I like the story of Johnny Appleseed. Sometimes I feel a bit like him,
planting seeds (starting companies) and watching them grow.
As I told a good and wealthy friend yesterday, I think I will be
tempted in the future, if my harvest ever comes, to stop doing startup
companies myself, but instead, to just teach and write and blog about
all the ideas that I think should happen.
I currently have a list of about 50 ideas that I believe could turn
into viable companies. I often wake up in the middle of the night (Brock Blake calls this “The Curse”) with a new idea, or first thing in the morning a new thought will strike me.
There is no way that I’ll ever be able to do them all. It might be best
to just scatter the seeds for these ideas as widely as possible in
hopes that they will find good soil somewhere and grow. We’ll see.
I used to carry 3×5 index cards around with me so that I could capture
new ideas whenever they struck. Now I use my Blackberry memo feature. I
have several memos marked “Ideas” that each contain many of my best
ideas. I always write down the date and the idea.
The amazing thing to me is how short my memory is. When I occasionally
review my idea memos, I often come across great ideas that I have already forgotten about. I think, “Wow, that is a great idea!”, as if it were a completely new thought!
Writing down great ideas makes them permanent (“the faintest pencil is
keener than the sharpest mind”) and if you think good ideas come from a
Higher Intelligence than your own and you value them enough to write
them down and act on them, from my experience, you’ll find that it
leads to having more of them.
Joseph Smith, Jr., born 200 years ago this December, said this about inspiration:
first intimation of the spirit of revelation; for instance, when you
feel pure intelligence flowing into you, it may give you sudden strokes
of ideas, so that by noticing it, you may find it fulfilled the same
day or soon;
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I have almost 250 Google Alerts now on topics, people, and companies,
so I receive emails on my blackberry every time news occurs about any
of these. This is like having a personalized, real-time Burrelle’s
clipping service that is delivered to my PDA. It is invaluable.
New terms I added today: fairtunes, giftwiki, bango, mobeon
Before I spend time personally one-on-one with entrepreneurs who want (free) advice, I ask them to do several things, including set up Google Alerts.
When I speak to students or educators I plead with them all to take
advantage of this amazing free service that will wire their brain to
breaking news around the globe about topics they are most interested in.
Imagine the increase in personal intellectual capital if every employee
in every company did this, and if every student and professor did this
Now fast forward a year or two when Google Alerts (or the equivalent)
will work with radio and TV broadcasts and conference transcripts and
university lectures and books as well.
Each of us will be able to design our own life-long learning
curriculum. We will be more intelligent, because we have designed our
knowledge alert systems, rather than reading a newspaper or watching a
TV news program with 22 minutes of airtime (with only a tiny fraction
of the information being relevant to us personally) and 8 minutes of
commercials, which are mind-numbing and inane.
One of the most useful skills in the future will be designing our own
personal keyword alert systems. I wonder if there is an opportunity to
consult with large corporations to help them implement personal keyword
alert systems for hundreds or thousands of employees, to help them stay
competitive, monitor their competition, be alerted to successes and
best practices that might affect them, and so forth.
I might be willing to design a consulting practice around this, in case someone is interested….
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Too many entrepreneurs try to do it alone.
But it’s easy to work together with a group of entrepreneurs that helps everyone succeed. That is what YEO and other organizations like it are all about. There are many examples of this in history.
In 1727 Benjamin Franklin and 12 friends formed a group which he called Junto, where they discussed the topics of the day for their mutual improvement. For decades these individuals helped each other succeed and make contributions to society.
Napolean Hill, author of Think and Grow Rich, wrote about Mastermind groups which he learned from Andrew Carnegie.
Authors Mark Victor Hansen and Robert Allen advocate building a Dream Team, a group of people who can guide you and help you achieve your goals.
Yesterday I held my first Brainstorm Meeting for entrepreneurs in Utah County. We met at Magelby’s for lunch. There were about a dozen of us.
After introductions I asked everyone to tell us what the biggest problem facing their business is right now. Then everyone pitched in freely with ideas and suggestions about how to solve their problem.
One person volunteered to take notes and captured dozens of excellent comments and ideas, web sites and marketing tactics, that could be very helpful.
We pooled our knowledge and all came away richer.
I think there is power in groups discussing problems and possible solutions, especially when everyone shares their ideas and knowledge freely.
