I met Frans Johansson during my time at Brown (he is a fellow alum).  At the time he had just released his excellent book The Medici Effect.  The key insight was that good ideas increasingly happen at ‘The Intersection’ of different fields/ways of thinking.  So mix up trash removal and bee-keeping, or Japanese cuisine and organic chemistry – and new ideas will flow.

Frans just released The Click Moment.  His thinking is transforming the way I think about creating new businesses.

Book Recap

• Success is random, not planned.  He gives extremely convincing arguments from years of research to prove this point.  I’m pretty much with him.
• In order to capitalize on this:
• Bring your mind to ‘The Intersection’ and have a bunch of interesting ideas.
• Place *many* small bets and carefully watch what takes off.
• Double down when you have a win.

Read the book (and others like The Drunkard’s Walk or The Black Swan) to learn more – but for now let’s play with the implications on being an entrepreneur if the above is taken as given.

‘Click’ to Create a Company

I want to build a hugely valuable company in the broad space of ‘helping people become fucking awesome.’  Zeo and sleep certainly fits this mold.  Other areas of interest range from productivity to nutrition to education.  Using the above methodology I should:

1. Seed my mind with tons of random interesting stuff.  Relevance is ‘anything that is interesting.’  Just sponge on books, movies, conferences, dinner conversations, etc.
2. Collect spontaneous ideas as they occur, and deliberately brainstorm on a regular basis.  For a great treatise on this see a recent Altucher post.
3. Create a filter.  What ideas am I PASSIONATE about?  If ideas aren’t extremely exciting on day one ditch them immediately.  Now write down the immediate next step on creating a business for each of those ideas.
• example:  Business idea – create a Pomodoro app that links people together through a system of mutual accountability to get stuff done.  Immediate next step – call a friend and agree to try this via Skype for a half-day of work.
4. Every week take three ‘first step’ actions for generated ideas.
5. See what hits and exert more effort on those ideas.

This feels right.  I’ve been extremely prone to over-analyze ideas, discard ideas as impractical, and generally rationalize things as if I could predict the future.  I can’t.  You can’t.  Have interesting ideas.  Try shit.  Pickup on what works.  Will see what turns up in the next few weeks!

I’ve recently been speaking with tons of folks who about good ideas to start massive companies.  A couple themes are beginning to reverberate.  Here are some recent comments:

• Building huge value in software these days is more like the publishing business – it’s awesome you have hardware experience Ben – that’s more valuable in this new world.  via Andy Payne
• The recent fracas where David Sacks (Yammer) said it’s going to be tough to build real value because big tech companies will beat you to it.
• I’ve been listening intently when the folks at Founders Fund speak.  One message: ‘find ideas that are good – but seem bad to others’  PG’s take and Thiel on secrets.
• And last – I have enough hubris to believe that the right founders make excellent decisions and build the best companies.  To enable this – founders must retain control.

So lets consider three binary variables when thinking about a startup idea:

• Good Idea or Bad Idea
• Start here – does the idea deliver tremendous value?
• Seems Like a Good Idea or a Bad Idea
• If it seems like a good idea – expect tons of competition from both new and established players.  Not impossible to win – but more timing and luck come into it as well as excellent execution.
• Easy or Hard
• Easy stuff will be easily copied once people realize you are on to something.  Makes it much harder to win.  How many folks are competing with Uber and iRobot vs. those who compete with Instragram and Pinterest?  So pick problems have real stuff that need to be solved and can be defended.
• Control
• I happen to think that companies that don’t remain in the control of a passionate founder are less likely to achieve world-changing outcomes.  So pick an idea that you can build a structure around where control is retained – this relates to who you need to recruit, money raised (and when), likelihood to build a successful independent company, etc.

Now let’s try this on a few startup ideas I’ve heard recently.

Company that delivers fresh, healthy, raw food in pre-packaged ‘meals’ with quick-cook instructions to your house.

• Good idea? – Nutrition is a huge thorny problem and this is an interesting place to start.  Not sure yet.
• Seems like a Bad Idea.  Dumb dumb dumb.  Direct to consumer challenges, food deliver and logistics, local and hard to scale, been tried before, big competitors have advantages.
• Hard.  For all of the above reasons – but if it worked you’d have put up big barriers.
• Control?.  Not sure – may be bootstrapable – but just as likely to require big investments in a space where tons of expertise is needed and where it may be hard for a small company to succeed alone.

Turn the front-facing camera on a smartphone/laptop into a passive health sensor that measures things like heart rate, respiration, facial expressions whenever you use the thing.

