Max Mednik

I just recently finished reading The Starfish and The Spider: The Unstoppable Power of Leaderless Organizations by Ori Brafman and Rod A. Beckstrom. It was a neat overview of the different elements of decentralized organizations and many of the ways in which they operate and can be superior to centralized organizations.

The book starts with the story of the modern science around memory. Scientists for ages thought that specific neurons and parts of the brain were assigned to specific memories. However, after a lot of testing, they found something surprising about accessing and storing memories in the brain: they are in fact not stored in specific neurons; they are stored everywhere. There turned out to be no hierarchy or chain of command in the brain; memory turned out to be fully distributed. This distributed structure makes the brain more resilient and is the reason why unpleasant memories are difficult to eliminate.

The first major example of a decentralized organization outside of the brain centered around Sean Fanning and Napster. The havoc that Napster wreaked on the music industry as well as the freedom it brought to students and consumers of music were clear examples of the power of decentralized/peer-to-peer organizations. Another example the book looked at was Al Queda, where the leader is hidden, and different terrorist cells operate autonomously. Wikipedia is another important example, where collaborators around the world contribute and police it, all voluntarily. When the founder of Wikipedia was asked by the authors who runs its servers, he responded, "I don't know. The users just take care of it." That seemed pretty neat (and scary) to me. The key takeaway here was that all of these organizations were using the absence of clear and commanding hierarchy structure as an asset.


MGM's Mistake and Apache's Mystery

The book analyzed the way MGM fought Grokster (another P2P file sharing program) in the Supreme Court and compared this to the story of the Apache tribe. When MGM was awarded a winning verdict, they were able to take down a fairly centralized organization for file sharing (Grokster wasn't fully P2P like eMule). The lesson there was that a centralized organization can fall when you kill its center.

On the flip side, the story of the Apache ends differently. When Cortez and the Spanish army arrived, they conquered and annihilated the other tribes who were centralized societies. The Spanish couldn't defeat the Apache just like the record labels in the end couldn't squash file sharing when it became fully distributed. The Apache distributed political power and had little centralization; therefore, the Spanish could never really fully conquer them.

A central organization operates on coercion. An open organization operates on leading by example. People follow someone because they want to, not because they have to.

When attacked, a decentralized organization becomes more decentralized. Napster was centralized and so fell quickly when attacked. eMule was fully open source and distributed with no declared leader or owner. No matter how hard you attack it, you can never fully destroy something so decentralized as that.



The Spider, The Starfish, and The President of the Internet

When the head of a major telco went to Europe for a business meeting pitching the Internet as it was just being rolled out, he was questioned as to who was the president of this new organization (the Internet). It was impossible for his business colleagues to understand that there was no president of the Internet; it's a network of networks that just works together through mutual agreement rather than hierarchical ruling. This was very hard for people to get initially (he had to in the end say that he was in the fact the "President" of the Internet in order to appease his audience).

This was a classic example of people who mistook a starfish for a spider. A spider has 8 legs with a central body. If you chop off its head, it dies. A starfish is totally different. It has separate control of its legs, and its organs are replicated throughout its body. If you chop off any part, it will grow back. In fact, it can replicate itself fully from just one arm. This seems so incredibly cool to me.

For the starfish to move, its arms convince each other to do it; there is no central brain. I absolutely love this metaphor for how certain organizations can operate.

The book explained how Alcoholics Anonymous (AA) is an organization that is a starfish. No one owns it. There is no central intelligence; intelligence spreads throughout the system itself. In this way, a decentralized organization sneaks up on you, mutates, and grows quickly.

The Accordion Principle: Industries swing back and forth between being centralized and decentralized.



A Sea of Starfish


The book went through many examples of products or organizations that took advantage of starfish principles to thrive: Skype, Craigslist, Apache web server software, Wikipedia, Burning Man, and the Quakers. Several principles came out of these examples.

Put people into an open system, and they will automatically want to contribute. 

A catalyst is responsible for sparking ideas and then getting out of the way. Here are his or her main tools: genuine interest in others, passion, meeting people where they are, trust, inspiration, tolerance for ambiguity, being ok with saying he or she doesn't know, a hands off approach, and an ability to recede.

A leaderless organization operates through norms, not rules.



Taking on Decentralization


When attacked, a centralized organization get more centralized. Think of army bunkers getting more fortified.

The only ways to attack a decentralized organization is through ideology (convincing them of a new way) or to centralize them by giving them a scarce resource (like money or cows) in order to create internal competition and hierarchy. It is somewhat sad that a right to property and money almost always leads to centralizing an organization.

