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Principles of Warren Buffett in 2019

William Glass
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Principles of Warren Buffett in 2019

In 2019 Warren Buffett’s principles have a notable change from his desire to invest in foreign markets, dating advice, and delaying gratification. Earlier this year Warren Buffett and Charlie Munger put on a show for the investors of Berkshire Hathaway. On the first weekend of May every year, Omaha experiences an influx of investors from around the globe. The sleepy midwest city is swarmend as one of the most influential and successful investors speaks to 40,000 pilgrims.

This was my second year attending the Berkshire Hathaway Annual Shareholders meeting (check out year 1 takeaways) and it did not disappoint. The questions flow from both journalists and audience members. Some are softball questions and others are stinging blows. Warren and Charlie take the questions in stride. Providing insights into their decision making and a glimpse into their investing philosophy.

What are Warren Buffett’s Principles in 2019?

A big focus of the conversation was why Berkshire is sitting on so much cash. The $100 billion or so is just sitting while Warren keeps Berkshire’s options open to an “elephant-sized” acquisition. When you become as big as Berkshire has become your investing strategy has to change with it too. Berkshire now has a ton of cash that it requires bigger deals to achieve the same level of returns. It also takes longer to deploy 10s of billions of dollars than it does with smaller amounts.

Halt Sign - Delay of Gratification

Delay of gratification

One question that really stood out was one that an 8-year old asked. He asked about how he could work on delayed gratification (I’ve written about my own experience as a child). He understood it is important in investing and that it is a tenant of Buffett’s strategy. Warren and Charlie took an interesting approach telling the kid to enjoy life. Delaying gratification can be valuable but also detrimental to your long-term happiness. Should you go to Disney for 2 days with your family now? Or should you wait for 10-years to go for a week? It probably makes more sense for you to go for 2-days now. There is value outside of the total dollar amount and the return has to outweigh the time. This is one of Warren Buffett and Charlie Munger’s life principles to take note of in 2019.

Outdoor Day Market - Financial Glass

Investing in Foreign Markets

People asked multiple questions about investing in foreign markets such as Asia and Europe. The response was a resounding “yes” that Berkshire Hathaway would love to get exposure to foreign markets. The bet Buffett has made over the years is on the resilience of the US economy. Yet that doesn’t stop him from wanting to get into foreign markets.

Warren Buffett’s Original Founding Principles

Buffett also discussed how he went about opening up his own shop. A question from the audience was from a 27-year-old who wants to open his own investment shop. “How does he know he is ready?” Charlie’s response was by asking that question you are not. Warren took a different approach talking about how he put ground rules in place before he took family and friends’ money. He set expectations that this is our strategy and if we are down you have to trust me. Ultimately you shouldn’t set expectations you can’t meet. You must also set out and actually do it (here’s what tipped me over the edge to entrepreneurship).

Operating Philosophy

Charlie and Warren talked about how they came a long way from humble beginnings. The original company, Berkshire Hathaway was a failing textile company. Since acquiring the company they have managed to focus on “compounding machines.” Identifying companies with a strong compounding effect and betting on those businesses. Berkshire prides itself on not having a strict formula with lots of committees and spreadsheets. The numbers are important, but so is the culture and nature of the business. This aspect of Warren Buffett’s guiding principles hasn’t changed in 2019.

Couple Toasting Glasses - Financial Glass

Dating advice

The Oracle of Omaha also gave some dating advice that can be applied in multiple contexts. You have to find the best partner…that will also take you. In the Berkshire Hathaway context, Charlie is smarter and Warren is more knowledgeable. They both enjoy working together and as such are able to have fun while doing business. The other dating advice is you get to choose who you select as your heroes and friends. Choose wisely!

2019 Warren Buffet Selfie - Financial Glass

Wrapping up the Principles of Warren Buffett in 2019

It is incredible what you can learn just listening to two of the greatest investors of the 20th & 21st centuries. The even people you meet and the insights you gain from the conversation will impact your investing philosophy forever. I highly recommend you checking out next year’s event. No, you don’t have to go all the way to Omaha if you don’t want. Yahoo Finance live streams the event every year. 🙂

More posts about investing

3 Keys to Personal Finance that Will Make You Rich

2018 Berkshire Hathaway Annual Shareholder’s Meeting – Warren Buffet

The Best Investment You Can Make

How to Prepare for an Upcoming Recession in 2019

Hiring for a Startup in 2019

William Glass
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Hiring for a Startup in 2019

Hiring for a startup in 2019 can be quite a challenge. With unemployment, at record lows in 2019, recruiting and hiring highly skilled workers is challenging.  To gain insight into what it takes to hire great teams I attended a startup panel on Recruiting and Culture. 

The featured panelists included Cheryl Roubian, Head of People at Greenhouse Software; Kate Smith, Director of HR at Betterment; Sonia Mammen, VP Head of People at Movable Ink; and Debra Hreczuck, Head of People at Culture IQ. The panelists had extensive backgrounds helping grow and scale businesses. They offered advice that both startups and small businesses can easily implement. 

Keys when hiring for a startup in 2019

Supportive Message - Financial Glass

Stay Focused 

One common mistake that entrepreneurs make when hiring for their startup is staying focused. First and foremost know what the role and responsibilities are that you need before you start interviewing. A classic mistake is not clearly defining what the responsibilities are for the position you are hiring. Ultimately this leads entrepreneurs to often hire for the wrong position or not providing clarity to a candidate. Be clear in what you are hiring for and stay focused throughout the interview process. 

Have a Tight Recruiting Process

A startup with a tight recruiting process is more likely to identify, vet, and hire the right folks. You want to clearly define the recruiting process for a candidate and be able to make a decision quickly. Quality candidates are hard to find so being able to move quickly is important. In order to move fast must have a tight process based on the role and responsibilities, you are hiring. Your hiring process has never been more important than it is as a startup in 2019.

Referral Bonus

When it comes to sourcing high-quality talent your best resource is often your current employees. Offering a referral bonus will encourage employees to bring other people from their network to join the company. As a startup, this is a quick way to jump-start the recruiting and hiring process in 2019.