• Good idea?  Hard to tell – would the data be actionable/usable?  Where would the business model be?
• Seems like a Good Idea.  We are increasingly measuring our health and acting on it.  The technology is available.  Makes sense.
• Easy?  I actually think this would be reasonably hard to do right the first time.  But once that was done – it would be easy to copy and hard to protect.
• Control Works.  Wouldn’t need much financing, easy to remain independent, etc.

Seems like a useful set of filters.  Thoughts welcome.

Zeo has benefited massively from the advice of many as we have grown and developed.  Lunch with a fellow company founder, investor feedback, specific trade advice around everything from legal to graphic design – there are literally thousands of people that offer up their advice over the years.  All are valuable.  I’d like to call out one class of advisors though – what I call a ‘key business advisor.’

Key business advisors constitute only a handful of the larger subset of people who give advice to the business.  And yet they deliver a huge portion of the value – the Pareto Principle in action.  I’d like to explore what makes these relationships tick – and try my hand at the other side of the table.

Zeo Key Business Advisors

To give you a feel for what I am talking about – here are some (by no means all!) of the key business advisors that Zeo has benefited tremendously from over the years.

Colin Angle – We cold called Colin when we were still students.  He had co-founded and was about to take public iRobot.  We thought that as a local consumer electronics success story that he would have allot to teach us.  Our engagement with Colin started lightly – a meeting in his office, inviting him down to a brainstorm session on the product – but over time grew into angel investment, board membership, and being one of our key business advisors.  Colin introduced us to our first (and second!) VCs – they were both investors in iRobot.  The majority of the Zeo board is on the iRobot board – which is pretty awesome.

David Barone – David bumped into Zeo at one of the many Boston-area networking events that we attended early on.  David is a successful medical device entrepreneur and now runs a consulting shop.  David helped us deal with early team issues, helped us recruit a CEO, and gave invaluable product advice (which we mostly ignored – to our detriment).  I remember genuinely trying to convince David that a product that we had barely envisioned would surely be on the market in 6 months.  He called my BS – and helped build a better plan.  David also served on the early Zeo board and invested personally.

Characteristics of the Few

What makes these relationships different and so hugely valuable to a startup?

• Key business advisors are truly committed to helping a business succeed.  There is a big difference between making an introduction and putting your reputation on the line.  Key business advisors will go that extra mile.
• Deep experience in the challenges a startup faces are critical.  But that kind of talent tends to be readily available.  What separates a key business advisor is the depth of their insight into your particular space.
• Key business advisors are passionate about the company direction and about the founding team and key management.  Both are required – it’s a long, bumpy path.
• These relationships are longitudinal.  A key business advisor can offer perspective over years of interaction as a startup grows.  Don’t make someone a key business advisor unless you believe they will offer value over years.  At the same time – it’s not permanent and the needs of a company and advisor will change over time.

How to Interact with Your Key Business Advisors

• First off – mutually discuss and recognize the difference in the relationship.  This is a big difference here from a ‘member of the advisory board’ – it’s deeper and broader.
• Interaction time can vary pretty wildly depending on current issues, stage, other things going on for the advisor, etc – but a general rule of thumb is a solid conversation on key issues at least twice a month, with things getting much deeper when needed.  They are consulted on key business decisions.
• Compensation is rarely cash and is very likely equity.  Advisors don’t expect to get rich off of those options – but it’s a truly important signal of commitment and an alignment of incentives.
• Investment – your advisor should be willing to invest alongside others in fund-raising rounds.  Again – this is mostly a symbolic gesture – but be wary of advisors who refuse to put their money where their mouth is (unless they truly don’t have the means.)
• Identify the needs of your advisor – and make sure they are getting what they need as well (see below).
• There is a difference between key business advisors and your Board of Directors – although there is much overlap.  A formal Board is more about legal governance and control than it is about business advice.  Don’t confuse the two.

What the Advisor Gets

It should be pretty clear how the company benefits from these key business advisor relationships.  But the wiifm for the advisor?  Here are the motivations I have seen at play – mostly in the case of a company founder taking an advisory role (VCs have different motivations).

