The magnitude of the global logistics industry

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I obsess over the magnitude of the global logistics industry. In the startup world we focus so often on consumer-facing companies because they make sexy stories…they’re relatable.

As technologies and efficiencies have improved, the demand to move smaller parcels has moved further up the distribution chain.

The old supply chain needed to move mass quantities of goods from manufacturer to importer to distributor to retailer and then to the consumer.

Today’s technology allows companies to skip steps, moving less quantity per shipment and sometimes shipping directly from the manufacturer to the consumer. For some incumbents, this is a catastrophic shift.

These changes are all made possible by innovations in efficient production requiring shorter lead times and lower minimum production quantities, more efficient planning technologies, innovations in retail (like Amazon and Ice.com) and other such innovations.

These changes are gargantuan. We talk about Uber’s impact on taxi companies frequently. We don’t talk frequently about signals like the number trucking companies declaring bankruptcy (which doubled in the first quarter of 2016).

To get a sense for the size of the market take a look at the below graphic. As a comparison, global revenue from taxi operations, a topic we love to talk about, is a mere $22B. UPS’s annual revenue alone tops $58B. Maersk, one of the largest sea-cargo companies, generates revenues of $47B.

The shift is catching entire industries off-guard. The opportunity for innovators is significant.

Source

global-logistics-market-infographic.jpg

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Yes, I still live in Las Vegas

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I encountered a strange phenomenon starting last fall. When I ran into people I don’t see often or otherwise communicated with them, they would say “I didn’t know you still lived in Las Vegas.” These interactions confused me.

When I shut down my company SHIFT in early 2015 I did it for a combination of reasons. We had adequate capital to survive the year but in late 2014 we woke up to a reality that we had some challenges with potential market size in Las Vegas. I had chosen some time before not to expand to Denver where we had a perfect setup to grow quickly. At the time, I didn’t want the distraction. By the time I realized we needed to do it to survive, doing so would have put our employees at risk. I chose not to take that risk.

More importantly, I was burned out and on a path to death. This is not an exaggeration.

I did not anticipate that a lot of people would assume I left Las Vegas as a consequence. Perhaps this is because a lot of people move places to start companies and, if they fail, they leave and go back to where they came from. Perhaps this is just a Las Vegas or even a downtown Las Vegas phenomenon. I don’t know. In any case it surprised me.

In case we don’t run into each other around town, I feel compelled to explain why.

Beware of narrative fallacies
Our monkey brains yearn to find patterns and attribute them to narratives. If X, Y and Z happen they must be a reflection of a linked set of events. There are cases where these narratives are true. Almost always they are wrong.

I’ve been witness to a unique version of this phenomenon over the past six years. It’s taught me that most of what I read from widely distributed sources is not fully accurate. And it’s taught me beware of my own cognitive biases and limit passing judgment on events. Through first-hand experience I know that doing so often leads to narrative fallacies.

I compartmentalize
Those who know me well know that I have a tendency slash uncanny ability to compartmentalize. I hold competing if not fundamentally opposed viewpoints simultaneously. I generally isolate the influences on decisions about one thing to influences relevant only to that thing. Thus, one thing I do is rarely directly related or influenced by another. It’s not fair to expect others to understand this. I’m working on that.

I did not move to Las Vegas for SHIFT.
I moved from San Francisco to Las Vegas to lead product at Zappos. I had an opportunity in 2011 to explore new areas and fell in love with two things: building physical places and the work of venture capital. These loves led to developing the Zappos campus, launching VTF Capital (fka VegasTechFund), launching SHIFT, building (and now selling) Work In Progress and a bunch of other stuff. Some of my work was with Downtown Project, a lot of it wasn’t. I compartmentalize.

I don’t drink, I eat weirdly and rarely go out
After the wind-down and through 2015 I grew obsessively focused on my mental, physical and emotional health. In some ways, I became a gym rat and I study food science relentlessly. Unintentionally (and through tons of research) I fell into a routine that has completely changed my being.