Fight starfish with starfish.


Hybrid Organizations (The "Combo Special")

The decision around centralization doesn't have to binary. Many organizations have successfully used starfish principles in certain parts of their operations and not others. An example of this is eBay, where the decentralized user ratings are critical to eBay's competitive advantage. The company itself is a spider, but it operates as a centralized company that decentralized the customer experience. They kept centralized what people wanted to know would be secure and regulated: money (i.e., payment through PayPal).

Other examples are Amazon reviews and Oprah book clubs, which decentralized by giving customers an important role. Companies who have open sourced part of their software (like Sun) are further examples. In HR, getting employee ideas and open brainstorming after alignment interviews between random pairs of people across the entire organization is a way to source decentralized opinions for centralized decision making.


The Sweet Spot

The "Sweet Spot" refers to the level of decentralization that's just right for a given organization, and this changes over time and across companies.This chapter looked at the example of Toyota versus GM. GM was way more centralized and used a traditional assembly line process; Toyota used lean principles and let line employees fully dictate how the operations would run. Toyota bet GM that this was not due to culture, race, work ethic, or anything outside of the pure decentralization of operations. Toyota offered to demonstrate this to GM, and this was the start of the partnership that became Nummi, where team leadership had control as opposed to some central authority; Nummi quickly became the most efficient and profitable plant in GM.

Another example of a product that finds some happy medium between centralization and decentralization is iTunes, which allows people to download music quickly and get individual songs (rather than buy full CDs) but does so in a way that's legal and ok with the music industry.


The New World

This final chapter went through the 10 rules of how modern organizations operate, taking into account the starfish principles outlined in earlier chapters:

1. Diseconomies of scale from centralization (huge, centralized companies quickly start being less efficient and less effective than smaller, more nimble and distributed ones)
   
2. Network effects
   
3. The power of chaos for creativity (order and structure can often hamper creativity)
4. Knowledge is at the edge, not centered (look to the fringes for who has the most cutting edge information)
5. Everyone wants to contribute
6. Beware of the Hydra response (based on the Greek myth, where attacking a decentralized organization like a multi-headed snake creates more proliferation [of snake heads])
7. Catalysts rule
   
8. The values are the organization
   
9. Measure, monitor, and manage (just because something is decentralized doesn't mean you can't measure it; just choose what to measure carefully based on the decentralized structure)
10. Flatten or be flattened (decentralize through some hybrid approach or be taken over by someone else who is decentralized)

This was a fun read and now makes me think about centralized and decentralized organizations pretty differently.

I rarely whine or complain about stuff I don't like, but it's about time I aired some of my frustration.

I think paper, hand signatures in this day and age are stupid and insecure. They can easily be forged/reproduced, and often times people spend little effort in making sure they sign things carefully and the same way every time. In addition, they require using paper (a limited resource) and extra effort and time. I need to print out 2 copies of a contract, sign them both with a pen, put them in an envelope, mail it to the other person, and then wait to get a fully executed copy back in the mail (remembering to follow up if it doesn't come). Faxing gets rid of the envelope and mailing step, but it's often still slow, cumbersome, and low quality (and you're stuck with another paper copy that you then need to scan back into your computer and store in a folder). This just seems so operationally inefficient to me. Using secure e-signatures, for example, seems like so much better of a solution.

I know there are various laws that require physical signatures (such as in real estate transactions and consumer home purchases), but I think that needs to change and be modernized.

There are so many better, easier to use technologies in existence that are more secure and more efficient. As I understand, there are 3 ways to authenticate a person: something you know (e.g., password), something you are (e.g., biometrics)/something you do (e.g., signature, voice perhaps), and something you have (e.g., RSA token). At this point, I understand some of these technologies may still be a bit expensive to roll out on a large scale, but I really think this is where things are going in the future.

But that's not all.

For my work on AMA, I had to negotiate and sign a lot of complex legal contracts. I saw so much inefficiency with respect to the work required to revise and collaborate on contracts with multiple counterparties and attorneys. And making sure you don't drop the ball on any important revision or issue is all up to you and your organizational/checklist-tracking abilities.

Managing the contract after execution is similarly manual, requiring calendaring, databasing, scanning, and manually indexing/categorizing the critical terms, references, and dates.

I don't know how many people suffer through these pains, and I'm hoping to learn through any feedback or comments people leave. What do you all think?

I definitely think there's a better way to do things, and that's what I'm hoping to achieve through Redlyne.

