Why the future is now – and the secrets that could be the key to getting your next big idea funded. Whether it’s VC, sponsorship or grant, I had a chance, with Epsilon’s John Immesoete, to break down the startup ecosystem as it relates to media and technology. We discuss ever-changing role of today’s CMO, and why data should be at the top of every marketer’s mind.
Filmed in Austin at SXSW 2017
John: Joining me today is startup consultant Paul O’Brien. He’s the founder of MediaTech Ventures, which works with brands, startups and agencies to scale ideas and businesses. Welcome to another episode of Conversations with Giants. We’re here in Austin, Texas this week with South by Southwest. We have a great guest today, Paul O’Brien, a part-time CMO, startup consultant, founder of MediaTech Ventures and our first robot man that we’ve ever interviewed on this show. So I’m very excited. This is actually… I’m a little scared. It’s like when the terminator comes to ask your name.
Paul: Thank you. Thank you, I’m excited to be here. I like doing this because it lets me augment reality.
Paul: I get a better sense for what’s in the room and what we’re up to today. Seeing the things that we can change.
John: Wow. Because regularly reality kind of sucks.
Paul: Well, yes. It would seem so, wouldn’t it?
Paul: But the challenge of course is you can’t see anything about these things on. So you sit here, effectively in the dark unless you’re watching something and that’s why I got this very slick set that…
Paul: Good morning!
Paul: Let me see where we’re at?
John: Now it’s real, all right.
Paul: This is the future, isn’t it? That we change the way we interact with reality.
John: I think partially.
What is MediaTech Ventures?
John: Well that’s actually kind of what’s cool. I mean, you are a bit of a futurist. Let’s start exactly with what MediaTech Ventures is? Explain a little bit, what’s going on.
Paul: Yes, I’d love to. It’s a—there’s a challenge on our economy with understanding the pace of which technology changes. A challenge in that it changes so fast that you need futurists, which thank you, I don’t think of myself as a futurist, I just think of myself as trying to keep up. And I do that because I spent a lot of time in Silicon Valley and I started my career actually in media but by way of the technology; working with Yahoo and these early streaming businesses out of broadcast.com and Yahoo Launch, when the old early music platforms.
And so, I’ve always been enamored with the fact that technology in media, whether it’s entertainment media or industrial media, ways to see things, ways to hear things that they’re intrinsically intertwined with technology; that technology makes it work, enables us to produce, enables us to do this, enables us to reach audiences and as a challenge though for the artists, for the talent, for the creative, for designers, to stay on top of those things.
And so, MediaTech Ventures works with universities, works with cities and states, works with venture capitalists to help folks understand where the money is moving and why? Help folks keep up with things like virtual reality and where the opportunity exists. And really just endeavors to keep this moving towards that future, keep us entertained, keep us enjoying music and not being so frustrated with how it gets disrupted. And instead, understanding what new technologies enables us to do to enjoy it, to monetize it.
John: So this is really cool because a lot of times we talk in the show, we’re advertising, marketing. And we talk about a model that is 50 years old, it’s changing rapidly or attempting to change rapidly. Maybe having a hard time sometimes keeping up with the way the world is changing. And basically, you’re a guy who to people who are out there who is like, I don’t know if there’s anything in that for me or whatever, but I have an idea that I think it could be good. They can come to you and you can help them formulate the idea, polish the idea, and find money to make it a reality?
Paul: Really, the last part is what we strive for…
Paul: And not necessarily just money but resources. Right. Who are the folks? Who are the skilled professionals? Who are the editors, if you’re developing a film? Who are software developers who can do with augmented reality or video games?
Paul: Who are the talented folks that understand this technology? Where does the money move? Because of that, whether it’s frankly, whether it’s ventured capital or sponsorship or grant. A lot of different entities want to participate in this ecosystem. It’s challenging to understand how.
Paul: And so we work to help them figure that out and make a difference.
John: So you head on something that’s really pretty interesting to everybody. Creative people, in particular, sometimes aren’t the best business people.
John: So don’t necessarily have that sense.
John: But everything that you’ve talked about so far is like where the money is, where the money moves? Everything’s a business. An idea is maybe only as good as an idea that you can sell.