One side effect is that I don’t drink which means I don’t go out unless it’s to specifically meet up with close friends. Separately I realized I’m happier in 1:1 or 1:few settings and most uncomfortable in groups. So you don’t see me in groups, in bars very often.

To minimize decision fatigue I essentially eat the same thing every day. After much research and tinkering, my diet is limited to foods that make me feel good and excludes foods that make me feel bad. Since restaurants often add tons of hidden ingredients to create amazing flavors, I rarely eat out and I don’t have meal meetings. These are my choices…because I’m weird.

I believe if I discovered this lifestyle while building SHIFT it’s likely I would have made different decisions about winding it down.

Even as a non-drinker I love meeting friends at bars. If you want to meet up, text me.

I don’t see home ownership the same way as most people
I once received feedback that the fact that I had not purchased a home in Las Vegas made people doubt my commitment to the city. And I’ve been repeatedly told renting is throwing money away. Both of these things are untrue.

Home ownership versus renting is first a trade between control and flexibility. It is less a financial decision than one of lifestyle.

I’m insanely fickle. Renting, which I have done my entire life, supports my tendency to want to change my environment frequently. Those who have worked with me know I constantly rearrange my home and work spaces. I am an obsessive tinkerer. Nothing is ever done.

Renting allows me the freedom to change my space or even the entire environment relatively frequently and with little friction. It also constrains the degree to which I can change my space since I can’t knock out walls in an apartment.

Priorities shift over time. As I write this I’ve just opened escrow to purchase a home in Las Vegas. I now value control over flexibility so I am buying a house in a neighborhood I love in the city I call home, Las Vegas. Ironically it was a trip to Austin that led me to consider owning versus renting.

And as an aside, the home buying process is whack. Agentdesks, please hurry up and fix this.

My work is global, I am local
I subscribe to the global vs local worldview. Derek Sivers articulates this thinking well. One is not better than the other. They are just different.

You can focus your time locally or globally.

But if you over-commit yourself locally, you under-commit yourself globally, and vice-versa.

If you’re local, then you’re probably social, doing a lot of things in-person, and being a part of your community. But this means you’ll have less time to focus on creating things for the world.

If you’re global, then you want to focus on creating things that can reach out through distribution to the whole world. But this means you’ll have less time to be part of your local community.

I have been a General Partner VTF Capital since 2011. Our team is based in Las Vegas and my partner is based in SF. We started as a 100% local firm and in 2013 started reaching globally. Today we are focused on commerce and retail without regard to location. A small percentage of our portfolio is based in Las Vegas which means the bulk are based elsewhere. I travel a lot.

Because we live here we do what we can to support the growth of the startup ecosystem. We sponsor events hosted by a local angel event organizer to help activate the local angel community, we’re investors in The Mill and we’re sponsoring several things in 2016 that don’t relate to our commerce and retail thesis.

I am a direct investor in several businesses. I am a board member at several others, all of them global. Two of them happen to be based at least partially in Las Vegas and both employ a substantial number of people in startup terms.

I have been working on a small physical product company (that’s really more of a hobby) for a year. It is based in Las Vegas (in my house) because Las Vegas makes sense for that type of business. Need/Want, a company I’m a fan of and am visiting next week, moved to St. Louis, a city to which they had no personal ties, because it made sense for their business.

I’m involved in real estate development not related to that of Downtown Project and not completely limited to Las Vegas. This is probably the most local thing I do.

Since May 2015, I’ve published what I am working on at zgware.com/now and most of the things I do are not related to one another. I do all of them from my home in Las Vegas.

Conclusion
No one narrative can explain everything we do. The closing of SHIFT is a single, isolated data point. Be skeptical of any narrative that relates one thing to another.

Las Vegas is my home. I was here before SHIFT and am here after it. I didn’t deeply consider leaving until people seemed surprised that I had not. Those people made me wonder if I was supposed to leave.

Clearly I did not.

