Author: Peter Cauton

Entrepreneur, startup advocate, writer, speaker, and HR guy. Husband, father to 6, worship leader, unabashed follow of Christ

JUAN GREAT MEET 2: POUNCING RELENTLESSLY ON OPPORTUNITY

Peter Cauton

WHAT:        JUAN GREAT MEET 2: Pouncing Relentlessly on Opportunity

WHEN:        7:00pm, WEDNESDAY, JULY 4, 2012

WHERE:     Function Room 1, 28th floor Union Bank Plaza, Meralco Avenue, Pasig City

After the success of the first Juan Great Meet, I’ve been very eager to continue doing events like this.

I’ve decided to make it a series where we would invite different entrepreneurs to give talks on their startup journeys, and then a question-and-answer portion. Then, like what worked so well before, we can have small group sharing/networking.

The difference this time is that I would need to be charging for the event (or my wife will strangle me) to cover some expenses. Just P500 though, and will already include the usual entrepreneur staple: Pizza.

The next entrepreneur talk is pretty exciting and I’m sure will be a tremendous learning opportunity.

Howard Go is the co-founder of Mochibits, Inc., an ultra-lean startup which has been creating money-making games on the Apple and Android App Stores for the past two years. Their most successful apps (SWIPETAPTAP, WORD TO WORD, and WORD STACK) have each been featured at one point by either Apple’s App Store or Amazon’s App Store.

Howard will talk all about his startup journey, which includes his own escape from the corporate jungle, putting up and closing down different businesses, and ultimately entering and thriving in the app development world.

I do know one thing: his pointers on what not to do and what to do when releasing an app is worth the price of ten admissions!

So if you are interested in:

– learning how to put up a lean tech startup, or

– how to create an app factory, or

– how to monetize apps, or

– hear an example of how someone jumped from the corporate life to form his startups,

…then reserve a slot now (limited to 50 slots) !

To reserve a slot, please deposit P500 to this BPI account:

BPI ACCOUNT: 3300-2024-53

And then you can either email me a copy of the deposit slip picture at pcauton@yahoo.com, or fax it at 02-5769358 (request for faxtone).

(UPDATE: Yes, you can pay at the event itself. Just reserve your slot by sending me an email at pcauton@yahoo.com. I trust you, please don’t flake!)

Seeya!

5 Things They Don’t Tell You When You Make THE LEAP

Peter Cauton

I thought it was over, but we managed to overcome so much adversity. In the end, it was soooo much worth it!”

Of course, we keep on hearing this about those who’ve taken the great leap from corporate to entrepreneur, right? The insane difficulty and the inevitable phoenix-like rise to the top.

But what exactly makes it difficult? What are the exact changes felt?

I’d like to highlight some of the things I felt and observed when I made my own leap, almost exactly 3 years ago today:

1) I WAS DOUBTING PETER

From ten years of structured work with a boss, I suddenly now called ALL the shots. I went from doing final interviews and creating performance management systems as an HR Manager to suddenly deciding what to build, who to market to, how to handle finances, and how exactly to spend my time.  There was nothing in corporate that could’ve prepared me for it.

I remember smiling and facing the STORM team to tell them I was going to be fulltime: about how excited I was and we’d get to do all sorts of things. While I was confident and optimistic, I was at the same time wracked with doubt.

What if I’m wrong?

In retrospect, having a team to lead also helped a lot: you’re forced to live up to the confidence you WANT to exude around them.

After some time, did end up getting used to it, largely because no matter what happens, you realize you don’t get fired.

Now, there is still doubt, with the difference being the knowledge that doubt really comes with the territory of doing new things. So the focus becomes – let’s do this fast, so if it doesn’t work, we learn and adjust fast as well.

2) THERE’S NO SUCH THING AS A SALARY

The whole point of a salary revolves around its consistency – every two weeks you get it, and what you get is exactly the same month after month.

If that’s what a salary is, then sorry, but you don’t get that.

I thought I gave myself a salary when I started fulltime for STORM, but it turns out, what I gave myself was an upper limit:  I would usually get something lower, and what I would get would vary each time.

Why? Simply because startups struggle in their first years, if not altogether folding.