John: Talk to me a little bit about, you talk about the perfect pitch. When people have an idea, I hear this all the time from bankers or whatever, where they can go and it’s like, “I don’t know there was nothing, there was no meat on the bones.”
John: Or “The pitch was bad.”
John: What’s a good pitch?
Paul: Understanding your audience. It all comes down to understanding your audience and that touches on why we’re so passionate about, media in general. You mentioned advertising and marketing earlier and how it’s changing. Fundamentally, advertising and marketing isn’t changing. Our methodology, our tools are changing, but at the end of the day, it’s all about understanding your audience and delivering right message in the right form and in the right format.
The perfect pitch, the imperfect pitch tends to miss that, tends to start by explaining what it is that you’re doing. I want to build an application to help musicians find great venues in Austin and that’s a great idea, it’s a noble idea and yet if you’re a bank, if you’re a venture capitalist, if you’re a large advertising sponsor, you’re immediately going to wonder how well that’s going? How much traction do you have? Do you have customers? Can you show it to me yet? Is it ready?
Paul: As opposed to appreciating that the audience for such a thing in this context is somebody’s got to write a check and they’re going to need return of some kind. So instead what’s the opportunity? The opportunity is that there are an exceptional numbers of historic, creative, modern, metropolitan, major and minor venues for musicians in a place like Austin. There are hundreds of them. How do you find the best experience for musician who perhaps can’t afford very much?
Paul: How do find the best experience for a talented band that can easily pull together 10,000 people?
Paul: Do you need all of the traditional models? Do you need the entire team of folks that puts together a concert for you?
Paul: Because in technology today, you don’t.
Paul: We work in that space. There’s a decent lead to a pitch I think. We work in that space, we’re going to make that possible.
Paul: For musicians to throw their own events, throw their own concerts, and find their own audience.
Paul: Find their own voice.
Paul: Who doesn’t want to get behind that?
John: Right. Well, that’s cool. I mean that takes again a couple things of advertising like good advertising marketing is always about knowing who you’re talking to?
John: And then the part you add on to it is to create a people. A good idea isn’t enough, you have—there has to be an ability, we’re in a capitalist society, there’s has to be the ability to monetize and make money because other people don’t necessarily just get off and like, “What? Wow what a cool idea that would be.”, even if it made no money.
Paul: Sure. True. Well, that’s why I think the perfect pitch starts that way because the way you fail to reach an audience is to start with something that someone will disagree with or not be interested in, or not care about. How can you communicate in such a way that everybody is going to be get excited about what you’re doing, whether they’re actually going to invest or not?
That at least get the idea, they like the idea. It makes sense. They’re willing to help in some way because you’re right, the challenge is that not only are a lot of media entities like bands and film makers not necessarily savvy business folks but frankly neither a small business is. They’re focused on building the restaurant, they’re focused on serving their customers and dealing with things like accounting and bookkeeping, little on marketing, understanding AdWords, doing email. Not only is it not something most people are familiar with, it’s frankly genuinely something that they just don’t care about and they shouldn’t.
The pressure about what they do. And so, how can we change that? How can we help them better reach the people that they need to reach in order to be successful? By providing some of those services, the technology, those platforms that they don’t necessarily even want to learn how to use but they need to. They know they need to.
John: So that’s why I called you a futurist because I think so much what we’re seeing in this economy right now, previous generations maybe it wouldn’t work for big company and that company would take care of you for the rest of your life, your family and stuff. That’s just not reality as much now, there are going to be a lot more entrepreneurial things. The countries changing, the economy is changing. You‘re a big fan of data, I know that. Let’s talk a little bit about like how data helps facilitate this stuff and really the importance of data starting with like finding the audience, finding where—finding what the reality is?
How data helps facilitate innovation and funding
Paul: Right, sure. That’s a wonderful question because I think in a future sense, I think we get burdened as business owners, as entrepreneurs, we get burdened with the ideas of big data, the ideas of the social graph. What is the social graph? We get burdened, we get challenged by the encouragement to use Google Analytics. I don’t even know how to start? But apparently, I have to code to use Google Analytics and I like to encourage folks that the idea of using data and the importance of data is much, much, much more simple than that.
Ask the questions and think about where you can get information with regards to those questions. One of the beautiful things that the internet did in frankly, disrupting and making it a little bit more difficult for media, for musicians.