Diversity

There are many studies that show the importance of diversity. The more diverse companies perform better than their peers on average. As a startup recruiting diverse candidates starts with looking outside of your network. Your network typically comprises people that are similar to you thus it is important to expand your search. Examples from the panel include going to the communities, events, and colleges that are more diverse. Getting out and tapping into new communities and networks one crucial tactic. Another tactic is to ensure you interview a number of diverse candidates for each role. 

Employee Lifetime Value

You may be familiar with customer lifetime value. A measure of how valuable your average customer is to your business long-term. You can apply this same concept to your employees. Think about the inputs to get really high-quality employees and the output that exists from finding long-term fits. This concept also helps when thinking about training and investing in your employees. As a startup in 2019 hiring is a challenge hence the importance of investing for the long-term. The value of each team member rises as their employee lifetime value

Empty Chairs Ready for a Seminar - Financial Glass
On-boarding and training is crucial!

On-boarding

When it comes to successful hiring and recruiting, it is important as a startup that you have a regular cadence. This tends to happen naturally with smaller teams. Yet as you scale it is important to have check-ins at the 30, 60, and 90-day mark. Early check-ins allow you to ensure proper knowledge and skill transfer, that you identify challenges early, and ensure cultural integration.

Resignation

When it comes to resignations understanding why as quickly as possible is imperative. You’ve spent a lot of resources on your employees and you don’t want to lose quality talent. Thus it is really important is to prioritize the why behind the resignation and work quickly to find a solution. Andy Grove in High Output Management talks about how this becomes your number 1 priority as a manager. Grove also highlights that time is not on your side so you must act fast.

Firing

When it comes to firing there are various different philosophies. One important piece is that it must be clear that it isn’t working out. You should always document your conversations and communications about an employee’s quality of work. There must be an opportunity for an employee to improve and proper guidance to help them succeed. You’ve spent a lot of resources to hire and train this individual. Therefore you want to ensure you’ve given them every chance to succeed. If you struggle with providing quality feedback or having difficult conversations, check out Radical Candor.

Implementing these best hiring practices as a startup in 2019

While the challenge of hiring quality talent is difficult for a startup, the above strategies will give you a blueprint. In order to effectively compete and scale quality, talent is crucial to your success. As you put your team in place hone in on marketing, product development, and raising venture capital. You will be faced with tough decisions that no amount of reading or studying will prepare you for (just ask Ben Horowitz). Check out the linked posts for additional business building tools. Good luck on your entrepreneurial journey of building a successful business.

More Posts about Scaling Your Business

Growth Hacking Tools – Creative ways to grow your company

Blue Ocean Strategy – Creating your own market

Crossing the Chasm – How to scale across the different types of users at each stage of growth

$100 Startup – Starting a successful business or side hustle

The Lean Startup – How to quickly scale and utilize your resources efficiently

Radical Candor

William Glass
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Radical Candor

Radical candor is a way of communicating with people at work that focuses on care and communication. It is that feeling when someone you trust genuinely supports you and expresses praise when you experience success. Yet, that same trusted person holds you accountable when you aren’t doing the things that lead to success.

If you’ve played organized sports, taken music lessons, or attended school, then you’ve likely experienced a range of support from your teachers and coaches. Have you ever had a leader who pushed you to get better? A leader who helped you build new skills while also sharing your hard-earned victories? This combination is the main idea behind radical candor.

I think I get it… but can you define radical candor for me?

Radical Candor Matrix
An excerpt of the Radical Candor Matrix from the book

Quite simply there are two facets that make up radical candor. The first is caring personally for each individual employee. The second is challenging directly. radical candor falls squarely in balancing these two key functions. 

In order to practice radical candor as a boss, you must check both boxes with each of your direct reports. One without the other leads to extremes that are either obnoxious or disingenuous. Lastly having neither is quite possibly the worst of all the possibilities. 

When I was leading a team of new sales representatives at Gartner, I wish I’d have understood radical candor. Looking back, I genuinely cared about my people but struggled to challenge directly. I often struggled between being a supportive boss and being able to effectively upskill my team through radically candid feedback. 

The philosophy behind radical candor

Build Real Relationships

As a manager, you can take some simple steps to implement a radical candor with your team. The first key is to build real relationships with your team. This means not just discussing work-related matters, but discussing other interests. Each member of your team will be different and building a relationship takes time. As a leader, you should be curious and open up about yourself. 

Provide Guidance and Feedback

The second key is focusing on guidance and feedback. As a manager, your role isn’t to do your work for your employees, but enable them to be successful. Managers may struggle with not wanting to be a micromanager on one hand. Yet on the other not being so hands off as to fail to support your team. When looking at guidance and implementing radical candor first focus on yourself. Ask your team for feedback and encourage radical candor about where you can improve. Invite, reward, and act on the feedback your employees give. This will provide the groundwork for you to do the same. 

Building a team

Building a Team

The third key is building a team. The best sports teams are composed of a mix of players. This may include a superstar or two but mostly consist of rock stars who consistently perform. Superstars are the employees who are on an incredible growth trajectory and focused on the next promotion. Rockstars, on the other hand, are content in their roles and focused on performing at a high-level. Building a team of only superstars is no way to build a strong team. You must encourage and support both your superstars and rockstars. The other nuance is that people will move in and out of those buckets during various times in their careers. Thus having radically candid relationships built on trust are so important. 

Results

The last key is results. If you’ve built a collaborative team focused on providing quality guidance consistently, the results will follow. The ultimate goal of radical candor is to do more as a team than each individual. The sum of the parts is greater than each siloed individual. Ultimately radical candor is about teams achieving great things together. 

See through floor - financial glass

What next…

Kim Scott lays out numerous strategies, stories, and tactics for implementing radical candor in the workplace. The book goes into great detail about the philosophy and how to effectively utilize meetings to accomplish goals. There are fantastic frameworks for approaching radically candid conversations and ways to implement radical candor. 

I encourage you to read the book yourself if you find the idea of radical candor interesting. The tools and tips are wonderful for both first time managers and seasoned managers. You’ll walk away with actionable insight and new perspective. 

