One of my favorite Bezo-isms is “Disagree and Commit.” I’ve seen it in articles a handful of times recently as the adulation around Amazon and Bezos’ management reaches a fever pitch.
Notwithstanding the disappointing forecast for Q418, Amazon’s recent operating performance has been spectacular. But, more interesting is that it has been “spectacular at scale” and across a very large and complex business.
While Revenue Growth YOY has been strong,
the real story has been YOY growth in Operating Income.
Those are beautiful numbers. It’s clear that in the past few years the company has turned on the profit machine.
For many years, Amazon (and Bezos) trumpeted their focus on revenue growth. The mantra was “we are reinvesting all of our profits in growth.” This is the same thing most startups say (and most VCs push for) as growth compounds rapidly if you can keep the growth percentage (yup – it’s simple math.) This has been particularly true for B2B SaaS companies, not withstanding the notion of the Rule of 40 for a Healthy SaaS Company.
While growth in revenue is still important, Amazon’s ability to generate this kind of growth on its operating income is a reminder that turning on the profit switch at some point does matter, if only to show how much leverage your operating model has (me thinks Tesla did that in Q318 for the same reason). The AWS numbers are remarkable to me – their YOY growth is 46% and their operating income is about 30%. That’s well above the rule of 40.
I would have loved to be in the meetings during the shift from “grow at all costs” to “keep growing fast, but flip the operating income switch.” There were many moments in time over the past 15+ years where I’m sure this came up. But clearly the focus on this changed in the last few years, and the results are now front and center.
I don’t hold any Amazon stock directly, nor do I play the stock market, but the financials in public companies have a myriad of lessons buried in them for private companies that are scaling. That said, the management lessons buried underneath the numbers are even more important. “Disagree and commit” seems to be working well these days for Amazon.
Amy and I are proud executive producers of the upcoming movie Pioneer In Skirts. It has been part of our activity supporting independent documentaries about gender diversity, especially in science and tech.
The daughter/mother leadership of Ashley Maria and Lea-Ann Berst along with their team has stayed after it and are close to the finish line. Watch the trailer and then if you are inclined toss a little money into the GoFund Me campaign to help finish off the film.
Pioneers in Skirts Sizzle Trailer from Pioneers in Skirts ® on Vimeo.
Amy and I love to read. Growing up, one of my favorite places in the world was the hammock in our backyard with a book. As an adult, one of my favorite places is our living room, on my couch, with Amy on her couch, and the dogs laying on the floor between us, while we read.
I also love DonorsChoose. Whenever I’ve had a crummy day, I often go online and fund a project or two.
Today, DonorsChoose has a match across the entire site for any donations for books. It’s DonorsChoose Book Match Day. How cool is that?
Amy grew up in Alaska and we have a house there so I just went and funded all the book projects in Alaska. Hopefully, by the time you read this post, there won’t be any left.
If you are a reader, love books, or want to help kids around the US read more, I encourage you to go fund a project (or a few) on DonorsChoose today. Search for the city you live or grew up in and have at it. It feels good and helps the next generation of readers.
I had a lot of fun at the Silicon Flatirons #GiveFirst conference last week and the smaller academic colloquium session the next day. It was a challenging topic, as we are simply exploring the idea of GiveFirst, how it works, and putting some scaffolding on the overall concept, both practically and intellectually.
Brad Bernthal, who spearheaded the two-day effort, led off with a short overview. Scott Peppet then interviewed me and Sam Zell as a kickoff to the event.
My fireside chat with Sam Zell starts at 14:00. While we come at things with different styles and experiences, when I watched it again to reflect on it, I found some really interesting overlaps and new ideas that hadn’t occurred to me.
If GiveFirst is a construct that is interesting to you, I encourage you to spend some time soaking in this video. When my book about it comes out in 2019, I think I’ll be able to point back to this as the first real public discussion of the idea.
It’s 2018. I’m still an incredibly heavy email user. It’s the primary tool in my workflow and has been since the early 1990s. I’ve tried a lot of different things over the years, but always come back to email.
I’ve been a Gmail user for almost a decade. While I’ve tried client-side apps, Gmail in Chrome has been the only thing that has stuck for me. I’ve also tried many of the iOS email apps and always end up back at Gmail for iOS.