I recently enjoyed listening to the audio version of Dan Ariely's The Upside of Irrationality. He's also the author of Predictably Irrational, which I hope to read soon.

The author, a behavioral economist and psychologist, begins by introducing an irrational behavior that affects all of us: procrastination. He says that procrastination is universal. When he sought a special treatment for a rare condition he had, he needed to inject himself with very uncomfortable medications on a weekly basis. In order to get himself to not procrastinate, he motivated himself with watching movies on his injection days, thereby associating good with bad.


As humans, we prefer short-term, not long-term goals. We routinely fail to take short-term pains for long-term goals. He explains that there is a lot of human-incompatible technology out there that doesn't take into account our fallibility (like the stock market). While his first book (Predictably Irrational) is about the downsides of irrationality, this book is about its upsides.

The first part of the book is about defying logic at work. Throughout the text, the author explained in detail the scientific studies used to come up with the conclusions presented. It was neat to understand how the experiments were designed.

• Paying more for less (bonuses): The author ran experiments on rats about incentives to understand how animals respond to different strengths of incentives. The rat experiments showed that increasing the magnitude of an incentive does not markedly change performance (above a certain medium level of incentive). Therefore, paying larger CEO bonuses doesn't help either.
  
  Medium motivation turned out to be better than small or large motivation. The author also found that social pressure (performing in front of others as they watch) worsens performance. High payments turned out to be only useful for simple, mechanical tasks.
  
  Therefore, the author advocates paying smaller, more frequent bonuses. He says the emphasis should be on straight salary, and you could even try paying a bonus for performance averaged over the past 5 years to smooth it.
  
  
• Animals prefer to work for food: Work without meaning or which doesn't find effect on the world is annoying even if it's well compensated. From the author's experiments, he found that even if you receive lots of money, if your work is immediately destroyed or unused, you are less satisfied than getting less money and having your work have effect on the world.
  
  In addition, the act of seeing meaning in one's work produces more productivity. The simple acknowledgement of work by others makes a big difference to your productivity and satisfaction. This means that division of labor, when it separates people from seeing results, can be counterproductive.
  
  
• Ikea effect: We overvalue what we make. Cake mixes that are fully automatic sell worse than cake mixes where you have to add eggs and water. People feel more attached to those things into which they make an investment of money or labor.
  
  This investment of labor increases attachment and causes us to overvalue the items compared to outsiders. From experiment results, it turns out to be important that one completes a project in order to overvalue it (and not simply start it). In fact, if we have to overcome some obstacle, we will love the results even more.
  
  
• Not invented here bias: "My ideas are better than others'." Organizations and individuals routinely dismiss others' ideas and overvalue the worth of their own.
  
  
• Consumers engage in vengeful behavior: We don't care whom we punish, agent or principal, as long as we punish someone if we feel like we've been harmed. Apologizing does lessen this revenge instinct.
  
  
• We adapt more quickly than we imagine: We are horrible at predicting how badly we'll feel if something unwanted will happen; we'll overestimate the effect on us and underestimate how quickly we'll recover. Humans can even get used to pain, and the adapted response lasts for a long time (based on many experiment subjects he studied that had traumatic experiences many years ago and yet their pain adaptation remains). He found that the severely injured actually associate pain with hope for recovery rather than suffering.
  
  We can even get used to joy. He calls the emotional leveling out of joy "hedonic adaptation." It turns out that job satisfaction is connected to raises, not pay level. Happiness is temporary, and one's emotional state reverts to the mean after good or bad situations. However, we are bad at predicting hedonic adaptation.
  
  Small interruptions delay hedonic adaptation; you can use this to extend enjoyment. However, don't break up annoying experiences (try to get those done all at once); do break up pleasurable ones to extend the enjoyment. You'll be happier if you do intermittent purchases, not one large shopping spree. When cutting back expenses, though, do so on many types all at once so you can quickly get used to the lower quality of life rather than cutting back one benefit at a time.
  
  Inject serendipity and uncertainty into your life to enjoy it more.
  
  
• Hot or not: The author spent a lot of time studying online and offline dating behavior. He found that like attracts like, which he calls "assortative mating." If you're somehow handicapped, it turns out there is no adaptation of what you like based on your own limitations; people just change the priority of other attributes they care about.
  
  
• When a market fails -- online dating: Without an efficient market maker in dating, like a yente, the market is really inefficient. The problem with online dating systems is that people can't be described like products with simple parameters. People are experience goods; you can only learn about others by seeing how they are in the real world.
  
