The SLAM – Startup Launch Assistance Map With Jon Warner
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Everyone dreams big, no matter how simple it is. When building a startup business, you already have success in mind. The question is do you know how to bring that success from your head into reality? Jon Warner, the CEO of Silver Moonshots and author of more than 40 books, talks about how to increase the chances of launching a successful startup business. He shares in detail the steps in how to build a strong foundation in the early stages of your business as mentioned in his book SLAM. He conveys the importance of narrowing your niche and understanding the needs of your target audience as one of the first steps you should be doing.
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Listen to the podcast here
The SLAM – Startup Launch Assistance Map With Jon Warner
Our guest is a five-time company CEO, Jon Warner. He’s a widely respected entrepreneur, expert, and mentor. He’s founded and led three startups, one was a failure, one that did not trouble the score, and one successful exit. He’s got the gamut of experiences. Jon’s career started in the corporate world with air products, working in the US and across Europe before joining ExxonMobil. At Exxon, Jon worked in the UK, Australia, Nigeria, and he ended his career there as a deputy CEO.
Following his several years in the corporate world, Jon founded and grew a management consulting business called the Worldwide Center for Organizational Development, which has had over twenty people carrying out a wide range of strategy assignments for all kinds of companies. He was also a founder and CEO of two other startups, a digital publishing company and a bill pay and payments software platform that operated globally. Since his exit from the latter, he’s been working California-based to mentor and invest in disruptive startup companies, especially in the area of technology, deployment, healthcare and aging tech in particular.
He’s now the CEO of Silver Moonshots, a research organization and virtual incubator for startups focused on a 50-plus population which is growing. Jon is a noted speaker around the world. He lectures on entrepreneurship. He’s a prolific author. He has a book called SLAM. There are also a lot of things about GRAND SLAM in there with all kinds of fun, clever things. He’s a graduate of the UK’s top Warwick University. Jon, welcome to the show.
Thank you, John. It’s good to be here.
Let’s start at your own personal story of origin. You can go back as far as you want to university or even as a kid. Did you always know you wanted to be an entrepreneur?
I did. I quickly got into doing anything I could to get out of the house and then earn an extra buck. Early on, that was delivering the newspapers in the days when that was possible to wash other people’s cars and various other things. I liked earning money that I’d generated through my effort. It got a little light switched on pretty early for me.
[bctt tweet=”Do you have a side hustle? Who should be on your team? What is the unmet need you solve?” username=”John_Livesay”]
We have this image of going to school. You have a PhD in Psychology of Neuroscience. Were any of the people walking around in the capes as we see on Harry Potter?
Not quite. That might get a bit of fictionalizing going on there.
You’ve written this great book called SLAM. Who do you think is going to benefit from reading this?
There are a number of people. The broad category is entrepreneurship. It’s anyone who’s interested in becoming an entrepreneur, is an entrepreneur. That’s the broad category. The reason I wrote it however is there’s a subcategory within it I particularly liked. That is people who’ve got side hustles, people who aren’t necessarily working full-time on entrepreneurship or their idea but would like to go and get that bigger, faster, stronger if they could, and maybe they didn’t have the roadmap for that to happen. That was who was in my mind when I was putting that book together.
Everyone’s clear that the word SLAM is a fun acronym. Do you want to tell everybody what that stands for?
The whole process which the book revolves around is the Startup Launch Assistance Map and that spells the word SLAM. What it is there to do is to support that whole process of exploration as you try and validate your startup idea. It encompasses a second acronym in terms of the way the process works, and you have to do them sequentially. Once you’ve gone through the validation phases, there are eight steps in there, you flip it over and you start thinking about execution. It’s an acronym called GRAND. On that basis, you are going to another eight steps to make sure that you get to where you need to go, which is growth and traction fundamentally.
Launching Successful Startups: It’s important to create the right team, the people that do the bits of the work and make you stand out and shine.
The interesting thing about the concept of a GRAND SLAM is you say start with SLAM and then go to GRAND. I thought that was a clever positioning there. Let’s apply some of these steps from SLAM since we start with SLAM into a side hustle of so many people want to be a speaker. I know a lot of people that have their own consulting agency or they’re running a digital marketing company, or they’ve had experiences as entrepreneurs and founders of themselves, or they’re maybe professors. There are lots of different people who have expertise. They have a main job, but they also want to be a speaker and maybe become a full-time speaker. In order to do that, you have to have speaking as a side hustle.
I know when I was working full-time at Condé Nast, I’ve started my speaking career several years ago where I would speak to some of the advertisers that I was responsible for getting as an added value perk. I would speak to their sales teams, whether it was a car company or a fashion or jewelry company that was advertising with my brand. I would say, “I’m going to train your salespeople on how to be better salespeople. There was run the ad to get the traffic and the dealership and then let me come speak to your salespeople about how to close more sales.” That’s how I started it as a side hustle. I love to use that lens. The first thing you talk about in SLAM and this is important for anybody who wants to be a speaker as well is, “What’s the unmet need? What’s my unique message that somebody would even want to have me come speak about?” Can you address that, Jon, on your experience of how important that is?
It’s crucial and it’s probably the most important step to get right and take your time doing so. Step one, any entrepreneurship venture would be to go and uncover that unmet need with the target audience that you’re aiming at. What I see a lot of entrepreneurs do is thinking, “I’m going to be selling ultimately to the whole world, so who cares? I’m going to be like Facebook. This is going to be huge. Everyone’s going to be the path to my door.” That’s not how it happens.
Even Facebook started in one university with first years in that university. You need to establish a beachhead of customers who have a need that you can solve for. In the speaking realm, that’s about thinking about what people want to hear about, what do they hear from me about, my topic, and how much it’s going to resonate with that beachhead market is something you want to dig into. The best way to go and do that is going and talk to a few people and find out who is likely to be that audience who’s got their hair on fire about an issue and expertise on.
I always like to remind everybody that Amazon just sold books first before selling everything under the planet and got a good concept there. If you personally had experienced the problem, whether you’re a speaker or not and you have this is the problem I know, I always like to say, “The better you understand the problem, the better you have the solution both for your customers and investors.” As a speaker, if you’ve been in the shoes of your audience, not only does that establish credibility and rapport, but it goes to this first point of SLAM which is the unmet need. One of the things that might be helpful for the readers is an example of that. I’ll give people mine and then I’d love for you to contribute one that you might have thought of that’s not necessarily in the speaker world but something you’ve dealt with your broad base of experience. The way I position what I talk about is that the old way doesn’t work anymore of selling and the new way is this. That framework can work for almost anything and it pulls people in.
I say, “The old way of selling of just pushing out a bunch of information or throwing up a bunch of stuff against the wall and hoping something sticks isn’t going to be successful anymore. The new way is instead of pushing, you become a storyteller who pulls people in and makes you become magnetic.” People instantly go, “This is something I might want to know about and have a speaker come to talk about, because it’s so clear of what the problem is.” I love your feedback on when you paint that picture if the old way doesn’t work anymore, as you said hair on fire, so what are you going to do?
[bctt tweet=”Anyone who’s interested in becoming an entrepreneur is an entrepreneur.” username=”John_Livesay”]
What I’d like to do, John, is unpack that because you, as The Pitch Whisperer, are doing something even cleverer than the way you’ve described it. Let me tell you how clever you were. What you did is you recognize that the entire market of getting out there and speaking was enormous. You immediately narrowed it down and said, “People need to pitch the things. They need to pitch for something. It might be pitching for a promotion. It might be pitching for a pay rise.” In your case, you went fairly all-in on pitching for investments and saying, “In that room, there are people who need to get money and it’s a special relationship.” You need to tell the story to investors as a beachhead market so that they will listen and the product that you are supplying is going to be exciting to the people listening to that pitch.
What you’re doing is daring them to make that presentation in a story-oriented way. What you did was gone cleverly in my opinion into the unmet need by slicing the marketplace into a specific audience. A customer persona people could imagine and say, “I’m going to go out and talk in that area, write books in that area, talk about it on my podcast.” In so doing, you allowed yourself to dominate that segment. That’s the key. What you’ve then described is the way you now delivered on the product side of that, which is step three, because you are now adding unique value in terms of giving people a way of making that happen so you’ve become top of line as a guy who can help you while I’m pitching for investment.