It was the time when I understood when A/R was really all about. Sometimes, clients just don’t pay on time – and it could be for inane reasons (like “the accountant is absent” or “the check is in the drawer and the person with the key is on VL”). Of course, they don’t really know (or care) that you’ve been banking on that check for everything.

Gosh, I hate receivables.

 

3) YOU NEED YOUR SPOUSE TO BE THERE FOR YOU

So in essence I told my wife, who just gave birth to our firstborn, that I was going to take an 85% pay cut to pursue my dream during the recession.

She had EVERY RIGHT to say something like:

“WTH?! Did you hit your head somewhere? Think about your son! Wait a bit first until the firm is more stable to give you higher pay”

And you know what? Thinking about it now, if she told me that, I probably would not have taken my leap when I did. And not doing so at that time would have killed STORM.

She continued to believe in me during the times relatives doubted my choice, or when there were more bad news, or when we had to tighten our belts.

My wife had faith in me.

And that made all the difference.

4) YOU WILL NEED TO FIRE FRIENDS

As a former HR leader, it was usual for me to fire people. That doesn’t mean it would be any easier in my own firms. In fact, it’s harder, because in a smaller team, I worked directly with everyone. They’re friends.

There will be hiring mistakes though. I think one big weakness we have had in STORM is that Pao and I have cream puffs for hearts, so we delay and delay.

Indecision like this can kill startups, because it isn’t built to carry deadweight like larger firms can. You just need to realize any delay isn’t doing anyone a favor and just do it.

5) IT’S TOUGH TO LEARN FROM MISTAKES

The cliché is true – mistakes will be where you will learn from the most. What they don’t say is how difficult this is to go through. In a lot of times, the lesson gets ingrained in you precisely because the bitter pill was tough to swallow.

In a startup, a mistake can make you miss a pay period. A bad hire can lead to extreme frustration. It can mean the loss of an important client. A series of mistakes can lead to further self-doubt and paralysis.

But this is something you have to learn to deal with and embrace, because it WILL happen. I do think these battle scars are precisely what makes an entrepreneur a true entrepreneur.

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Launching the Juan Great Leap Startup Lab!

Peter Cauton

Wheels are churning.

Over the last few years, I’ve built three successful firms with the help of some really amazing   people:

1. STORM Consulting

2. Searchlight International

3. Stream Engine Studios

It was then that I realized something – what I really wanted to do was to help people build startups! And so over the last few months, I’ve tried to crank out a system which could help me: a) manage all the existing startups, b) build a value-multiplying ecosystem, and c) create even more startups with more people!

(It was an idea I initially called Bizkitchen, but the more I thought of it, the more I realized it made more sense to do it under the Juan Great Leap platform)

The system’s wheels are slowly churning: we are set to release around 2-3 more exciting startup concepts in 2012, with several more in deep incubation.

We plan to release 4-6 startup concepts every year from hereon.

How is this lab different from Startup Accelerators like Startup Weekend or programs like Smart’s Ideaspace or Globe’s Kickstart program?

Well, for starters, you can’t “join” this lab. It isn’t event-based. We create startups in a more grassroots manner. We seek ideas and people out, then if an idea captures our imagination – we try to quickly build a company from scratch: from picking the right founders, to testing the idea using lean startup methodologies, to releasing MVP’s, and ultimately launching. The approach is very organic.

Another very different mindset we have is the inclination towards the bootstrapped approach. One trend we see now is the immediate tendency for entrepreneurs to approach investors, usually sacrificing equity, control, and freedom.

Sometimes, funding is exactly what a business needs to start. Sometimes though, it just isn’t. You CAN bootstrap and be profitable (take a look at this). You can retain equity and control and love what you’re doing. It should always be the first option. At the very least, you can create traction, which in turn, creates a whole lot more bargaining power for you at the investor’s negotiation table.

So wait, if I have an idea for a startup, can this incubator help me? 

Yep. And you don’t need to join any event, or do a pitch, or submit a business plan. All you need to do is to email me at pcauton@yahoo.com and request a coffetalk with me.

