It’s Not Pretty,* But It Works

Phew. The final version of the functional prototype is up on our home page, and it works! try_wahanegi_betaIt really helps almost anyone who is facing a big life decision. I find that amazing…the prototype works even though it’s not pretty.* In fact, it is pretty ugly.

Deciding to be proud of something that is ugly was a hard decision for me. If nothing else, every product I’ve ever managed was beautiful at launch, with plenty of demoable killer features and design elements that were purpose-built to generate demo oohs and aahs on a big stage. Experience matters, after all, and in consumer web it matters perhaps above all else.

Perhaps.

It is amazing what a great demo can do. It excites people. It get’s the creative juices flowing. It makes the impossible seem possible. But, as I know well, in no way does a great demo guarantee success. In fact, a great demo can hide serious flaws in your assumptions, and hide those flaws not only from investors and potential customers, but also from yourself.

This prototype certainly doesn’t do that…the uglies are right there for anyone to see, including me.

Perhaps it is more amazing what a great story can do.

Imagine a 40-year-old woman spending all day resisting the urge to head to the casino all day. She logs into Amazon’s Mechanical Turk to distract herself, looking for a little work, and she finds a request to test our prototype. After spending twenty minutes searching her soul for the answers to our questions, she writes this note: “I feel like this was a God shot – I’ve been stressing out all day because I haven’t gambled. I logged into [MTurk] and this was the first task I received. Yes, very helpful. It made me think. Extremely helpful.”

Or imagine a 20-year-old woman struggling with the decision to move out, away from her roommate, to find her own place. She spends ten minutes with the prototype and says this,“I feel liberated. This helped me with a decision I’ve had trouble making. [Now I see] I’ll be proud and happy with myself. I’ll feel independent and confident that I can handle all my own problems. I’ll be happy that…I can do what I want when I want to.”

Or imagine a 50-year-old woman trying to decide whether to go back to work. After fifteen minutes, she knows what she needs to do, “As much as I love being a homemaker, I know deep down that going back to work is the right answer, even though I’ve been fighting it. This was a very eye-opening experience. It really was like getting a full session with a consultant in only a few minutes…it helped me bring to the surface the answer to this question that I had kept buried down deep inside for so long.”

Now imagine that there are hundreds of stories like those in our database already, including some from men, too ;).

It is hard to deny the feedback coming in about the prototype. The decisions are serious. People deciding to change jobs, to have children, to move across country, to stop gambling, to get married, to end their marriages, to have surgery, to go back to work or school. The results are positive. People feeling relieved, relaxed, clear, motivated, excited, thoughtful. Not everyone, not every decision, but the lion’s share.

The prototype was built for research purposes, and the research shows one thing very clearly:

“It’s not pretty,* but it works.”

Maybe that’s what the lean startup philosophy is all about.

So I added that slogan to our home page to get my heart and soul into being loud and proud about an ugly ducklingugly1930-cvr that will be pretty, eventually…all that takes is a bit of money and time and some expert help from designer and developer friends. But the prototype helps people now, with real decisions, so out into the world it goes to gather more data for the mill.

Now we need to get the rest of our house to do that well. We’ll be rebranding the product…too many people stumble over our company name, so at least we’ll make it shorter. And we’ll be writing up the results of our decision research…we’ve gained some very interesting insights from our 600 participants and 100,000 data points. That will set us up to begin our word-of-mouth social media campaign to help 4,000 more people decide wisely, and continue our quest to build the world’s biggest database of life decisions.

Then while that it rolling, it will be time to recruit some great people and raise a little money.

Onward!

 

*yet

Why Intrapreneurship Will Never Work

giantFirst, a parable.

The giant and the thousand pixies are walking through the wilderness. They come upon a massive mountain range that blocks their way. The giant pauses for a minute to think about the obstacle. The lean pixies swarm the lower slopes, shouting with excitement as they scramble for paths over the mountains. Very quickly a few of the pixies reach the first rocky heights, roughly even with the knee of the giant, and shout “Tally ho!” as they rush down into the first of many steep valleys, calling their fellow pixies after them.

