Guy Kawasaki - The Art of the Start

good morning good morning my name is Guy Kawasaki and this is my son Nate and Nate it happens to be traveling with me on this trip and when we were backstage he said can I go on stage with you to see what it's like and I didn't want to stifle his creativity and stifle his be a daringness so here he is so now take yourself ok beating so my name is Guy Kawasaki I am the chief evangelist of a company in Sydney called canva I'm here today to talk to you about the art of starting things specifically the second version of the art of starting things I come from Silicon Valley I was the chief evangelist of Apple I was a software evangelist for Apple I was a Motorola advisor and I am currently not only the chief evangelist of canva I'm also on the board of trustees of the Wikimedia Foundation which is the Wikipedia entity and a visiting executive fellow at the School of Business of UC Berkeley Haas School of Business and I have to tell you I just love your country I come to your country two or three times a year and I'm gradually getting more and more assimilated I only drink flat whites now I love this Japanese restaurant in Surrey Hill called taco fantastic place when I die I have decided that some of my ashes will be spread in front of bathers pavilion at Balmoral Beach because I've actually written books in bathers pavilion and it is just it's just I don't know why it just brings me great peace to be at Bay this pavilion and to show pictorial proof of my assimilation into the Australian culture I present you with this picture so I've been drafted into the Bondi bathers Club and I'm going to go through my life saving thing a few days ago my family and I went swimming in icebergs the saltwater pool let me guess there is a reason why that thing is called icebergs right now it is absolutely freezing cold so I've had a great time and now I'm going to try to pay my host back by providing information about startups nolan bushnell who came out two speakers before is a fantastic example of Silicon Valley entrepreneurship innovation daring and all the good stuff so he was one of my heroes and I hope to pass on ten good tips about entrepreneurship for you so let's get started so the first thing that I learned about entrepreneurship is that great companies great entities start with people asking very simple questions you know when you look at a Microsoft or an Apple or Google you might think at the very start of that company they had a grand vision of how they would have operating system and application and devices and gaming and online presence and I think you'd be very surprised to learn that most of these great company started with something very simple questions like therefore what this happens when you have a perspective of vision a passion and you know in your heart that someday there'll be lots of phones and these phones will have good cameras and these phones with good cameras will all be connected to the cloud therefore what therefore you start Flickr or you start snapchat because when this vision comes true there'll be so many ways to get pictures online there should be a service to tap into that phenomenon so you start a flicker the second concept is isn't this interesting this happens when geeks and nerds get together and they try to create something and they fail luckily they fail and when they fail they notice something that's interesting about their failure an example that goes back decades from America is of course posted pads from 3m 3m is in the business of making chemicals they specifically wanted to make a very strong glue they completely failed and they made a very weak a glue so weak that you could attach it to a piece of paper stick the paper on something and pull the paper off it would leave no trace very very weak glue but isn't this interesting and post-its was born the third question is the genesis of Apple you know is there a better way why is it to use a computer you had to go to a university you have to work for a large company you have to work for the government is there a better way and there came the Apple one three examples of the kind of simple questions that entrepreneurs ask themselves so what I'm trying to tell you is don't put this burden upon yourself that you have to come up with this megalomaniac plan to create this multibillion-dollar corporation that's going to eventually control the world ask and answer simple questions step one step two is to make what I call an EM vvvp most people are familiar with the concept of an MVP Minimum Viable Product I would like to add to the list of these not just viable viable meaning you can sell it for more than it cost to make but also valuable that you've created a product that to use the words of Steve Jobs dents the universe it makes a difference because you can have something viable that is not valuable you can make money doing things that are mediocre and mundane and the final view I'd like you to add is validating that this product this service validates your vision validates your perspective your idea your hope for the world let me use a negative example let's suppose it one day you open up your browser you open up your newspaper you find out that Apple is going back into the printer business it's going to start selling laser printers again let's apply the viable valuable validating tests to that laser printer is it viable absolutely people will buy an Apple labelled laser printer no problem right so they'll make money doing it is it valuable I would debate that it's not valuable what difference does it make to the world if Apple sells