So true. Well one of the other principles in your great book, The Go-Giver, is all about influence and, boy, founders need to be able to not only influence investors but they need to invest – be able to influence people to join their team because investors really are looking for a strong team and your leadership ability to attract the best people with technical skills for example versus your startup versus another one. So I’m sure you have some insights from your book. How do people create influence?

Bob:

Sure. Well, I personally define influence as simply the ability to move a person or persons to a desired action, usually within a context of the specific goal. Now what I call ultimate influence is the ability to do that in a way that makes the other person feel genuinely good about themselves, about the situation, and about you. Now the law of influence that says that your influence is determined by how abundantly you place other people’s interest first. Now this sounds counterproductive I guess it’s best and probably pollyannaish at worst. But when you think of it, the great leaders, the top influencers, the most successful salespeople, and when you’re looking for an investor, your salesperson, this is how they conduct their businesses and they run their lives. They’re always looking for ways to make the other person’s life better, to find value for them. Now, I want to just qualify this if I may that when we say, “Place other people’s interest first,” we certainly don’t mean you should be anyone’s doormat or a martyr, or self-sacrificial in any way, shape, or form. Absolutely not. It’s just that as as several of the mentors told Joe, the protege, the golden rule of business, of sales, of networking, and I guess – of pitching, would be the of being equal. People would do business with and refer business to. If I would say invest in those people they know, like, and trust. There’s simply no faster, more powerful, or more effective way to elicit those feelings toward you from others, than by moving for – stepping the outside yourself, moving from an I focus or me focus to an other focus, or as Sam – one of the mentors in the story who told Joe, making your win about the other person.

John:

That’s great. When you get people to feel like they’re on your team, and it’s a team effort or as I call it a co-pilot kind of feeling, man, things take off because you’ve really shifted it from all about me to even all about you to let’s make these all about us. Now, you’ve got people’s attention and it taps into what you’re saying of your definition of influence which is now you feel good about yourself for making this decision, you feel good about me, and you feel good about what you’re doing.

Bob:

Exactly.

John:

That’s a win-win. This is so incredibly valuable. Is there any last secrets or tips that you want to give people to make themselves have value and influence and authenticity?

Bob:

Well, one thing with authenticity is simply really tapping into your core, and not trying to be someone you’re not. Learning from everyone, adapting people everyone’s wisdom. We can learn from everyone adapt their wisdom but don’t try to adapt their personality, because it’s not going to work. So learn from all but stay true to your authentic core. Don’t try to go in there as someone else. Go in there as yourself. Then law number five – the law of receptivity simply says the key to effective giving is to stay open to receiving which means that when we have done what we’re suppose to do and we have been able to present this in a way that does serve others and benefits others, and there’s a win for everyone involved, allow yourself to receive the abundance that you’ve earned.

John:

That really speaks to your belief system that you deserve it.

Bob:

Yes, oh that was a giver.

John:

Because we can all sabotage yourself and say well, I did a bad job on that pitch and they’re probably never going to fund me, and you start making up all these stories in your head that may not be true just because your sense of self is such that, “Ugh, I don’t really deserve this or I’ve gotten so many no’s in the past that that’ll continue to be my future,” and you can’t do that, right? You have to hit the reset button.

Bob:

Absolutely, and study abundance. Study people like Randy Gage and Bob Proctor, and so many of the people out there who speak and write on abundance itself, because we get plenty of negative messages from the world, all telling us that people are bad and mean and nasty, and that money is a bad thing – all these horrible messages that we get. We get it from everywhere because that’s what sells. So what we’ve got to do is check our premises and not accept those things, and ask questions when you hear something that’s contrary to abundance, and then go out of your way to listen and learn from the materials that are based on abundance.

John:

Well Bob your book, The Go-Giver is certainly based on abundance and something that I highly recommend everyone getting a copy of, and we’re going to put it, the link in the show notes and obviously it’s on Amazon, but how can people follow you on social media? How can people find you to hire you as a speaker?

Bob:

The best way is just to visit my website which is burg, B-U-R-G.com and everything’s there from my influence and my insights, getting a chapter of the book so you can see how you like it first, my blog, and all of the places where I am on social media. It’s all there at burg.com.

John:

Great. Yes and your Twitter is just your name right? @bobburg?

Bob:

That’s right.

John:

That makes it easy. Well Bob, you have been an extreme giver of your wisdom, your insights and most of all, your spirit. Thank you so much for being on the show.

Bob:

Thank you for all your doing and thanks for having me on. I appreciate you greatly.

John:

Great. Likewise. Thanks again.

Thanks for listening to The Successful Pitch podcast. If you like the show please go to iTunes and write a review, and encourage your friends to write reviews too. It really helps get the word out. People say that the longest distance is between someone’s mouth and their wallet. People can tell you they’re going to invest but when it comes time to write the check, they don’t do it. So how do you get people to say yes and then follow through? Visualize yourself on a left side of a river bank, and you have to cross the river, and on the other side of the river is where the funding happens. So first you make up your idea, then you make it real, then you make it reoccur. Once you start dipping your toe into the water to get to funding that’s where I can help. I get you cross that river faster, than you would on your own, with a lot less frustration than you will get when you hear a bunch of no’s and you don’t know why. So if you want some help getting funded faster with less frustration, go to my free funding webinar sellingsecretsforfunding.com/webinars, and sign up and get in depth information on how you can get funded fast. Thanks.