If you are an entrepreneur, you should join or form such a group in your area.
If you want to attend our next Utah County Brainstorm meeting, email kateygreat “at” gmail.com.
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I have often felt that librarians are among the most underrated and underappreciated professionals in the U.S. The reference librarians that I have known over the years are among the most intelligent people I’ve met. They don’t know everything, but they usually know where to find anything–and fast!
I started a masters program in Library Science at BYU about 15 years ago, but it was short lived because my first company started taking off and needed me full time. But over the years I have spent hundreds of hours in the business and government reference section of the BYU Library. I have found many hidden treasures there. I have been richly blessed by my time in libraries.
For example, it was a librarian who first told me about Ancestry, the publishing company in Salt Lake City, which she said published 2 of the top 5 genealogy books of all time. Discovering Ancestry led to our purchase of that company a year or so later and the rest is dot com history. Many of the early databases we added to Ancestry.com were scanned from or discovered in the BYU Family History Library.
All of the content in our original CD Sourcebook of American History (which sold tens of thousands of copies) came from the BYU Library. Much of our original LDS Collectors Library content was discovered in the library.
I have gotten more new business and marketing ideas by perusing Directories In Print than any other single source. I now own the 23rd edition so I can browse it any time that I want.
Today I spent a couple of hours with two excellent series, the International Directory of Company Histories, in 68 volumes, and the Business Plans Handbook, which has 8 volumes filled with actual business plans that have been used in fundraising.
I decided that I will require every entrepreneur who asks me for free help to look through the index of the International Directory of Company Histories to find other companies in their space, to see what they can learn from the history of other companies, particularly the keys to their success.
Today I read about the founding of Altiris, a local company. I didn’t know that it was a spin of from KeyLabs, and that the former director of Novell’s SuperLabs was one of KeyLabs’ founders. I’ve know about Altiris for years, but I gained a much better understanding of the company today by reading the brief history. I bet MyFamily.com will be written about within another year or two. New volumes come out every year.
Personally, I think I’ll read every one of the several thousand company histories in the next year or two, trying to identify the key reasons why these companies became large and successful.
Sometimes it was product uniqueness, sometimes it was timing, or sales or marketing strategy. Sometimes it was luck.
I read about one Australian wine exporter who floundered for 10 years and nearly died until they qualified for a government marketing subsidy and then came up with a very obnoxious brand name (which I won’t repeat here). Now they are doing tens of millions in revenue. I read about a Canadian insurance company that succeeded for 75 years in large part because they didn’t require up front payments for policies–they had generous billing practices and therefore wrote a lot of insurance.
My goal someday is to create a Taxonomy of Business Success Tactics and to create some kind of Decision Tree software that will help entrepreneurs. If you are facing a particular challenge, I’d like to be able to retrieve a dozen or more historical examples of decisions other business people made when facing similar challenges. My system will mostly pull up full-text narrative; I’m not going to attempt to create computer generated decision paths. I think decisions must be left to your intuition–but your intuition could be informed by history.
Whether or not I ever built something that could really be useful to other entrepreneurs, I don’t know. I may just end up with a full-text knowledge base similar to my Taxonomy of Internet Marketing Tactics knowledge base that has over 200 ways to increase site traffic and conversion rate. I’ve benefitted a great deal by having this knowledge base at my finger tips for years. I just wish I could polish it up and make it available to others.
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Last month I heard Warren Buffett and Charlie Munger pontificate for
5-6 hours at the annual Berkshire Hathaway shareholder meeting in
Omaha. And now I’ll be able to tell my children and grandchildren
someday that I once saw the world’s richest man, assuming he passes
Bill Gates this year, but more importantly that I studied the ideas of
the world’s greatest investor. It cost me a weekend and a few hundred
dollars to attend this event.
Every time I see in person one of the brilliant people of our
generation, I come away a different person, with a mind full of new
ideas and excitement. I heard Bill Gates speak in Silicon Valley about
3 years ago; Mark Andreesen at a Jupiter Conference in Napa Valley 4
years ago. John Bresee of Backcountry.com gave a brilliant,
thought-provoking speech at UVEF last week. Paul Brockbank gave one a
few months back. Alan Hall, CEO of Marketstar, gave a
super-inspirational talk about his mission in life and the twelve
characteristics of successful entrepreneurs at Weber State in April.