In addition, I encourage you to read about other management philosophies below.  

The Hard Thing About Hard Things – What they don’t tell you when you become CEO.

High Output Management – Classic principles from Andy Grove the former CEO of Intel.

Lean Startup – Classic philosophy about how technology companies can grow quickly.

The Art of Cultivating Grit – Angela Duckworthy studied Grit and how you can cultivate it in yourself and your team.

Business Building Tools

For technology companies looking at strategies to scale check out – Crossing the Chasm focused on moving from early adopters to mainstream users, Growth Hacking Tools strategies and tactics to help scale, Influencer Marketing how you can use this underutilized strategy to grow, and Blue Ocean Strategy creating new markets without competition.

Other areas of interest – Product Development, Raising Venture Capital, Hiring Great Talent.

Building a Business – The Next Chapter

William Glass
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5
Building a Business – The Next Chapter

I’ve got exciting news to share with you. I’ve decided to step away from the employee life to focus on building a business. 

“So, what’s the plan?”

I am starting a tech business that plays in the personal finance space. I’ll also be supporting other entrepreneurs with their early stage ventures and continuing to grow my real estate portfolio.

Building my own business - Personal Finance App

“Why now?”

Ever since I was in middle school/high school parents and teachers would ask about my career aspirations. I always found the question maddening. At the time, I didn’t know how to describe what I wanted. Instead, I would just say that I don’t want a career. I’d even go as far as saying that I’d rather have a job than a career. What I wanted was to emulate the renaissance man embodied best by Leonardo Da Vinci. As a result, I dreamed of creating and having a much larger impact than I could ever have in a traditional career.

Through the years I have gained experience and taken time to reflect. What I truly want is to be able to build a lasting business and focus my energy on pursuits that have special meaning. For the past few years, I have written numerous business plans, pitch decks, and even launched some short-lived e-commerce sites. All for the sake of learning, I have not one, but two,  real estate licenses in two different states. I’ve purchased a rental property and a piece of land. Oh, and I even took the GRE just to keep my options open.

Yet, there is one business that I keep revisiting. It aims to solve a problem that hits close to home for me. In addition, there is a tremendous market opportunity that exists today and that the current market players can’t/won’t fulfill. That is why I am choosing to build this business now.

“Got it.. so is there any way I can help?”

Over the course of this journey, I’ll be tapping into my wonderful network. Specifically, I’ll be seeking partnership opportunities and connecting with other growing businesses. I am an advocate of collaboration and creating positive support networks. Send me a direct message if you are interested in collaborating.

I am grateful for all of the amazing people and experiences I am fortunate enough to have had so far. In college, I was able to travel a good portion of the world. I’ve spent a year teaching English to middle school and high school students in rural Thailand. I’ve worked for the most trusted and respected technology research company on the planet. I was lucky enough to help develop an innovative startup that has an incredible founding mission, wonderful product, and talented people. Through my journey, I’ve been able to learn from extremely experienced and smart people.

As such, I am incredibly excited and energized to be building a business. I welcome any constructive feedback and open lines of communication. Cheers to the next chapter!

William

Strategies for building a business

New Product Development Process

Growth Hacking Tools

Influencer Marketing Strategies

Blue Ocean Strategy

The $100 Startup Starting a Successful Business

Drive: What Motivates People in 2019

William Glass
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Drive: What Motivates People in 2019

DUnderstanding what motivates people in 2019 is a challenge that every business and organization must understand. The question of motivation and how you can motivate people is a difficult one to answer. Daniel Pink’s book Drive: The Surprising Truth About What Motivates Us contextualizes the shift in how human motivation has evolved, where we are failing, and what motivates people in 2019.

The problem with how we motivate people now

Currently business, government, and other organizations focus on external rewards. Rewards can be if-then rewards so that if you do X activity you will receive Y reward. Conversely, if you do not do X activity you will receive Z punishment. In 2019 most organizations still, use the carrot and stick philosophy to motivate people, which is ineffective.

Financial glass - carrot on pole

An additional facet how we classically have viewed what motivates people is the focus on external rewards. This is usually a monetary award, a promotion, or maybe a free trip. While these external rewards are important, they do not address the intrinsic rewards of personal fulfillment. External rewards can be good short-term tactics to motivate people, but long-term intrinsic rewards are much more powerful.

What motivates people today?

The 3 key areas that Daniel Pink lays out in Drive of what motivates people are autonomy, mastery, and purpose. The key to what motivates people in 2019 are optimizing for these areas.

Financial Glass - What motivates us in 2019 dandelion blowing in the wind

Autonomy

As human beings, we have the desire to be autonomous and self-directed. We desire the freedom to choose what we do when we do it, how we do it, and whom we do it with. Democracy as a governing structure has grown and spread over the past 300 years due to this very notion of individual freedom. 

Our current management structures tend to limit employees’ freedoms to control their work. Companies that offer greater autonomy on the tasks, time, team, and technique are outperforming their traditional counterparts. Pink uses the examples of Atlassianand the 20% time idea that Google has made famous. Engineers spend 20% of their time working on a project of their choosing. 

Finding ways to give employees more control over their work helps spur motivation. Autonomy doesn’t mean standards go away or timelines disappear. Those remain in place, simply enabling greater autonomy over the details and enabling more intrinsic motivation to do good work is the goal

Financial Glass - What motivates people in 2019 - Mastery

Mastery

The second key to what motivates people is mastery. The autonomy discussed earlier encourages greater engagement as people now own their own methods of work. This engagement is the first step towards the second key to what motivates people, mastery. 

Think back to a time when you were really engaged or engrossed in an activity, you likely experienced a feeling of time passing quickly. You become engrossed in what you are doing that before you know it lots of time has passed. This is the idea of flow. Reaching flow states puts people on the road toward mastery. 

There are 3 laws of mastery you need to satisfy. First, mastery is a mindset that requires you to see your abilities as always improvable. Second, mastery is a pain in that it demands deliberate practice, grit, and hard work. Third, mastery is impossible to fully realize making it both frustrating and tempting.