His companions’ success intrigues the giant. He can see farther with his superior height and climb better with his superior strength. So he inspects the wooded foothills, gets down on his hands and knees, and begins to crawl over the most promising pass. Soon enough he has surpassed his friends, and some of the pixies are following behind on the broad path left where he pressed the rocky crags flat, marveling at what he has done.

A short while later he pauses to survey his progress. His path veered here and there with the fall of the mountains but largely remained true. As he sits he notices his fine walking pants are torn, his deep pockets have spilled their contents, his boots are scuffed but their rugged soles unused. He flexes his arms and lifts a mountain in each hand.

He stands, dusts himself off, and strides over the remaining mountains, taking care not to stumble. Behind him he hears the pixies shout.

One group calls to him in a small distant voice, “Hey, where are you going?”

The other calls in a growing chorus, “Gold, gold, thar’s gold in them thar hills!” So the giant turns, calling to his friends that he’s coming to help.

———————–

I spent twelve years as a product manager conceiving, building and launching new internet technology products and new business models within existing companies. They ranged from niche products targeting important customer segments within a larger ecosystem to broad category-creating platforms that helped to shift entire markets. The companies I worked for were idiosyncratic as are all companies; however, my experience exclusively leading a dozen new product businesses within existing companies for over a decade gave me access to some universal truths. Since I am not trying to sell those particular experiences to large companies, I have no need to flatter them, so let me speak plainly.

I was inspired to write this by a great post-mortem of Qualcomm’s now dismantled Venture Fest program on Steve Blank’s website, written by a fellow MIT alum Ricardo dos Santos, whom I think I would enjoy meeting someday. In his story and my research over the past year I see several truths more clearly than before. They are in my story of the giant and the pixies, but let me be more clear for those without patience for parable.

Intrapreneurship will never work for five reasons:

  1. The Strategy Mismatch – Entrepreneurs want to create new businesses, and companies want to expand and improve themselves. That sounds like a nice fit. However, in reality entrepreneurs are at odds with companies that host them in a way that is not true for external angel and venture investors. The entrepreneurs must follow their concepts and customers where they lead, and even if they are lucky and persistent enough to see some success in the market, it is a near certainty that will be in a direction that is not well matched with the current operation of a host business. The company must steward its resources, make use of its scale and grow predictably – it should rightfully seek ways to leverage its strengths, like the giant surveying from on high and seeking to protect his pants and make use of his long legs and rugged boots.
  2. The Budgeting Mismatch – In the early stages entrepreneurs cannot deliver revenue, so they are working to command the very expensive resources of the company in a budgeting process that is for them either a zero sum game where they hold few cards and gain sparse resources, a well-intended but structurally unsound ‘innovation initiative,’ a political exercise of alliance building to protect shadow projects, an exercise in making risky promises with the belief that they will be able to continue commanding investment when those promises do not pan out, or a ‘big bet’ business unit initiative that is completely dependent on the continued leadership and political capital of the head of the host business. I have followed all five strategies, and they all worked as implied. I used those strategies knowing that they were in the interests of the company only if the products panned out, that the company had no good way of accounting for them, and that even if they did pan out they may still fail during the growth phase because they would then have to survive in the ‘real world’ of budgets when their growing revenue was still far from justifying their much more rapidly growing expenses and business model mismatches. This is particularly true in large companies, where everything is far more expensive to do, no matter how hard a leader tries to be lean. In my experience, the ‘big bet’ worked best of all, like the giant lifting another mountain in his hand…but a giant can as easily toss a mountain aside as carry it forward.
  3. The Rationality Mismatch – While in many circles it is fun to bash the seeming stupidity and irrationality of corporations, in my experience the anecdotes of ‘irrational’ and ‘political’ corporate behavior are often better seen as the exceptions that prove the rule, especially when it comes to cash flow. Rather I think of corporations as unnaturally rational. Money comes into and flows out of big companies in highly predictable ways, far more predictably than any individual person’s wallet, and wildly more predictably than the cash flow of entrepreneurs. Corporations are created by entrepreneurs to make this predictibility happen. So instead of irrational and political, I prefer the perspective of corporations as hyper-rational psychopaths, shackled by flows of cash and put to use by society. Corporations look first to themselves and their best way forward, leaving their pixie companions behind as it suits the needs of the business; and largely as they should do, in my opinion.
  4. The Irrationality Mismatch – I also do not know why the myth of a rational ‘homo economicus’ persists in the face of vast scientific research, most notably that of Nobel Prize winner Daniel Kahneman, but we should put it in the dustbin of business history. Individuals are not rational, especially when making big decisions, and within the vast sea of human irrationality, Kahneman singles out entrepreneurs as an especially irrational group. I can already see these patterns in the early decision data from the Wahanegi beta, try_wahanegi_betawhere changing jobs and starting a business are among the most common life decisions people are face. Let me assure all managers and investors of one thing, if you didn’t know it already – when people are considering a new job or a new venture, you are not a big part of the decision. It is their visions of themselves, their lives and their family that drives them to make such decisions, and cash is a mechanism and a de-motivator far more than it is a motivator. This makes sense upon reflection, since their motivations must come from deep and enduring sources to be strong enough to make decisions in the face of incalculable uncertainty and change. Like the pixies, they are doing it because the challenge is there and it excites them…plus, there just might be gold in them thar hills…it has happened before, after all.
  5. The Outcome Mismatch – The founder’s curse, when a company outgrows the entrepreneur, is a triple-curse inside of a corporation. Similar to the outside world, the businesses may outgrow entrepreneurs, especially if they are young or primarily technical. The entrepreneur can try to avoid this by jumping to another new business inside the same company, but only so many times, since the inevitable variability associated with new ventures will stand out against the predictable corporate backdrop, regardless of their perceived skill. Finally, if the entrepreneur is capable and the business successful, it is quite likely that the business will gain the attention of senior executives and be subsumed within a larger business to assure its success. When that happens, the entrepreneur will not get the freedom of a large cash payout as happens with an external acquisition. That is fair, since they were well compensated and well resourced along the way, but it still makes a large difference in their prospects inside the company. They are likely to be asked to move from an entrepreneurial role to a senior functional role that makes best use of their key strengths…and find themselves out of the game they enjoy, like the pixies standing by as the giant carves the mountains apart for their gold.