  The author experimented with creating virtual dating systems, where users could have online date simulation experiences, like looking at art together or playing a game. The presence of any external object helps stimulate discussion and allow people to learn more about each other.
  
  
• Why people will help one person but not many: People feel agony over one child who fell in a hole (a famous news story from a few years ago), but not for genocides killing hundreds of thousands or millions. There are several reasons for this: identifiable victim effect, closeness (physical or emotional or similar in some way), vividness, and specificity. Another related issue is the drop in the bucket effect, where people will donate more for one named person in Africa than to help many people in Africa; they think they can make a difference for one person and are just a drop in the bucket when contributing to many (even though this is irrational). The best way to counter this is to agree to certain rules and stick to them.
  
  
• The long term effects of short term emotions -- why not to act on negative feelings: We forget our emotional states but remember our decisions in order to be self-consistent later on. Don't make quick decisions when emotional as this can drive future behavior even when the initial emotional state is no longer relevant. Slowly count to 10 when you're under duress.

The book concludes with two general conclusions. First, we need to know our irrational limitations but also use our irrational strengths to be effective. Second, we need to experiment to learn how to make better decisions.

The book was informative and entertaining from the experiment-design standpoint, and as someone who likes learning about psychology, I enjoyed the book very much.

Earlier this quarter, Nancy Duarte spoke to us at UCLA Anderson about presentation design. She's the author of two great books on the subject: slide:ology and Resonate, and her firm designs presentations for extremely influential business leaders and politicians, in addition to teaching people how to design impactful slides.

She started her talk with a personal story about herself and then gave us a debrief on what she just did. She explained the structure of her introductory story as a structure we can use for any story meant to grasp people's attention:

1. I'm a hero
2. I face a roadblock
3. I emerge transformed
   

She said that PowerPoint should not be an exhaustive report; it should be visual and persuasive. You can save the details for handouts to give people at the end.

If you have to give a report, give an executive summary, distribute it as a document, let the audience read it, and then just discuss as human beings. That's a lot better than cramming numbers in a PowerPoint. Only project visuals that are mnemonic for the audience to remember your message, not for you to remember what to say.

Start your presentation with a unique point of view and the stakes for the audience. Incorporate story to show the transformation of a hero from beginning to end. This can apply to business presentations where a team that performs an analysis and comes up with a result can be the hero.

To bring it to a more subtle level, she argues the presenter is actually not the hero; the audience is the hero. The presenter's role is that of mentor or yoda.

She spent months studying dramatic story structure from classic Greek dramas to the most effective speeches of all time (MLK, Gandhi, Neru, Steve Jobs). She studied the visual/emotional shape of story to come up with a sine wave representing going back and forth between "what is now" and "what could be." She says this is the secret to taking your audience on a ride with you through your speech. Her argument definitely seemed persuasive to me.

She broke down every second of Steve Jobs' iPhone launch PowerPoint that she worked on and pointed out his strategies to us. She pointed out how he literally marveled at his own product and modeled the emotion he wanted his audience to feel. The "star" moment was something they'll always remember: when he turned on the iPhone for the first time and showed scrolling.

Jobs mentioned Wayne Gretzky in his speech, quoting "skate to where puck is going to be, not where it has been."

From MLK and Neru's speeches, we learned about the use of metaphor, repetition, political reference, scripture, and emotions. 

In terms of connecting to audiences, Duarte's happy that people can now give live feedback on Twitter as they're listening to good or bad speakers. She advocates addressing hostile reactions explicitly in one's talk in order to inoculate them.

She spent some time also describing her creative process. She first storyboards everything with Post It's that she can then move around. She does this to find holes. Then she just puts the Post It's into PowerPoint.

Some useful links:

• Five Rules PPT Template
• Duarte Training Tools

Below are two related videos as well: The Five Rules presentation, and her TEDxEast talk on uncovering the common structure of the best communicators.

Overall, the talk was useful, and as a personal lover of clean, simple, visual slide design, I definitely enjoyed meeting Nancy and hearing her speak.

I recently finished reading The 4-Hour Workweek by Tim Ferriss. I can honestly say it was a game-and mind-changing book.

The overall concept has to do with lifestyle design: structuring and optimizing every part of your life so that you can make concrete progress towards living your dreams here and now, rather than in the distant future. The author has made himself an expert in many fields, such as entrepreneurship, travel, Japanese, tango, health, martial arts, online marketing, and product design. As a person with many interests and hobbies myself, I have respect for a fellow Renaissance Man.