• Giving Back – The more experienced and successful and entrepreneur becomes – the more their motivation shift to the altruistic.  They want to see others like them succeed.  They want to help make that happen.  For advisors with this motivation – hug them close, make them feel loved, and recognize them profusely.
• Portfolio of Equity – Company founders lock up an enormous amount of their personal capital (financial and otherwise) in what amounts to only a few buckets per lifetime.  Contrast this to a VC who gets to make a few bets per year – adding up to dozens or hundreds over a lifetime.  By becoming a key business advisor you can diversify your talent over a few companies.
• Pattern Matching – Starting a company gives you deep insight into what works and what doesn’t.  But since you can only start a few companies this gives you a limited number of data points from which to draw.  Investors get to experience many more data points – honing this pattern matching skill.  By advising a few companies you can radically increase the number of data points you have to draw on.
• Gaining Perspective – Being a company founder can be a myopic experience.  You are working on the same thing every day – you are super close to it – and sometimes don’t see the forest for the trees.  One of the key values that an advisor brings to a startup is this outside perspective.  But it works in reverse as well.  When a new technique works, or a piece of data emerges – it will often have repercussions on the advisors business as well.

The wiifm for me?  I feel a truly powerful need to knock it out of the park in my own ventures.  My key motivation for advising right now is to help me toward that goal.  Pattern matching is #1, followed closely by Gaining Perspective.  On the flip side – I am happy to Give Back and Build a Portfolio – and those motivations will become more important over time as I grow into advisory roles.

I’ve got a couple conversations ongoing that may lead to advisory roles – and I am truly excited about getting this off the ground for me personally!

@AndrewWarner of www.mixergy.com interviewed me on video about how to make hardware startups happen.  Had a great time chatting with Andrew!

The Personal Health Record is Dead.  Long Live the Personal Health Record.

We are generating increasingly large amounts of electronic health information.  Runs tracked using GPS, blood glucose on our smart phones, sleep tracked using a headband, your hospital records in an Electronic Medical Record, etc.  It seems obvious that all of this information should end up stored in one place and accessible to whomever you choose to give access to.  And all of this data needs to be connected to various services that make use of it. Upon this premise the Personal Health Record was built.  Microsoft HealthVault and Google Health are the two most notable contenders - and most people use one or the other to store their health data.  Wait.  What?  Actually – NO ONE uses Google Health.  Or Microsoft Healthvault.  Or any other PHR.  What gives?

People ARE tracking their health and generating enormous amounts of data.  But they are NOT using PHRs.  I spoke with a very well known provider of athletic services (data analysis, coaching programs, etc.) this week who had integrated his product with Microsoft Healthvault.  They jumped through numerous hoops to get their service linked up – all for a less than 100 users who linked accounts.  I personally have both a Google Health and Microsoft HealthVault account.  I use neither.  Why?

Chicken and Egg

A Personal Health Record needs three key components to be successful.

• Data – Automated data entry – health records, fitness metrics, weight, sleep, etc.
• Services – Data is no good by itself – it needs to be connected with smart analytics, advice engines, content, community, doctors, etc.
• Customers – Someone must be using all this stuff together.

All three must be present for a healthy ecosystem – and a classic chicken and egg situation emerges.  It can be hard to get initial traction.  No one will build services without data streams and customers.  Device manufacturers don’t bother to hook up to take advantage of no customers and services.  We aren’t there yet – of the three the data sources are the most connected – with services and especially customers lagging.

Skip the middleman

In new industries ‘compatibility’ with other solutions doesn’t matter.  There is nothing to be compatible with.  One must create the entire customer experience from soup to nuts.  Hence the first Ford cars had most of it’s parts made by Ford.   As industries grow and mature different companies find their niche and begin specializing.   Nowadays your Ford car has parts from thousands of independent suppliers – Ford tied it all together for you.

We are in the early days for digital health services.  For the most part – today – if you want to offer a solution to a customer you need to build the WHOLE product out.  A good example is Zeo.  When we started designing the product years ago it became clear that we needed to cover the whole value chain from sensor -> electronics -> data analysis -> coaching.

In a more mature ecosystem companies have a choice – they can specialize.  Consumers can mix and match hardware, software, and services.  In this more mature ecosystem there is definitely a place for a central data store/PHR.

What happens now?

In the short-term devices will begin to open up, services will begin to emerge to take advantage of these open platforms, and customers will connect their individual devices to individual services and make use of both.  This will work well for quite some time.  Then – eventually – things will start to become unwieldy.  Two or three data sources and a handful of services will turn into a dozen data sources and a dozen services.  And the PHR will be there – ready to tie things together.

The PHR is dead.  Long live the PHR.