In my opinion, any one of these five mismatches is enough to doom corporate entrepreneurship initiatives, no matter how lean. Together they stack up high enough to blot out the attempts of corporate PR teams to cast their companies as trendy hotbeds of entrepreneurship, if not in the moment then always in the course of time. The parable of The Giant and The Thousand Pixies is inevitable, woven into the fabric of business, much like the Innovator’s Dilemma.

Lean principles can be used by corporations to improve existing products and business processes. Running lots of small experiments, connecting with customers,  investing after success and all the other lean principles are business gold. But the principles should be applied not to intrapreneurship in the sense of building new ventures, but to management in the sense of increasing alignment with customer needs, stewarding resources and growing revenue.

Beyond that, I believe corporations should not be lean innovators, they should be giant innovators. They should focus on the type of innovation that ONLY they can do, not the type that everyone knows they do poorly. The type that requires eyes that can see over mountains and arms that can lift them. Innovation that involves deep R&D and vast infrastructure aimed at problems that are already well understood but whose solutions demand huge scale creates big bet opportunities to benefit the corporations at a similarly massive scale, and is the best way to use their cash to benefit society. Of course it will not always work and many will fail, just as entrepreneurs fail, and corporations run by the entrepreneurs that founded them (e.g. Jobs’ Apple, Bezos’ Amazon, Zuckerberg’s Facebook, Page and Brin’s Google) are probably best able to make the decisions to take such risks. But they should not mistake the skills of the lean pixies for their own - a thousand striding giants can do much more than move mountains.

Should Startups Give 4-1-5?

We are getting closer to launching our first limited release and beginning to collect decisions and, hopefully, money. So now is a good time for us to finalize our giving program. Many large corporations give, even some startups…it seems like 1% of EBITDA is the gold standard (assuming you have any, of course), and sometimes 1% of equity.

Wahanegi App Tile LogoHowever, I want giving to be a distinctive part of the company, core to our mission, built into our brand, the product and the P&L. I have a radical idea about it, and I’m hoping folks out there will share their thoughts. The basis of the idea is that it’s easier to decide to give something away before it exists, and doing so brings some of the human benefits of giving forward to today while giving strong incentives to grow financial contributions more in the future.