My own philosophy has a lot in common with Tim's, which is why I found his book really striking a chord within me. However, it also made me realize how much of my own behavior and habits is self-destructive and pointless, even though I've been proud of those same habits for many years (e.g., "time management" and "promptness with email"). At times, those skills are helpful, but TIm does a great job explaining the danger behind them.

This book had so many details and concrete suggestions that there is no way I can do them justice in a blog post that I want to keep relatively short. I will just try to highlight the most relevant or interesting suggestions. A lot of info can be found at 4hourblog.com.

The overall book can be summarized by a simple acronym: DEAL.

• D: Definition. Define what you want in life, your goals, your dreams -- the concrete activities you want to do or skills you want to master. You don't need a reason for them; they can be selfish or they can be serving the world.
  
  Don't waste the most productive years of your life and wait for retirement to fulfill your dreams. Distribute mini-retirements throughout your life, such as taking 1 month to learn/travel for every 2 months of work. Forget the people who tell you that doing personal stuff is lazy.
  
  Relative income is more important than absolute income. You can earn money in dollars and spend money in a foreign currency (living abroad) and can create a very comfortable lifestyle.
  
  Conquer fear by defining fear. Spend time living coarsely to know that which you fear (being broke or on the streets) and not be afraid of it. What you most fear is usually not that bad. Success is defined by the number of things you do each day that you're afraid of or are uncomfortable doing; it is really those actions (such as that difficult phone call you've been putting off) that move your objectives to completion. Do one very scary thing every day.
  
  In fact, there is often less competition for bigger goals. It is easier to achieve unrealistic goals sometimes because few try.
  
  Dreamlining: apply timelines to dreams. Turn your big goals into defined steps that you can take concrete actions towards. You'll be surprised how little money it takes to live the life of your dreams or have the mini-retirement you want to try out.
  
  
• E: Elimination. Remove activities, tasks, technology, people, and physical items that waste your time and energy. One of these is checking email. Another is simply the philosophy that you must stay on top of everything; learn to let things slip which are not costly to fix in order to be able to devote yourself to the things that matter to you. This really went counter to how I used to operate, and I'm now running everything I do through this new filter/philosophy.
  
  The big rule in this topic is 80/20; most of the valuable work is done in 20% of the time. What you do is more important than how you do it; effectiveness is more important than efficiency. I feel as if I've always been a slave to efficiency and spend so much time and money learning about ways to be better at squeezing in more tasks into my schedule; the author's approach is completely different. Eliminate everything unnecessary, and free up time to actually live life.
  
  Being busy is a form of laziness. Doing less is the path of the productive. Don't get sucked into the habit I always find myself in: "w4" (work for work's sake). Lack of time indicates a lack of priorities.
  
  Parkinson's Law: Tasks will swell when you have more time. Shorter deadlines create greater focus. Limit tasks to the important, and shorten tasks to ensure fast completion. Remove poisonous friends who drag you down or waste your time.
  
  Complete only 2 mission critical items per day; set up this 2 task to-do list the night before. Do not multitask. Ask yourself 3 times per day if you're just inventing work.
  
  Stop asking for opinions, and propose solutions. Make decisions personally and professionally.
  
  Live on a low information diet. Information depletes attention and creates w4w. No news, no email or voicemail checking when traveling. Reading more than using your brain is bad; you should be outputting more than you're inputting. Just let others synthesize information for you (such as by asking others, "Anything interesting happen today in the world? I didn't get my morning paper."). Focus on just-in-time information over just-in-case information. A bit of fiction reading is ok though.
  
  Master the art of unfinishing. This one is a really sticking point for me. Just because you started something doesn't mean you need to finish it.
  
  Refuse and avoid meetings. If you have to meet, get clear agendas up front. Prefer email then phone then in-person. Use Grand Central/Google Voice and other services listed in the book to make your life easier. Answer voicemail with email. Use if/then structure of messages to cover all the scenarios to avoid back and forth and take yourself out of the loop.
  
  Batching is the solution to routine tasks. Batch personal and business tasks as much as possible until the repair costs (of doing this too late/past deadlines) exceed your hourly time cost. Grant as much power as possible to subordinates to work without you. Life is not scaleable if you're the decision and information bottleneck. Give authority for fixed amounts of spending and review the impact of others' decisions periodically; try this for short trial periods.
  
  Other time savers: Evernote, Scansnap, Doodle (I recently started using Tungle.me), Xobni, Copytalk, and Earth Class Mail.
  
  
• A: Automation. Find a business and automate it. This book made me realize that there is probably more to life that can be automated and outsourced than cannot. There are many ways to take yourself out of the picture so you are no longer the bottleneck and the world around you (such as via virtual assistants) can work while you sleep.
  