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Why investors prefer intros (from an investor who gets a lot of email)

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Elizabeth Yin is a Partner at 500 Startups where she leads the Mountain View accelerator. She also founded and sold a company called LaunchBit. We were investors.

I met Elizabeth four years ago via an intro from a personal friend. We invested not long after our meeting.

Elizabeth has written two must-read blog posts for startup founders in the last week: How to ask for an investor intro? and Who is the best person to ask for an investor intro? Go read them, I’ll wait.

I have first-hand experience in her thinking. She did exactly as her posts explain when she introduced me to Jonathan Manzi and his company Ink a few months ago. Her email included a summary of the company, why she was emailing (the company wanted an intro because of a past investment of ours) and said “let me know if you want an intro.” Side note: never introduce two people who don’t know each other via a blind intro…it really sucks…use the double opt-in intro.

At first, it appeared to be a weird connection. I couldn’t understand why she thought we were a fit for each other. But because I know her and trust her judgment, I took the meeting.

Twenty minutes into the call with Jonathan I was excited. The thirty-minute call lasted well over an hour. I completely nerded out. My partner Will had a similar experience. And a few weeks later we invested. We tell everyone we meet about them.

Prioritizing your time as a venture investor is one of the hardest aspects of the work. On one hand you want to meet everyone you can. It’s fun. People are awesome. Some of the meetings may lead to investments or something else exciting. Either way, you’ll probably learn something from them.

On the other you need to spend time working with your existing portfolio and doing your part to help them become great companies. It’s hard to do both.

We are operationally-focused investors. We invest in a specific area that matches our skills. We choose to prioritize our time towards work that can directly contribute to our portfolio companies’ success. 99% of our contribution is work, 1% is capital.

This means we’re working on intensely cerebral problems very frequently. We’re helping write job descriptions. We’re helping solve multi-channel distribution challenges. We’re analyzing acquisition funnel data. In other words, we’re doing things.

If I take a meeting with everyone who emails me, that’s time (and cognitive load) I’m not devoting to helping a portfolio company. The compounded opportunity cost of that decision is immense. And meeting with a new founder if I know it’s not going to lead to an investment is disrespectful.

Our historical investment data shows that all of our strong and growing investments came via intros from people we know. And all of our investments that came via unsolicited pitches ended badly and the bad usually came about quickly. The data shows us that trying to manage that inbound provides a net negative return. So we don’t do it anymore.

But if someone I know takes the time to make an introduction, that vote of confidence carries significant weight. It’s like dating. The intro is a signal that the other person isn’t bat shit crazy.

A bias towards intros can be misread as supportive of a good ole boys club, that it makes it harder to become a founder for the less “connected.” I get that perspective. I also think it’s wrong.

Why does an intro matter? It demonstrates that somewhere along the way you’ve forged a relationship with another human about your company. If you are an early-stage company and/or a first-time founder, it demonstrates that you have sought advice from someone more experienced than you. It says a lot about how you think.

You may not have an intro path to every investor, but if you are a first-time founder you should be spending time with mentors. If those mentors have experience in any type of company building, they know potential investors. They know at least one who would be willing to take a chance on you, even at a small level. Over time, you’ll find your way to intros to larger investors.

Your first check might not be $1M and, frankly, it probably shouldn’t be. But I can tell you, from both sides of the table, that if you build genuine relationships that aren’t based on money, with people who help make you a stronger founder, those people will go to work for you and get you great investor meetings.

If you don’t know a potential mentor, find a successful founder on LinkedIn and message them, keep it short. Ask them real questions. They were in your position once too.

And, as in the example of Ink, an investor will be much more likely to take a meeting, even if the fit isn’t immediately clear, because she trusts the person making the intro. More importantly, the investor’s mindset during the meeting will much more open.

Your founder time is the most valuable resource your company has. Spend it wisely.

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We are addicted to now

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This weekend I read The Economist and the printed Sunday New York Times. I’ve done this every Sunday for a few months. For the most part, it’s the only hard news I read and I only do it once a week.