What’s interesting referencing the Amazon example again is once I had that beachhead of investors and founders that I’ve helped get funding, I’ve now broadened it to companies like Honeywell or Coca-Cola. Even Redfin, which is a tech company disrupting real estate bringing me in as the sales keynote speaker to show them a new way of selling, because of my experience selling media for Condé Nast. I’ve been in their shoes. I know what it’s like to have a quota. I know what it’s like to be seen as a commodity. I know what it’s like to feel burnt out. Here’s the solution that works for me and it can work for you if you become a storyteller, X, Y and Z.
Those double-click of unmet needs for one market and then expanding it beyond others. What’s interesting for people to hear because whether you’re reading this and you’re a startup pitching an investor to get your startup funded or are equally important if not more so. As you know, Jon, startups love to see customers paying for something you’ve created to make sure there’s some proof of concept that you talk about, is one of the key value propositions in SLAM. You need to be able not just to sell your product to investors but sell it to a customer who’s going to pay for it.
When I was being interviewed and this will happen to everybody, it’s typically between you and in my case, two other speakers or if you’re the founder pitching an investor, it’s between you and all the other investors or the other founders pitching that one investor. They said, “I was up to speak to an executive search firm.” They said, “Have you spoken to other people in our industry before?” That’s a lot of people, especially if you’re trying to grow your business, so that objection comes up a lot. There’s some real value here of how to handle that that you talked about in SLAM.
The way I handled it was I said, “I haven’t spoken exactly to the executive search firm industry which has to pitch themselves to get new clients to find their next CEO.” I have spoken to another industry that has a similar business model to what you have which in my case was Gensler, an architecture firm and they have people who specialize in practice areas like you do. They have to go up against two other firms for an hour and pitch. They weren’t telling stories. They were presenting the designs and you are going in there. When you double-click, I said, “What’s the biggest challenge you have when you have that one-hour pitch?” This is so important to take away from what you said on this unmet need. Sometimes, people don’t even know what it is, but if you can identify it for them and then show your solution, Jon, that’s when your magic kicks in.
Launching Successful Startups: Once you’ve determined your value proposition is unique and different, you need to corroborate all of that.
One of the other things to add John to that is that the secret here is and it’s counterintuitive by having at least initially a narrow beachhead so you go out and maybe you help people to go and pitch to seed investors for example. That’s an incredibly narrow niche. You credential yourself as being able to deliver your value proposition so your ability to go and tell a story, to go and get people to cross the river as you often like to say, get to the other side. When you do that, people recognize you can jump to other segments because you’ve already proven you can dominate that one segment. They then buy it. You can add segment after segment and before you know it, you are the person who does pitching well in whatever circumstance. That’s what’s happened to you for several years.
We had an example of talking to the CEO of DHR International, this executive search firm. He said, “When it’s between two other firms and us, we always ask if we can be the last.” Research has shown that whoever goes last typically is more memorable. However, here’s the unmet need that you talked about, Jon. You can’t control that. It’s up to them what order you go in. When I identified that as an unmet need, we might ask to go last. We can’t control it. We hope we do so it increases our chances of being memorable. The real problem is you need to be memorable and you can’t depend on what order you go in. What you can control is telling a story that makes you memorable and when you do that, no matter what you’re pitching, you could be first and you set the bar. That’s why they ended up hiring me when he understood how I was solving that for his audience. The book SLAM says, “That’s your core foundation to getting a yes, whether it’s funding clients or pulling in people on your team,” which is the second part of SLAM.
Let’s talk about the importance of team and if you don’t mind, I’d also like to add in the importance of culture that goes with it which I know is a little bit of what you talked about in the second part of the GRAND elements. I want your opinion here, Jon, on how important is it for you to create a team even at the very early stages that understand the culture you’re creating so that they know if it’s a fit for them or not.
The keyword here for me is the right team. Once you’ve uncovered the unmet need and the beachhead market that’s got their hair on fire about that need, your job is to think who it that consoled for those problems is. Clearly, the founder is the main person if you’re a speaker. If it’s a one-person band, it’s you, but you’ve got to think about what else that sector needs for me by way of expertise, by way of production values, by way of the way communications occur, distribution of information before and afterward. Even a speaker will have a fractional team around them, an army of people that might do bits of the work. They make you stand out and shine. In a company, you’re going to be recruiting people progressively and what you want to do early on is shape that team so that its culture is completely consistent with what you’re trying to deliver by way of value.
The team is the old adage that a lot of people on the investment side invest in the jockey and not the horse. The jockey is always the team and the quality of that team and it’s not a single founder or the person who had the idea. It’s the people they surround themselves with, both advisory and direct, fractional, full-time, part-time, and all the rest of it. That’s why it’s step two on the SLAM map. It is almost as important as covering that unmet need.
Even as a speaker, I’ve had to find people that I feel are the best team to be my speaking agents or to create the website and the design of what my brand is, even down to the color choices. If I don’t have a clear sense of who I am, what I stand for, what I want my brand to stand for, how can I possibly explain it to the people on my team? That’s what its visionary skills, painting that picture keeps going back to SLAM number one. Here’s who I helped, here’s the problem myself, and because of this, here’s the feeling I want when people go to my website or when you’re looking for an agent.
[bctt tweet=”Entrepreneurship is a venture where you uncover the unmet needs of your target audience.” username=”John_Livesay”]
What’s your beachhead as you say, Jon? I get very specific with them. I’m like, “Here are my five specialties, technology, healthcare, real estate, automotive, and design.” Anything as a sales team in those areas that’s who you pitch me to. Think how much easier I made it for the speaking agent to know exactly what to put me up against, and who to recommend. Otherwise, it’s like you’re a sales keynote speaker. Do you know how many there are? What’s your hook? What’s your niche? All those things are blurry until you can define it that short and crisp. That’s what SLAM helps people do.
What you’re wrapping around that is having a clear vision in terms of what you’re doing, in terms of meeting that unmet need with the product you want to supply. I like Peter Thiel’s statement in his book Zero to One because you also want to get people who can take a step to change the difference in terms of that beachhead market issue. They do get a result. If you’re pitching for investment, what’s a great result? I got investment or at least I shortened the time it took me to get the investment I needed. If you’re delivering that, people beat a path to your door so your cost of acquisition of new clients goes down as a result of that.
For example, to have those stories ready to go at a moment’s notice, whether it’s your elevator pitch or you’re in the call and it’s between you and two other speakers or you and some other investors, or you and two other clients that you’re pitching. I will say, “That’s the value of storytelling. Would you like to hear the story of how I helped this architecture firm win a billion-dollar airport renovation?” That’s the value proposition. You already know the outcome. Here’s the story that you can then use to win your next big pitch for the business. We’ve got the unmet needs, the team, and now the value prop then we want to test this out and the social proof is great for that.
What you’ve got in steps one, two, and three which is on the diagram of the SLAM map and the book elucidates is the rock on which you’re going to go and build your speaker career or your startup or whatever it might be, a side hustle. Your value proposition is unique and different, but you do want to corroborate all of that. Step four is the corroboration step and it’s a pivot point. It’s almost a fulcrum around which the rest of the map operates. You’re constantly testing with your audience whoever they may be that the assumptions and the beliefs that you have about what can be successful are true in their words and their eyes, not you guessing. It’s corroborated by the target customer you’re aiming at, that they are doing the corroboration. The more you do that, the more you do risk your startup and the more attractive you become to new customers and indeed investors you want to come and invest in you.
Here’s an example of that. The irony of me having to sell myself to get hired, to be the speaker, to DHR International, the executive search firm, was that after I was giving my keynote, I also did a workshop for them. They would say, “There are competitors, other search firms that have placed more executives in our particular niche.” How do we handle that objection? I tell them the exact same story of how I connected the dots from an architecture firm using the same business model to their business model and what other companies have you worked with that you could do that front to answer that objection. They went, “Oh.” The test was that’s how I’m in front of you. I know this works and you can use this too so that’s where it becomes great.