Here is the idea, targeted expressly at pre-money founders:

  • 4% of pre-money founders equity, i.e. equity before the company has any outside investors. This would get significantly diluted if there are many funding rounds, but is still meaty. And it is easiest to give something away before it exists and when basically only the founder(s) have to decide.
  • 1% of revenue less COGs, aka gross profit. For many startups this can become a large majority of revenue pretty quickly, so they can be giving from the start. Plus, it drives real incentives to make sure the cause is somehow meaningful to the company, and not just a future tax dodge or corporate whitewashing.
  • 5% of EBG, meaning net profit before giving but after taxes and financing expenses. In other words, it only kicks in once profitability is pretty high already. For startups this may take a while to add up, but having it built in from the start makes it more meaningful and also gives nifty, tax-advantaged incentives to boost profitability as high as possible.

Hence, Giving 4-1-5. For those in the know, that is also the area code for San Francisco.

Here some pros and cons to start the conversation:

PROS

  • Meaningful without being excessively damaging to growing companies, while also providing useful governing incentives.
  • Designed for startups and difficult to retrofit into a P&L or equity structure, giving startups yet another competitive advantage, a social responsibility advantage, over incumbent corporations.
  • Catchy with a strong regional association with today’s startup mecca…has the possibility of becoming a movement.
  • Could become a mark of distinction for profit-driven companies that want to stand out in their commitment to causes beyond themselves.

CONS

  • It is hard enough to start a company, why make it harder…when push comes to shove, would you really feel good about giving away money in the face of payroll or competition or investor pressure? Isn’t it just a weird distraction?
  • As with anything corporations do, it could be cast as window dressing or moral equivalency trying to hide other sins.
  • It can’t possibly scale to a large company, certainly not a public company. And the board could always change it anytime, anyway, so the future promise is not real.
  • Why not just follow the herd and go with 1/1/1

What do you think?

Humbling and Inspiring Beta Testing

Last night I got the results from the first few beta testers, and they are very encouraging. As they say, it looks like there’s a pony in there somewhere. But more than that, the stories are profoundly humbling and inspiring. We all struggle with big life decisions. Their experiences are very personal yet completely anonymous, so I thought I would share a few.

If you are facing a life decision and would like to try the beta, sign up on our home page.

“Should I end my self-employment and go back to work for a bank?”

I am a married woman in my early thirties with three children. I graduated high school and am self-employed. As far as this decision, I am most worried about my family, but I think it would be a better situation financially and for my career. My Wahanegi experience was thought provoking and moderately helpful. I definitely need to do more thinking. Before I was not sure I should go back to work at a bank. Now I think probably yes.

“Should I get a divorce?”

I am a married woman in my early forties with three children. I am an employed college graduate. As far as this decision, I am most worried about my relationship with my husband, and I think it would make almost everything else in my life much worse. My Wahanegi experience was very helpful. I liked it. It helped me make a list and answer what was important to solve the problem. Before I thought maybe I should get a divorce. Now I am not sure.

“Should I stay in Los Angeles or move somewhere else?”

I am a woman in my early thirties who is self-employed and has an advanced degree. As far as this decision, I am most worried about my friends and leisure time, but I think it would be better financially. My Wahanegi experience was slightly helpful. It was quick and addresses core values – interesting to see how I value certain experiences over others. But it didn’t change my mind. I thought I should definitely move before Wahanegi, and I still do.

“Should I move out of my parents’ house?”

I am a woman in my early twenties, employed and with some college education. As far as this decision, I am most worried about money, but I think it would be a better situation for my relationship with my boyfriend and my ability to explore life. My Wahanegi experience was very helpful, it kind of put everything in a different light and helped me look at the problem from a different angle. Before I thought maybe I shouldn’t move out. Now I think maybe I should.

“Should I stay in law school?”

I am a man in my early twenties, a law student with an advanced degree. As far as this decision, I am most worried about my career and money. My Wahanegi experience was moderately helpful. I feel like I confronted the major factors deciding my life’s course and evaluated how each makes me feel. I thought I should probably stay in law school, and that didn’t change.

“Should I buy a house?”