I remember the first time BigCo called.  They were interested in talking to our company (really – itty bitty us?), they wanted to talk about a potential partnerships ($$$$ – eyes wide), would we like to meet?  The first time a major player in your industry notices your startup is an exciting time – what do you do?  Will they steal the idea (don’t meet with them!)?  Buy you for a bazillion dollars (get your negotiating point for a $3 bazillion dollar valuation ready before the meeting)?  Waste your time (Yes)?

When your startup starts to get press, launch products, and generally develop real thought and market leadership – the BigCo’s will keep on coming.  Here is my guide to what to do.

1.  BigCo calls.  Or you meet them at a conference.  Or someone offers an introduction.  What to do?

2.  ALWAYS HAVE AN INITIAL CONVERSATION.  You have no idea what they are thinking – use an initial touch to point to feel them out.  Suggest an into call/coffee of 15-30 minutes.  Don’t agree to a 1.5 hour initial meeting with presentations (you risk time wasting, giving away too much information, etc.).

3.  During that initial conversation – gather AS MUCH INFORMATION AS YOU CAN without giving away anything non-confidential about your company.  Make sure the other party also agrees to speak non-confidentially – this clears both parties of nasty litigation possibilities going forward.  Unless you are in stealth mode there will be a TON to talk about without ever stepping onto confidential ground.  While you are speaking non-confidentially try to get them to declare their intentions.  How are they thinking about this market space?  How do they plan to grow into this market?  Do they have any initiatives in the space that they can talk about?  Who else have they been speaking to in this area?

4.  Ok – the intro call went well.  Unless they are truly uninteresting or already offered that bazillion dollars you have a decision to make – is it worth engaging further?  Presuming the value of a potential partnership is very high (otherwise don’t proceed) – what are the risks?

• Giving away confidential information/plans to a competitor – I don’t view this one as a huge risk.  Anything you share that is confidential should be covered by an NDA.  If they plan on ripping you off anyways they would be stupid to sign that NDA and expose themselves to potential litigation.

• Time waste – This is the big one.  Truly evaluate the likelihood of a deal getting done IN THE NEXT 6 MONTHS.  Where are you and where are they in their process?  Talk to people who have done deals with BigCo before to get a feel for their internal process.  If you can see a highly valuable deal getting done in 6 months – go for it.  If a deal isn’t getting done shortly don’t go cold turkey – continue to communicate good news, catch up occasionally, and cultivate personal relationships.  Just don’t fly the management team to France for a presentation that you spent the last week preparing and clearing with legal ($$$, time, etc).

• We already said no to this (years later) – This risk is often overlooked.  Companies have institutional memory.  We pitched early and often to one BigCo before our technology was fully baked and before we were even close to market.  They came to a wishy-washy conclusion about the technology and the company at the time (justifiably).  We have been unable to rectify that initial impression despite 5 years of solid progress on the technology and the market.  We talked to BigCo too deeply too early.

Partnership with BigCo can really drive value for your startup – but watch out for engaging too early – in my experience this almost always leads to disappointment and time wasted on both sides of the table.

One recent technique I have been applying is to use different days for different types of activities.  I got the idea to try this from Tim Ferris and the Four Hour Work Week – he mentions batching tasks together as a wonderful way to improve efficiency.  I have been using the Pomodoro Technique to manage blocks of time and I have noticed recently that days that were cut up with meetings were extremely unproductive for me (aside from the meetings).  Few Pomodoros.  Little actual work.

Today is a good example:

8:30-10 – Work

10-11 – Meeting with Potential Consultant

11-11:30 – Work

11:30 – 12 – Internal Meeting

12 – 12:30 – Phone call with a student entrepreneur

12:30 – 2:00 – Lunch with a colleague

2:00 – whenever – work

I had a productive early work period from 8:30-10, but as of this writing (11:16am) I can’t imaging getting any real work done until around 2:30 – the time slots in-between and calls will be short and I will not be motivated/able to do real work.

Here is how I am trying to do things going forward:

Monday, Wednesday, and Friday – Schedule back-to-back meetings, phone calls, events from 9am -> whenever.  When meetings/calls/events end – take a long break (maybe go home), and then crank out more work Pomodoros in the evening/night.

Tuesday, Thursday – Nothing scheduled – just work Pomodoros.

Weekend – As required or as motivation dictates.

I have a few questions I am asking myself as I get this new schedule started:

• Can I go down to 2 meeting days and 3 work days?  Will depend on the nature of my current activities.
• generally I am extremely productive 9am-1:30pm, a lazy bum from 1:30pm – 8pm, then I get a huge burst of steam from 8-11pm.  How can I take advantage of that instead of trying to work when I am lazy and trying to relax when I am charged to work?
• How disruptive will meetings who’s timing I cannot control be?