The next part of what you talked about in SLAM is the market size. I’m always talking to people about putting their own roadmap together in terms of invisible to irresistible and all the steps along that ladder. You can’t keep working with your core clients because things happen. People leave. Businesses get disruptive like Disney buying Fox. Suddenly, Fox is not hiring a lot of people and if you’re in charge of finding executives for Fox and you haven’t been growing your market in other areas, you’re in trouble. Speak a little bit about what somebody should be looking at in terms of market size. What can I do to see how big this could get or how do I scale something?
Launching Successful Startups: Podcast is an excellent example of content strategy where you can leave a legacy and people can access it through time.
It’s all about scale trajectory and velocity in this section. What you’re doing is saying, “How big is the pond I’m fishing in and is it going to be big enough to give me the velocity, the growth, or the traction that I need?” Your beachhead market might take you quite a long way, but it might not stay the same. Things change in the world of log so what’s going to be your approach and how big is that market? In some cases, the pond is not going to be big enough and it’s not going to grow fast enough.
You might have to look beyond this, and your job is to measure this. Your ambition might be different. You might want to say, “I’m in a lifestyle business. I’m a lifestyle speaker. I’m more than happy doing twenty gigs around the country may be and that’s enough for me.” If you want to go and be Anthony Robbins and you want to go and do a multimillion-dollar business out of all of this in books and promos and everything else, you’re going to have to think about the market in a different way. The key is to have metrics around that that are rigorous so you know where you’re heading, and you can do risk at that side of it as well in terms of that whole analogy of fishing in the pond.
You talk about in SLAM the next thing is how to reach these people. Are you going to use Instagram or Facebook or something else completely different? One of the things is this concept of lateral thinking and not doing what everybody else is doing to reach your target.
You can perhaps get the clue that even in the price that you’ve taken, you should have started forming a view of where beachhead mark you’re aiming at, at least initially, hang out. What do they pay attention to? Are they reading blogs? Are they reading emails? Can you reach them by email? Is it social media or which platform within it? Do they hang out at trade shows? There are a number of channels. You can’t be in all of them. You don’t have the bandwidth in time and you don’t have the money usually on the tip to do all of them. You’ve got to be careful about the channels and make sure they’re consistent with where people pay attention and then you want to go and put your budget together so that you can test those channels on an agile basis. Go to market is a practical way of saying, “How am I going to get the message to the particular audience that I found in the unmet need section right back at step one?”
One of the things I’ve done that I want to give as an example for people to start putting their thinking caps on is using a podcast as a marketing tool. One of the things I’ve done is there are quite a few speaking bureaus out there. Some you have to be exclusive with but a lot of them you do not. In other words, as a speaker you can be represented by multiple bureaus and they each have the different clients that they pitch different speakers to. However, you can imagine how many speakers are pitching them to represent them all the time.
I was fortunate enough to get a gentleman named Bernie Swain who wrote a book on entrepreneurship and started the Washington Speakers Bureau which represents almost all the former presidents including going back as far as Reagan. He reached out to me because I had created a podcast that had value and he wanted to be on it. He didn’t even know I was interested in the speaking business. I did him a favor by having him promote his book on the show which then gave me that first leverage so I could go to other speaking bureaus, many of whom based their business model on his and say, “Would you like to be on my podcast to tell your story of how you started your entrepreneurial bureau? By the way, one of the leaders in your field, Bernie Swain, has been on my show.”
[bctt tweet=”Always think of how to add value to your customer because their pain is costing them.” username=”John_Livesay”]
That was relatively easy. Suddenly I have something of value to offer them. During that interview, they get to like and know me and then many of them, almost all of them I believe have said, “We want to represent you now.” If I call them cold and said, “Let me tell you about me,” without giving anything, it’s not the easiest thing to do like an actor getting represented by an agent. I wanted to throw that out there as an example of lateral thinking of what is that I can do that I don’t see other speakers doing well. Many speakers that have a podcast, some do like Tim Ferriss, but are they using it to get bureau agents to represent them? He doesn’t need to but somebody at my level, like looking at the landscapers you talk about in SLAM and figuring out what is it I could do with the resources I have and the way that no one else is doing and then that comes to life.
It’s an excellent example. In fact, it’s an example of a content strategy but not traditionally most people would think about blogging or going out on social media platforms but a podcast is a wonderful way of leaving legacy content that people can access throughout time and you can put these things up on other platforms as well at the same time so that people can listen to, other than credential you as someone that can help them. It’s a very good example.
One bureau was celebrating its 20th anniversary so they use being on my show as part of the promotion for that. It all worked out and then the final element of SLAM is the actual business model. How am I going to make money?
This is crucial and it’s the step before the last because you do want to enter the ecosystem in step eight on the SLAM map, but it’s probably the one that matters the most from an investor perspective because if you can’t make money in terms of what you’re doing, you’re going to be in trouble. There are many ways to do this and it’s not about pricing. It’s not about slapping a price and saying, “I’m going to charge something similar,” or any startup that thinks that way. The key here is thinking about how do I add value to that beachhead customer and their needs because their pain is costing them something emotionally or actual money or resources or sheer frustration and friction.
What you’re doing is come along and say, “I’ll take that pain away. What’s that worth to you?” If you can do that, you are demonstrating value-added and sometimes it’s like 2x, 3x, 5x. If you’re doing that, you have a monetization model that’s working and again, you become investable because people can see that the face for those of you that are high so it needs a lot of care and attention to craft the business model well whatever it may be.
SLAM: Build your startup idea or early stager business with the Startup Launch Assistance Map
What you’ve created here, Jon, I believe is almost like a Sherpa helping someone climb Mt. Everest. Without a map, without someone like you with all your expertise and guidance saying, “Do this then do this. Don’t do this out of order.” It’s like you’re trying to help somebody bake the cake who’s never baked a cake before. They forget to preheat the oven or they don’t put all the ingredients in them or whatever it is and then they wonder why it doesn’t rise. You have given a proven step-by-step process that’s so valuable. I’m sure there are many people who wish they’ve had this earlier in their career, but the good news is it’s available now. You’re sharing your wisdom, your expertise. The book is called SLAM. Tell us how else people can work with you?
I spend my time mentoring startup organizations of all types. My passion space is healthcare and within that, I particularly like the 50-plus population and companies that are solving for all the unmet needs for people who are 50 and more. They tend to get marginalized by society. There are many needs and not in healthcare. It’s in many other realms at the same time. Anybody who’s got a side hustle ideating around this or a small company that’s thinking about the older adult community I’m particularly interested in working with. I run a virtual incubator every quarter. Eight companies come into that virtual environment. We make a six-week sprint to go and go through the SLAM process.
That’s something they can look upon the SilverMoonshots.org website. It’s listed right there. I’m happy to engage. I’m happy to explain the SLAM process. Some of the resources, the actual map itself, both front and back, are on the website at SlamProcess.com. Those are free resources for people to download all of the questions and all of the eight steps on the SLAM slide are there. You can turn it over when you’ve got product-market fit and validation and go to the execution side, the GRAND side, and hopefully get a GRAND SLAM over time.
It does become your Bible what you’ve created for people because it’s done with so much thought and visual. It is so well done and so well executed. Congratulations on that. There’s a whole video that goes with it, a map. You’re like the GPS for businesses.
I hope it’s a good tool to help people explore. I hope people don’t think of it as a cage. It’s an enabling tool I hope to explore your idea.
Thanks for being with us, Jon.
I appreciate it.
Important Links
- SLAM
- Jon Warner
- Silver Moonshots
- Zero to One
- Bernie Swain – Past episode
- SlamProcess.com
- Better Selling Through Storytelling Method Online Course
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Pursuing A Life Of Significance With Aaron Walker
Posted by John Livesay in podcast | 0 comments
Having money, a big house, and a profitable business can lead to a fulfilling life – or so we all think. In this episode, discover what a life of significance truly means as you learn from life and business coach Aaron Walker. Successful in business, Aaron first experienced retirement at the early age of 27, but it did not scratch an itch he thought it would. Learn how pursuing a meaningful life led him to masterminds and a podcast, and his “why” in writing his book, View from the Top.