I am an unmarried woman in my early twenties with one child. I am employed and have some college education. As far as this decision, I am most worried about money, but I think it would be better for my relationship with my boyfriend, family and community. My Wahanegi experience was moderately helpful. It was a pleasant experience, better than other surveys I’ve taken. Before I thought I should probably buy a house, and I still think so.

“Should I move out to live with my brother or stay with my parents rent free to help with my daughter?”

I am an unmarried woman in my early twenties with one daughter. I graduated high school and am currently working. As far as this decision, I am most worried about money, but I think it would be a much better situation for my daughter. My Wahanegi experience made me think and was slightly helpful, though now I am more confused. Before I thought maybe I should move out. Now I am not sure.

“Should I have a fifth child?”

I am a woman in my late thirties, employed and with some college education. I am in a civil union and have four children. As far as this decision, I am most worried about money and my health, but I think it would be better for my family. My Wahanegi experience was slightly helpful. It helped me look at my decision in a different light, from another side. It was good to expand my outlook of things and bring to light aspects of the decision that might be hidden. Before I thought I definitely should have another child, but now I think it is more of a maybe.

How to Make Wise Decisions

Wahanegi App Tile LogoWahanegi helps people like you make wise life decisions.

“I feel happy. It made me realize the answer was already inside me. Wahanegi is extremely helpful, and I strongly recommend it. I like it.”

Are you facing a big life decision? Try the Wyzyr beta today, it’s anonymous, easy and effective!

———————————————————————————————————

Decisions are the hardest part of life, the times when we set out and take fate in our hands. The word is stark – it comes from the Latin decidere, meaning to cut off. No wonder difficult decisions put us on a knife’s edge. They are literally cutting off life directions.

So we work to understand our decisions before we make them, to be sure we make the right ones. We seek advice from friends and experts, we gather data, we read, we search the Internet. Many of us know to sleep on big decisions, and a few of the most disciplined among us may even apply statistical tools to the effort.

But in the end, after all that work, it is still impossible to make the right decisions, because no matter how hard we try, we can’t truly know what direction the world will take in the future. We have to decide anyway.

That is not an argument against understanding the decisions we face. We have responsibilities to ourselves and those around us to make the best decisions we can. But we should not do it to make the right decisions; we should do it so we can make our decisions wisely. The wise response to facing an impossible task is to look inside ourselves. We should understand our decisions as best we can, but we must keep in mind that we are building that understanding not to find the impossible right path, but to have confidence and peace of mind about the decisions we make, come what may.

Our instinct for empathy, for understanding how others feel, often drives us to seek people who have faced our decisions already. That is a valuable intuition. We ask about their experiences not just because we want to figure out what will happen, but because a wiser part of us wants to know how we will feel about the world after the decision. In this sense, empathizing with someone is an incomparable way to communicate. By putting ourselves in their shoes, we are not only seeing what they saw, but also borrowing their life for a moment to better imagine our own future perspective.

I believe this empathic perspective and the insight it brings is the essence of wise decision-making. It gives us necessary distance, what Nobel laureate Daniel Kahneman calls the “outside view.” It gives us experiential weight and depth by putting us in our own shoes, as they will feel to us after we make the decision. It allows us to inhabit a world our decision may well create, and use that experience to better know our own mind.

This wisdom gives us confidence, so our motivations become winds at our back. More importantly, this wisdom also gives us peace of mind, so when the currents of the real world fail to obey our imaginations, we can calmly tack away from a direct heading without turning away from a challenge and heading back to port.
When we make wise decisions, we strive to fully imagine how life will be for our future selves and those around us. We do not talk about and study our decisions forever, returning again and again to a vain search for the right one. We diligently absorb the most important and valuable information we have. We step outside ourselves and look back to better accept the truth even when it hurts.  We inhabit the experiences of others to better know ourselves. And then we decide.

———————————————————————————————————

Wahanegi App Tile LogoWahanegi helps people like you make wise life decisions.

“I feel happy. It made me realize the answer was already inside me. Wahanegi is extremely helpful, and I strongly recommend it. I like it.”

Are you facing a big life decision? Try the beta today, it’s anonymous, free, easy and effective!

Women Listen, Talk, Pray…Men Decide Anyway

Our recent survey uncovered interesting differences between how men and women face difficult life decisions. While perhaps not surprising, the results are worth thinking about.