One of the beautiful things that the internet actually did was it—assured us into this information age. The data comes from simply searching Google. Data comes from asking a question on LinkedIn or on Quora. Data comes from building an audience on Facebook, even before you have a business. Build an army is on Facebook and start to pay attention to what they’re excited about, what they are paying attention to, what they reacted to.
And I give you a sense for what you could be doing or should be doing. And an easier way into, is your way into the data that’s out there. These are ways into putting analytics on your website. Why? Because analytics isn’t about measuring conversion rates and where the traffic is coming and these more sophisticated marketing questions.
It really gets back to the basic marketing questions, from physically where? Where it’s coming? Are people coming from New York? Am I getting an audience out of India? What I do with that? That’s magical.
That’s insightful in terms of figuring out whether or not you should just take a local ad out, the newspaper. Should you take a local ad out in a newspaper in Dallas? If nobody in Dallas even knows that you exist yet or they’re paying attention. Maybe, maybe not.
John: So there really is getting a data really in its simplest form that a lot people don’t necessarily realize. See, in most coming in everybody knows now data, data is everything. I got to get into data, if you get some data, I have to analyze the data. I don’t always think that they know exactly what that means but in essence data’s just intelligence, data’s just the truth about what’s really happening out there. That is what I think is really part of what’s fascinating about what you’re doing and part what’s fascinating about the disruption in the world right now. Old media, let’s look at the last election, just as a platforms of old media and new media.
John: Old media said, this is going to happen and this is completely going to happen. The left coast and the right coast are saying that this is going to happen. Reality comes in and old media missed it, 100%. What is going on with—couldn’t data have maybe said that had somebody analyzed it more correctly than it’s like, this isn’t the luck that you think it is.
Paul: It’s a wonderful question because it’s—could data have given us more accurate insights to what is happening. Yes, data is still not that accessible. The challenge with most of this platform is it is information, it is truthful, but you still have to understand what it’s telling you. You still need those CMO’s, you still need the companies like Epson as I understand. You still need folks that know how to interpret it. And that’s what’s interesting about the old media world versus the new. The old media world was trained in focus groups and how to interpret studies and how to avoid confirmation bias, at this tendency that we have to look for data that affirms what we want. And the challenge with new media is it actually making it easier for us, easier for us to make those mistakes. It’s easier for us to find the people on social media who agree with us, therefore I must be right.
John: We think the way we do.
Paul: Right. Everybody else thinks the way I do. I must be the answer. And so, while data is more available, it’s more accessible, we do still have to practice the traditional marketing techniques that being on AdWords, for example, is not marketing, being on AdWords means you have a marketing channel in place. Whether or not you should or whether or not you’re doing it well, whether or not you know what it’s doing for you, that’s what marketing is. That’s what marketing is and it’s challenging.
John: So it’s really, if you use it properly, data can challenge the conventional wisdom, if you use it properly but you have to be willing to look at the good, the bad, the ugly, see if it’s works and all versus than just the step that you agree with.
Paul: Certainly, I think so. And you could argue, I think you could argue that the data in the last, the previous election, was there too. It was there too but you have to appreciate, for example, you have to appreciate that the coasts and major cities tend to be a little bit more involved on the internet.
They tend to be younger populations, they tend to be more technically involved. And so, 10 years ago, certainly 15-20 years ago, when I started on Yahoo, there would certainly be a bias perhaps in information on the internet with regard to politics because the cities are more involved. In the slightest election, that’s certainly started to change. In fact, the entire world is much more involved on the internet. And so, we’re reaching a point where we can start to measure everybody everywhere. Throughout the world and figure out what we might do and might want to do, perhaps should do. And so, that bias is being eliminated simply by the fact that our sample size is more inclusive, it’s more comprehensive of everyone. And so, is that what happened in the last election, our sample size opened up to a lot of people that we weren’t measuring before, that we weren’t talking to before.
John: Or didn’t have a voice.
The Shift to the Center of the U.S.
John: So it’s interesting. Your company, you’re Silicon Valley trained, I appreciate it. Certainly no follow both coasts but she kind of located right here in the center of America. Is this something to that we are going to see more again thinking down the road a little bit, the coast clearly kind of own the media?
John: Yes. Somewhat but definitely like the key influencing things. Are we in the start to see like because of digital data, all these things, a shift in that way or like to more on the center of America?