a leather or laser printer and does it validate anything about apples vision for the few not at all so laser printer from Apple is viable but it is not valuable and it is not validating entrepreneurs in this audience as you come up with your product ideas I want you to rise above Minimum Viable Product I want you to make a Minimum Viable valuable validating product the M vvvp number three is to get going to get started so many entrepreneurs or would-be entrepreneurs are just obsessed with shipping something that's perfect and they take too long my experience is that people ship things too late more often than they ship things too early if you're going to make a mistake make a mistake by shipping too early not too late the key to doing something like this to getting off to this fast start is to do something that is probably cringe worthy you're going to look back and you're going to say my god how did we ever think we should ship what we shipped it should embarrass you the first book that I wrote when I look at it now it embarrasses me when I think about the first Macintosh that I was affiliated with 128 K of ram 400 K floppy drive the secret hard disk that was a whopping 5 megabytes thanks to my efforts there was no software my god what were we thinking it makes me cringe to think about the first Macintosh but you know what if you're in an organization and you have the luxury of cringing about your version 1 it means you probably did it right and by definition if you're in an organization and you're thinking about version one that makes you cringe at least it means you are still alive don't worry ship something cringe-worthy next thing is to find complimentary soul mates two key concepts in this bullet item first complimentary complimentary means that fundamentally in an entrepreneurial organization there are only really two necessary skills somebody has to make it and somebody has to sell it everything else is make it and sell it and so if you're an engineer you need to find someone who can sell it and if you're a salesperson you need to find someone who can make it if you're all engineers there will be no one to sell it if you're all salespeople there'll be nothing to sell Steve Jobs needed Steve Wozniak Steve Wozniak needed Steve Jobs complementary and soulmate soulmates mean that you need to be on the same page that if some of the founders are looking at a company is a lifestyle company where they'll work part-time and they'll never come in on weekends they'll never work late they're trying to build a company that suits their lifestyle and maybe they'll quickly flip it and other people are willing to dedicate their lives they're going to latch themselves to the company if the company goes down they're going to go down with it that's not soulmates you need people who are on the same page third point about getting started is to make a mantra I think many organizations particularly American ones filled with MBAs spend much too much time making mission statements the purpose of these mission statements is to kind of cover every possible group that's involved every party every everything so major savings come across like this where we endeavor to create patent-pending curve jumping paradigm shifting products that exceed the expectations of our customers while enabling our shareholders to receive a monetary reasonable return while enabling our employees to self actualize their life goals while killing as few dolphins as possible okay that's your American mission statement what you want is a mantra a mantra has only two or three words the mantra for Google democratized information Apple increase productivity and creativity Federal Express peace of mind it's stuff like that my personal mantra empower people to words that define why I exist make a mantra the next thing you need to do is to define a business model absolutely perhaps distasteful to some people but you have to make money some key concepts about a business model first of all be specific it's not about saying what we're a software company that's not specific enough neither is saying we're an enterprise software company that's still not specific enough you need to say you are an enterprise saw for a country serving the biotech industry specifically the application for FDA approval it should be so specific that you have the name or the title of the person who has your money in her pocket your job is to get your money out of her pocket into your pocket that's the definition of a business model it is that specific next point is to keep it simple you know what there are many ways to innovate on products and services very difficult very rewarding if you pull it off I would suggest that if you can pull off the engineering the science of innovating with a product or service you should not also open up a new front called we're going to innovate on our business model it's too hard to innovate on product and service and then to throw on your going to innovate on a business model you're making your life too hard basically you want a business model where it costs you a dollar and you sell it for ten dollars that's it very simple third point is to ask women the reason why I tell you this is because I believe that men have a fundamental genetic flaw the fundamental genetic flaw is men want to kill things men want to kill plants they want to kill animals they want to kill people they want to kill countries they want to kill political parties they want to kill products they want to kill services they want to kill companies okay so whenever you ask a man is it a good idea to start a YouTube killer