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Listen to the podcast here
Pursuing A Life Of Significance With Aaron Walker
Our guest is Aaron Walker who is a life and business coach and runs masterminds for men. He’s a veteran businessman. He continues to inspire countless entrepreneurs with his leadership skills and his transparent and authentic life. His purpose in life is to mentor men to be better versions of themselves. Having more than 40 years’ experience and more than a dozen startups allow him to lead with confidence. He is the author of View From The Top, Living A Life of Success and Significance. He shares practical insights and wisdom on how you too can find hope and inspiration. He has an amazing real life-story that will challenge your thinking and motivate you to action. Aaron, welcome to our show.
John, thanks for having me.
Would you mind taking us back to your own story of origin? I would love to find out what made you who you are. You can go back to your childhood, high school, college or whatever grabs you.
I’m going to take you way back. I’m almost 60 years old now so I’ve got to go back to when I was thirteen years old. My dad woke me up on a summer morning and he said, “Get out of the bed. We’ve got some work to do. We’re going to go down and we’re going to remodel a pawnshop.” I said, “Can I make any money?” He said “Yes.” I said, “I’m all in.” I didn’t even know what a pawnshop was or know what that was, but I went down and helped him for the summer. When we got through doing that project, I went up to the owner at the time and he was 23 years old. This guy was opening a pawnshop in Nashville, Tennessee, where I’m a native. I said, “I don’t even know what a pawnshop is but I go to school across the street and I would love to work here after school and on the weekends.” He hired me on the spot. I worked every day and then on Saturdays and two years later when I was fifteen years old, I decided this is what I want to do for a living.
People asked me, “You’ve got to be kidding. What did you enjoy about it?” I said, “It’s the people. I love the different people that came in.” I went to summer school and night school for eighteen months. I had enough credits to graduate at the beginning of my junior year. I started working every day and I met a couple of guys with a lot of money because I didn’t have any. My parents were very poor and I didn’t have any money. I went to them one day and pitched us going into business together and they laughed at me. They own the 21st largest insurance agency in the country at the time. I said, “Why don’t we take my pawnshop experience and your money and open a store?”
They said, “Mr. Walker, how old are you?” I said, “I’m eighteen.” They started laughing again. They said, “We’ve never had anybody eighteen years old approach us.” I said, “That’s beside the point. Are you interested?” After two months of negotiation, they agreed to do it. I went and opened a pawnshop when I was eighteen years old. I wasn’t even married. I was still living at home. A year later, I get married to Robin and I said, “We can’t mess this up.” We agreed to pour every dollar back into the business. In 36 months, I paid off a ten-year loan. I was 21 years old. I had a paid-for-business and I said, “I can duplicate that.” I did and then I did it again and then I did it again.
When I was 27 years old, a Fortune 500 came and made an offer I couldn’t refuse and I retired. I was 27 years old and I thought this is the American dream. I go from broke and a convict to making enough money to retire by the time I’m 27. That lasted about eighteen months. I got fat and lazy, I was getting in the bed in the middle of the day and Robin goes, “This is not what I signed up for.” I went back and bought the company I worked for when I was a kid. We spent the next ten years quadrupling that business. As I shared with you a little bit earlier, I had a very serious accident in 2001 where I ran over and killed a pedestrian. It rocked my world when that happened. I sold the business. I took off for about five years and didn’t do anything. We traveled around the world. We built a new house and took a break.
My wife approached me again and said, “You’re getting fat and lazy again.” We go into the construction business. We build a very successful construction company. I turned 50 and I retired. Robin goes, “You’re going to drive me crazy if you don’t do something.” The mastermind members of mine, which is Dave Ramsey and Dan Miller and some of those guys said, “What are you going to do now?” I said, “Nothing. I’m going to retire. I’m going to call it good. I’ve been working since I was thirteen.” They said, “You’re too young.” I started coaching. That led to doing podcast interviews which led to mastermind groups. Now, we have fifteen mastermind groups, 150 men from nine different countries. I’m having the absolute time of my life helping people be successful and significant.
That is quite a lot to unpack. I love the story of the fantasy that, “I’m going to retire at 27. I’m going to retire at this age.” There’s something about not being relevant and not giving back that I think you are probably more equipped than almost anyone else because you’ve gone through this multiple times. It’s almost like in the Wizard of Oz when you go behind the curtain and you say, “That isn’t it. That’s the fantasy.” You work hard to get to this place where you don’t need to work and then you can find a life of significance. You’re saying it isn’t the answer.
It’s not the answer at all. I thought it was, and I want to warn people, if you’re working to stop, quit doing that because it doesn’t scratch the itch like you think it’s going to. I thought by being a poor kid that I was going to have enough money, this big fine house, a vacation home, nice cars, that I was going to feel meaningful and purposeful and I was going to live a life of leisure. Quickly, I discovered that it’s not what I thought it was going to be. Don’t hear me wrong, John, I want to make this clear. I hate when people with money go, “Money is not important.” I want to go, “You liar.” It is important but I don’t want you to make it your only focus. I don’t want you to make it your God. Focus on why and your purpose in life, then you have something that’s tangible that you can hang your head on.
[bctt tweet=”The Facebook persona, for the most part, is just a lie. People don’t really share the things that are going on in their families.” username=”John_Livesay”]
Aaron, what motivated you to write your book, The View From The Top? The thing that I love about this is not just success but success and significance.
To be totally honest with you, I didn’t want to write the book and let me tell you why I didn’t want to write the book. As I said, I’ve been in a mastermind with these guys that are here in Nashville. We all live in Nashville, Tennessee for decades now. Sitting on my left for ten or twelve years was Ken Abraham. Ken is probably the most noted ghost author on the planet. If you look him up, you can see he’s written over 95 books and some of the biggest name people on the planet. He’s written their books. He had sold millions and tens of millions of copies of books and sitting on my right was Dave Ramsey.
They’re all good friends of mine. Anyway, Dave has written a dozen books and sold millions of copies and Dan Miller sat across the table from me. He has 48 Days To The Work. He’s written seven or eight books. I said, “Who’s going to read my book?” I’m in this group, with all these people that are very successful, who’s going to read my book? Ken Davis did my mastermind group and Ken wrote a book called Fully Alive. He’s traveled all over the world. He’s a keynote speaker. He’s an amazing guy. He said, “Aaron, you’re writing the book for the wrong reason.” I said, “What do you mean?” He said, “When I wrote Fully Alive, the first year it came out, seventeen people wrote me an email and they said, “Mr. Davis, I didn’t commit suicide because I’ve read your book Fully Alive.” He looked at me and he said, “Aaron, if you can change one life with your book, will it not be worth it?” I said, “You’re right. It’ll be worth it.” I’m going to write that book because now the reason is different. Now, I write the book to help people uncover for themselves what’s important in life. I teach them how to be very successful financially, all the while being significant. That’s the piece that people are missing.
I have loved this concept. My own personal mission is to help as many people as possible get off this self-esteem rollercoaster where they only feel good about themselves if they’ve gotten a certain amount of success or book sales or whatever it is, likes some social media. What I hear you saying is when you let go of that attachment of how many books did I sell and that is it more than this person and comparing yourself to other people, you are free to create something with a very different purpose without the attachment to the outcome. Would that be an accurate summary?
100% and first of all, you’re never going to win in a comparison game because I even almost did it at the beginning myself when I looked at Ken Abraham and Dave Ramsey. I said, “How could I ever compare to this?” I couldn’t compare. After the book first came out, a guy that was in my mastermind group, his young son picked up my book and read it and there was a life transformational experience for him as a result of reading this book. He got onto a different path. He was on some substance abuse and he couldn’t get off of it. This book helped him reframe his life. I got a phone call from him and said, “Thank you for your book because it’s radically transformed my life.” I went in and told my wife, “If nothing else happens, if I don’t get any speaking engagements, if I don’t get anything, if nothing happens, it’s changed this one man’s life, his family tree.” It was worth the effort. It was worth the time.
You touched earlier on the pedestrian fatality that you didn’t intentionally cause, but it did happen. A lot of people would not be so transparent and authentic about that and yet you are. I want to bring that up for people to take a look at that blind that we’re only as sick as our secrets or people can always tell when you’re trying to hide something. People who haven’t experienced something like that, we all have something that we have trouble forgiving ourselves for, I would imagine. I know someone who that happened to him as well. He did it as a young boy. First of all, I have several questions about it clearly. I want to acknowledge and applaud you for your authenticity and transparency because when you are willing to do that, you inspire other people to do that. My first question around is what made you so confident to do it and tell that story?