I used to be hooked on real-time information. I needed to know everything now. I feared that not knowing would create some kind of vacuum. I would miss out. Looking back I don’t know what I feared missing. But I feared missing it.

At one point I had a screen on my desk dedicated to public market data complete with a CNBC live stream. My phone received every breaking update. I relied heavily on my tightly curated Twitter follows to surface what I needed to know about world events and the startup world. I’ve always used Twitter that way.

To “keep up to date with my market” I hungrily consumed updates about huge startup fundraising events and unicorn stumbles. There was much data. I needed to know what was happening. Right. Now.

Until I didn’t.

Our media culture feeds an addition to comparisons. This is especially true in the startup world. Fundraising, speed bumps, the Zenefits’ debacle. This company raised $20M. This unicorn’s valuation is under pressure. We need to know everything NOW. We feed off knowing how we’re doing compared to everyone else.

Outside of the startup world, the media culture feeds and addiction to information. We need to know what’s happening in an election caucus in a random state at 7 pm on a Saturday night. And while we’re finding out, we need to know what’s happening in every other caucus plus the current time in Shanghai. And we need a countdown showing when we’ll know the next bit of information from another random state.

We are addicted to now.

Those addictions were distracting me. I was getting mid-day headaches. I couldn’t focus. So why did I keep going back?

My media consumption differed from how I work. I apply a very strict set of restrictions on information in my work in business. When looking at business data, project data and information sources in my companies I always ask (and pressure others to ask) “what specifically will we do with the answer to this question.”

What will I do differently if I know? That’s a powerful question. It’s another way of challenging yourself to consider how the information you are seeking will inform your actions. In the absence of a clear answer then the information’s role is to entertain. And that’s ok.

  • How will the real-time primary results in Kansas inform my choices?
  • How will the (statistically random) drop in the Dow Jones Industrial Average inform my choices?
  • How does knowing that ten companies raised announced fundraising deals over $15M yesterday inform my choices?

Each of those events is potentially important. But they are not important in isolation. They are important in context.

There is nothing I can do right now with the results of a primary in a random state other than post a snarky Tweet. Since I’m not an active day trader, there is nothing I can do in real-time in the midst of a public market sell off. And there are no changes I can make right now to how I do business if I know that a company raised a bunch of money.

By rule then, this information is entertainment. It is fine to consume entertainment. It is not fine to consume it thinking it informs.

There is a lot I can do if I learn those things in the context of a larger picture. My actions in this election can be informed. I can rebalance my investment portfolio. I can coach my portfolio companies on the state of venture capital.

I need time for the story to settle and for its sister stories to settle. I need analysis to make decisions. I need to understand how this isolated piece of information fits. Analysis is only possible when it’s possible to understand the broader context of information.

So I quit real-time. I essentially stopped reading Tweets which eliminated most of the real-time noise. I dropped all of the tech blog newsletters. I stopped watching CNBC.

I sought out thoughtful writers and news collectors (newsletter people) who had a deep interest in the businesses I’m actually interested in. These are often people for whom the love of the topic is greater than the pressures of developing a large audience.

I invest in companies that produce and sell things and technologies that bridge physical and digital commerce. So I’ve started reading more deep analysis work in areas like manufacturing and logistics. And I’ve kept that news contained to daily or weekly wrapups that I can consume in chunks. Nothing gets a “breaking news” alert.

I invest in venture capital, yes, but I don’t invest in the venture capital fundraising business. News from that world that is actually relevant to my work will make it to me after it’s had time to settle and develop context.

I read more books. My attention span is increasing. I’m working more deeply and less frantically. Changing how I receive information is having an impact on my brain.

My Sunday NY Times/Economist ritual started it all. I felt informed at the start of a week. It was the new habit I inserted to put pressure on the old. And it gave my license to think about the value of the rest.

The rest were purely entertainment masquerading as informative. Their value was zero. So they are, now, gone.

I’m missing some perspectives. Over time, I’ll find them. But opening a firehose of undistilled information with no sense of context isn’t the answer.