is it a good idea to start something that will kill PowerPoint or Apple or Apple's watch or Apple's MacBook is it a good idea to start a bank to kill Commonwealth Bank every man always says yes because men cannot resist the temptation to try to kill things women do not have this fundamental genetic flaw so when you want to know if you have a good idea and you have a good business model do not waste time asking men only ask women number five number five is to weave a mat you know when you start a company it is a beautiful situation it's like being the first skier down the mountain in the morning if you're into figure skating or ice hockey it's like being the first person on the ice after the Zamboni has shaved the ice it's just a beautiful feeling and a company when you start it it's just like that if you're in an existing company you have these crappy employees you never should have hired you have this crappy furniture in this crappy office you have a crappy architecture you have this crappy install base that's bugging you for free upgrades you got all this stuff right but no when you start a company it's pure packed powder that no one has skied on and in that kind of scenario you're tempted to think oh there's so much stuff we can do in our new company we could like work with graphic designers and design a new logo this really cool logo and we could create these viral Kickstarter 90-second videos you know that's going to win awards and then we can order stationary and we can go to whatever your version of Ikea is we can like build this really cool stand-up desk with an electric motor connected to it and all this kind of cool stuff because when you're on a sheet of ice or at the top of the mountain the Nonna's ski down before it looks also interesting so a mat is to help you prioritize the first thing you should do is worry about milestones milestones are things that you would call up your spouse or text your spouse and say honey today we shipped today we finish the design today we closed our first sale you would not call up your spouse and say honey today we ordered business cards am i not a great entrepreneur next thing is you have to test the assumptions of your business it's very important you know I'll give you the Silicon Valley pitch for pets.com 300 million Americans 1 & 4 owns a dog that means 75 million dogs each dog eats 2 cans of dog food per day 150 million cans of dog food per day how hard could it be with our Rockstar programmers to make a website with e-commerce using black hat SEO techniques to get a mere 1% of that 150 million cans per day that's one and a half million cans per day 365 days a year because this is b2c at least b2d this is not b2b right dogs eat every day of the year so you test this assumption that it's not so hard to get one and a half million cans of dog food per day well one way of testing the assumption is to do bottom-up analysis the way the bottom-up analysis works is hmm using all our SEO black hat magic and all this kind of stuff perhaps we could get a hundred thousand uniques to our site in the first few months let's say of those hundred thousand uniques a thousand buy a case of dog food so a thousand people buy a case of 25 cans of dog food that's 25 thousand cans of dog food so we have a little bit of a discrepancy bottom-up we come up with 25,000 cans of dog food per month going the other way we come up with 45 million cans of dog food per month conservatively speaking and I hate to break it to you guess which side of this spectrum your results are likely to be 25,000 per day 25,000 per month so you need to test your assumptions next thing you do is definitely ship to launch do not simply talk about this 1% this growing market but you need to get it out there and finally you do tasks tasks are things that help you reach milestones tests assumptions stuff like hire and engineer that's a task ordering a logo is not a meaningful task milestone assumption tests test the picking order of entrepreneurship number six is to tell your story great entrepreneurs can tell their story you know many many entrepreneurs stand up in front of an audience they say I have patent pending curve jumping paradigm shift the enterprise scale herbal product everybody says that because they think that everybody else stands up and says I have a piece of crap that slow buggy and hard to use and cannot scale so this is the opposite test the opposite test means that ask yourself is your competition saying the opposite of you is your competition saying of us I have a slow buggy hard to use piece of crap so now you come up and you say I have patent-pending curve jumping paradigm shifting bug-free really fast easy-to-use product the odds are that you're flunking the opposite tests if everybody says the same thing I don't care what adjectives you use you're not saying anything different the second point is to make it personal you know the great stories of Silicon Valley are not about penetrating these large growing markets pierre omidyar the founder of eBay tells a story that the reason why he created eBay was because his wife was a toy collector she wanted to sell her collection of Pez dispensers there was no way for her to do it so he created eBay to help her sell Pez dispensers online incidentally total story okay but it is a great story nonetheless great story nonetheless the point is to make it personal and the third point is to embrace what I call the 10-20-30 rule of PowerPoint or keynote depending on app you use this means that you have to tell your story with ten slides in 20 minutes using no font larger than 30 points