First of all, by being around very successful people and coming to discover early on in my career that the Facebook persona, for the most part, is just a lie. We don’t share the things that are going on in our families. Everyone sees is the nice house, they see the nice car, they know you have this job and you’ve got 2.3 kids and you’ve got 3.7 cars and you’re living this thing. They’re not privy to the conversation that’s going on inside of the home. Inside of the home, one of the partners is working more than they should and they’re doing it at the expense of their family. They come home one day with a pocket full of money to a house full of strangers. What I’m teaching people to do is to prioritize your priorities and focus on what matters. The only way that you can do that is to be authentic and transparent and vulnerable with a few people.
I’m not saying go out and air your dirty laundry to the world but I am saying that you need a group of people around you such as a small group, an accountability group, a mastermind group or a connect group. You can call it whatever you want to call it, but you need an environment where you can go and go, “Things are not going so well right now. I’m struggling in my relationship. I’ve got a child that’s gone wayward. My job is on the bubble. I’m not even going to have an income a few years from now. I’m not making my mortgage payment. I’m wrestling with these trials and tribulations in my personal life and I don’t know where I stand as an individual and I don’t have this self-esteem or this hyper sense of awareness to myself and I’m getting myself in trouble.”
The reason that I am so authentic and transparent is that’s where strength begins. When we address who we are as an individual to a group of non-biased, trusted advisors, they then can help us. If they’re giving us advice on things that we’re telling them that’s not reality, how in the world could we ever get good advice to go forward and build on a solid foundation? I’ve had the privilege of experiencing that with a number of very successful people. That’s why I come forward with telling my story.
Authenticity and transparency are where strength begins. That’s such a powerful way of combining something that people think, “It doesn’t seem like you’re coming from a place of strength at all,” but in fact, it is. Was it hard to forgive yourself and any other insights from that experience?
A Life Of Significance: People struggle to have enough money and material things thinking that they’re going to feel meaningful and purposeful. Disappointingly, many discover that it’s not what they thought it would be.
It’s been eighteen years and the first five years were very difficult. I had to go to a lot of counseling and talking to a lot of trusted advisors to help work me through this. First and foremost, I do want to mention, it was not my fault. It wasn’t an error of judgment. He didn’t see me. He was 77 years old. He was crossing the street to catch a bus and we found out later he couldn’t see good and he run right out in front of me. It was a very horrific automobile accident. Still, he was somebody’s father, somebody’s husband, somebody’s brother and it took me years to work through that.
What I come to realize working through that is how fragile everyone’s life is and in the book, View From The Top, the chapter that I talk about this, I call it Blindsided. We all can be blindsided. There’s not a person listening to my voice right now that a phone call might not change your life. Something could happen that’s devastating to your life. You may get a message or a note or a phone call that you never saw it coming. What I discovered through this accident was that we had had tremendous success early on but it was all about me and my family. What I started thinking about was my legacy. I said, “What would my legacy have been?” My legacy would have been, “A poor kid from Nashville, Tennessee makes enough money to retire at age 27 and nobody cares.” I said, “That’s not what I want. What I want is I want John’s life to be better as a result of having known me.” That’s the reason I share this.
That leads right into the never-ending power of a mastermind. You were talking about how you started your own and now you teach other people how to create them. Tell us the journey of masterminds and how people can either possibly start their own or join yours to find out.
I appreciate that and I want to touch if I may on some of the reasons that I think being in community is so important. You call it accountability mastermind. You can call it whatever you want to call it. We weren’t designed to be in isolation. Isolation is the enemy of excellence. We’re designed to be in community and we need people around us at all times. First of all, for accountability purposes. If you think about it, we need people calling us out. We need a sense of encouragement today. We need people to come up to us and say, “John, I believe in you. I know you can do this.” We can find that in the community. We need relationships which I think is the most important asset that we could possibly have. We all have blind spots and a lot of people are unaware of those. We need people to call us out and say, “John, I’ve noticed that you’ve saved this. I noticed that this is going on frequently in your life. This is going to catch you if you’re not careful.” We have people pointing that out.
I also say that masterminds give us access. It allows us to be in other spheres of influence. We talk about the insight that it can give you. We talk about perspective. What it gives me more than anything is the ability to see things differently. There are so many things like that that we have insight, different things that we need in our life that we would never have in a million years. It’s the insight that it can give us. There’s spiritual health that we need. There’s vision, there’s mission, there are values, there’s so much that this community or mastermind can give us.
That’s the reason that I am on such a quest to be sure that everyone is involved in this. People call me regularly and they call me big A. They say, “Big A, how in the world have you scaled masterminds to the level that you have?” We developed a program called the Mastermind Blueprint. What this is, it’s teaching people if you’ve never even had a mastermind how to start it, how to grow it and how to run it. A lot of people want to scale it to the heights we have. Other people just want one or two groups. If you start thinking about your sphere of influence and the impact that you could have on other people’s lives, you could start a mastermind and impact and have life transformational experiences for the people you know.
Yours is called Iron Sharpens Iron. What a great visual that is. Describe how you came up with that as a name.
I’m a Christian by faith. A biblical proverb is Proverbs 27:17, “One man sharpens another just as iron sharpens iron.” I’ve had the privilege to be in these groups where they call you out. They call you out and say, “I’ve heard you say this or I’ll watch you do this or you don’t do this.” In order for you to get better, these are the things that you’re going to have to do. It’s not for the faint of heart. We need people in these groups that are willing to call one another out and we just decided that if we’re going to help other people accomplish their dreams and goals, there have to be some sparks flying. That’s why we call it Iron Sharpens Iron.
What a great analogy. You’re only focused on men. If there are women that are reading and say, “I would like to start a mastermind for women,” could your program work for them?
Let me explain that a little bit. Some women get offended by this and let me explain and hopefully you won’t be offended. Women have become our biggest advocates because they say, “Big A, you’ve done something with my man. What have you done? He is not the guy now that he was when he joined ISI.” There are women’s groups out there. Michele Williams has BVU, Better Version of Yourself, a mastermind for women and does the exact same thing. I can introduce you to Michele. I’m happy to do that but our course is gender-neutral. If it’s women, if it’s man, if it’s mixed, it doesn’t matter. We can walk you through the process. We give you two and a half years’ worth of content to teach you and to help you along the way. You don’t have to create anything. We give you the lead magnets. We walk with you for six months, twice a month. You have support from us that gets you up and going. We don’t leave you. Once you buy this, we walk with you through the whole process.
[bctt tweet=”Isolation is the enemy of excellence. We need others to help us break our upper limits because we all have blindsides we need help seeing.” username=”John_Livesay”]
For people who might not understand the distinction, can you compare this to mastermind versus a networking group?
For group coaching or things like that, this is a whole different level. This recaps what I’ve been talking about the whole interview. You can do group coaching, you can do networking but you just deal with the surface level when you’re talking about networking. I’m talking about something that’s life transformational, personally and professionally. I’m talking about people that walk with you on a weekly basis to help you accomplish your goals, your dreams and to hold you accountable, to connect to you and to give you the resources that you need in order to be successful. I could stand up here for an hour and give a dissertation or I can lead a group coaching but that is not going to have the same impact if you get in a group and you’re meeting with the same ten trusted advisors week in, week out, month after month, year after year our people have in our groups. We’ve had people to double, triple and quadruple their business. We’ve had people that have absolutely transformed their personal lives because they have this close-knit community, their board of directors that walk with them every single day.
You talk about that isolation is the enemy to excellence. Many people don’t realize the importance of having a tribe or not doing it alone all the time. Can you speak to why isolation is the enemy of excellence?
If I don’t fess up and I don’t tell you, then there’s no one checking in. If I don’t push the ball down the field, no one knows. Brian Moran wrote a great book called The 12-Week Year and we’ve implemented that into the very fabric of what we do. You focus each and every day on these lead indicators. You focus on the task. You have weekly accountability meetings related to the objective that you’re trying to accomplish. You repeat that every twelve weeks. Procrastination is the enemy also. We continue to procrastinate and this doesn’t allow you to do that. We have people around you and that surround you, make sure that you focus on the task at hand and then the goal takes care of itself.