Patrick Byrne gave an incredible speech at BYU a few months back; I got
to hear him again in Price Utah a couple weeks ago. Last year I
heard Clayton Christensen teach about disruptive technology at the Open
Source Business Conference. In 1999 I heard Bill Joy of Sun speak.
Other great speeches I’ve heard include Michael Gerber, author of
E-Myth, and Robert Allen author of “Nothing Down.” I was once in an
unforgettable several hour brainstorm session with Mark Victor Hansen,
author of the Chicken Soup for the Soul series (close to 100 million
books sold). I’ve been in meetings with Mary Meeker of Morgan Stanley,
and Henry Blodgett and Jamie Keegan. I’ve spent hours exploring
subscription business models with Pat Keene, formerly with Jupiter, who
is now a key manager at Google. I’ve met Eric Schmidt of Google before
and chatted with him about MyFamily.com. I probably attended a dozen
Jupiter events from 1995-2000, and heard great speeches each time.
But there are brilliant minds, including some of my business heroes,
whom I have never met or heard speak. I’ve never met Bill Gross of
Idealab or Jim Clark the billionaire. (When UITA honored Jim Clark with
a Hall of Fame award I was so hoping to get a chance to meet him–but
he send his son in his place.) I’ve never heard Seth Godin speak,
though I’ve studied his books carefully. I have never heard David
Neeleman speak, although when I found out he had lectured at BYU-Idaho
last year I said to myself, I would have driven the 282 miles to
Rexburg, Idaho just to hear him speak. But I didn’t know about it until
it was too late.
The return on investment I receive by spending a little time and money
to have a chance to personally see and learn from the brilliant people
of our day is incredible. They always help me think big thoughts and
dream big dreams. So why don’t I take more opportunities to do this?
What gets in my way?
I think the #1 issue for me is that I don’t know when and where my
gurus are going to be speaking next. When I found out one of the Google
founders would be attending the Always On conference at Stanford in
July, I decided I had to go. But how often do the brilliant people
speak at local or regional events that aren’t well publicized, and I
just miss the chance to go hear them?
So maybe I’ll launch a new web site that keeps track of people’s
business heroes and when and where they are going to be speaking next.
I can send email alerts so that people don’t miss out on opportunities
to gain intellectual capital by attending lectures from brilliant
people in person.
Of course, I’ll launch it by tracking my own heroes speaking schedules
first. But if I do build such a site (assuming there isn’t one like
this already), what should I call it and what other business
heroes/brilliant minds should I add to my list?
Let me know what you think….
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In New York and San Francisco, a lot of business networking happens after business hours at bars and other venues. There are places to go almost nightly, where co-workers hangout together and people meet new people. Back in 1999 one of my MyFamily.com co-workers in particular was the king of San Francisco after hours business networking–he knew everyone at other SF dot coms. Such networking leads to cross-pollination of ideas and deal-making and has a very positive impact on business.
So what are the folks in mid-America to do? We live in smaller population centers, with far less concentration of businesses, and there are comparatively few networking events that draw us together. Besides, many non-city dwellers have greater family and community responsibilities (and therefore less free evening time) than the young, hip crowds that flock to the high-energy cities. I know I’m over-generalizing, but I’m trying to make a point.
I have found that LinkedIn.com can adequately replace big city after-hours networking if used intelligentlly. For example, today LinkedIn.com has more than 2,400 users in the Provo, Utah area (a lot more people than can even fit into even a very crowded bar). Today I went through all the most connected Provoans who are not connected to me. I have found half a dozen very successful and talented people with lots of connections (and some endorsements) whom I am now anxious to meet. In the next few weeks, I’ll make contact with each of these people and invite them to lunch or to an event like a UVEF meeting.
LinkedIn is the best place I know to proactively meet important and trustworthy people outside of your current circle of friends. It is far less random and therefore even more productive than hanging out after hours at a big city bar.
Unless you are using LinkedIn proactively and regularly (at least weekly!) you are neglecting what I consider the best tool on the web for building your social capital, which rivals intellectual capital as the greatest source of value creation on the planet.