if you just did that you'd be better than 90% of the pitches in the world 10 slides 20 minutes why 20 minutes when there's probably a 60 minute window for your appointment it's because despite my efforts to this day roughly 90% of the world uses windows and I know that if you carry a Windows laptop in to a meeting it takes 40 minutes to make it work with the projector if the whole world use Mackintosh's if the whole world used Macintosh is this would be the 10 60 30 rule okay and 30 points select all the fonts in your presentation make them 30 points and see how much goes off the page and keep cutting till it all fits 10 20 30 number 7 is to hire infected people by infected people I mean that you need to ignore irrelevant see okay everybody knows when you hire somebody you look at their education and you look at their work experience you're looking for a match you're looking for relevancy you're looking for proven potential all this kind of good stuff and I'll tell you there are two cases one is let's say you're trying to hire somebody perfect educational background perfect work experience but does not love the product does not get it in that case I would make the case that the perfect education and perfect work experience is irrelevant ignore that don't hire that person the flipside is also true let's say the person doesn't have the perfect background education and or addictions but does love the product thinks that the product is world-changing denting the universe when I first saw a Macintosh I swear the clouds parted the angel started to sing okay you need to ignore their relevant I came to Apple from a background of working in the jewelry business literally schlepping gold and diamonds counting gold and diamonds no computer science degree no work experience in the computer science business in the technology business ignore the irrelevant second thing is to hire better than yourself a players hire a plus players B players hire C players C players are D players a players hire F players and so we go if you start hiring B players if you lower your standards you're going to be surrounded by Z players this is called the bozo explosion you need to fight the bozo explosion last point on hiring infected people is to apply the shopping center tests the way the shopping center test works is this let's suppose you go to a shopping center you go to Queen Victoria building and you look across the way and you see someone that you know is interviewing at your company okay so you can make a beeline straight to that person say I know you're in a company I hope you join us we were just going to kick butt we're going to change the world we're gonna democratize design at canva whatever it is right one reaction is you just make a beeline to that person second reaction is you know Queen Victoria building is not that big if I get face to face with that person I'll say hello third reaction is I am going to go to Westfield Mall if your first reaction is not to make a beeline straight to that person I suggest you not hire the person because startups are families dysfunctional families but families you have to want to go straight and see that person number eight is to socialize and I don't mean in the political sense socialize means that social media is the best thing that ever happened to entrepreneurs because now marketing is fast and free and ubiquitous when I started companies we'd have to spend $75,000 for a Wall Street Journal ad we'd have to go to Comdex and CES not true anymore step one is to perfect your profiles the avatar your face should project that you are competent that you are trustworthy and you're likable the cover story should tell the story of your company your brand or your career but the avatar is just your face the cover photo tells your story next point is you need to embrace the NPR model NPR National Public Radio is like ABC for you ABC I think your government pays NPR is supported very little by the US government they have to run these fundraising pledge drives every once in a while but you know what NPR provides such great content that people don't mind the pledge drive in fact we contribute so the test for social media is you're providing such value that you can run a pledge drive at canna which bride a canva we try to present such great content about design not about canva about fonts and colors and photography that when we want to run our pledge drive ie telling you about a new product or service from canva we have earned the right and you feel the need to reciprocate to pay attention to our pledge drive because we have been providing great content all year that's the NPR model next thing is to pass the reshare test the reshare test means that whatever you post is so great that not only do your followers like it they will reshare it to their followers it is a higher test for content because when people reshare your content it means that they are risking their reputation on what you shared and if you can pass the reshare test you will increase the size and potency of your social media platform because more people will find out about you pass the reshare test number nine is to seed the clouds that is to make it rain American colloquialism for sales the key to sales is to let one hundred flowers blossom you may think you know exactly what people should do with your product or service come to find out you were wrong unintended customers use your product in unintended ways don't freak out celebrate declare victory Apple wanted to make Macintosh a spreadsheet database and word processing machine guess what 0:43 Macintosh became a