The reason that the isolation is the enemy to excellence is if you don’t tell anybody, they don’t know. If you don’t share your troubles, you can’t get over your Achilles heel or your blind spots. When you have people surrounding you, they can encourage you, they can help push you through these upper limit challenges. We all have upper limits challenges. It doesn’t matter who you are. We all have a threshold that we bump up against the ceiling and these people can help take you to a different level. It opens doors and possibilities that you never dreamed possible. I would just suggest that if you want to excel, you have to get involved in some topic community so that you can be all that you were called to be.
We all have upper limit challenges and it’s from our childhood and our belief systems. If we’re not associating with other people who can hold us accountable, show us where we’re limiting ourselves, whether it’s a belief or a behavior that needs to be changed, then we will just stay at our own upper limits there. I imagine that part of this successful mastermind is the quality of the people that are in it. Can you speak to what criteria you use when you help people develop their own mastermind?
When we first started doing mastermind groups, if you had the fee you could get in and I quickly saw that wasn’t going to work well. We developed an application process that we go through and we do an interview. We vet every single person that comes in and we turn away a number of people because they’re takers, they’re not givers. What we are trying to do is to fill up a room full of givers because in the natural reciprocity, you’re going to get all you need. When somebody is interested in themselves, they only want to come in and get out of it, if it’s only beneficial to them, that’s not how you grow. That’s not how you build relationships.
We take a look at the motivation of why you want to be into groups. Once we establish that you are the giver, then we go through a series of questions. There are about 25 questions. How we can help you? More about your family. What you’re trying to accomplish? What your long-term goals and aspirations are? It’s a very lengthy process and then once we worked through each and every question, we determine whether you’re a good fit for this group or not. When you’re very careful vetting this many people, getting the right person in the right seat, as Jim Collins says, on the right bus, there’s the magic that happens when you have that level of synergy.
You certainly are walking your talk and hats off to you for that. Then taking it one step further and allowing people to not just hear about it but learn how they can start and run and scale their own mastermind. I haven’t seen or interviewed anyone else who’s doing that and you’re taking your own success and not just showing people, “Here’s some fish, learn these life lessons.” You’re teaching them how to fish, which is such a great gift because you’re scaling the scaling.
Someone asked me, “Why do you do this? Why don’t you just continue to add mastermind groups, other facilitators?” There are seven billion people on the planet. We have 150 people in our mastermind. I have an abundance mindset. If you have an abundance mindset, you’re willing to show your cards. I don’t hold them close to my vest, I’m like, “First of all, I live it and I do it and you teach it.” We’re at the stage in our career where now we’ve lived it, we’ve done it and now we’re teaching it.
A Life Of Significance: Masterminds give you access to be in other spheres of influence and the ability to see things differently.
How can people follow you? I know the website is ViewFromTheTop.com. If someone has been motivated and said, “I need to learn how to start my own mastermind,” what’s the next step?
The easiest way is to go to ViewFromTheTop.com and I make myself very accessible. My phone number is there. My email is [email protected]. Reach out and send me a note and I’ll personally give you a call and we’ll talk through it. I’d love to be able to share with you more as well.
I can’t thank you enough for sharing your time, your wisdom and your passion. You are someone who I’m glad to have in my world.
Thank you, John. I certainly enjoy being with you.
Important Links
- View From The Top
- 48 Days To The Work
- Fully Alive
- Mastermind Blueprint
- Iron Sharpens Iron
- Better Version of Yourself
- The 12-Week Year
- ViewFromTheTop.com
- [email protected]
- Better Selling Through Storytelling Method Online Course
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The Titanic Effect: Helping Startups Navigate Through Icebergs with Drs. Todd Saxton and Kim Saxton
Posted by John Livesay in podcast | 0 comments
Hitting icebergs is just part of the business, especially when you are in the startup stage. Nevertheless, it does not mean that you can’t steer away from them because the fact remains that these mistakes can be costly. We double up the insight in this episode as host John Livesay interviews business professors Drs. Todd Saxton and Kim Saxton. Giving us a preview of their book, The Titanic Effect, they help startup founders navigate the icebergs that so often sink startups in the ideation and early stage of development. As they touch on the four oceans that startups have to get across and how they can do that, they also offer great advice on practicing your pitch.
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Listen to the podcast here
The Titanic Effect: Helping Startups Navigate Through Icebergs with Drs. Todd Saxton and Kim Saxton
Our guests are Drs. Todd and Kim Saxton. They’re award-winning professors at Indiana University’s Kelley School of Business as well as co-authors of The Titanic Effect. The book is a practical guide to help startup founders, as well as their investors and supporters, successfully navigate the icebergs that often pop up that sink startups in these early stages. They’re going to share their decades of academic and professional experience, business strategy, marketing, venture-funded startups to help you navigate these deck burgs that often sink early startups. Drs. Todd and Kim, welcome to the show.
I’m fine. Kim is fine. Thank you so much for having us. It’s a pleasure.
I’m excited to be here and chatting with you.
Let me ask you to each tell me your own little story of origin before you became professors, married and all of that stuff. I love to hear one of you start and say, “When I was growing up,” you can go back as far as you want, “my dream was,” and give us a sense of how you became a professor. We’ll get into the story of how you started working together and got married.
Here I thought you were going to do the origin story of how we got together, which was already dialing back many years.
I’m always fascinated, especially people who dedicate their lives to teaching the university level. Did you know in college this is what you wanted to do or did you as a young girl know, “Someday I’m going to be a professor?”
If I say what my real childhood dreams were, honestly, my first dream was to be the president of the United States. I went to MIT because at some point in high school I discovered I was good at math and computers. I worked in a debit processing center at the local junior college and got to play with some of the first personal computers that were coming out. By the time I got to MIT I had realized, that whole be the first American female president was going to be a tough way to go and would be fraught with a lot of icebergs even though I didn’t know that term. I thought, “I’m going to go make money instead. That’ll be a lot more fun.” We both got into consulting directly out of college, helping companies identify what they’re going forward, strategies ought to be as what I did. Todd did something some related. Todd started to want to go back and get a PhD and follow in his dad’s footsteps of being a professor. I pulled out my SAT scores and I discovered that what I told the SAT when I took that exam to get into college was that I wanted to be a professor as well.
[bctt tweet=” Practice your pitch on your least likely prospect first. ” username=”John_Livesay”]
I can’t wait to hear. Your dad was modeling for you, Todd, what a professor’s life was like?
The academic connections, it’s funny because Kim and I have both been out six years from college and working in business consulting on the East Coast. Circle back a little bit, I’m a Jersey boy. I grew up selling newspapers on the Jersey shore. My mom bought the lawnmower in exchange for me mowing our own lawn for free, which meant I could use the lawnmower to mow our neighbors’ lawns. That’s my connection back to your network.
I can relate to you both well of Kim talking about early computers. I was at the University of Illinois in Urbana-Champaign and we had Plato where you can touch the screen back then. That was totally cutting edge. I don’t know if you’ve ever remembered or heard of those. I also had a paper route, Todd. I would do the entrepreneur thing, knock on the doors, “Do you want to subscribe?” You sell it, you deliver it and you’ve got to go collect it at the end of the month.
If you’re good, you make your money in tips.
Don’t throw it in the bushes.
There are things you throw in the bushes in New Jersey, but it’s not your customer’s newspapers.
Ironically I skipped over that. My early pitching was as a Girl Scout, I went door-to-door. Those times you had to haul the boxes with you. After a little while, you only had one type of cookie left.
You had pushed those. The mints are gone. Now we’re pushing peanut butter or something. I can relate.
You learn how to message pretty quickly so that you don’t have to haul those cookies back to the house.
The Titanic Effect
Let’s hear those story of the origin of how you too wonderful people connected. You can make it as romantic as you want or as academic as you want. The choice is yours.