Mastery motivates us through engaging in flow states that in and of themselves are rewarding. As the end state of mastery is never quite achievable, is difficult, and requires us to continually improve.

Financial Glass - what motivates people in 2019 - purpose

Purpose

Finally, the last key to what motivates people in 2019 is a purpose. People inherently seek purpose to support a cause greater and more enduring than themselves. This can come in the form of supporting specific causes, seeking religious and spiritual fulfillment, and pursuing a legacy. 

The current rewards system of external motivators or purely profit goals doesn’t cut it in today’s society. What motivates people in 2019 is beyond the external factors which are often table stakes. Alignment on both profit and purpose-driven missions is extremely important and a key to motivating people. 

You can see this shift happening from companies such as TOMS shoes to larger corporations like Proctor and Gamble’s Gillette twisting its catchphrase to “the best a man can be” in support of changing what it means to be a man. Banks that focus on impact investing and index funds that track socially conscious sectors are the beginning of this alignment.

financial glass - motivational sign

Implementing what motivates people in 2019?

The impact of redesigning work around what motivates people today is critical. This change will create a more productive, engaged, and satisfied team. You will decrease inefficiencies and ultimately support intrinsic motivation that is lacking in the way work is designed today. 

If you are an established organization it will require discipline and explanation as you transition. A gradual progression may be the best way to transition. Ensure you are focusing on your company’s key performance indicators to see how they adapt and listen to your employees. It may seem daunting yet the results over time will speak for themselves.

If you are a startup and are a small agile team, then you can more easily make changes. By supporting what motivates people today you lay the foundation for supporting autonomy, mastery, and purpose. To build a world-class team you must have alignment on motivation.

Additional motivation and principal ideas

The Rise of Superman – the power of flow states

A Whole New Mind

Gamify – motivating through game mechanics

Growth Hacking Tools for Startups

High Output Management Principles in the Digital Age

William Glass
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2
High Output Management Principles in the Digital Age

Applying high output management principles in the digital age is crucial in our changing world. The internet has disrupted every major industry and changed the way every company operates. The philosophy Andy Grove wrote about in 1983 was based on his time leading Intel. At the time, Intel was a leader in the tech sector producing microprocessors used in computer hardware.

Andy Grove published High Output Management 36 years ago. Since then, the internet has infiltrated every facet of our lives and changed the way we work. In the digital age management, principles have to adapt to remote workers and a plethora of communication platforms. Yet, the core principles Grove laid out adapt to our modern workplace.

Financial Glass - Man reading about business

What do high output management principles in the digital age look like?

The principles that Grove outlined focus on understanding the basics of production, management’s core duties, cross-functional teams, and individual performance. While the principles remain the same, automation replaces the formerly human led activities. The shift towards technology and the proliferation of the internet merely amplify organizations work. It remains crucial to understand the basics of production whether you work in a restaurant, software company, or services firm. You have to understand the key inputs and time to implement for those inputs to be effective.

Why are high output management principles important?

The shift towards technology and the proliferation of the internet merely amplify organizations work. Understanding the basics of production for your business regardless of the industry is crucial. You have to understand the key inputs and timing for those inputs to be effective.

As the speed of everything has increased with technology, consumers demands raise the stakes for speed and accuracy. This means that the people in your company have even greater leverage and responsibility making their productivity even more valuable. Due to this automation, a sales rep can reach thousands of potential customers with a few clicks. With this greater reach creates opportunities for great communications to have a positive compounding effect.

On the flipside, negative outcomes are also amplified with the advent of technology. Wells Fargo’s perverse incentive program led to bad behavior. Employees were easily able to create new accounts and charge customers fees without their consent. Perverse incentives and the greater leverage people have can quickly ruin a company’s business and reputation with its customers.

Thus the stakes are now higher than ever to adopt the high output management principles in the digital age.

Financial Glass - Two women working

How do you apply high these principles to your business?

The good news is it is not harder to implement high output management principles in the digital age. Still applicable today are the four overarching ideas that Grove laid out in 1983.

The Breakfast Factory

First and foremost is understanding your production process. Grove uses the example of a breakfast restaurant and of having a 3-minute egg as the core of the breakfast. When looking at your own business think about what has to happen between the order and a satisfied customer. Ask yourself what are the inputs meaning raw materials, information, and what activities/effort must happen to create the desired output?

Once you understand what raw materials and activities that need to be done, think about the outputs. What is the desired output for your business? In the breakfast factory example, it may be the perfect egg with other sides to round out the meal. Identify what ‘good’ looks like.

Next, determine key indicators that you can measure and track throughout the production process. What are the key indicators that will help you predict if your inputs will equal your desired output?

Lastly, is checking for quality. You may have to start over if you only test quality at the end of production. How can you create regular checkpoints to ensure quality?

Financial Glass - High Output Management Principles Time

Management is a Team Game

In implementing, the fourth broad idea of high output management is management. The first struggle, which is still common today, is understanding the desired managerial output. It’s not just having lots of meetings and checking boxes with employees. Truly defining the key output is the first step. Next, is the methods of delivery through meetings. There are all types of meetings from process-oriented meetings, 1:1s with subordinates, staff meetings, operational reviews, and mission-oriented meetings. Each type of meeting is a manager’s tool.

The good news is in the digital age there are many modes of conducting meetings. With more distributed workforces face-to-face meetings often become impractical. When you use video conferencing ensure that everyone is aligned on the purpose of each meeting. Great managerial work involved clearly defined meetings.

The next principle is the decision making process. Technology either enables or hinders decision making which is why you must define your ideal process. The ideal decision-making process is simple. The three steps are free discussion, making a clear decision, and getting full support.

Lastly, when it comes to management is planning. You must continue to execute today while planning for the future state of work. In the fast moving business environment, things move quicker than in the past and you must be able to adapt. Staying aware of the current environment while looking at the future of your business is vital to long-term success.

Team of Teams

Hybrid roles and organizations are a part of the way businesses operate in today’s more complex business environment. High output management principles in the digital age focus on reporting structures that bridge business units and roles. In the startup environment, this is a natural phenomenon as limited resources require that people take on multiple roles. Cross-functional roles must have clear lines of whom they report to and their goals.