I believe one of the major benefits to an entrepreneurial culture is allowing people to adjust their work schedules and locations to suit individual productivity.  The goal of a startup is to build a product, gain traction with customers, and become profitable doing so.  Nowhere in that book is there an inviolate work structure – stuff just need sot get done.

Will let you know how this experiment goes – and please pass on any tips and thoughts you have – I plan to blog more about entrepreneurial time management.

Update:

I have had trouble keeping with this schedule.  Was beginning to think it was impossible – then I read this blog from Paul Graham (Y-Combinator) on a Makers Schedule vs. a Managers Schedule.  It exactly the same idea I had – splitting Maker and Manager time and trying to maximize the Maker time.  Very cool stuff – and a recommended read.

Nope – not the Zeo IPO party (someday).

I was told by a fellow entrepreneur recently ‘see you at the IPO party’.  We had planned a ski trip – flights booked, rooms reserved, powder days forecasted… he decided to work on his startup instead.  I said he was crazy – he said ’see you at the IPO party’.  Hell, maybe I am wrong and there are personality types that can sprint start to finish – but even among entrepreneurs I think these individuals are in the minority.  He has decided to focus on his startup to the exclusion of his life – I hope it works out for him.

I have seen many startups fail – usually not due to a market flaw, product flaw, or financing mishap.  That may appear to be the problem – but the more likely scenario is that the entrepreneur just couldn’t keep killing himself/herself to overcome the problem at hand – and they gave out.  This isn’t a lack of willpower – people simply run out of the creative and mental juices that allow them to solve tough problems.  It’s natural and human – you can only run so far at full speed.

I have spoken with many of these entrepreneurs – they worked as hard as they could, came up short – but damn – at least they gave it their all!  Its comforting to feel this way – no one can blame you for running as hard and fast as you could for as long as you could and not making it – right?  Not so fast.  By continuously sprinting most entrepreneurs make it less likely that their startup will succeed.  They also suffer personally.  This could come in many forms:

• Can’t stand missing out on children growing up – re-evaluate life time
• Run out of steam emotionally and physically
• A husband/wife puts the foot down – time to get a real job and stop working insane hours
• Start making bad decisions as a result of being at the brink – startup death ensues
• Even startup success can become personal failure – how many entrepreneurs achieve the hollow victory of pre-mature aging, broken relationships, and a full bank account?

This blog will focus on entrepreneurship, the world of self-tracking, technology, and other random topics.

Here is what I hope people will get out of my posts:

• I am deeply involved in ‘tracking everything’ – its a powerful way to learn about your life and make positive changes.  This blog can become a resource for people interested in following a similar path – I will talk about what works for me, what doesn’t, and make suggestions for the future.
• The last six years at Zeo have taught me a great deal about entrepreneurship, product development, manufacturing, hiring, financing, etc.  My posts about what I am experiencing and what I have learned may help others.

Here are a few of my goals for becomingawesome.com:

• Begin discussions with interesting people – entrepreneurs, self-trackers, partners for Zeo, etc.
• Have a forum to expound on issues that matter to me, generally entrepreneurship related but also other topics from time-to-time
• Evangelize Zeo
• Create a nice incentive for myself to begin ‘tracking everything’

As the content and readership here develops I would appreciate any and all feedback, either through blog comments or to ben@becomingawesome.com

About me:

I started as an entrepreneur early – in 9th grade an interest in computers led to forming a computer hardware and services company – PCsforYOU. I was bitten by the entrepreneurial bug and believe I will be happy founding companies for quite some time. I am currently the Chief Technology Officer for Zeo Inc. – a technology startup that has created the world’s first personal sleep coach.

I went to school at Brown University and graduated in 2005 with a degree in Computer Engineering. I began my career working for BBN Technologies as a Systems Engineer. BBN was a technology playground (they invented the Internet!) and while there I worked on robots, embedded Linux, and ad-hoc mobile networking.

During my junior year at Brown (2003) I co-founded Zeo – the goal was to create a product that made groggy mornings a thing of the past. Our breakthrough SoftWave sensor technology measures brainwaves comfortably in the home and accurately tracks sleep phases throughout the night.

We launched the Zeo Personal Sleep Coach into the market in 2009 to rave reviews. We have since been featured in the Wall Steet Journal, the New York Times, the Today Show, etc.

Outside of work I spend my time climbing and skiing mountains and maintain a strong interest in world politics and international relations as a carryover from my Model United Nations days at Brown.