We asked a total of two-thousand Internet connected Americans to think of the most difficult life decision they faced in the past two years, and then pick what was most helpful in making that decision. The list is based on Wahanegi, Inc. research into the ways people make difficult or important life decisions.

Women are much more likely to find it helpful to look inward for answers than men. As you can see, 31% of women found it helpful to listen to their hearts or guts. Similarly, praying, meditating or sleeping on it was helpful for 29% of women. The compares to 22% and 20% of men, respectively.

Men and women found talking with friends and family most helpful in roughly equal measure – 30% of women and 26% of men. There was also no significant difference when it came to searching the Internet, with 12% of women and 13% of men saying it was most helpful.

Few people found more commercial or standardized methods most helpful. This includes lists, journaling, spreadsheets or other tools; talking with experts; and reading books, magazines or specific websites. Even if you add them all up, women still find them less helpful than any one of the big three (hearts and guts; friends and family; or prayers, meditation and sleep) on its own.

But what about the poor souls who answered ‘None of the Above,’ comprising over a quarter of women and a third of men? To some extent that high response rate is probably bad data; we used Google Consumer Insights for this survey, so some people may have made that choice to avoid answering the question. We are considering a follow-up survey to correct for this. However, based on our other less statistically rigorous research, we have found that for some people and some difficult decisions, nothing is most helpful.

As for the higher number of men in that sad situation, perhaps they can learn something from the women around them and spend some time looking inward for answers to impossible decisions. Said another way, not only are women 20% more likely to find multiple methods helpful, but men are also 30% more likely to find nothing helpful. What works for women may well work for them, too.

Or you can sign up for our beta and see what we’re up to.

 

The survey was fielded in the second half of October, 2012 by Wahanegi, Inc. The 95% confidence interval is roughly +/-1 to 3% depending on the response, with the larger band applying to higher percentage responses. Two separate samples of 1000 responses were averaged to generate the final results. Respondents were allowed to select more than one answer.

Compassion is the secret to wise life decisions.

Decisions are the hardest part of life, when we take fate in our hands and cast off in our own direction. Even the word itself is hard – it comes from the Latin decidere, meaning to cut off. No wonder we sometimes have that feeling of being on a knife’s edge trying to decide. The decisions we make literally cut off life directions.

So we use our big brains to try to understand our decisions before we make them, to make sure we make the right ones. We seek advice from friends and experts, we gather information from books and the Internet. Many of us know to sleep on big decisions, and a few of the most disciplined among us may even apply statistical tools to the effort.

Yet in the end, it is still impossible to make the right decision. No matter how hard we try, we can’t truly know what direction the world will take. We must decide anyway, and do it wisely.

Wahanegi App Tile LogoThat is not an argument against understanding the decisions we face. We have responsibilities to ourselves and those around us to make the best decisions we can. But we should not do it to make the right decisions; we should do it so we can make our decisions wisely. The wise response to facing an impossible task is to look inside ourselves. We should understand the decision as best we can, but we must keep in mind that we are building that understanding not to find the impossible right path, but to have compassion for ourselves after the decision is made, come what may.

Our instinct for empathy, for understanding how others feel, is what drives us to seek people who have faced our decisions already. What was it like to start your own company? When did your body get back to normal after a third child? How does it feel to go back to work once your kids are in school? Who are you voting for? We ask not just because we want to know what others are doing and what will happen, but because we want to know how it feels. Such empathy is important, and it gives us valuable perspective and insight into our decisions.

But the act of deciding is not just an act of empathy. It is an act of compassion, the wish to relieve the suffering we see in others.  When we make decisions, we imagine how life will be for our future selves and those around us, and then we decide on a path that best balances their suffering with what may happen. Our instinct for compassion is what drives us to make decisions. Without compassion, we would simply talk about and study our decisions forever, searching in vain for the right one. We would never decide.

Keeping compassion top of mind changes our perspective towards decisions. It instills wisdom by motivating us to value the most important and meaningful information we have, to seek the truth even when it hurts, and to make decisions that motivate us, reduce our regret and increase our happiness. It points us to some of the most enduring wisdom of all. Know thyself.

If you are interested in knowing what we are up to, you can sign up for our beta.