The Players

In today’s tight labor market and unemployment at near record lows, the people in your organization are its greatest assets. Being able to understand your people and keep them motivated is crucial. The art of motivating people is an ever complex and evolving task. It continues to get increasingly difficult with the advent of technology, distractions, and a multitude of opportunities. High output management in the digital age must focus on your people. Understand what motivates them and recognize their motivation will change over time.

Performance reviews are just as crucial today as they were in the past. The immediacy of feedback and iteration of improvement happens more frequently in the digital age. You have more opportunities to deliver feedback and praise. Ultimately these performance reviews should encapsulate and build on the more frequent feedback you provide. These formal performance reviews are crucial to help clarify, motivate, and record employees performance.

Interviewing, quitting, and training are all the boss’s job. Hiring is not a task you want to overlook. The folks you hire will become a part of your organization and influence the culture you are creating. In the digital age, it is easy to outsource or use tools to suggest candidates. It is well worth the expense to ensure a cultural fit. Additionally, when a valued employee decides to quit you have a very short window to understand why. You must be willing to immediately focus time showing you care and hopefully save from losing a valued team member.

Lastly, the boss must conduct training and spend time with new employees. You want to instill the right behaviors and ensure you are aligned.

Financial Glass - High Output Management Principles Ideas in my hand

What will happen to your business if you apply high output management principles?

If you adopt the classic high output management principles to your business you will set yourself up for incredible success. The essence of the ideas is to focus on the most important aspects of your business. Understand those key pieces from production to management and organization structure to the people. Distilling down what is most important and using technology to enhance your ability to execute will create a stellar combination.

Final takeaways

The classic high output management principles that Grove laid out 36 years ago are just as applicable today. The digital age has brought new challenges and ways of doing business, yet the core foundation is still the same. Take time to analyze your own business and identify how you can apply these principles to your organization.

More Management & Business Philosophies

The Lean Startup

Ego is the Enemy

Blue Ocean Strategy

Glad to Be Here

February Goals Progress Report

William Glass
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February Goals Progress Report

February Goals Progress Report

As I mentioned in my January Goals Progress Report, I am going to publish a monthly review on how I am tracking towards my goals. For my February Goals Progress Report, I had a series of success and some other areas I fell short. I learned about what works well for me, what doesn’t, and my adjustments for March. 

Quickly before jumping into my February goals progress report here is a recap of my 2019 goals.

2019 Goals

I laid out a few key goals that I am focusing on for 2019 which are listed below. 

  • Acquire 4 more rental units located in Alabama or Florida
  • Read 36 books this year
  • Limit my alcohol consumption to an average of 1 day of drinking per week
  • Generate through a side business $128k/month before year end
Financial Glass - Goal Progress Planning

February goals progress report tracker

As a way to keep track of my goals, I have created a Google Sheet calendar where daily I update my notable activities. Through this document, I track what I am doing and my accomplishments. Through this data gathering exercise, I can start to see trends and which goals I am not making progress based on my activities.

As of February I have officially: 

  • Analyzed 8 properties this month, but have not made any official offers
  • Read 3 books bringing my total to 5 year-to-date
  • Drank 2 days over the course of 4 weeks. Bringing my year-to-date average of 1.25 drinking days per week
  • Soft-launched the Runners Fuel website and finalized V1 of the product. Focus in March is to start marketing and to get my first sale. Financial Glass & Runners Fuel combined are currently generating $0.05/month.

February goals progress report SMART breakdown

If you are not familiar with SMART goals, they are a way to create goals that can actually be measured and achieved. Saying ‘I want to be healthier in 2019’ is not as powerful as saying I want to go to the gym 3 times a week. I added one tweak to the SMART goal to add how I will celebrate the goal upon completion. Often, I am guilty of setting forth a new goal immediately continuously raising the bar without properly enjoying the initial achievement. This constant push for more can negatively affect you if you do not take the proper time to celebrate.

Financial Glass - Goals Progress Report - Real Estate

Real estate investing

Specific: Purchase 4 more rental units in Alabama or Florida

Measurable: Measure incremental success through analyzing 1 deal per day and making 1 offer per week

Achievable: I currently own a duplex and have the infrastructure in place for FL and Alabama to own and manage the properties

Relevant: Financial freedom / financial independence align with my 3-year, 5-year, & 10-year goals. Owning cash flowing rental property is one strategy for achieving that success.

Time-Bound: Have acquired the units (ideally) before my birthday May 29th.

Celebration: Going out to a very nice dinner with Karolina

Financial Glass - February Goals Progress Report - Yoga

Health-related goal

Specific: Cut Booze consumption to an average of 1 drinking day per week

Measurable: I have a tracker within my 2019 Accountability Spreadsheet

Relevant: This goal rolls into my desire to lead a healthy life that will allow me to live a long and prosperous life. Controlling booze consumption can be a key component.

Time-Bound: My average needs to hit that mark for all of 2019 and I track on a daily & weekly basis.

Celebration: Getting a 90-minute message

Financial Glass - Library Filled with Books

Education

Specific: Read 36 books this year

Measurable: Read every day for 30 minutes on average equating to about 3 books per month. I track my completed books through book reviews on the Financial Glass and GoodReads

Achievable: Last year I read between 28-30 books

Relevant: Part of my long-term vision is to be a lifelong learner and get better every day. Reading a large number of books is a tactic other successful people have had and will expose me to new ideas, ways of thinking, and stories.

Time-Bound: This goal is specific to 2019

Celebration: Posting an obnoxious social media post with the links to all my book reviews and key takeaways from each one 🙂

Financial Glass - Goals Progress Report - Business News

Financial independence & creativity

Specific: Have a business by year-end that generates $128k in gross revenue/month

Measurable: Monthly income increases from launch date

Achievable: Yes, with focus and iterating on both an online business and Isagenix business

Relevant: This goal tracks to my 2021 & 2023 Financial targets as well as financial freedom / financial independence

Time-bound: This is measured on a month over month basis and is tied to December 2019

Celebration: Pop 1992 Bottle of Dom Perignon with friends and family. Write a $10,000 donation check.