Paul: We already are.
Paul: We already are, so MediaTech Ventures is based here but we don’t just work here. We’re based here for a reason and it’s that we are already seeing that migration. We did a study 5 years ago about the immigration patterns within the country. Where are people moving and why? And true enough they’re leaving the coast, they’re coming out of Silicon Valley, they’re coming out of LA, they’re coming out of New York, and they’re coming to the central core of the country, they’re coming to Chicago, they’re coming to Austin, Dallas, Houston, are exploding as well.
And that struck us as one the most interesting things that we might ask of what’s going on in the United States. Not just that they’re moving but who’s moving and why? And what we noticed in Austin and in the rest of Texas for that matter, is that the folks moving aren’t coming out of the front into the media industry, if that’s a good way to characterize it.
The actors aren’t coming from Hollywood. The anchor folks in the news media industry in New York aren’t coming to Texas. The people that are moving are the technical folks, the technical skill sets, the sound engineers, the producers, the video game developers.
And what’s been fascinating since then is seeing the big companies validate, validate that idea that Conde Nast move their digital team to Austin just last year. Comcast is moving their media R&D team to Austin this year. Certain Xfinity who folks should know because they created Halo and cable TV, just moved their entire company to North Austin, that the big businesses are realizing that there’s a wonderful convergence here, not just to media and technology but other—in the creative professions, the artistic professions. With the coders, with the talent, with the engineers, and with the folks leaving the coast, well yes, they do dominate the media but they dominate an aspect of the media.
Nobody thinks of Silicon Valley as being the film industry, because it’s not. But Austin has a film industry and has software developers and technology professionals, its we’re able to rethink, we’re able to really embrace and understand what’s going on in video here because of that cross pollination of skills sets and talented experiences.
John: So that’s cool because again like money makes everything move, money makes stuff happen. If money is going there, if support stuff is going there, artists will follow. And artist also I mean there’s a reality of like the coast have gotten pretty expensive. So just the fact that a life can be kind of built in some place more easily and still get—still have access to the world. That’s pretty cool. That’s disruptive.
Paul: That’s disruptive. And what I’m concerned about, what we really get passionate about is again the question of where the capital goes? So if I put my venture capitalist head on and take off the media tech, if the venture capitalist in me acknowledges that, there’s actually a plus side to the fact that the coasts are expensive.
And if you think about that, why on earth would that be a positive, why on earth would the fact that it could cost a lot more to higher people? Your benefit to the investment community and it becomes apparent when you compare it to these lower cost economies that if you take a company out of Saint Louise or Denver, one of the cheaper economies, less expensive economies. And you take that exact same company and you build that in San Francisco, exact same company or really is equal.
The fact is, the bottom line is the company in San Francisco is going to half to raise more money. They’re going to be more aggressive about it, they’re going to focus on raising more capital simply to afford what it takes to do there. And so, when those announcements are made about those two companies raising capital, one has raised $500,000, the other one has raised $3 million, which one does the world pay attention to? Which one does the world perceive as having a more substantial opportunity? It’s not necessarily the one on the coast, not necessarily, but it looks that way.
And the challenge in the venture capital ecosystem is that at the end of the day, our job is to raise the capital, our job is not to write the checks to the startups, that’s what angel investors do. Our job is to raise the capital to make it available to entrepreneurs. And so, the question of the perception matters to investors. If you’re an investor, don’t I want to be where the raising $3 million and delivering billion dollar returns and these unicorn startups.
Why would I want to be we’re things are smaller? Well, short answers because it is easier to start a business here. It is less expensive, it is more likely that you have a positive outcome, though may not be a substantial an outcome. And so the important to the media side what we’re doing, the importance of you’re doing is educating all sides of the economy, all sides of the equation. There’s a cost and benefit, there’s a pro and con to just about everything. Make sure you understand where you are and why, where you are and why.
John: This is a fascinating conversation and also is really kind of getting into the complexities of business, data, creativity and how they come together and we’re going to keep it going. One thing that you talked about, you say, in addition to all the other things that you do, you’re a part-time CMO.
The Part Time CMO
John: So, top job anymore, CMO’s are like full time CMO’s have a very short life span. It seems like in these big businesses that the average and others saying is like 24 months or something like that. But let’s start to delve into this world a little bit. What exactly like you’re CMO, you got a new job, what’s the first thing that you should do?