We can help you:

refine the idea

outline a plan of attack

set you up with co-founders (if you need)

manage your back-end functions: admin, HR, accounting, etc…

recruit your first, critical employees

set-up your first office within our premises or outside

share contacts and resources with ALL the member startups

source your funding

create a calendar of transition from part-time to fulltime in the startup

test your ideas using lean startup methodology

So what are you waiting for? Take one great leap! 

We’ll help you piece your unique startup puzzle together

How we are ALL in danger of doing the dodo – and what to do about it

Peter Cauton
Uhm…no offense dodo, but you even looked the part!

Unfortunately for the species, the dodo remains synonymous for concepts or objects which have become obsolete due to failure to evolve.

When I graduated in 1997, the following industries were kings of the the roost. They are now dead or are shadows of their former selves – all in just 15 years.

Record Stores – remember shops like Odyssey and Music One?

Today, everything in this room can fit in the phone in my pocket

Newspapers – My dad used to get 3 newspapers for the house daily. And that Sunday Manila Bulletin edition was thicker than the Bible.  Now? My dad goes online for his news. Manila Bulletin is now as thick as a comic book.

Video and Game Rentals – ACA Video anyone?

Landlines – I’m not really sure why we got a landline for our house. I think it was because of the bundled package with the internet. It NEVER rings anymore.

Point and Shoot Cameras (not SLR’s) – the lining was on the wall when the smartphone camera specs started getting better and better. Then the iPhone 4-S came out and was essentially the straw which broke the camel’s back.

Photo Developing Shops – These shops seemed to be in every other commercial block at one point. Now you hardly see one.

Encyclopedias – Remember Collier’s, World Book, and Britannica?

These are some of the industries which I think would be in quick decline from hereon:

The PC – Have you seen how cheap laptops now are? It’s also worth noting that the Macs, while still selling well, are now Apple’s lowest-selling machines next to phones and tablets.

Book Publishing – Did you know you can now self-publish in Amazon? (and according to a lot of authors, make MORE money)

Brick and Mortar Bookstores – I used to think, “There would always be a need for a book! It’s a different feeling to turn actual pages.” Then I got an iPad and was introduced to ebooks and Amazon online. From buying a book almost every month just 2 years ago, I haven’t bought a physical book ever since.

(What do you think is on the verge? Hit the comments!)

It’s not surprising that we see industries come and go. What is staggering to observe is the rate of human adoption – and therefore, disruption. How much time did it take for books to gain prominence? Hundreds of years. What about newspapers? Landlines? Record shops? Cameras? The PC? Decades.

Now? You can change the world (and make something obsolete) in months, or even weeks. Just visit the likes of techcrunch and mashable to find proof.

What does this mean?

No one’s job is safe. 

Nowadays, it’s dangerous to become a one-trick pony. (Hello, cobol programmers) You have to be a lifelong learner.

Nowadays, you have to become an expert in becoming an expert. You have to do it fast, too.

Nowadays, you have to deal with the ambiguity that comes when technology disrupts markets every other week.

Flexibility, learning fast, and managing ambiguity?

Sounds awfully like what an entrepreneur does.

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10,000-Hours to Entrepreneurial Greatness

Peter Cauton

In his delightful book, Outliers, Malcolm Gladwell states that for someone to be “great” at something, he should have spent at least 10,000 hours honing and perfecting this skill.

The famous 10,000-Hour Rule

He cites The Beatles and Bill Gates as examples.

The Beatles performed live in Hamburg, Germany over 1,200 times from 1960 to 1964, amassing more than 10,000 hours of playing time, therefore meeting the 10,000-Hour Rule. They used all that time to hone and perfect their music. According to Beatles biographer Philip Norman, by the time they got back to England from Germany, “they sounded like no one else. It was the making of them.”

Gates met the 10,000-Hour Rule when he gained access to a high school computer in 1968 at the age of 13, and spent 10,000 hours programming on it.

In Outliers, Gladwell interviews Gates, who says that unique access to a computer at a time when they were not commonplace helped him succeed. Without that access, Gladwell states that Gates would still be “a highly intelligent, driven, charming person and a successful professional,” but that he might not be worth US$50 billion.