I’ll share the non-romantic part. Our first jobs out of school were at the same consulting firm in the DC area. Kim was the sixth and I was the seventh person hired. This was a relatively small entrepreneurial consulting firm. For the first few months, we struggled to work together. We did not get along. Kim may ask me to cut this out, for now, just between us, when we started dating and it got serious enough. We were like, “One of us probably has to leave.” Kim went to talk to the founder to say, “I’m moving onto something else. Part of the reason is I’m dating someone here.” He went through every member of the company, including some that were married, the other women, the janitor, the company dog and the only entity left was me. It was like, “It can’t be Todd.”
We got to keep that in. That’s at least likely to be dating. Kim, what’s your version of that story?
It’s pretty much like that. In fact, at that time, I was conservative and he was clearly liberal. There were so many different ways that we should not get along at all. As we tried to work together, that same founder one time said to me, “Would you stop yanking his chain already?” I didn’t realize I was. What ended up happening is that over a weekend thing, we realized that there was some attraction. We thought, “You can’t ignore chemistry so what we ought to do is probably date and get this over with so we can move on to the real love of our lives.”
It’s fascinating because I talk about going from invisible to irresistible in a business sense but also in a dating sense. If you have so much pressure that this has to be the investor that funds my startup or this has to be the customer that hires me or this has to be the love of my life. It’s too much pressure. If you think instead of, “Let’s get through this and we know we’re not going to be a fit, there’s no pressure.” The irony of that, if people could take that away from this show, I’d be thrilled that if you start to hold things a little lighter in your hands, how much that shifts things.
That’s interesting as a way to think about it. I never connected these two before. I counsel entrepreneurs when they go to their first pitch, whether it’s for money or a customer, go to the one you think is going to be most challenging and least likely first because you’re going to screw something up. You’re going to mess up the value proposition or the connection or frame of reference, whatever that might be. You’re going to hit icebergs. Get an iceberg that isn’t your biggest opportunity, whether it came from funding or a customer perspective because you’re going to get beaten up. You’re going to learn something from that and get better. As you get better, you got closer to home and the bigger and better opportunities because you fit some of those icebergs but survived.
He gave me that advice. He’s had to do some cold calling and I said, “Here are my best prospects.” He said, “Don’t call them. You’re not great prospects. Get them out, burn through five or ten of them. By then you’ll be ready for the good ones.”
Practice your pitch on your least likely prospects first, that’s unique advice because you’re not attached to the outcome.
[bctt tweet=”Be accountable as you scale.” username=”John_Livesay”]
Maybe it’s a phone instead of practice. There is a chance to compare it. We’re still married for many years.
Honing and practicing for me. We are rewriting everything already. I know in your book The Titanic Effect, originally, this metaphor was a sideline. It became something that anchored the whole concept. Let’s hear the story of origin for how did you come up with the idea for the book?
It started with the term technical debt, which you’re familiar with and some of your audience, for those that are not when particularly software. Any physical product that you’re trying to build it, you can’t invest enough time, resources, energy to build it all the way into the robust version that you might envision eventually. You have to cut some corners. You’ve got to build your software on some code that might be a little bit flimsy to go out there and get that minimally viable product or that early testable model to get feedback. The challenges, as you start to scale, as you move from that one pilot customer to five customers to hopefully ten, twenty plus, if you’re building on this weak foundation, it’s going to collapse upon itself. That’s from a technical standpoint, from a product standpoint, and that’s the term of technical debt. There are equivalents in our metaphor, these other oceans.
You have the people that you work with, who you surround yourself with, how you allocate equity. You get advice from who helps guide you, who you hire as your early employees. In the human ocean, all of those are important decisions, but also have associated debt with them. As we thought about it was all of these decisions look obvious and easy when you are resource-strapped, and that’s the part above the water. There’s all of this mass below the water that you can’t see or anticipate because you’re making decisions under conditions of uncertainty. That connoted the image of the iceberg, and at least many of us, when we think about iceberg and failure, we associate that with the Titanic. I’m like the superficial naming guy was like, “We’ll call our presentation The Titanic Effect, then something after to make it a little more specific.” They were like, my co-authors, Michael and Kim, “It’s a good idea. It’s catchy. We should probably make sure there is some substance.” I was like, “Substance, that’s your bailiwick. I’m out of here.”
You have images of all the different icebergs and things. I’m a big Titanic fanatic. I’ve been to the museum, the menus, touched the cold ice and watched all the documentaries. You’ve got me in a minute. The research that you showed people that it’s not what icebergs are not all the same, Kim?
We started with that idea originally of marketing debt and human debt. We started thinking, “Let’s name the debts and all that.” We got onto the iceberg. We started doing iceberg research. It turns out that icebergs are super cool. They have such a variety of size from little bergy bits. Imagine a berg all broken up to iceberg islands. It’s huge masses. They have different shapes. Some are downed, tabular and all this stuff. We started getting into it. It was easy to envision these debts as different icebergs. Even since I focus in the marketing area, I have a visual image of each one of the ones as something a little different. In the book, they all look the same. There was too much granularity to try and talk about size, shape and all that. It was pretty exciting. I’m the researchy person to do that background work. I said, “If my very creative co-author and partner here is going to come up with a fancy title, I need to figure out if it has any legs. I started researching it and it turns out that there’s a lot that’s been written about the Titanic.
There are many resources too. We’ve read books, documentaries, online research. The museum has a lot of information too. We started finding thing after thing that matched up. Todd usually tells the story of a change of investors bringing on a new investor caused them to change the shipyard that they use. You can imagine what the ramifications of that are going to be. They have three different segments, this luxurious class and the steerage as we know about. The groups of people are trying to do different things. What was cool is that the first-class luxury passengers were Americans and the third-class steerage was from Eastern Europe. Can you imagine trying to have a successful marketing program that bought those two different groups of people into the same boat?
The Titanic Effect: If you don’t have alternative opinions, you’re not going to be able to aim your product into the market and understand the variety of needs that are out there.
Never were they supposed to interact. The romance went out as it did with your relationship. Did you dance to Celine Dion’s song at your wedding?
Can you imagine doing that in 1912 like share difficulty of that is mind-boggling?
I hadn’t thought about it like that. The buzz of getting the wealthy people, you’re like, “I’m sure everybody wanted the glamor of all that.” The masses, what would make them want to get on that versus all the other ways to get across? One of the things I want to talk about what you have in The Titanic Effect is the four oceans, the human ocean, the marketing ocean, the technical ocean and the strategy ocean. I know you have a whole chapter devoted to each one of those things. It’s such a great incentive for people to start thinking of this metaphor in a way that, “I want to buy this book now because we started dabbling in the marketing ocean there a little bit.” You can each talk about each one or you can split it up however you want to do it. Let’s dive in on what’s the human ocean? What’s the biggest mistake people make when they’re putting their team together?
The human ocean has these different seas within it. I know geographically that doesn’t quite work, but in the metaphor, please forgive us and allow us there that you have your co-founders. The biggest mistake that I see early-stage and first-time entrepreneurs make, and frankly even seasoned entrepreneurs, are allocating all the equity early and equally across co-founders. Your three people go out for coffee or a beer and they sketch out this idea on the napkin. They get all excited. They’re going to start this company. We’ll split everything three ways equally. A few months later, how many times that everyone is completely pulling their waiter or even able to fully contribute? The co-founders, how you allocate equity, whether you have the appropriate mix of people. Those are some of the debt bergs on the human side within co-founders.
The next sea that we talk about are the investors and advisors. Those are the people that you enlist their help, ideally some money as well. You need that feedback, encouragement, support, connections and how you go about doing that. Who you choose, how many you choose and how you interact with them are some also important sources of either resource or in some cases step bergs as well that can limit your success moving forward. Finally, within the human ocean are the employees and who are those early employees that you hire? Do you go after the cheap but enthusiastic interns who may be graduated or aren’t even through college and bright, but don’t know a lot and maybe can’t help the venture as much and spend a lot of time training, etc.? The other end of the spectrum, the giant whale hunter who has had the huge success and demands $250,000 salary and a lot of equity. It turns out they’re a one-hit-wonder and don’t know what they’re talking about. That can also be a huge source of a debt berg. Who those early employees are, how you leverage outside resources, that’s one of the other major elements we talk about in the human ocean.