  Eliminate and automate before you delegate to others. Define rules and processes. Each task must be time consuming and well defined for virtual assistants (VAs). Have fun with it (like having them send emails to friends on your behalf). Create separate logins for them to use for your main accounts, email answering, etc.
  
  Find your muse: Own a business and spend no time on it. Outsource all infrastructure. Cash flow and time allow for anything. Minimize initial investment, and test before you produce through a landing page. Pick a niche market, and develop a product for a known market opportunity.
  
  Several ways of doing this: Resell a product; license a product; create a product; or create, repurpose, or license content. No need to be an expert. You can create how to/information products like 2 CDs, a transcription, and quick start guide. Take a skill you know and apply it to a specific market which doesn't have it. Microtest your products with simple AdWords campaigns.
  
  
• L: Liberation. Negotiate a remote-working agreement for your job. Start your own online business that has everything outsourced and just takes a couple of hours to run.
  
  Management by Absence (MBA): Remove the human element, and 
  plan your business with the end in mind of being out of the picture. The book gives lots of great advice and scripts for negotiating remote work agreements with your boss.
  
  Mini-retirements: Traveling often saves money over living expenses in the US. Arrange to teach language classes abroad. Tons of resources are listed in the book for figuring out and "hacking" travel in a sense.
  
  If you do this, you will need to face the reality of figuring out what it is you want in life and filling the time void. People dread doing this and avoid this by filling up their time with work or excuses for why they can't live life now. One way to get over this is to just pick big goals and peak life experience to pursue, like mastering Japanese in Tokyo or winning a tango dancing contest in Buenos Aires. A goal could be some form of continual learning and service. You could focus on  language acquisition and some physical skill or sports. You could work to Improve the world in any way you want.
  
  Don't worry about questions without answers or philosophical questions over which you have no control. Slow down; attend silence retreats. Write down doubts in a journal. Recapture childhood dreams, and try them out as part-time vocations/callings. (This is something I've always thought about doing!)
  
  In order to do big things, let many small things slide. Limit your options. Don't scan your inbox over the weekend. Fast decisions preserve usable attention. Limit the options you consider and the time you allow for consideration. Try to not complain for 21 days. Don't deliberate past decisions. Create a "Not to do" list.
  
  Don't please all your customers -- only the best ones. Limit yourself to what you know and what you do great; enhance your strengths instead of worrying about your weaknesses.
  
  Let small things go; pay late fees. Don't carry a cell phone 24/7. Live one day per week without technology.

There were so many resources, books, and online services listed that I can see how much time the author put into researching and creating a life that is in line with what he preaches. I feel I've mostly been converted and now think a lot about my own life and behaviors, trying to figure out what dreams to pursue and how to structure my life to focus on what's most important and what I enjoy.

The parts of the book that I question the most or do not fully agree with have to do with the cautions about technology and reading. I think it is clearly the case that there is too much information out there, and it is easy to get sucked into it. However, I think that if a person finds enjoyment or fulfillment from reading books or listening to audiobooks (also prohibited by the author, except for his audiobooks), then that's ok. In addition, I think it's fine to pursue businesses where you want to be actively involved and enjoy that. In general, the author's viewpoint is a little extreme (obviously to make a statement) but more or less correct.

I definitely recommend this book to any other perfectionists, work-a-holics, and Renaissance Men and Women out there.

I recently went to a Hacker News meetup featuring a great speech by Giles Bowkett, a self-made wizard of Ruby on Rails, online marketing guru, and personal coach.

Giles has recently tried the challenge of launching one mini-business per month. He did this to test the limits of creativity, see what lessons he could learn, and hopefully make some money doing it as well. He managed to achieve all three goals.

He did this by first becoming a master of Ruby on Rails and speaking at tech conferences and blogging on the subject to build a reputation. His background was also in acting, and he's found ways to combine his interests in acting, coaching, and technology to make money through online mini-businesses. A lot of the lessons he taught (like the power of virtual assistants) reminded me of the life-changing and mind-altering lessons I learned in The Four-Hour Workweek, which I recently completed reading and can't wait to blog about.

The books he read that helped him with his challenge were the following:

• Millionaire Next Door
  
• No BS Marketing to the Affluent
• My job went to India (and all I got was this lousy book)
• Purple Cow (which I recently blogged about too)

Here were some of the general lessons he taught. I wish I could do justice to his witty and hilarious speaking style. For example, he's written a lot of neat, free apps out there like minimal bit.ly and Hacker Newspaper, and hearing the stories about those (as well as his "ban" from Hacker News) was really entertaining. He would be an awesome Pecha Kucha speaker!