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Developing Indifference

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I’ve learned a lot about indifference in the past year. I always thought of indifference as the razor sharp tool one develops when he doesn’t care. Indifference is deeper than not caring. Indifference is the most powerful tool in the behavioral change arsenal.

Indifference isn’t an active feeling. You only know you’ve developed indifference when you look back on a period of time and realize you didn’t think about something at all. If you are thinking about how you don’t care, you’re not indifferent. You’re preoccupied.

Indifference can’t be developed actively. Indifference is the process of making a thing irrelevant. It’s using a new iPhone and realizing, months later, you haven’t touched your Blackberry or missed it at all.

Indifference is a feeling that will baffle you. You will marvel at questions like how did I, after being addicted to my Blackberry for so long, just stop caring?

We often mistake apathy or angst for indifference. We say we don’t care about the negative people, bad habits or the things we keep doing even though we say to want to stop.

Over the past year, I quit drinking, overhauled my food intake, got in shape and got my mental house in order. In the process I lost 30 pounds, dropped to 13% body fat, developed an unbreakable gym routine, relaunched our fund and kicked off countless (mostly bad) business ideas. I changed how (and with whom) I spend my time. It is not an exaggeration to say I am a different person.

None of these achievements was intentional. I didn’t set out with a master plan or even a small plan. I didn’t download a magic app or read a diet book.

In each case, I found a small habit that conflicted with my view of how I wanted things to be in some measure of future time and replaced it with something else. I repeated that multiple times and quickly the habit changes compounded.

At that point, I had not yet read The Power of Habit so I didn’t realize that what I was doing was a scientifically superior path to creating lasting changes. I just knew that by removing one habit without a replacement for the chemical releases it causes for my brain, there would be a void and I would fail.

Why haven’t I fallen off the wagon? Indifference.

I am indifferent to alcohol, junk food, toxic people, status comparisons and so many things that a year ago I was addicted to.

We are not programmed to want things that are bad for us. We do not specifically need Jack In The Box. We don’t need negative people. We don’t need alcohol. We need the dopamine and serotonin releases from the deliciousness of a Meaty Breakfast Burrito. We need the releases brought by social validation.

When you consciously know what you want your world to look like you can spot the habits that conflict with that world view. In those moments of lucidity, you know what to eliminate but have no idea how to do go about tackling it. It’s at this point that some of us jump on fad diet plans or “vacations” from the habit.

The problem with that approach is that science proves you can’t simply eliminate those habits en masse overnight. You can stop yourself from drinking that extra glass of wine but you can’t stop your brain from wanting the chemical releases it triggers.

To develop indifference you have to make the bad habit obsolete. Think of a habit like an iPhone. A new iPhone and an old iPhone do mostly the same things. They are 99% identical. But the 1% of things the new iPhone does is exciting. If someone bought you a new iPhone you would look at the two side by side and choose the new one.

Want to get in shape? Create an unwinnable situation for your brain. Set an early morning appointment at the gym with a trainer or a friend. After a few weeks you’ll find the early mornings after an extra glass of wine or a late night in front of the computer make you groggy.

You’ll be miserable at the gym. You’ll want to go to bed earlier. And that glass of wine doesn’t make the mornings any easier. Your brain, high on dopamine releases from the gym, isn’t starved. And before you know it, the bad habits disappear and as a bonus you developed a daily exercise routine.

Want to drop junk food and eat more vegetables? Start eating tons of vegetables. Or as I do, drink them. Fill up. Your brain will be flush with nutrients it loves and the brain chemicals will flow. But you’ll find there simply aren’t enough hours in the day and space in your stomach to eat the crap and the vegetables. You’ll have created an unwinnable conflict, giving your lucid brain the chance to make the logical decision, vegetables win.

These are trivial examples. True indifference is more personal. No matter the subject, the science is the same.

Our monkey brains don’t discriminate between available sources of dopamine and serotonin release. They will do everything possible to get the chemical releases from wherever they can get it, good or bad.

To drop bad habits we must add good ones first. There’s only so much room in the car. Once it’s full, something has to go. And the choice is easy.