Paul: Grasp the breath of what a company is doing, of what the business is doing, and I mean the breath; the financials, the hiring practices, the trends in the industry occurs, see most on that part. But I find that most marketing professionals don’t necessarily embrace the fact that their job is product development as much as it is, audience development. And the only way to do that well for business is to be as intimately involved as the CEO.
There have been some wonderful articles written about the idea that the CMO is the new CEO that this discussion we’ve been having about data and the importance of marketing is ever more significant than it used to be. How can you run a company well if you’re wearing that hat of cheap marketing office? And I think the reason that it changes so much. The reason that the life span of a CMO seems short is because things change so quickly.
The ability to keep up with what Facebook’s going to do tomorrow or the best way to manage your CRM with your sales force, it’s going to be completely different in month. And so, companies to some extent rightly need to transition through folks as they grow. I don’t think there’s any wrong with that.
That’s why this idea of part-time has merit, we are more entrepreneurial ecosystem. How does an entrepreneur get the experience, and the talent, and the resources they need at the time they need it? On demand at a cost they can manage?
John: So you’re talking about something that I think is interesting. The CMO’s of today, his or her job is much more complicated than a CMO of yesterday.
Paul: Sure. Yes.
John: Than it used to be to simplify to its most simple. CMO used to be really in charge of the company’s message, its narrative. And that would have pretty relatively few outlets for that. You put out some TV ads, you put out some finance, and it hopefully arrive at a campaign idea kind of work. People are more, less forced to see it. That’s completely off the table now and I think what’s really happened is a CMO is a growth officer. Now, companies really look at like marketing is really a growth engine. And how—I need to make sure that this brand is selling, right? That’s a huge thing, the money trail.
Paul: It is a huge thing and yet I still believe passionately that the challenge we have is that the internet changed everything and we’re still simply trying to figure out what that means. That the role of the CMO has changed but not as substantially as it might seem in the sense that what we simply have are more resources, more options at our disposal. Whether or not you should put an ad on Google, it’s the same question as to whether or not you should put an ad on a billboard of the free way. We have the means now of better measuring which of those things works and why.
John: So that really is the key. A CMO of the future or of now really need to take this data thing seriously because you really need to kind of look at like where these buyers, how they’re acting, because it’s a lot different than it used to be. But if you use that, then the job becomes much what it was anyway. It’s still building the narrative and still putting the narrative out there but it’s just putting it out in a different way than you typically think about.
Paul: Yes, and you have to appreciate that today someone has going to have a VR head set on. That the consumer, that even your potential partner if you’re in BDB or in an enterprise company. Your audience is being bombarded and has access to just as many opportunities as you do. As the marketing professional, how can you possibly reach them all through anyone channel? The answer is you can’t. You’re absolutely can’t. It’s all the more reason you have to understand who your customer is, who your audience is, and how to reach them, how and where to reach them?
One of the most exciting examples of that that we’ve discovered is how efficient and effective and inexpensive, radio still remains. Folks want to say that podcasting is disrupting radio and it’s not. It’s new, it’s exciting, it’s not more disrupting radio than the internet, actually disrupted print. Do we not use print anymore? No, we actually certainly do still, we use print; it’s very different but we certainly still use it.
And the exciting fact in that context is if you think about it and then instead of, is just audio, your business how does your business reach people through audio, what your podcasting? You could stream yourself pretty easily and radio, hyper local radio is paid attention to, it’s listened to, it’s relatively inexpensive, it’s a great medium that we’ve disregarded a bit.
John: Now, I—
Paul: Because our fascination with video and the internet.
John: I agree. And it’s a captive audience.
John: If you look at traffic times and big urban cities and stuff right now, those are just going up and up and up. You have a captive audience for an hour that you can reach efficiently. That is—that’s a great medium.
Paul: It’s brilliant. It’s brilliant for local businesses.
John: And it’s a mass medium.
Paul: Right. Right.
John: There’s a difference, isn’t there like as we talked about digital, we get into the world like content and stuff. But the mass media is still has a place because people react differently to a mass message than to a personal message. It’s still galvanizes it in a different way, right?