1. Forget failures. Take what you learned and move on. Don't reminisce on problems and failures. Doing anything great requires lots of failing.
   
   
2. Repeat wins. Focus on what works and expand it. Emphasize and develop your strengths; downplay and minimize your weaknesses.
   
   
3. Create mini-sites to sell books and services through affiliate marketing. He was a non-believer like most of us, and he also thought online marketing is not as cool or hardcore as making money in other ways. However, once he got into it, he learned how scientific and hardcore it actually can be, and he learned to leverage every piece of infrastructure out there to create mini-businesses that bring a period cash inflows that he sure doesn't mind.
   
   
4. Offer free awesome seminars on a subject you know and immediately up-sell. He spoke about how this technique works and talked about how it was successful for him (Note: he didn't really up-sell us at his talk, which was considerate). Offering free short online videos and tutorials is a good way to do this too.
   
   Another technique he discussed was limited time sales and expiring offers. We have seen recently how this can be a powerful motivator through daily deal sites. In addition, countdowns to launch and hints/previews to build up excitement before sales can really help.
   
   More techniques for online sales and marketing can be learned from the following gurus he mentioned: Dan Kennedy, Eben Pagan, Frank Kern, Russell Brunson, and John Carlton.
   
   
5. Revenue management. Offer multiple price points to see what people are willing to pay. Market your product to have demand exceed supply; keep expanding capacity or doubling price until you go too far and then back up. That was effectively the formula he advocated.
   
   
6. Lean product design. Find out people's questions and make products answering their questions. Just jump in and start; early is better than perfect. Actions are better than plans. A great audience is better than great technology.
   
   
7. Change your habits to change your life. You really can support yourself and have a good time while starting mini-businesses on your own. He says money management is essential, including tracking how much you're earning and spending on each activity. To spice things up, he's enjoyed co-working with friends.

Overall, it was a fun and engagement presentation, and I look forward to the next meetup.

I recently read Purple Cow by Seth Godin. I had heard of this long-time marketing classic for a while and finally got around to reading it.

It was my first book by Seth Godin, and I enjoyed his simple, to-the-point style. The entire book was thus pretty quick to read.

The title of the book comes from the idea that when you first drive to the countryside, cows look pretty cool. However, cows get pretty boring after a while. However, a purple cow would be pretty remarkable, even after seeing normal cows for a while.

This is the core concept behind the book. Your offering must be remarkable, just like a purple cow. You can no longer rely on advertising on a marketing department to simply selling existing products; you must innovate and focus on the product itself.

The method he argues for is to create remarkable products that people seek out. He calls such a product an "idea virus" that you must get to the right "sneezers" who can spread it. These sneezers are early adopters in a specific market niche that you directly appeal to. After you've had success doing this, you must reinvest your profits to create new remarkable products as the existing ones become commonplace.

He argues that you should welcome criticism and in fact do things that provoke it. Appealing to the center of the market and the masses is bad; you appeal to no one and your message becomes bland. He argues for the opposite. If you show up in a parody, you're doing the right thing.

He brought up the Japanese word "otaku," which means something more than a hobby but less than an obsession. You must find consumers with otaku who will try your product, learn it, and spread word about it. It is helpful to target markets with already existing otaku. For example, go to sci fi conventions to find sci fi fans.

The key is to change the product, not the ads. A slogan is just for sneezers to pass on your idea properly. Don't use committees or compromise on your crazy, directed ideas. Leave design mavericks alone to do what they want and create remarkable products. Once you get sneezers, get their permission to keep them posted on progress, and give them tools to spread the word. If you can, build marketing into your product directly so it's obvious how to spread information about it.

He recommends launching 10 products with 1/10 of the ad budget each instead of 1 product with the full ad budget in order to learn 10 separate, useful lessons.

Overall, there were four key Purple Cow takeaways in the book:

1. Don't be boring (be remarkable)
2. Safe is risky (appeal to the edges, not the masses)
3. Design rules now (focus on design, not marketing)
4. Very good is bad (be remarkable)

I enjoyed the book and can see how it is such a foundational text for influencing a lot of current thinking about these subjects.

 

Yesterday, Craig Newmark came to talk to us at UCLA Anderson (Professor Jonathan Greenblatt led the conversation). It was an interesting discussion and went into many areas I wasn't expecting. Below are some of my notes and takeaways.