And that is how we develop indifference.

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Cheeseburgers, AI and Habits – Weekly Roundup

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I’ve had an intense week thanks to a scheduling snaffoo that essentially booked a meeting every hour, on the hour, several days this week. So my writing has been sporadic as has my reading. But where I’ve found the time I’ve devoted it to deeper topics. Here are some of my highlights of the week.

Books

I finished reading The Power of Habit. I can’t recommend this book more. Since I listen to audiobooks now more than I read with my eyes, I don’t have the same voluminous highlights as I did when reading Kindle books. So when I finish I sit down and write a few notes that I want to remember from the book. Here are my notes from The Power of Habit.

This week I’m reading Fooled by Randomness. I can’t stop thinking about a character called Nero, a stock trader who chose a less glamorous (and less profitable) path in his career. And is generally happy with it. So far this book is a winner. Check out this passage:

Why isn’t Nero more affluent? Because of his trading style–or perhaps his personality. His risk aversion is extreme. Nero’s objective is not to maximize his profits, so much as it is to avoid having this entertaining machine called trading taken away from him. Blowing up would mean returning to the tedium of the university or the nontrading life. Every time his risks increase, he conjures up the image of the quiet hallway at the university, the long mornings at his desk spent in revising a paper, kept awake by bad coffee. No, he does not want to have to face the solemn university library where he was bored to tears. “I am shooting for longevity,” he is wont to say.

(more…)

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The thing about service

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A few weeks ago I bought something from a startup. The company is two years old but thanks to a big bump in exposure was surely seeing an unexpected surge in orders.

The website noted that the product would ship around the 25th of February. Checkout, handled by Stripe, didn’t include many details and neither did the order confirmation. This was fine.

By February 29th, nothing had come. The website said would respond to customer emails within 30 minutes. So I emailed the company asking for an update. About 24 hours later I received a response.

The response was poorly written and the agent pasted the current expected ship time from today’s website to explain why my product purchased a month ago had not shipped.

I replied explaining that I bought it a month ago and expected it to ship in February and just wanted an update so I could plan. About 24 hours later I heard back. Nothing would ship until late April unless I wanted to change my order to a totally different product but the agent’s explanation of the options was poorly written and hard to follow.

I still haven’t decided what I want to do. And in the process of explaining why the item is delayed to two friends, I’ve somewhat unintentionally shared negative reviews of the company.

Something similar happened a few months ago with one of our portfolio companies that normally ships within 24 hours. A week passed and nothing arrived. The products are the kind for which there are dozens of alternative sources, one of them is Amazon.

When I emailed to ask about my order I got no response instead receiving a mass email the next day noting general delays and including a coupon for future use. I still didn’t know when my order was shipping. When I inquired to cancel my order I was told I couldn’t and then, magically, the order appeared that day. I received a shipping confirmation two days later.

This company didn’t break a promise. They offer no guarantees around the speed of shipping. But my dozen previous orders shipping same or next day. So while there was no explicit promise, the company’s past actions created an expectation. An expectation, given no explicit information to contrary during checkout, is the same to a customer as a promise.

Neither of these experiences is surprising. Commerce is hard and things break. It’s normal.

What’s not ok, no matter how young your company, is delivering bad service. We live in a world that expects immediate responses. Customers are increasingly less tolerant of delays. You can thank Amazon for that expectation.

When delays happen we expect information. Humans seek clarity and, in its absence, do irrational things. Humans also have a bias towards avoiding uncomfortable realities. So when we’ve acquired the customer and failed to deliver, we hope that if we just focus on getting the order out, that will solve everything. That thinking is flawed.

When you break a customer promise you start a clock. Every minute that passes is a minute the customer could be and likely is sharing her negative experience with friends. Bad news is more conversation-worthy than good news, unfortunately. And so while the customer may share her frustration with ten friends, she won’t call all of them back later and tell them she received her product and loves it.