Paul: It does. I think what’s been interesting to watch with regard to the implication of mass media is evident to news and with journalists. In that the idea of citizen journalism, and the idea that anyone can write a blog and the idea that anybody can have an audience in social media has done a number on the news. It really has. But we’re waking up to the fact that noise, breadth of content, isn’t necessarily the same as quantity or excuse me, as quality.
John: Quality of content.
Paul: Quality of content, right. And what’s exciting about the media industry and things like 360 video and live streaming and podcasting is that the expectation that I think the audience has of media professionals like yourself. The on air individual, the expectation has shifted from being someone to whom we just subscribed, to whom we just listened to, we just read the Wall Street Journal. Now, I want to talk to, I want to tweet with Walt Mossberg. I want to go an event with some 360 gear on where I can see Kara Swisher and maybe even chat with her. That the role of media is changing.
The media professional is changing from that of merely being one way about to being two way and I think that’s exciting because we’re realizing that the amount of information is valuable because it’s data. And as a consumer of information, I can now have a personal experience not just with the news journalism but the same as through a musician, the same as through with an actor, the same as through with a designer or video game developer. That my experience with your brand is different, I cannot talk to you, I can now enjoy my experience with you, really get to know you and better appreciate what you’re saying and whether or not I believe or I agree with what you’re saying. It brings a new way of finding credibility in the news.
John: So quality of content though is the key to make it all work.
John: Because it was a Wild West Show, at first everybody was out there and putting stuff out and I was like, “Oh my God, anybody can do this.” But it did just become what we used to call clutter, noise, and now like even a brand, a good brand has an opportunity like never before because it’s going to have some credibility and ability to like I want to engage to them.
Paul: What’s fun and exciting to watch is how these mediums are available to everyone and how it’s then difficult and challenging though to figure out where best to represent your brand. Where as a business, as a musician, to show yourself off, to be a part of that experience. I for example, I like to write and I’ve got a descent sized audience on Twitter because of that. Focus all the time, tell me that I should be doing a video series on YouTube. That’s not my thing. That’s not how I work. It’s exciting to chat with startups and business professionals and entrepreneurs about the idea that, the best way to leverage the media is to think about yourself.
Just think about your person and don’t think about the business and the brand. Think about what you do. What you’re comfortable with. If you’re not the type of person to be engaging on Facebook, don’t worry about being on Facebook. You don’t have to be everywhere because though your audience is now everywhere and is easily distracted, what people are looking for is that engagement, that personal experience with you as a brand.
John: That’s actually a huge thing. We talked about it too. You’re heading on the notion of reinvention. You constantly have to reinvent, right? Just as especially now, in this new age, it’s like you can’t fail for very long the way you used to.
Paul: Two thoughts if I could give you one. I love the idea of reinvention first because you might get a sense for it but I just started out in radio and so I’m very passionate about that side of the industry. Ended up in the internet because of Yahoo and because of Yahoo I ended up in e-commerce in Hewlett-Packard. So I’m reinventing myself a couple times early in my career. Ended up in Hewlett-Packard and the search marketing industry, so I got the online media aspect to what I’m doing to.
And in working in e-commerce I failed a lot, I failed substantially, on a couple of occasions. And what it taught me though was how to discover myself. How I realize, how I ended up in e-commerce at Hewlett-Packard because it was the right fit at the right time. I was good at it. I could help them of what they needed at that time but it wasn’t really me, it wasn’t and I didn’t represent who I am. It took me a while to figure out that my roots we’re at this convergence back with my radio experience, back with my online media experience. Tying those things together.
And what I challenged was your first—your second thought though, the way that we can do that, the way that we can discover ourselves, the way that we seriously going to think about it, the way I define success is not avoiding failure, is not overcoming failure, it’s not the opposite of failure; it’s in fact, being comfortable with it, being comfortable in your own skin recognizing that no amount of success that I might have or you might have will still result in failure. I’m still going to make some mistakes. We’re going to make some bad decisions and that’s okay because now I’m doing what I love, I’m doing what I’m passionate about. The faster I can fail, frankly, I think the better. Let’s try things, let’s move, let’s hit it, let’s recognize, let’s use data, let’s recognize when we shouldn’t do that anymore and go back and do something different that might work.