desktop publishing machine we did not plan that Aldus PageMaker was a gift from God the created desktop publishing and saved Apple imagine a world without Apple we'd all have phones where the battery lasted for more than half a day we'd have GPS we'd have GPS that actually worked we'd have a real keypad we had G phones you could put in your jeans and they wouldn't Bend it would be a different world let a hundred flowers blossom you think you have a spreadsheet database and what process you mean come to find out you have a desktop publishing hallelujah declare victory throw stuff against the wall see where it sticks go up to the wall paint the bullseye around it you hit the bull's eye god bless you number two number two is to enable test drives what you're seeing is two people I think you're smart and because I think you're smart I'm going to enable you to test drive the product and service then you decide don't ram it down their throat third point is to find the influencers you know it used to be easy top-down you sucked up to the Wall Street Journal they made you it's not true anymore I'm not saying you should ignore The Wall Street Journal but I'm telling you right now the pyramid has become inverted and now lonely boy 15 at aol.com who lives with his mother and sleeps on Bosley right sheet buzz lightyear sheets could make you successful you cannot ignore that anymore social media you know in the business of books it used to be the people waited for the New York Times Book Review to review a book before you bought it if the New York Times bless you you had a best-seller it's not true anymore when a book ships on Amazon in the next couple days there'll be dozens of reviews there'll be a conglomerate cumulative store score of four stars four and a half stars or two stars people go to Amazon they look at four and a half stars they read a few reviews by lonely boy 15 not the Washington Post not the New York Times not the Sydney Morning Herald none of that they look at that they look at the scores and they click and it's in their basket that's the nature of marketing today lonely boy 15 is the influencer number 10 don't let the clown's grind you down arguably the most important thing and I'm 2 minutes and 48 seconds overtime but what can you do because right yeah you're trying to cut me off but I know that the next thing is a break okay so so what are you gonna do not take me to Melbourne so so number Jen I spent two minutes introducing my son what can I say so don't let the clouds grind you down this is about Bazar city this is about clueless stupid negative people there are two kinds of clowns or bozos in the world one kind is a loser slobbing li disgusting pocket protector Japanese watch rusty car that's a loser that's not dangerous because only a loser would listen to a loser so unless you're stupid loser you don't have to be afraid of other stupid losers because you're not stupid enough to listen to the loser no danger the dangerous bosal the dangerous clown is a successful bozo or clown jess is in all black owns lots of stuff that ends in I like Armani Ferrari Lamborghini Maserati howdy is okay out is the exception okay so you look at that person you think wow rich famous must parse too smart I should listen to this person I would tell you rich and famous parses too lucky half the time right now you know the Tom Cruise doesn't have a perfect symmetrical face I still hope that you don't take his advice on religion okay he's rich and famous I don't think you should listen to Kim Kardashian about raising children okay rich and famous doesn't parse to write or smart so I think that Bo's acid is like the flu how do you fight the flu you get a flu shot you inoculate yourself so when you encounter big flu you've built up resistance I'm gonna give you some bilasa tea now so when you encounter velocity as you start a company you can resistible Zasa tea I think there's a world market for maybe five computers Thomas Watson chairman of IBM five computers I've five Macs in my house I have all the computers he anticipate in the world in my house this telephone has too many shortcomings to be seriously considered as a means of communication devices inherently have no value to us Western Union 1876 oops you know Western Union could be PayPal today could be Bitcoin it could be square but not if you write off telephony what were they going to do teach all the Americans Morse code and put a telegraph in every house string a long wire behind your car put a telegraph in your car hallelujah there is no reason why anyone would want a computer in their home Ken Olsen founder of debt great entrepreneur great innovator so successful in a mini-computer curve took us away from the mainframe curve but he could not embrace the personal computer curve imagine if you were Steve or was and you met Ken Olson and you told them your plans for personal computer and Ken Olson shut you down by saying there's no reason why anyone would want the computer in their home because if you think about it at the time you were starting Apple who would be a better investor advisor director mentor than someone like Ken Olson right and he would have told you uh-uh no one's going to buy a computer there's no reason to have a computer in your home this is dangerous both ah City don't let the clown's grind you down and that is the art of innovation thank you very much you

Channel: Wired for Wonder

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Keywords: Guy Kawasaki (Organization Leader), Wired for Wonder

Id: U8EVD739BxQ

Length: 31min 37sec (1897 seconds)

Published: Wed Sep 30 2015