If you can’t deliver the primary thing the customer wants: what she ordered. Then you deliver the next best thing: information about when the customer will receive what she ordered. If you can’t deliver that, you deliver acknowledgment that a problem exists and a timeline for when you will have a certain date of delivery. If you can’t deliver that, you deliver a timeline for when you will next send an update the customer.

Make no mistake, a missed customer promise is a crisis. Your goal in a crisis is to minimize uncertainty. People do crazy things when they are uncertain. They cancel orders, they write insanely negative reviews, they tell their friends.Conventional wisdom says that business can be the best at price, quality or service, and only one. Unfortunately, in today’s commerce environment while you might not be able to deliver incredible service, you can’t get away with delivering bad service.

Conventional wisdom says that a business can be the best at price, quality or service, and only one. Unfortunately, in today’s commerce environment while you might not be able to deliver incredible service, you can’t get away with delivering bad service.

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Lowest Common Denominators

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What do you do if you have a nagging problem you simply can’t figure out how to solve? You try a new approach. You rinse, repeat and try again.

Imagine standing at the bottom of a hill with a wheelbarrow full of rocks. You need to get the rocks to the top. And no matter how many paths you follow the rocks always spill on the way up the hill. You regroup, map a different path and try again. You bring in a few extra hands to help push the wheelbarrow but no matter what, you can’t get it up the hill.

Problems are simple. Every problem has a single identifiable solution. There is an optimal path for the wheelbarrow to follow. Your job is to uncover it.

So what do you do when, despite repeated efforts, you haven’t been able to find it?

Most of us have bias towards believing that since we are closest to the problem and the data we need to solve it, then we must know the path to the answer. We believe we haven’t found the answer yet because we’re too busy. So we bring in help, define the problem and explain how we want to solve it. We are the closest to the problem after all, we’ve made the most trips up the path with the wheelbarrow.

Sometimes this approach works. But often it fails because we’ve failed to realize there is a second reason why we’re not finding the answer. Us.

Organizations have a tendency to prescribe solutions to problems assuming that the problem is bandwidth, not an erroneous perspective. Having tried multiple times we fail to see that of all the elements involved in each past attempt, the lowest common denominator us and the solutions we’ve explored.

We fail to see that the problem isn’t actually getting the wheelbarrow up the hill, it’s getting the rocks up the hill. We’re so close to the problem we’ve failed to see an alternative solution…carrying the rocks ourselves. We’ve hired people to push the wheelbarrow and, having failed, our resolve to get the wheelbarrow up the hill only grows. We drift away from the original problem unknowingly. We focus on being right.

We are the lowest common denominator in every past attempt. We’ve developed a defensive bias. We don’t realize that instead of focusing on solving the core problem, we’ve started focusing on solving our solution.

We hire smarter help. We bring in architects and engineers. We tell them to get this wheelbarrow up the hill. And when one of them challenges us to consider carrying the rocks in backpacks, we scoff. They clearly don’t understand the problem.

Smart leaders understand defensive biases. Great leaders are self-aware. They know that despite their strong belief that getting the wheelbarrow up the hill is a potential solution, they need to be open to alternative views.

But egos are strong. Great leaders side step them. They focus on deltas. When faced with an alternative solution, carrying the rocks in backpacks, the great leader asks “what’s the difference in organizational cost to try both?” And when the delta is within an acceptable margin, the great leader tries both.

If you haven’t been able to solve a problem and you bring in additional resources, you have two choices: execute your solution with the additional resources or try a new solution. The latter takes guts requiring you to admit, at least to yourself, your solution was the wrong solution to the problem.

One requires a deep desire for a solution to the problem, a bias towards prioritizing the organization’s mission over your own. The other suffers from defensive bias…you don’t want to be wrong.

One of my greatest life lessons was learning, in every situation I’m involved in, I am an identifiable lowest common denominator. So when something isn’t working it’s logical, in fact it’s necessary to look at myself and my view as one potential hindrance to finding a solution.