John: So that’s really the crux of it for an entrepreneur or entrepreneurial thinker. Embracing the fear because that’s you’re going to have fear at first, but then knowing that you’re going to fail, the fear kind of goes away and you turn that into learning. That in the essence becomes your own data.
Paul: Right. And so, a local entrepreneur, the President of Indeed, beautiful search platform, a search technology for finding jobs and recruiting. The President was on the radio just last week, I heard it him on the radio and he said, “The epitome of a good entrepreneur is equal parts Don Quixote and Mr. Spock.”
Paul: You have to wake up in the morning, every morning, certain that everybody else is wrong, that your dream is right, that no one can tell you, “No.” But then also looking at things logically, looking at the data, and making conclusions based on what’s happening very, very quickly. That’s the only way to overcome fear I think is to have that overconfidence perhaps that I don’t necessarily exactly know what I’m doing but I know we’re doing it right and I know we’re going to make it and I know we’re going to succeed. And let me go check and make sure that we are actually doing that.
John: Being very left brain, right brain?
Paul: Yes, exactly.
John: You have to do that. I think you hit on another notion that is important especially like as a young person, you kind of have to have a strategy on like what success looks like to you, in a way, as a person. But you constantly reevaluating yourself to find like, “Okay, what are my core strengths, what am I good at, what am I not good at?” Because sometimes I think of myself as a young man, I thought I was good at everything. No, like—no, I can do that, I can dot that. But as life goes on, as you fail, you do kind of come back to like—well, like can sort of do everything but here’s like the one, the five things that I’m actually that I may be really good at or better than other people. Does that sound familiar?
Paul: It sounds important, it sounds critical, and it does come from our experiences as children, frankly. I’m involved with a wonderful new program here called “Pitch-a-Kid”. Pitch-a-Kid, where entrepreneurs and start up founders our age, have to get in front of an audience of kids and give them their pitch, to talk back to the idea of the pitch. And the feedback, the questions, the challenges that kids will give an experienced professional, they don’t care if you’re Bill Gates. They will ask you the most eye opening brilliant questions because they don’t have that fear and they’re willing to make those mistakes because they don’t see them yet as mistakes, they don’t see them yet as failures. They see them as questions and opportunity to learn.
I was no football player. I tried to be. Everybody wants to play football. I was no football player so I didn’t try for too long. I discovered that I was pretty good at swimming and so I get into swimming. That philosophy, that childhood spirit, that desire to learn, that desire to build, that’s what we need to retain, that’s what STEM education, needs to retain that as kids grow up and go through university systems, that doesn’t get beaten out of them, might that you retain the accelerance for asking question and making some mistakes and finding what’s right for you.
John: And good for successful business person. To realize I think that no matter how high you get up or how good you think you are, you really have to surround yourself with some people who aren’t afraid to say the upper has no clothes.
Paul: , that’s exactly right.
Paul: I like to use the “Your baby is ugly” reference. In the startup community a lot, I love your pitch, it’s a good idea, its “Oh a little ugly.” Because the fact is that’s helpful, right? Let’s not get ahead of ourselves. A little too much praise, little too much exuberance for what you’re doing can be a bad thing, frankly. Especially as an entrepreneur, you need to avoid, avoid. Not intentionally but you need to be able to step around and identify those mistakes and so it’s critical to have people around you who frankly are better at what you’re doing than you are.
The CEO’s job is to find people much, much more capable than they are and that’s strategy. The strategy is how the CMO, how the CEO, how the CTO helps do that. They provide a North Star that the team, the experienced, talented team of folks that can code or design, or build, or communicate more effectively than they can. They’re the ones who build the company based on that objective, based on that North Star. And again we’re going to deviate left and then we’re going to deviate right. We’re just going to keep you on the same track.
John: That’s a good management insight too because I think that the big problem a lot of managers make no matter what it is, micromanaging, thinking that they have to do every single part and that’s actually absolutely wrong.
Paul: It’s entirely wrong and it’s most difficult in the context of this newer theme of a lean startup of boot strap startup and chasing customers, revenue and selling things quickly, find revenue quickly. Because at the end of the day the founder or the CEO of a business will always be the best sales person for whatever that is and yet as the CEO or the founder of a business, you got a million other things you need to be doing.