February goals progress report audit

The first weekend of the month, I sat down with my friend Adi to reflect on our monthly goals progress discussing what worked, where did we struggle, how can we support each other, and what is our focus for March. Below are my takeaways for each area we discussed.

Real estate

Analyzing real estate deals on a daily basis isn’t working. What is more realistic is setting aside a day or two days to analyze deals. Moving forward, I’ll sit down and analyze a series of deals in one sitting.

By the end of March, I’ll have submitted 5 official offers.

Financial independence and creativity

Runners Fuel

The main goal is to sell my first product before the end of March. I believe I will acquire that customer by running a Facebook ad campaign. I’d also like to enhance & add additional products – perhaps incorporating development sprints. Product enhancements include:

  • Link to YouTube Videos within the product page
  • Creating a scale within the product to define the key terms. Light – be able to have a conversation, Medium – struggle to hold a conversation, & Hard – not be able to have a conversation.
  • Explore customization. For example, being able to have people customize the training program for start date or length of time they have to train
  • Incorporate social posting/sharing queues. In the product having prompts for accountability purposes and encouraging people to share their journeys.

Financial Glass

The main objective is to figure out the goal for this site. To accomplish this I need to come up with one central theme to anchor the site’s content. Otherwise, it is a series of random posts that do not tell a story. Other areas I will explore include:

  • Organizing the content better, starting to test promoting the content
  • Explore YouTube Vlogs as another outlet
  • Delivery mechanism – how best to distribute content
Financial Glass - February Goals Progress Report Hand

Concluding February Goals Progress Report

Finally, I learned a lot during the month of February and have gotten clarity on what I’d like to accomplish in March. I have a path forward for my 4 major goals and have a tracking system that is helping me stay organized. We will see what progress is made in March and I’ll continue to share what is working well as I focus on creating my ideal lifestyle.

Previous Goals Progress Reports

January Goals Progress Report

Lifestyle Design

New Year Resolution Revisited

2018 Goals

New Product Development Process

William Glass
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2
New Product Development Process

It is crucial as an entrepreneur to have a new product development process in place to ensure a constant cycle of innovation. A new product development process is about identifying, understanding, and solving problems that exist in the marketplace. As a startup or early-stage venture, you must have a way to validate, create, and test your products early and often. The number of startups who fail due to lack of product-market fit can often be traced back to their new product development process.

Financial Glass - New Product Development Process - Wireframe Prototyping

What is a new product development process?

A new product development process is a systematic way to ensure the highest likelihood of success for your product. There are many methodologies from the lean-startup idea of an MVP (minimum viable product – not most valuable player), blue ocean strategy for creating new markets, and $100 startup for small lifestyle businesses. At the core, a new product development process is your formula for identifying, validating, and solving problems with your business.

Your new product development process is the step-by-step method of how you as an entrepreneur and business create your product. It doesn’t matter if your product is physical, software, a service, or an experience, you need to have a method of innovation in place.

Financial Glass - Product Design Board

Why does it matter if I have a new product development process or not?

As referenced earlier, most startups fail. Even established companies lose their edge and falter if they don’t constantly adapt their products. Blockbuster and Sears were established companies who failed to innovate their product and services over time ultimately leading to their demise.

Beyond failure is that you want to be spending your time and money wisely to ensure the highest likelihood of success. If you are going to fail you want to do it cheaply and quickly so you can move on to the next item. If you are going to create an awesome product and company you also want to do it fast. 

Additionally, as your company scales, you want to have a process that everyone follows to ensure your product team is aligned. You don’t want to have an unclear process and build or adapt your product without a clear roadmap and vision as to why. Having a new product development process in place ensures the team is aligned. 

Financial Glass = UI/UX Sketches

How do I create a new product development process?

To answer this question, I attended a new product development panel hosted by Stacklist in NYC. The event was held at Alley Chelsea and featured four product leaders with experience in successfully creating products. The panel consisted of Melody Koh, a former product leader who now is a partner at Nextview Ventures a seed stage investor; Nick Gavronsky, a former product lead at Betterment and co-founder/head of product at Trade Coffee; Lina Dorkhman, a senior product manager at The Wing, a co-working community for women; and David Miller, a former product lead at Gick and senior director of product management at New Classrooms, a non-profit EdTech company. 

The panel highlighted 4 keys to creating a new product development process that will enable your business.

Financial Glass - New Product Development Process Panelists

Create a new product development process early-on

Create a product development process early-on. Even if your company is just you. Document your new product development process and ensure that it is written down. Having a process early-on doesn’t mean you won’t change it as you learn and grow, but it does ensure that there is a thoughtful approach to development.

Vision of falling in love with the problem vs. the solution

Before developing your new product development process and solution be sure you care about the problem you are attempting to solve. When first coming up with an idea this typically isn’t too difficult. The challenge comes when your initial idea of the solution just isn’t feasible or won’t be a viable business. That is when you have to be willing to explore other possible solutions. 

If you fall in love with the problem, then you won’t get caught in the trap of trying to make your initial idea or solution fit no matter what. If your customers don’t want it or it doesn’t actually solve the problem, then you need to refocus your attention on the problem. 

Refocusing on the problem allows you to pivot and develop solutions that solve the problem. The first step is falling in love with the problem.

Financial Glass - New Product Development Process - Man holding design & be creative sign

A lot of science with a dash of art

Now that you are creating a process and have fallen in love with the problem, the next step is the tactical piece. A new product development process is much like middle school science where you have your question or problem – you make a hypothesis (your business idea) on how to solve it. 

Identify the key assumptions that must be true in order for your hypothesis to be viable. List all of those assumptions out and then rank them based on most important. An example is building a house. You can design and architect your dream home, but if the ground is not level then you won’t be able to lay the foundation. Uber’s business model wasn’t possible before the advent and proliferation of smartphones in people’s pockets. Even before that there must be wireless internet that can connect those phones. Ensure you understand those key assumptions first and foremost. 