And when others are involved who may themselves be unknowingly focused on being right, the most effective tool to get past these biases is asking a simple question: if the delta between trying both and trying one is low, what’s the harm in doing both?

You can keep trying to push the wheelbarrow up the hill. You can simultaneously send one person up the same hill with a bag of rocks and see what happens.

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This post originally appeared at Zach Ware's Notebook.

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Traveling

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Yesterday I hung out with my good friend Lorenzo at Geekdom / 80/20 Foundation in San Antonio. As always it was a ton of fun and inspiring to see the growing energy in San Antonio.

I’ve been coming to San Antonio for various reasons since the mid-2000s. It’s a vibrant, creative city which, like Las Vegas, is often overlooked. It shouldn’t be.

Travel has a way of helping me put my world into perspective in surprising ways. Breaking out of my daily bubble has a surprising way of making me see the world through a different lens.

The biggest breakthroughs in how I see my life and my work have come to me while traveling. When I think about times I’ve had the clearest thinking, when I’ve broken through the biggest mental walls, they have always been when I was somewhere besides home.

I’m not talking about great negotiating successes or big “wins” that come from intentional travel around specific meetings or events. I’m talking about accidental mental breakthroughs completely unrelated to the reason that made me travel in the first place. The team at SHIFT knew that if I was gone for 4+ days there was a good chance I would come back with a completely wild and deeply formed idea.

A few months ago I decided to make a point to travel somewhere “fun” at least once a month. I consider “fun” to be less of a driver in place selection but rather a driver in selecting the longevity of the trip. This month’s it’s Austin & San Antonio, March is St. Louis, April is New Orleans, May is likely going to be New York.

I’ve been to all of those places before, a lot. I’ve done tremendous amounts of work in all three and I’ll be doing some work this time.

But the fun mindset gave me a mental openness to reach out to people I know and those I don’t with casual intent. The trips last a few days and have no specific agenda. The trips allow me to explore cities in ways an intentional trip for a specific meeting wouldn’t. I have meetings, I eat great food, I visit gyms, I sit by fires.

When someone asks if I’m traveling for work or fun I don’t know how to respond. I generally don’t see the world binary terms and travel is no exception.

Some place selections are in reaction to asks from our portfolio or people I know. But instead of assessing whether a meeting is worth the hassle of travel I see the opportunity as a prompt to consider a “fun” trip whose measure of value isn’t determined by the outcome of the meeting.

Considering the geographic spread of our portfolio and of the relationships my past work built, I can visit a lot of places with familiar faces. So that’s what I’m doing.

Thanks to Airbnb I generally stay in places more like home than a hotel. The power of location cannot be overstated.

I’m sure as the year unfolds I’ll visit new places, perhaps some internationally. But it’s most likely that I’ll stick to the US for my monthly “fun” trips. They are mentally easy to schedule and the cities are just familiar enough to not cause mental overload.

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This post originally appeared at Zach Ware's Notebook.

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We vs They

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Consultants have a habit of saying “we” when talking about company strategy. They co-opt themselves onto your team and make suggests like “we should target that market” or “our revenues are looking good.”

The word choice is part of a deliberate strategy to create a warm, fuzzy feeling in an otherwise transactional relationship.

I have the opposite view. It’s creepy. I notice it every time a consultant does it and it makes me feel weird.

Recently I’ve observed some investors doing it when describing big company successes for companies they are involved in, often in blog posts. We raised a big round. We launched a killer feature.

100% of my focus as an investor is on helping our portfolio companies succeed. Sometimes I help raise a round. Sometimes I help solve problems. Sometimes I work on product design.

But when most great deeds are done, the great work was the output of the great team. They did it. I’m proud of them.

Sometimes I say we when we actually did the work. There are times when I get to be a part of a problem-solving team. And in those cases and with those specific accomplishments, I’ve earned the right to say we. Maybe the investors I’m thinking of did as well.

Most of the time, even if I’m a company director, I’m a bit player. I didn’t make magic happen. I helped. They should be congratulated.

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This post originally appeared at Zach Ware's Notebook.

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