Gladwell explains that reaching the 10,000-Hour Rule, which he considers the key to success in any field, is simply a matter of practicing a specific task that can be accomplished with 20 hours of work a week for 10 years. He also notes that he himself took exactly 10 years to meet the 10,000-Hour Rule, during his brief tenure at The American Spectator and his more recent job at Washington Post.

Now, let’s apply this to entrepreneurship.

Think about the great entrepreneurs you know. What do people like Henry Sy and John Gokongwei have in common? They began honing their entrepreneurial skills very early on – as teenagers! Imagine the skills they built early on – negotiating, sales, financial savvy, handling pressure (they didn’t eat if they didn’t earn) – all essential entrepreneurial skills. They got to 10,000 real early, cumulatively applying what they learned onto their new ventures.

Steve Jobs started as a teenager. Richard Branson started his first business, a magazine called Student, when he was 16. Investor extraordinaire Warren Buffet did odd jobs and “buy and sell” as a child. Buffet bought his first shares at the age of 11.  Jollibee’s Tony Tan Caktiong spent his teenage years helping with the family’s restaurant business in Davao he built the ice cream parlors that would later morph into Jollibee.

I could go on and on.

Gladwell makes a lot of sense. The more experience you gain as an entrepreneur, the better at it you become. I remember telling people that if there was one thing I regretted in my entrepreneurial career – it was that I could’ve started sooner. (I started at 30) I would’ve made my mistakes earlier. I would’ve applied my learnings faster.

I would be a much better entrepreneur now had I started earlier – I have absolutely no doubt about that.

Time on the job is essential. Sorry, but whatever time you spend in corporate does NOT apply.

Want to be a great entrepreneur one day?

How many hours you got? 

Related Juan Great Leap posts:

A)Getting employed- by a startup – CAN count in your 10,000 hour quest. Read more at Learn how to build a startup by joining one

B) 6 Tips for Developing a Startup Without Quitting Your Day Job – You can start your 10,000 without letting go of your security blanket first.

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The Shy-Guy’s Guide to Awesome Networking, Part 2

Peter Cauton

(This post is the second part of a two-part series. Part one can be found here.)

5. Remember, there is no template

No, you don’t need to be THIS GUY to be able to network effectively.

Like in part one, I’m starting this segment with a psychological hurdle. We often have a perception of what a networker is – someone extraverted, someone who is oftentimes the life of the party, someone with 4,839,234 friends in Facebook. A natural gift of gab certainly helps, but it doesn’t mean your destined you can’t network well if you aren’t. Some of the very best networkers I’ve come to know are mild-mannered and unassuming. This is important if we want to grow into mega-networkers: it CAN be learned and it ISN’T necessarily tied to our personality.

Like in growing any skill, however, you have to be able to practice it often.

6. Build, but also remember to maintain

It’s relatively easier to build a network versus maintaining it. Maintenance is hard work. Maintenance means keeping tabs, sending emails, grabbing lunch together, doing Skype chats and all that. How do you do this if you want to maintain say, 500, quality relationships?

Segregate.

Quick and dirty strategy: choose 50 (why 50? try googling path.com’s original strategy) relationships which you find very critical to your objectives. Be sure you have face-to-face time with them regularly. The next 100, perhaps a face-to-face meeting every 6 months or so. The rest? Email correspondence. Build up a system like this (the actions and the numbers are dictated by how much time you can free up), and remember, you can move people up or down your hierarchy.

The most basic way to maintain a business relationship? Keep promises.

They say a relationship takes a lifetime to build and a moment to ruin. Your network of “quality contacts” is a web of relationships. A single broken promise can ruin not merely a singular relationship, but your entire reputation.  Don’t let people down.

7. To sell, avoid selling

This is a very interesting irony I’ve seen happen time and time again. Most of the time, we network with people with the particular intention of selling. The thing is, most people, especially in events/occasions where the person isn’t there as a buyer, are immediately turned off the moment they sense a sales pitch coming. And the feeling is, “I’ve been had!“

SWITCH OFF that paradigm that you are there to sell. Instead, make friends. Allow your genuine interest in people to take over. Focus on building a relationship.

Once the relationship has been established and you are talking, trust me, the conversation will naturally flow into what you are peddling. The person will then buy from you if she is interested. Sometimes this process I just described can happen in one conference, or it can happen across months.