The next phase is to conduct research. You need to get out and speak with the people whose problem you want to solve with your business. You can go face-to-face conducting interviews, focus groups, surveys, or attending industry events. The questions you ask must help you prove or disprove your assumptions. Based on this exercise you will refine your assumptions and ultimately prove or disprove your hypothesis. 

Once you have reworked your assumptions and perhaps tested a different hypothesis to land on one that is proven, you can start testing! Test your business idea if it is a sketch, conversation, or mockup to your potential customers. See how they interact with your prototype or concept. 

Finally, after you have validated your product you can start building!

Financial Glass - New Product Development - Sticky Notes

After validation get your product out

You want to build a great product, but the first iteration will almost certainly not be perfect. You have to create the core functionality of your product when you launch. The panel suggested that you should launch at 50%-60%. You must ensure the core value proposition is fulfilled, but you shouldn’t worry about having every possible bell and whistle. Facebook launched essentially as a database of people’s pictures with basic information about them. There wasn’t a timeline, messaging, live video recording. All of those bells and whistles came later.

Go back to your tested assumptions and release when you have the core functionality that satisfies those assumptions. Think from your user if the product solves the main problem you have and if you’d enjoy the experience as a customer.

Fundraising is a process of building conviction

The last piece of advice is around what do investors need to see from my new product development process to fund me. The answer is that it depends. 🙂 There are 3 main things that investors look to understand.

1. Opportunity – Do I believe in the opportunity?

2. Team – What have you and your team done in the past that will give me confidence? Why you?

3. What have you done already? What product progress have you made?

Your prototypes and strength of your product become more important if the other areas are not as strong. The ultimate goal is to build conviction into why you are the team to solve this problem.

Financial Glass - Star filled night sky over the ocean

What if I implement a killer new product development process?

If you are an early stage startup, you can drive a competitive advantage through your new product development process. Being able to quickly come up with a hypothesis, understand assumptions, and validate before spending resources are crucial on a lean budget. As you scale your company, a simple defined product development process will allow you to build great features and additions to your business. You will be more customer-centric and ultimately please your customers. 

Related posts for startups…

Growth Hacking Tools for Startups

Utilizing Influencer Marketing for Startups

3 Keys to Raising Venture Capital for Startups

Crossing the Chasm

Lifestyle Design: Sharing My Story

William Glass
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4
Lifestyle Design: Sharing My Story

If you are anything like me then lifestyle design and having the freedom to live your best life is something you care deeply about. Designing your ideal life takes careful considerations of your values, needs, and wants. It requires you to do soul searching and take time to understand who you are today and who you want to be tomorrow.

The rollercoaster of lifestyle design

The rollercoaster of lifestyle design

I’ve spent a lot of time doing just that over the years. It’s been a rollercoaster ride that has caused me lots of internal turmoil. There are moments of elation and clarity followed by self-doubt and a loss of direction. There will be days that I’ll wake clearly knowing what I want out of life. Then before the end of the afternoon, I’ll be completely lost and filled with self-doubt.

What I’ve learned through these reflections is that we are in a constant state of change. Our own thoughts and emotions influence us. Other times external forces impact our mental state. You will have bad days, good days, blah days, and a mix of days in between.

When it comes to lifestyle design and creating your ideal world, the road is rocky and filled with potholes (or for the Game of Thrones fans “the night is dark and full of terrors”). What is clear to me is that you must choose. You have to be willing to say “this is what I want my life to look like” and then go for it. You have to have optimism and confidence in yourself to chase after your ideal lifestyle.

lifestyle design - child shooting a bow and arrow at a target

Lifestyle design is a moving target

Also, you must recognize that your ideal lifestyle is not stagnant, but a moving target. Today my ideal lifestyle will look different as an unmarried man than it will when I have a family. Changing your mind is okay. We all do it. In fact, it is more worrisome if you don’t change your lifestyle design focus. It may mean you are stuck or not growing.

Recognize that your life vision will change due to internal forces but also external factors which may change it for you. My parents got a divorce when I was in high school which I couldn’t control. The way I spend time with my parents and family changed without my ability to control it. The only thing I control is my reaction and how I choose to spend time with each of them separately now.

The key is to not to take on a victim mindset. You may not be able to control external factors, but you can always control your preparation, reaction, and actions. Extreme Ownership is an idea from retired U.S. Navy Seal Jocko Willink on taking personal responsibility for how you respond to everything in your life. I believe it is crucial to understand this concept.

Lifestyle design paintbrush and watercolor

Painting the vision of your life

You are responsible for shaping your ideal life. You are the chief designer of your lifestyle and the one responsible for making it happen. External factors may change the materials you work with and force you to alter your initial vision, but that’s okay. If you are a painter and someone takes away your paintbrush become a finger painter, potter or graphic artist. Regardless of your tools, it is on you to achieve your dreams.

Every day I wake up and either make progress towards my ideal lifestyle or I don’t. At the end of each day, I track what went well and what didn’t. Am I better than I was yesterday? What is one thing I am grateful for today? How would I rate today? What are some key accomplishments from today?

I have a vision of my life 1-year, 5-years, & 10-years from now, when I’m 80, and when I’m dead. I recognize that what works for me will not work for everyone. Perhaps thinking about your legacy when you are dead is just too cringe-worthy and that is okay.

Growing into your ideal life

Now that you have a long-term vision of your ideal lifestyle, you must also focus on the shorter-term how. You don’t have to know every single step or understand exactly how you will get there. Though, you do need to focus on the small steps and tweaks that will get you closer to your designed lifestyle. Over time the compounding effect of small changes will cascade into something much greater than you could have dreamed.

This is how we as humans learn. When we are babies we learn to crawl, walk, and then run. We learn to brush our teeth and get dressed. Over time we build up more skills. Lifestyle design works the same way.

Every day (well almost) I either do yoga or run, read, journal, and reflect on my day. I’ve tried the miracle morning and doing all of these things at once, but it was too much. I made it a few weeks before I relapsed to my old ways. You don’t have to do everything all at once. Pick one small tweak stick to it as best you can and continue to build on your habits. You must take tangible steps each day, week, and month towards not just designing and architecting your ideal life, but building it.

kids playing a guitar and laughing

Don’t worry, be happy

At the end of the day, you should be happy and content with yourself. While you will experience the ups and downs that are part of the human experience, you have to go to sleep remembering what you are grateful for.