In the employee sea, Todd, I wanted to add, the iceberg that’s named our debt berg has named the dearth of diversity is one that deserves more attention. We have been working with some incubators and looking at some of their companies. I was struck that out of all of the companies and all of the founding teams, there were four people who did not look like everybody else. Academic research is interesting when you have people who are much like you, more homogeneous, you get along better. Startups are a hard path to go. Getting along better is probably good. On the other hand, if you don’t have those alternative opinions, you’re not as well going to be able to aim your product into the market and understand the variety of needs that are out there.
Let me ask you about advisors within the human ocean. How important are they, is the first question, which they’re very important. What’re the criteria of what makes a good advisor? How often should you expect them to talk with you? What equity do you have to give them over time? I have so many questions about advisors alone. It’s one little grand of sand in the ocean there of human odds. It’s something that you are expertly qualified to answer. I haven’t heard many people talking about that granular level if you don’t mind.
[bctt tweet=”Get an iceberg that isn’t your biggest opportunity because you’re going to get beaten up. ” username=”John_Livesay”]
I can’t pretend to have all the answers on that as you suggest. It’s a complex and nuanced question. At some point, it boils down to rapport. The fact that you like working together. It’s going to be a slog when you’re involved in any new activity, innovative activity, new project, and especially a new venture. It’s a long journey and they’re going to be hard moments. You want to be with people that you genuinely like, respect, appreciate and have fun with. That’s an important underlying element. The more objective criteria, I wouldn’t dare call it a rule. I’ll have somebody who documents and shows me, it only took X, but it’s a 50 and five rule that it will probably take you meeting with 50 people having a cup of coffee, a beer, whatever, lunch to share your idea. To get five that you feel are truly in that inner circle that is our trusted advisors that you have a good rapport with that get back to you.
One of the mistakes I see some entrepreneurs make is they try and maintain connections with 50 people and you simply can’t do that. The goal isn’t to make your network as big as possible. You want to be more engaged and activated, but also it takes a lot of networking and searches to find those five, settle with the first five you get. Within those five, you want some people who are not exactly always devil’s advocates in your face, but at least aren’t yes people that do challenge you. That you’re willing to have that and that gets back to that alternative perspective that Kim talked about and having a diversity of perspective is important.
Following that, it is having some diversity in terms of their backgrounds that you have one or two advisors that are more industry experts. You have one or two that perhaps have started a company, have grown one or two that are more on the investor perspective, that’s financial savvy and hopefully, connections that when it comes time to raise money. I think of it as this critical mix of elements that are all part of the stew that or ocean that helped you be a successful startup, but also help you identify different types of debt bergs in different oceans. You want advocates and advisers who can help you navigate that journey.
I wanted to have Kim speak to this one particular thing you said, which is that you’re not hiring a bunch of advisors who agree with everything you say and being comfortable enough to be coachable, to hear other people’s perspectives or maybe even criticism like you’re going down the wrong path or whatever it might be?
Nobody likes to have Negative Nancy around all the time. You have to be tough with yourself and say, “Who is going to be the person who’s going to see all the bumps in the road?” Who’s going to be able to point out those hazards to me and it’s going to tell me 1,000 ways that this isn’t going to work. For some of us and me, if you tell me all the challenges that I’m going to try to cross them, surround them. It’s good from that perspective, but also you want somebody who maybe can see things that you can’t see. There’s this hard thing about being the founder of a startup or the founding team is that you have to be enthusiastic. You have to be persistent. Sometimes you need to go a different path and to be doggedly persistent and not to be able to hear or listen is tough.
The ultimate pivot that everyone ultimately ends up doing. That’s why people invest in the team more than the idea and that awareness is something that a lot of people don’t register with or they feel embarrassed sometimes that they have to. I’ve seen it time and again where you have to be willing to let that go a little bit. We obviously don’t have time to go into all the oceans. I did want to have maybe you talk one little bit about the strategy ocean because some people think, “Why does strategy have its own ocean or its own chapter?”
But before we go on, I’d like to close on one more thought on that advisor side because we frequently get asked to be advisors. In fact, some years we’ve done hundreds of lunches and coffees and things like that. As advisors, we have a talk and a coachability metric that we use. We’ll take the first coffee with anyone and we’ll have lunch sometimes. You go away and if you ask a second time, we’re very likely to take the second one as well if we’ve already given the first one. If you come back in the second one and you have tested nothing that we said in the first one and/or you are doggedly holding to ideas that we suggested negative things about the first time, we recognize you as not being coachable.
The Titanic Effect: One of the mistakes entrepreneurs make is they try and maintain connections with 50 people.
That’s great criteria or excuses of why you haven’t done something yet.
Moving into the strategy ocean, we recognize that we don’t have all the oceans in the book. We pick solutions that were in our sweet spot, our comfort zones. There are regulatory issues and legal issues and all that. The challenge that we see with some startups and probably most startups at different points in time are that because you have these different arenas that you’re moving forward. You’re moving forward the human stuff. You’re moving forward the funding. You’re moving forward what your customer relationship is going to look like. You’re moving forward the product. The whole thing gets unwieldy.
You get something that’s very in-depth on the product side. There’s no understanding or recognition of how this could be marketed or what’s valuable to customers or you get something at the sales and marketing side starts promising something that employees can’t do. That’s why we call it out the strategy ocean because that’s the place to bring the other three oceans together. To remind people that you have to be coordinated, you have to move one piece forward a little bit. The next piece forward a little bit.
That lack of coordination, one department sales promising something that engineering can’t deliver or is a nightmare even at a small scale.
Measurement, what happens, we’ve seen a lot of startups is they get so busy doing and they’re shorthanded, that they don’t even have metrics in place. They know the metrics that they’re going to need to see if they’re going to go do an angel pitch or a VC pitch. They’re not effectively running the business with metrics. We advocate different metrics at different points in time, but identifying what those metrics are and having somebody look at them. The third sea in the strategy ocean is about accountability, which is, we all think we’re heading in a certain direction, but until you put a name to it, it doesn’t happen.
Always be the founder or even the founding team as you grow up a little bit, as you start to scale, that accountability has to start to transfer to others within the organization.
What you’re saying is sometimes accountability is delegating stuff too. It’s not doing it all yourself. It’s been a fascinating look at the Titanic as a metaphor and the oceans that we all swim in, whether we’re starting a business or working in a business and all the challenges that we face. The book is called The Titanic Effect. Is there any last thought or piece of advice you each want to leave us with?
I’ll cut in on one and it comes back to very much the theme of a lot of what you talk about and making sure in your picture, in your story, you know what you’re trying to get out of it and that it is both stage-appropriate and context-appropriate in a very personal sense. We’ve talked about our own interactions with each other. When we’re looking for feedback, I’m going to characterize two different types and try and make this brief. We do a lot of writing. If I have a deadline that I’ve got to get it out by midnight and into a journal for review or whatever, I have to signal to Kim, “I’ve got a tight deadline. I need these superficial and it’s okay if you say, “That’s great, Hon.”
[bctt tweet=”If you’re good, you make your money in tips. ” username=”John_Livesay”]
At the early stages of this project, however, when we were trying to flesh out this metaphor and extend it, we needed to be ruthless with between all three of us. What may have created some challenging discussions, but that early stage, that’s the time to be open to much more discursive conversations about what’s going to work, what isn’t, what is clear and what is not? Understanding where you are in the journey and what you were looking for in your pitch, whatever that might look like is an important part of the process. As you very well know when articulate in many ways, a pitch is not this model with the constructed. A pitch varies a lot by what you’re trying to accomplish, who your audience is, etc. That’s certainly very true as you’re navigating from an early stage of launch and ideation through the later stages of growing a venture.
Keep on sailing, that’s the goal.
If people want to follow you on social media and track the book, what’s the best way for them to do that?
They can check out the website at www.TitanicEffect.com. We have a weekly blog and we email out little tips once a week so we don’t clog your inbox, but it’s fun when people email or text us and say, “I love that.”
Thank you both for sharing your expertise, navigating the waters that we all face.
Thank you so much. It’s been a lot of fun and good luck with your endeavors. To the audience, good luck with your pitch, whatever that might look like.
Thank you.
Important Links
- The Titanic Effect
- https://www.TitanicEffect.com/successfulpitch
- Better Selling Through Storytelling Method Online Course
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