8. It’s not about you

Always remember the double-edged sword. Rather than always thinking “what can this guy do for me?” Always think,  “what can I do for this guy?” You’d be surprised at how much more helpful your contacts can be if you are proactive with helping people out.

What are some easy concrete ways you can do this? Send people articles you’d think they’d appreciate. Introduce people to one another if you think it would be mutually beneficial. Give free referrals. Be a mensch.

Dive in! What have you got to lose?

Bonus tips!

– Always have business cards in handy. Put some in your wallet and in your car.

– Blog

– If you find yourself all awkward in networking events, ask yourself, “What have I got to lose, and what have I got to  gain?”

– Contribute. Don’t be a lurker.

(No, I won’t spam you, subscribe now to Juan Great Leap!)

The Shy-Guy’s Guide to Awesome Networking, Part 1

Peter Cauton

I have always found it easy to speak before a crowd, but I’ve always been a little bit on the shy side when it comes to one-on-one meetings with strangers.

It’s funny that I never really saw the value of effective networking when I was in Human Resources. As a startup owner though, I gradually found out how extremely critical it was to network effectively. Clients, suppliers, co-startup founders, mentors, friends, advice-mongers – you name it, I’ve found them all in networking.

We all know the cliché, “It’s not what you know, it’s who you know.” I used to scoff at this when I started working, having the image of a social butterfly in mind. I have discovered though, that it’s not like that at all. To be effective in business you NEED to have a good network.

The following tips are from my own personal experience on how to grow a network effectively.

1) Forget the “user” paradigm

This was my first hurdle – it was psychological. I had to get rid of the notion that I was trying to get to know a person because I wanted to “use” the other party. Of course, it’s partly true. The thing to remember is, it’s a two-edged sword. Yes, you want something from the person, but you are also trying to offer something of value to the other party. If establishing a great business relationship could be mutually exclusive to both of you, then why not?

2) LinkedIn Rocks!

I have always found that LinkedIn is miles away from Facebook when it comes to business networking. Isn’t it much easier to invite strangers (or accept invitations from strangers) than doing the same thing in Facebook? It’s because LinkedIn is an accepted business tool for networking with strangers. Three important things to remember in LinkedIn:

A) Reflect your accomplishments

LinkedIn is wonderful because it’s essentially your online resume – so when people visit your page, they know exactly what sort of value you can give them. Don’t give them a hard time guessing what you do. Say it straight. Use 2nd person. (3rd person sounds a bit too Lebron James) You’d be surprised at how many people will reach out to you through the social network once you’ve established your expertise.

B) Be a person

When inviting people, say something like:

“Hi, my name is Peter. A goal of mine is to network with great people in the industry, so I hope you don’t mind this humble invitation to connect. It’s my hope that you find some value in my own profile. Cheers!”

instead of the robotic template “I’d like to add you to my professional network – Peter Paul V. Cauton”

C) Above all, do not spam!

3) Think of quality AND quantity.

I’ve always been told something like, “10 quality contacts is better than 100 informal acquaintances.” Agreed. For sure.

You know what trumps 10 quality contacts, though?

100 quality contacts. 500 quality contacts trumps a hundred, too.

Yes, quality contacts are crucial, but with the advent of the internet and mobile tools, you can now establish and maintain a wider network of quality contacts.

How exactly do you get to that many quality contacts? Here’s a very important paradigm to take:

4) Be a conscious networker

This is a very important tip, and it’s helped my networking a lot. Networking needs to be a choice – something you allot a specific time of the week for. For example,  I have one hour in a week dedicated to just finding good contacts to network with in LinkedIn – so I easily add 10-15 people in my network through this.  Also, every week, I resolve to have at least one opportunity-seeking coffee talk. I usually ask old friends if we can have coffee, or someone I’ve had online exchanges with, or even a current client. These meetings can usually mean the start of an acquaintance becoming a “quality contact.”

Pay for the coffee. It’s worth it.

I’ve paid Starbucks a small fortune over the past few years. In fact, I was mildly amazed that last Wednesday, I was in three Starbucks shops (and ordered each time) in a span of 5 hours. Yes, the expenses creep up a bit, but when I think of it, ALL my ventures in the last 4-5 years started in a coffee shop. It’s all worth it.