Now go out and show the world how you lifestyle design… your way.

More financial glass posts…

The Wisdom of Winnie the Pooh

3 Keys To Financial Freedom

2019 Goals

Avoid My Mistake Run Your First Race

Utilizing Influencer Marketing for Startups

William Glass
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3
Utilizing Influencer Marketing for Startups

One of the most effective emerging growth strategies is utilizing influencer marketing for startups. Influencers are people or brands that have a sphere of influence within a given community. You can find influencers on social media platforms like YouTube, Instagram, Twitter, and LinkedIn.

Each platform lends itself to particular types of influencers and audiences. The audience you are trying to reach will determine which platforms and influencers you should target.

Hand holding phone above crowd at a concert

Why is utilizing influencer marketing for startups important?

The short answer is because it works. When done right, influencer marketing can have outsized returns for startups. The second reason is that it offers a targeted, cheap way to reach your target audience. Influencers already have a loyal and engaged following of your target customers. These followers listen to what influencers say. 

A colleague of mine paid $40 for his teenage son to go to an event where a YouTuber was signing autographs. My colleague was amazed that his son thought this person was famous just from watching the weekly videos he puts out. This example highlights that influencers are micro-celebrities and command attention even if they aren’t household names. 

Key steps to utilizing influencer marketing for startups

In the current age, influencers are a key emergence from social media and are democratizing celebrity. The internet and social media allow niche communities to form and thrive. After attending a meetup focusing on growth hacking tools for startups, the theme of influencers rose to the top of the list of strategies.

I chose to attend a follow-on panel discussing influencer marketing in greater detail. Stacklist and Alley Chelsea hosted the panel on utilizing influencer marketing for startups. The panel consisted of Ian Borthwick from SeatGeek, Kate Artemyeva from Scentbird, and Anjelika Kour from Digital Design NYC.

Below I’ve outlined the key insights into a formula for how you can utilize influencer marketing for your startup.

utilizing influencer marketing for startup panel members
Utilizing Influencer Marketing for Startups Panel Members

1. Finding influencers that are right for your startup

You’ve decided that you want to explore an influencer marketing strategy for your startup. Now what? First, you should have an idea of who your target customers are. For example, Scentbird targets women who are 24-35 and are based in the US because those are their ideal customers. These are the people most likely to purchase their designer perfume subscription.

Great, so now what? In the example of Scentbird, it’s not obvious what their offering is so they need a platform where they can educate their consumers. Naturally, YouTube lends itself to being the best platform as their target audience spends time on the platform and in a video, you are able to explain their not-so-obvious designer perfume subscription model. 

The other important piece is to look for not just the number of subscribers, but the actual engagement from their audience in the form of likes and comments. A good ratio that was discussed is a YouTube influencer with 200k followers receiving 1,000 views per video. For each platform the engagement is different and your goal is different as various platforms are better for sales conversions vs. brand awareness.

2. How to engage influencers

Great! So you’ve identified a few influencers on a specific platform that you want to work with… now what? The advice from the panel was that for your first few influencer engagements you should reach out directly to the influencers yourself. Don’t use an agency, as hearing directly from a brand creates a much stronger relationship with the influencers. 

Message them on their platform and ask to discuss providing sponsored content. Going into the engagement, be knowledgeable about their audience and the type of content they produce. Ensure you align expectations on the content that an influencer will create and what the compensation will be for the influencer. 

Ian at SeatGeek mentioned that his favorite types of influencers to engage with are the micro-influencers that have 10k-15k followers. These influencers are just getting started and are more grateful than influencers with a larger audience. Additionally, give away freebies as payment whenever possible. For SeatGeek, they will trade great tickets vs. large sums of money. It is cheaper for them, plus it tends to promote more brand affinity with the influencers. 

person scrolling through Instagram on their phone

3. How to measure your influencer marketing strategy

Measuring your influencer marketing program is super important. If you don’t have the right tracking system in place then you won’t know if your efforts are successful or not. Both SeatGeek and Scentbird use promotional codes that are specific to each influencer campaign to track the success of their campaigns. They can quickly see the conversion rate into sales. 

It is important to set out a specific goal before utilizing influencer marketing for your business. On YouTube and Facebook, there tend to be higher conversions to sales vs. Instagram which is better for general awareness. If the intent is sales conversion then ensure your metrics align to that goal.

There are many methods for measuring the success of an influencer marketing for your startup including promotional code and analytic tools.

4. Maximizing influencer marketing ROI for your startup

The last key to utilizing influencer marketing for startups is maximizing your return on investment. Quality content is critical in the internet age and your influencer program can go beyond awareness and sales conversions. Influencers will take additional photos and videos outside of their original post. Ensure when you are contracting that you ask for that additional content that isn’t used. You can repurpose that content for Facebook, Instagram, YouTube, and Google ads. 

Another important aspect is to recognize the value in the long-tail that certain platforms offer. YouTube videos don’t disappear like SnapChat, Instagram, and Facebook stories. SeatGeek sees old YouTube videos still converting even after the promo code has expired. Podcasts and written content are other mediums that can produce a long-tail. 

Audience getting seated for utilizing influencer marketing for startups panel

Wrapping up

Large brands undervalue the power of influencer marketing currently. As a result, it is cheaper and more effective utilizing influencer marketing for startups. This is because you can get very targeted and the cost of engaging influencers is often much less than other marketing mediums. Another benefit of utilizing influencer marketing for startups is the cross-pollination of content. Startups are able to use additional content on multiple platforms. Lastly, the long-tail impact influencer marketing can have for startups is invaluable.

All-in-all utilizing influencer marketing for startups is a valuable growth strategy. If you see the possibilities of influencer marketing, continue to educate yourself on the power of this medium. And finally, give it a try!

More posts…

Growth Hacking Tools for Startups

2019 FinTech Trends Meetup

3 Keys to Raising Venture Capital

The $100 Startup

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