Reflections on 2013 and resolutions for 2014
It’s been a good year
2014 has began well. Partly because I was skiing with my family as I usually do in the beautiful alps. The fresh air and the mountain always helps me self-reflect and think more. Without a shadow of doubt that one week skiing may be the most productive of my entire year. And whilst I always push myself to self-reflect that time of year – and this year in particular- is the deepest and most meaningful retrospection of all.
As I reflected on the past year I realized how much had actually happened. We started the year on steroids, the typical ‘go go’ top line investor fuelled growth mode. We operated on vanity metrics instead of sanity metrics. We were fat and over-bloated. We were management heavy and inefficient. We were shooting for the stars and developed tunnel vision.
And then something painful but retrospectively lucky happened. The investor appetite changed, some of the assumptions, promises and myths came out sour. Some hidden realities came out of the wash. The froth came off the cappuccino.
I’ve said time and time again that the true test in life is what one does when that happens. In our case I’m proud to say that we just picked ourselves up, implemented some drastic changes, got real and elevated sanity above vanity.
It wasn’t easy. We had to let go of team members, change plans and direction, scrap a lot of things that had emotional equity built in, and especially for the guy at the top who gets the shit from both ends – investors on one and team on other – I can tell you I had more than a few sleepless nights.
But we pulled through. We turned the business into cash-flow positive, we became leaner and meaner, the people staying over being part of the earlier hires who had more dedication and passion about who we are and what we stand for. Who share our sense of purpose.
We made drastic changes like moving from two split locations to one, which meant making our support team in London redundant. We dropped a few balls in the process with some metrics temporarily dipping but overall we came out a winner. Our costs overall halved and our revenue trebled in the year.
For this I am most grateful to the team that’s left over. They are warriors, with heart, passion and dedication. To reward them I doubled the stock pool and allocated a much bigger chunk of equity to the team that stayed for the fight. Some of the more senior management voluntarily took salary cuts in exchange for more stock.
The difference I’ve seen in mindset and perceptions is that from night and day. Its almost a different company now. Before I had employees. Now I have partners. Co-owners. And I push them to look at me more as a peer than a boss.
But good is the enemy of great !
Yet with all of that, I was still troubled at the end of the year. I had a niggling piece of the puzzle missing somewhere. I felt we did good but not great.
So I sat down and wrote what I would define as a great business to me. I imagined what a great business would be to me in 10 years. What’s the ultimate dream? Thinking freely without the ‘how to get there’ to drag me down.
And I say ‘to me’ because no doubt the relative importance of what makes something great differ between entrepreneurs. Some may be more motivated by being number 1 in a space, being the largest, being global, being whatever.
The answer was this. To me a great business is one that:
- Serves a real purpose and a strong vision. Lives in the future not the past
- Builds great products that people love and share
- Delights customers with great service
- Has a team of talented people who are happy and proud of what they do
- Keeps innovating ahead of the rest.
These 5 things matter more to me than making money, employing thousands of people, having political power, offices all over the world… all those things that motivate so many others. There’s nothing wrong with those things – its just not what makes me tick. And if you as the CEO don’t tick the company wont either.
So I used this a template to ask myself two questions
- Fine, this is what I consider great. But is it the right strategy for the business? Will it help us win?
- If so how well do we do against these today? And how do we do better?
Thats all great, but will being great help us win long term?
I believe the answer is yes. And here’s why. The online staffing industry is a mere $1Bn today of a whopping $450 Bn total. That’s 0.2% penetration compared to say 10-15% penetration for e-commerce which had a good decade head start almost and which always leads the services sector online and offline. You don’t need to be a PhD in Economics to figure out that that will grow
I also happen to believe that unlike e-commerce which are pure consumption platforms and so can leverage – much like Amazon did – a centralized distribution system for economies of scale, in our space we are both consumption and production platforms. The work gets done on the site. So unlike say in ecommerce where a $10 item is delivered in much the same way as a $10,000 item – hence economies of scale – in services a $5 gig has a much different workflow than a $5000 gig. So different products will be needed, with specific workflows to climb that mountain.
Which is why a strategy focused on innovation is the winning strategy. Building great products, that serve a real need, that play in the future, that delight customers, by a team who are proud and happy building them, and doing it again and again and again. Constantly reinventing ourselves.
Thats my dream.
As for purpose. That’s the one thing I tick most confidently in the 1-5 criterion list. We are not a product that’s cool and ‘in’ today (ironically why some investors don’t like us – which is music to my ears!). What’s better than being cool is being important. MySpace was once cool. LinkedIn is important. It matters. And I know that we matter to our community. If we disappear tomorrow it would affect half a millions peoples lives.
But in the long term we are all dead!
So using this as a framework, I went back and had a brutally honest chat with my team. Starting first with my top lieutenants. The goals being clear: how do we get to this end point?
The process was so refreshing. We haggled on the near term and mid-term goals and priorities, the order of events in which to get there, how to quantify them etc. but all agreed on the end vision. And from that we collectively formulated a plan to make it happen. Before we die ideally ! J This gave us set goals for the quarter and the year ahead as a team to work towards.
And so more than any other year I feel more confident, more relaxed, more focused and more refreshed. That there is a clear vision, and end goal, full alignment with a great team of people on how to get there.
We stoop up and talked to the team openly about these goals and why they matter. With brutal honesty. I emphasized again and again that it all starts – much like my self reflection on what was missing at the end of 2013 – with brutal honesty. I have been an entrepreneur for 10 years now and I have tolerance for little else. A culture of brutal honesty and is the glue that binds us together to meet these goals. Without it we are just playing musical chairs. Building on quick sand.
Life is too short for that. As Steve Jobs said “you are already naked. You have nothing to lose”
We have nothing to lose!
I did the same process with myself although a founders personal and business life and intrinsically intertwined and inseparable.
But looking back on 2013, the moments I regret are those where I was more fearful than I should. Fearful of taking action, or admitting things first to myself and then to others. To be fearless you must first be brutally honest
Fear is our worst enemy, it’s makes us think of the negative instead of the big picture. Its unnecessary inertia. Its like the cork on a champagne bottle. All that good stuff bottled and when it pops…. Beautiful bubblesJ
If could play God and design Man from scratch (someone please invent this tool )! I’d remove fear, add more empathy, passion and forward vision. There’s way more intelligence in this world than open-mindedness and fearlessness. What a dream it would be to live in a world where everyone sees first what can go right rather than what could go wrong. A world where people understand how pathetically insignificant and temporary our little existence is and how every minute of it should be utilized to amplify it to the max. And even then at best we make a tiny dent in the universe.
Indeed much of my thinking above started from the ultimate acid test in life: “when I’m dying, what would I like to tell my grandkids? “ Some may want to show them all their properties, or trophies, or money, or great memories they acquired.
Unfortunately there is no gene for memories yet (someone please invent this too!). The sad reality of life is that we acquire all these memories and one day they are gone. Just gone. What’s left behind is what we’ve built and the people that’s influenced.
And so that’s the position I want to be in. To point to the cool things I’ve build and say “we built that. And it’s changed something for ever. And I had fun in the process” And I had a swell of a time along the way. (hopefully my grandkid doesn’t respond: that sucks paps J)
So I start 2014 with a promise that I wont forget this. I’ll live every moment fearlessly, with courage, remembering how little we have to lose in almost everything we do, yet how much we have to gain.
I end with one of my favorite poems by Roald Dahl:
“My candle burns at both ends
It will not last the night
But ah my foes and ah my friends
It gives a lovely light”
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