Continued here!

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Don’t Put Parrots In Customer Service

Peter Cauton

A few weeks ago, I was in the hospital passionately arguing with an HMO officer who was insistent on applying a policy which was so evidently not applicable to my own particular case.

“If we implement this policy, instead of the insurance paying for my fees, I would be paying YOU – it doesn’t make any sense.”

“Ganoon ho talaga.”

WHAT?! I was furious. But I understood what was happening. The person on the other line was trained to placate customers and explain policy, but no true power to interpret or be flexible.

This is inherently why customer service sucks in so many companies – most customer service personnel are simply given a script and if-then scenarios. Invariably, there WILL be cases which won’t fall under any of the planned scenarios – a lot of them. So what happens?

“Ganoon ho talaga.”

“I’m extremely sorry sir, but that’s policy.”

“Let me work on this sir, I’ll put you on hold.” (I’ve had a service put me on hold before for an hour)

A friend of mine told me before that the root cause of this was structural – the product management group is oftentimes separated from the group which does customer service. It gets worse in this outsourcing age – the customer service group can be in an entirely separate company. Structurally, customer service would NOT have easy access to information, nor would they be in a position to make any calls about how to interpret a policy for a specific customer incident.

The problem is, customer service IS a part of the product.

This is why I love Citibank Phone Bankers – I can feel a real difference with how empowered and well-trained they are. In my years phone banking with Citibank, I’ve yet to have a problem they couldn’t solve by themselves in a span of a few minutes, or give me a number where I can talk to a person who can solve my problem. I also know they are paid well and are taken cared of – it’s tough to pirate them. Good job Citibank, you’re putting your money where your mouth is.

Any business that has customers will automatically have to think about customer service. How is your business treating its customers? Do the people who manage customers directly have the power to solve unforeseen customer issues? Or are they parrots with a script?

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To ensure success, go DEEPER not wider

Peter Cauton

Okay, so you are a startup owner.

Chances are great that you have limited resources. Understanding that you cannot be everything to everyone, you identify a niche and concentrate on that.

I am now getting more and more convinced that the niches we think are specific enough are STILL oftentimes too broad. We have to go deeper.

When STORM was originally conceptualized, we wanted to be a technology firm which specialized in HR. Soon enough we found out that was too broad. So we thought of specializing on benefits. You know what? Still too broad. This year, our big decision is just to concentrate on ONE thing: Flexible Benefits. See all those other products in our website? We shall soon be pulling all them out. We realized we needed to focus ALL our resources on ONE problem: getting Flexible Benefits right. We want to solve this problem with all we’ve got. We want to solve this problem better than anyone else in the world.

This boils down to the decision if you want to do one GREAT thing or merely good things. Spreading your limited resources across many things increases the probability of making a lot of mediocre products. Just remember that mediocre doesn’t have a shelf life, being great does. Look at Apple. ONE phone at a time. ONE tablet at a time. They just make that ONE thing the best there is.

Got an idea? Know who your target market is? Here’s a suggestion: segregate this market further and choose to niche even more. (Of course, you have to walk the tightrope here a bit and ensure you have a big enough market)

Creating a tablet application for children? Pick a specific age group, say 5-6 years old. Then do heavy research on the developmental aspects and mental acuity levels of children 5-6 years old. Then release a product specifically for children 5-6 years old. If you are a parent, and you have a 6-year-old, wouldn’t you want to buy a product specifically created for your child instead of getting a “for 8 years and below?”

Designing a clothing line for mommies? It might not be specific enough. Then research on the style differences between women who are 20-25 and everyone else. Focus your marketing and sales activities just on this demographic. Ignore the rest. You know what, not only will you capture the 20-25 market, but also the women in their 30’s who want to look younger.

And for all those people creating software houses? For goodness sake, pick a niche. Learn that niche. Yes, you will get offers to develop other stuff outside your chosen niche. Resist the money and decline. You can make that money up once you begin dominating a more specific niche. And no, “mobile” isn’t a good enough niche. Go deeper – pick an industry, a vertical, or an even more specific platform. Think about your specific customer and then sell specifically.

Go deeper.

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