And at the end of the day, as you bring on sales professionals, even if it’s the best sales professional in the world, it’s entirely likely that there are not as good as you at selling your own thing. Because you can make whatever decision you want. I can sit down with you and say, “Yep, we take that deal”, “We’ll sign right now”, and “Close the business.” And so the CEO, the small businesses are absolutely has to get comfortable with realizing that, they’re in capable of building a business on their own shoulders, that you need those professionals who have the experience, have the reputation of being excellent in your industry so that again so you can steer the ship and they can run it and any make sure it doesn’t sink.
John: Great lesson. Kind of as we wrap up, just one final thing if we could encapsulate it. I think everybody who comes to you or whatever it’s like I want to start a business, I want it to be successful. Somebody had to just say if you could tell him one thing like, “This is what it takes to be successful.” I know it’s a lot of things but there is a North Star of success.
Paul: Is there a North Star of success? I think you, I’m a big fan of Simon Sinek’s work, Start with Why? I’m also a big fan of an old economist, Peter Drucker’s work, he wrote a book called Innovation and Entrepreneurship, which most people these days don’t read because it was written back in the 80’s. It’s on the news to start a book these days. You read those two books and I think it answers that question that Peter Drucker made the point that only two things matter. Only two things create value in business, innovation which we’ve been talking about, and marketing, which we’ve been talking about. And he added marketing is the one that distinguishes the businesses, right? We want to think that’s it’s the innovation like if you invent something, you’ve got something distinct. It’s actually not that; it’s the marketing.
Apple, Apple is not Hewlett-Packard because of the marketing, because of the experience and the brand. And the only way to arrive at that is to understand the why? Understand your why. Why is it that we’re doing this? Why is it that anyone will care? Why is it that a bank or an investor, or a customer, or a partner will care? Why is it that we’re going in this direction and not on that direction? That’s the most difficult question asked but it’s also the most important because how you do what you’re doing, what you do, when you do things, where? Whether or not you do it in Chicago, or in Austin, or in Silicon Valley, depends first on understanding why you’re doing it.
So start why and appreciate that the idea of both innovation and marketing are critical to that path, critical to that path. Those three things though, why marketing and innovation are what’s going to get you there and start with those things before you even invest a dollar in filing an LLC, filing a patent, building a company; start with those fundamental questions because that’s what’s it will foster the passion that other people have for what you’re doing.
John: I love it. Actually I think that fits completely with just a notion of what advertising marketing is always about. It’s retell the narrative and whatever you make, there’s a narrative that makes it different and stick to the narrative. We talked about that a lot in our own company so I think that’s a fascinating way of looking at it.
Paul: Good. I look forward to hearing these stories, these narratives that you guys put together here. We’re trying to tell a lot more stories out of Austin and there’s some great video experiences, blogs, podcasting and audio experiences coming out of this part of the world because as you can imagine, as we think about those narratives and where they’re coming from. Everybody’s wondering why and how Texas is doing so well and I’m excited to be a part of telling those stories whether or not it’s through the venture capital ecosystem, or I’m involved in a venture capital firm called 1839 Ventures or through what we’re doing in MediaTech Ventures. These narratives are going to get folks a glimpse of what we’re doing in this part of the world.
John: That’s cool. I mean, I think South by Southwest is a great example of it. It’s where technology and creativity and all these things come together. Data, I mean it’s really cool. I think it is blazing a trail for the rest of the world so very cool things coming out of here.
Paul: Incredibly, and what’s exciting is that the buzz, the local buzz in Austin. This year, we’ve been having it for a few years but the local buzz is that you all realize Austin is always like this. Austin is always like South by Southwest, not as big of course. We have 300,000 people here for the next week but we’re always involved in live music, video games, film, data platforms, mobile experiences, audio and podcasting that you can head up to road tomorrow and go hang out with EA, and go hang out with the IBM Design Labs in Austin. That’s the character, that’s the narrative of Austin; that the experience you have in doing something like South by Southwest is why you should be here all the time.
John: Yes, it’s cool. And you should keep Austin weird.
Paul: We’re trying.
John: Okay. Good. Well, listen I really enjoyed our talkfest. Anyway, I really appreciate you coming down here to share some of your insights and knowledge and good luck to you with moving forward.
Paul: Cheers to that. Thank you very much.
John: Have fun.
Paul: Thank you.
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