Both social capital and intellectual capital are combined in the clever Morgan Stanley ad campaign from a few years back: “It’s not who you know. It’s what who you know knows.” LinkedIn can help you increase both. Use it.
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I was very fortunate to be involved from the beginning of Ancestry.com: an internet startup that achieved positive cash flow (by July 1998) before raising outside capital. This required some self-funding, bootstrapping, and using all the online marketing tactics that we could discover. It also helped that we sold annual subscriptions to our online databases. We would collect the money up front, but recognize the revenue over a full twelve months. So we achieved positive cash flow well before we reached profitability.
The learning our small team gained when our funding was limited was invaluable. We had to be very guerilla and very creative. My favorite book in those days was “Guerilla Marketing Online: 100 Low-Cost, High-Impact Weapons for Online Profits and Prosperity.” Net.Gain was another classic title that shaped my views about how community would lead to content and commerce.
From 1998 to 2000 the company raised $75 million in venture capital, opened an office in San Francisco, hired several hundred new employees, including a new CEO and CFO who were going to prepare the company for an IPO. I moved from CEO to VP Marketing to General Manager of Ancestry.com to VP Interactive Marketing to VP Strategy, VP Corporate Development and finally GM of the MyFamily.com business unit. Wherever I felt I was needed, I would jump in and try to make things happen. As a company founder and director, and being very close to our CEO(s), I had the benefits of knowing everything that was going on in the company, and formed opinions on the employees, partners, tools and strategies that had the greatest positive impact on our business goals.
Like other dot coms, we spent money freely in order to build traffic to our web site. Eyeballs were our most important metric, revenue was second, and profits were a distant third. Wall Street was rewarding sites with huge numbers of visitors, betting that advertising revenues would follow, so spending money to bring traffic to the site was the main imperative.
When we could afford virtually any technology or service, I found a number of ultra-valuable resources that very few entrepreneurs that I know have ever had the benefit of even trying, let alone using day after day.
I decided today to list and describe the five most valuable services that I absolutely loved that most entreprenuers can’t afford. But as your internet company grows, you should plan to invest in some or all of these services in order to improve your intellectual capital, your efficiency, and maximize your business potential. Used appropriately, these services can generate an incredible ROI and give a company a tremendous competitive advantage over companies that aren’t using them.
1. Jupiter Research. I have to start with Jupiter. The idea for Ancestry.com was born at a Jupiter conference in September 1995 in San Francisco. Jupiter held conferences and published analyst reports on everything related to internet business: e-commerce, internet marketing, consumer content, technology and infrastructure, and more. More than any other company, they fanned the flames of the internet revolution. They served up the koolaid, and I drank as much as I could get my hands on. Their projections about internet and broadband adoption, and their reports about consumer and business usage patterns told dot com executives what to plan for and what to build. I attended probably 6-8 Jupiter conferences, and we subscribed to several analyst tracks, paying probably tens of thousands of dollars per year for all their advice. We even hired Patrick Keane (now with Google) to consult with us for a day about our internet subscription business model. He was the subscription expert. Today, while most of the original Jupiter folks are gone, and the company was acquired by Internet Media Group (run by industry veteran Alan Meckler), they still hold conferences and they still have research you can subscribe to. Fortunately, they often issue press releases and all their analysts blog, so you can pick up a good deal of market intelligence for free until you can afford to become a full-fledged customer.
2. Audience Measurement Service. I remember running into the Media Metrix booth at Fall Internet World ’97 in New York City. They were publishing a free list of the Media Metrix 500–the 500 highest trafficked web sites in the U.S. It was in alphabetical order. I was so happy to see Ancestry.com on the list. Over the next few years we were active subscribers to Media Metrix, Nielsen Netratings, and later Comscore’s audience measurement services. Today I would probably choose either Comscore’s MediaMetrix 2.0 or Hitwise, a recent entrant into the U.S. market, but the one with the largest panel of internet users. All these companies have panels of from 50,000 to 25 million internet users who have given them permission to record their internet usage patterns: which sites they visit, how long they stay, etc. Based on these samples, the companies project overall internet usage. Comscore customers have access to a database of the top 10,000 most popular websites in the U.S. Hitwise customers have access to thousands of top sites in hundreds of categories. If I had to choose one service today, it would be Hitwise.