Until now.
An increasing number of people in my world have been using Superhuman so I decided to give it a try. I was skeptical that it would capture my attention beyond a day. Two weeks later it is, in fact, superhuman. I’m using the Chrome app and the iOS app as my primary email clients.
The other tools I have in my email workflow are SaneBox, Todoist, Notebene (which recently replaced Captio), and FullContact. As a result of Superhuman, I eliminated TextExpander from the mix. The one limitation of Superhuman that causes me a little pain is lack of direct integration with FullContact, which would make managing my address book better.
I didn’t realize how sluggish Gmail on Chrome is, even on a 225Mbps connection (which is what my office is clocking in at this morning.) And, at home, where I often see 3Mbps at high peak usage times, it’s a dream. But, that’s a tiny part of the speed. The big change is that I keep my hands on the keyboard 100% of the time. While I’ve been a heavy Gmail keyboard user, it turns out that you need the mouse for a bunch of Gmail things. Superhuman has turned them all into either keyboard commands, a slightly different workflow, or a “snippet” that lets you create your own compound shortcuts.
I never thought I’d recommend a web-based email client that costs $30 / month, but Superhuman is worth every penny of it. I wish I was an investor, but I guess I’ll live with being a Superhuman user.
I was really tired this weekend (from the week) and didn’t feel like doing anything other than laying on the couch near Amy and reading. She was also tired, as she spent the week in Wellesley at a board meeting and a bunch of other Wellesley related stuff, so even though the Boulder weather was magnificent, we stayed home other than a quick trip to Boulder to get our eyes checked and have sushi with some friends. Oh, and took really long naps both afternoons.
By Sunday night I was tired of reading (but Amy wasn’t) so I went downstairs and watched Finding Traction, the documentary about Nikki Kimball’s monstrous performance on the 273 mile Long Trail in Vermont. While I’m limited to running marathons, I find inspiration from watching ultras …
The book list started with me finishing a book I’d started earlier in the week. I read mostly on the Kindle this weekend, but John Doerr’s book came in the mail in physical form so I read it that way.
Mastering the Market Cycle: Getting the Odds on Your Side: Howard Marks (Oaktree) is a brilliant investor (and great writer) so I read everything by him I can get my hands on (and there’s a lot of it going back to 1990.) Not surprisingly, I learned a few key things from this book and it reinforced a bunch of others I already knew.
Power to the Startup People: How To Grow Your Startup Career When You’re Not The Founder: There is an infinite number of books now aimed at startup founders and entrepreneurs, but very few aimed at startup employees. Sarah Brown is a Boulder friend (now living in SF) and this is a really good book. There are lots of Boulder stories and people in it, but Sarah does a great job of covering a lot of ground that is generally useful to anyone considering working in, or already working in a startup. It’s the second “startup employee” book that I think is really good, following Jeff Bussgang’s Entering StartUpLand: An Essential Guide to Finding the Right Job (which is referenced a few times in Sarah’s book.)
Year of Yes: How to Dance It Out, Stand In the Sun and Be Your Own Person: In my effort to read more memoirs by women, I enjoyed Shonda Rimes book. I can’t remember who referred it to me, but it was good and added a dimension to my memoir reading that had a lot more X and no Y in it. Amy and I regularly watched both Grey’s Anatomy (at least the first four seasons) and Scandal (again – maybe four seasons) so Shonda Rimes has entertained us a lot. With this book, she helped widen my perspective on a number of things I hadn’t thought much about.
From Like to Love: Inspiring Emotional Commitment from Employees and Customers: Keith Alper is a long-time friend – we were both on the YEO board in the mid-1990s, spent a lot of time with the Kauffman Foundation when Jana Matthews was there, and have continued to connect on numerous things over the years. This book embodies everything I’d expect from Keith, is a good read and had some fun new suggestions in it. Definitely worth reading if you are a CEO and you like the word “love” in a business context. And, if the word “love” in a business context scares you, then this book is also for you.
Measure What Matters: OKRs: The Simple Idea that Drives 10x Growth: John Doerr is well-known as a long-time advocate of OKRs. Today, I hear the word OKR in a lot of contexts where I’m 100% certain the company is implementing them incorrectly. If you are using OKRs, please read this book. And, if you are thinking about OKRs, please read this book.