1. Know when to get out of the way and not meddle. Early on, Craig hired a great CEO and let him run the company as he saw appropriate. He stayed engaged but tried not to interfere, focusing his efforts on customer service.
   
   He's managed to keep Craigslist at about a 20 person staff. The bigger an organization, the more it's like Dilbert (he worked at IBM before). He made reference to Dunbar's number, or the theoretical limit of about 150 people that can keep a small-company feeling/culture. Beyond this (and probably within this too), people learn to get ahead by just telling their boss what he or she wants to hear. [I'm learning about this same topic in my Leadership, Motivation, and Power class. Will post about it soon!]
   
   In terms of other leaders, he said he admires Ron Conway and Larry Page.
   
   Craig thinks he's not a real entrepreneur and just got lucky. He repeated this a few times. This was neat to hear.
   
   Speaking to a young audience, he encouraged us to take more risks but to develop a broad social network so we can engage enough people when starting new projects or companies.
   
   
2. Social media is critical, especially for philanthropy. Many people in the philanthropic sector, such as leaders of grassroots organizations, are turning to Craig for help in advising these new organizations on using social media to get their word out. He says social media is key to allowing leaderless organizations to thrive and get input from the community.
   
   He used a funny analogy to "ye olde times" and "social media technology" back in the day. He spoke about the Gutenberg printing press as the original social media technology; Martin Luther was the first to use it for a social revolution. He spoke about the original bloggers (Thomas Payne, John Locke) and the original online forums (religious talks, meetings). Listening to him talk about this was really funny.
   
   In general, he said he wants to bring a voice to the moderates through charitable means and social media. He's been doing a lot to help veterans through IAVA and the Bob Woodruff Foundation.
   
   In terms of social media and the government, he spoke about the Sunlight Foundation which aims to cast light on government activities and find ways to improve them. He says it would be good to cast light on lobbyists and expose the flows of money to the press.
   
   In terms of Wikileaks, Craig acknowledged that diplomats are those that lie for the sake of their country. He has mixed feelings about this: as a nerd, he wants all info to be open, but he also knows that some stuff in government needs to be secret. Maybe just revealing where money goes is all that we need.
   
   Overall, he's in favor of projects like Jumo that aim to connect causes to people and that use social media to involve the community.
   
   
3. Trust is the new black. With so much user-generated content (UGC) and so many news sources and information, whom you trust becomes critical to curating your reading and learning experience. He wants to get his news from sources that are accountable and use rigorous fact-checking. He says he gets the best news from The Daily Show (unfortunately).
   
   The Daily Show gets away with using comedy while telling the truth, and this is not something new. Oscar Wilde said, "If you want to tell people the truth, make them laugh, or else they will kill you." The only person in the king's court who could tell the king the truth was the court jester.
   
   Craig predicted that in the future we will receive news on pad-like devices and TVs but from trustworthy curators of news, such as our social network and accountable sources.
   
   
4. Craigslist secret sauce: KISS. Craig described how the website started out as an email list that he ran on Pine (and still uses Pine for) as a hobby. He wanted to just tell his friends about local events and other stuff that meant something to the people around him. His entire marketing was word of mouth (and lots of launch parties in SF).
   
   Their core innovation, he said, was actually listening to users and not web designers, potential investors, marketers, etc. His users wanted a simple, fast, focused, and free site. They spend a lot of their engineering efforts doing just this (for example, writing their own caching code to keep the site fast).
   
   He claims that speed is the reason why the UI remains simple and old-school. He said they do introduce UI changes slowly but want to keep the site fast (they don't have a mobile app because the site works quickly on any phone already). It seems to me like modern server technology could serve up his site quickly even if it had a more complex UI, so I think the real reason for keeping it old-school is the feeling and tradition behind the site and a focus on keeping it simple. Same reason for no use of social media to promote the site. They get about 50 million views a month already; this is plenty for him. They just want to be a classifieds site. Period.
   
   Many people asked why he doesn't monetize the site more, perhaps in order to generate more money for philanthropy that way. He says he's a libertarian primatist and having lots of money to throw around is not always good, like the situation Gates faces. He'd rather help everyone by giving free advertising on his classifieds site for roommates, furniture, cars, etc. and let others use their money as they see best; he does this because it just makes sense to him to do it that way. This was a really interesting perspective on the website; I had never thought about how giving the service for free was philanthropic in its own way.

Overall, I was impressed by his emphasis on just doing what he thought was right, on pleasing his community, keeping his site simple and focused, and using social media and nontraditional mechanisms to promote philanthropy.