Why is audience measurement so important? First, if you want to dominate your industry, you need to know exactly how well all your competitors and potential partners are doing. The fastest way to find them all and to know how they are trending it from audience measurement. Alexa is a free resource, but it’s not very accurate and the search interface is lame. Second, telling your story is a big part of the key in attracting investors, partners and even customers. When your audience measurement numbers look good, you can use them to prove that your company story is playing out well. There’s nothing like a press release that says in effect, “Media Metrix reports that Ancestry.com is now the #1 genealogy site in the world.” These services provide credible data to help you tell your story. Third, by querying the audience measurement services intelligently, you can find all the fastest growing web sites, and then spend time figuring out how they are building such momentum. I used to spend hours locating all the fast-growing sites, visiting them, signing up, and figuring out which internet marketing tactics and web development tactics they were using to acquire millions of users–sometimes almost overnight. By learning from the successful companies, I could come up with dozens of new ideas for my own web sites. Netratings had a feature where I could see which web sites were sending traffic to my competitors. Fourth, you can use these sites to find partners, advertising venues, and affiliates. We recruited hundreds of affiliates and found dozens of high traffic places to test advertising campaigns on by using audience measurement services. Fifth, you can find companies and web sites to acquire using these audience measurement services. One of my greatest regrets at Ancestry.com was a missed opportunity. Using Media Metrix I came across a hot genealogy property called Genforum.com, the leading message board service for genealogists. We contacted the developer and offered to buy his company. But three weeks earlier he had signed a binding term sheet with our leading competitor. Our competitors acquisition of Genforum.com gave them a huge boost in the marketplace, adding hundreds of thousands of monthly visitors to their traffic. We had to build our own message boards on www.familyhistory.com, and it took us about 2-3 years to surpass them in message board traffic. If only I had used Media Metrix a month earlier to find this super valuable property!
The current audience measurement services cost tens of thousands of dollars per year and are therefore out of the reach of many internet entrepreneurs. Use Alexa as a weak proxy for now, but figure out a way to become a subscriber to one of these supervaluable services.
3. Web Analytics. Before Omniture, Coremetrics, and Websidestory were robust enough, we had to build our own web analytics system. Jeff Brody, programmer extraordinaire at MyFamily.com, created our marketing dashboard and wrote hundreds of custom reports that our marketing team could run daily to measure improve our performance. Today, many web sites use very cheap log file processing tools or very weak web analytics programs. The ROI for investing in a high-end service like Omniture Site Catalyst is phenomenal. When you train your team of web developers and marketers to test and measure all their site design changes, landing pages, and external campaigns, using Site Catalyst, you can eliminate all the mistakes from designers and marketers going with their gut feeling or their subjective opinion about how a page ought to be designed. All the most successful internet companies use these high-end systems (which generally cost at least ten thousand dollars a year) or have their own proprietary systems.
4. MarketingSherpa. MarketingSherpa is my favorite publisher in the world. They interview internet marketers weekly and publish the most valuable case studies on the planet. The get the details on how to build traffic, how to generate online leads, how to increase conversion rate, how to use offline campaigns to generate online visitors, how to improve the retention rate of your customers. I could go on and on and on. If you don’t sign up for all their free email newsletters then you’re missing out on a goldmine. A couple weeks after publishing their free email newsletters, they start charging $9 per case study. I have collected several hundred case studies in my email inbox and in my browser cache, so I’ve basically saved thousands of dollars already. But I have spent thousands of dollars attending MarketingSherpa’s annual subscription summit, buying transcripts, and buying their reports on email and search engine marketing. For entrepreneurs, MarketingSherpa material is the most valuable and least expensive of the tools that I am reviewing today. So make this the first service you plan to become a fanatical user of. Start with the free stuff, work up to the paid reports, and study this material in the way it deserves. They have the highest concentration of online tactics that work (with real world examples) of any publisher in the world. I wish MarketingSherpa would launch a $99 per month subscription service that would give me full-text access to all their material and a search engine and taxonomy that would make it come alive. My own cobbled together system isn’t convenient enough for me, and I have missed a number of valuable email reports.