Ready for Monday? I’m going to start things off with a short run.
I got an email this morning from a close friend who asked how I reconcile a particular issue around the concept of #GiveFirst. Following is the setup from the email I got.
“I was thinking of you yesterday. I recently met with someone in town who was looking to connect. I took the meeting because, well, I always take such meetings. I’m just wired that way and you never know what good things can come from such random meetings.
So I love doing them. But yesterday the person I met with showed up with an agenda and, at the top of his list was “GiveFirst to <my organization> and <me>.” He had an agenda…he had an ask of me…but he wanted to “give first” by asking me how he could help me.
I think he misunderstands the mindset. And I think he’s not the only one. By opening up with that, he put me in a position of having to do something–respond to his inquiry–I didn’t really have any need to do.
Moreover, he inadvertently put me in debt to him from the beginning. “Before we begin, let me ask you, ‘How can I help you?’ ” While I don’t really have a lot of asks it still felt yucky, insincere, and manipulative.”
This is a chronic problem with understanding how to implement #GiveFirst. While well-intentioned, it shifts the burden of responsibility from the #GiveFirster to the Receiver. Ponder that for a second.
Here’s an example from my personal life. Amy and I do a lot of things for each other, all the time. But, imagine a situation where she’s overwhelmed, or tired, or in distress from something. If I show up at that moment and say, “How can I help,” I’m adding another thing for her to do to the mix. She is now responsible for figuring out what I can do to help her. If she knew this, she probably would have already asked me. Instead of helping, I’m merely adding another log to whatever fire is already burning.
Instead of asking someone how you can #GiveFirst to them or their company, you should take the opposite approach. Do your research before you meet. Understand what their (or their organizations goals) are. In a lot of cases, you can often figure out a short-term need that they have. Then, when you meet, have a prepared mind for the conversation and listen to where it goes. In real-time, ofter to do something that fits with what you are hearing, or what you expect the goals or short-term needs are.
This doesn’t have to be an explicit part of the conversation (e.g. “I’m going to #GiveFirst to you by doing the following.”) Instead; it needs to be completely non-transaction – you are not doing something to earn anything, including brownie points. You are, instead, operating in a #GiveFirst framework, where you are willing to put energy into something without expecting anything in return. Ideally, you’ll just go #GiveFirst and do some stuff that is helpful to the other party. Not once, but as part of establishing and developing a deeper relationship that comes from a non-transaction perspective.
It’s easy to fall into the trap of mechanizing the #GiveFirst philosophy. It’s explicitly called #GiveFirst and not #TellMeWhatICanDoToHelpYou to stimulate you – the giver – to do the work to figure out what is helpful.
Every year or two I refresh the formatting on this website along with a few others that I help manage and generate content for. I work with a great firm called Valet that I really like and everything is hosted on Pantheon, so the process works smoothly for me.
In addition to the refresh on Feld Thoughts, I also just refreshed Venture Deals (which used to be Ask the VC) and Startup Revolution. Amy and I also recently put up a website for the Anchor Point Foundation (our foundation). And, Seth and Micah did a big refresh on the Foundry Group website.
As part of this, each of them now has a separate subscribe by email option in addition to an RSS feed. If you want to skip searching for it and just subscribe, click on the following links as you desire.
I’m still cleaning up a lot of little stuff now that it’s all live (e.g. I know the favicon for Venture Deals shouldn’t be my face), so if you see something that is either broken, wrong, or that you don’t like, toss it in the comments or email me. And, of course, general feedback on things that could be better are very welcome.
Fantasyland: How America Went Haywire: A 500-Year History was awesome. Given that Sears filed for Chapter 11 today, I’ll start with some perspective from 1976.
America is remarkably dynamic. Humans constantly create narratives about things and how they work. Suddenly, popular books are appearing, such as Sapiens: A Brief History of Humankind, that challenge the relevance of our narratives.
There is so much to reflect on when reading a book like Fantasyland or Sapiens. Pondering the meaning of life is an endless human pastime.
It’s particularly interesting in the context of the growth and development of a country, which in and of itself is a temporary construct, just like everything else.
I’ve always loved reading fantasy. And, after reading Fantasyland, I realize I’ve been living in it also.