5. Affiliate Network. Affiliate marketing is my favorite form of internet marketing. Amazon has over a million associates, promoting their products in exchange for a small commission. When I left Ancestry.com we had more than 30,000 affiliates. It was our most profitable and productive internet marketing program at the time. We paid a good deal of money to launch our affiliate program on BeFree.com, one of the three major affiliate networks. Most internet companies try to avoid the expense of a third party service and try to launch their own program. You can use low-cost server software from Kowabunga (acquired today by CGI Holding Company) or DirectTrack. While there are some negatives to belonging to one of the big three networks, Commission Junction, BeFree.com (now owned by the same company), or LinkShare, I’ve always felt that the benefits far outweigh the expense.
The interesting thing today about affiliate marketing, which is usually based on the pay-for-performance model, is that search engines might end up morphing into affiliates. Bill Gross’ latest search engine, Snap.com, has launched a cost-per-action model where Snap only gets a percentage of the revenues that come from its referrals. If click fraud continues to spin out of control, I wonder if Google and Yahoo will someday have to embrace the cost-per-action model as well, which will make them superaffiliates as well. I hope things don’t come to this, but if the $1 billion fraud estimates in the pay-per-click industry are accurate and if this continues to grow, then a cost-per-action model might be the only long term solution.
A few other expensive services that most internet entrepreneurs can’t afford come to mind. I’m just not as prepared to write about these off the top of my head as I was about the top 5. But here they are:
- Robust email marketing solution that offers personalized email to each customer/prospect. (Early on, in 1998, we invested in UnityMail, which was a good solution at the time, but it wasn’t as scalable as what we needed and the price keep skyrocketing.)
- Ad serving technology. We used Adknowledge in the early days, which I loved, and then we invested in software from Accipiter. We could serve ads and change ads on the fly, and run real-time reports on which of our creatives (ad banners mainly) were generating the most click-throughs and sales. Having this real-time intelligence allowed us to refine our message until we were maximizing the revenue potential of our own banner ad campaigns.
- Keynote systems is a great tool for monitoring your web site uptime and speed from multiple locations around the country. If you get to the point where your site is generating thousands of dollars per hour, then you can’t afford a site outage or a site slowdown.
- An onsite search engine. The best article I’ve ever read about how important on-site search is to revenue was published this week by Catalog Age. If you run an online company, I’m betting that your own onsite search engine is weak (most are), and that you are losing a great deal of revenue because the results you are given your customers are subpar. Invest in better technology and customization of your web site’s search results. I use a free service from Atomz.com for my Infobase Ventures web site (since it’s not an ecommerce site). They are a good company and are listed in Catalog Age as one of the vendors for commercial search.
- VentureSource database from VentureOne. I have never personally used VentureSource, which is a database of all the venture investment and M&A deals going back many years. But at MyFamily.com we had a brilliant young investment analyst who helped us with our acquisition strategies and he used this tool very effectively. It’s the best way to figure out how to price a deal. All the VCs use this database, and they have a great advantage over entrepreneurs who don’t usually have any insights into recent deal terms and valuations. There used to be a great free service called VCbuzz.com which announced all the new venture investments and now I still get free emails regularly from VentureWire announcing new deals. It’s important for entrepreneurs to find out who is getting funded and how much money they are raising. Many times they are your competitors or potential customers (now flush with cash) and you need to be aware of strategic opportunities. I sometimes wish I could spent full-time watching VC investments and analyzing how new VC bets are going to impact existing businesses and industries. It’s fascinating stuff and one thing that makes our economy so exciting and so unpredictable. Within five years of raising venture capital, Google is the most valuable search engine in the world, with a market cap that rivals eBay. Within five years of raising $130 million in venture capital, JetBlue is the second most valuable airline in the United States. It is so fun to try to spot the next eBay, Amazon, or Yahoo. It’s also fun to predict which online companies are going to fail. But alas, I’m an entrepreneur, not an investor, so I can’t afford to spend all my time analyzing and studying this fascinating field. Someday I hope to start a company that will do this for me, and just feed me (and other paying customers) their analysis, based on the tools and data that we will have access to.
Please comment on my list. I want to know what I’ve left out. If you have experience using other expensive (and therefore unaffordable for most startups) tools or services that could dramatically benefit internet companies, please let me know.
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I’m pretty happy with the way my February column turned out for Connect Magazine. I think it’s the best column I’ve written so far. It’s about reducing your chances of failure by investing in your company’s greatest asset–the minds of your employees. Please let me know what you think of it.
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