How do you make a mark?

How do you make a mark with a new company in a competitive market? How did Facebook reach its first $100 million mark in revenue?

The answer may surprise you - and change the way you think about your own business strategy.

In 2006, Mark Zuckerberg and his team were more focused on coding Facebook than growing revenue. Mark hired Dan Rose from Jeff Bezo’samazon.com as “VP of Business Development” to help grow revenue.

Dan had learned from Jeff Bezos that one big partnership can make all the difference to revenues. He watched Myspace start doing big deals in the grand style of it’s new Deal Maker owner, Rupert Murdoch. The problem was, Facebook was growing, but was not as big or as established as Myspace yet, so its marketing partnerships were still small.

Within a month of Dan joining Facebook, in August 2006, everything changed. Myspace announced a $900 million deal with Google. Myspace had the traffic, and Google had the ad network. It was a perfect partnership where Google would manage Myspace’s ads, and that deal single-handedly made Myspace profitable.

Dan Rose asked “Who has the most to lose from this deal?” The answer was Bill Gates’ Microsoft MSN ad network, which had lost out to their arch rival Google. Dan jumped on the phone to Microsoft, and asked them if they wanted a similar deal with Facebook. Microsoft’s answer? “Okay, we’ll be down there tomorrow to iron it out.”

That one deal, wrapped up 24 hours later, doubled Facebook’s revenues in 2006 from a forecast $22 million to over $40 million. The year after, the Microsoft deal was worth over $100 million in revenue to Facebook.

One phone call to solve Microsoft’s problem - which was not wanting to lose to Google - led to Facebook’s first $100 million.

Sometimes to win the war, it’s easier to help others fight their battles than to fight your own. Sometimes their battles are much bigger than yours.

Who would you love to work with who would want to have you in their corner? Who could you be helping to win big today?

The fastest way to find out? Bring in someone with inside knowledge - Inside knowledge that’s outside the box.

“If opportunity doesn't knock, build a door.”
~ Milton Berle

 

What does an English teacher know about math? Plenty, if your name is Jack Ma.

Jack raised $4.5 billion (the largest private tech investment ever) for Ant Financial: A company he created in December 2014. The company has gone from zero to $60 billion in value in just 16 months.

Jack Ma has never taken no for an answer. In September, 2014, when he was not able to list his company, Alibaba, in Hong Kong, and with China banning any foreign ownership of its companies, Jack got around the rules by setting up a Cayman Island shell corporation which would receive a percentage of the profits of Alibaba.

He then listed the Cayman Island company on the New York Stock Exchange, raising $25 billion in the largest IPO in history - without giving any of the shares in his China company away.

Before the listing, he took the payment side of the business, Alipay, and moved it into a separate, private company that he controlled, called Ant Financial. As Alibaba has been making headlines over the last year, Ant Financial has been quietly growing as Jack’s second billion dollar business.

Ant Financial now reaches 450 million users (More than the population of the US and UK combined), and has given out 20 million loans to entrepreneurs in China. Alibaba receives 37.5% of the profits from Ant Financial, but does not own any of it. Jack has managed to spin the business off entirely from Alibaba, and then grow it alongside Alibaba while entirely under his personal control, from zero to $60 billion in value.

This has allowed him to pursue his vision of helping the small guys while raising the money he needs from the financial markets and without losing control or giving away any ownership.

Jack’s next step? The former English Teacher plans to list Ant Financial on the China stock market later this year, which is likely to double his current net worth of $22 billion.

While too many entrepreneurs get caught up in how much of their pie to give away, Jack understands that when you own the bakery, you can always make another pie.

How can you create partnerships and raise financing creatively, while keeping true to your vision? How can you organise your own resources smarter? Take a tip from Jack, and never take no for an answer.

“They called me ‘Crazy Jack’. I think crazy is good. We’re crazy, but we’re not stupid.” ~ Jack Ma

Remember You network is your net worth

How valuable is your network? The Paypal Mafia is an extreme example of the phrase “your network is your net worth”.

When eBay bought Paypal in 2002, the founders of Paypal had an average age of 30. With the opportunity to go out and start again, they decided to stay in touch and share their strategies, experiences and connections as they launched their next businesses.

The result?

Elon Musk launched Space X and Tesla (Now worth $30 billion+)
Reid Hoffman founded LinkedIn (Now worth $25 billion+)
Peter Thiel launched Palantir (Now worth $20 billion+)
Steve Chen and Chad Hurley founded Youtube (Sold to Google for $1.65 billion)
David Sacks launched Yammer (Sold to Microsoft for $1.2 billion)
Russel Simmons and Max Levchin launched Yelp (Now worth $1.6 billion+)
Dave McClure founded 500 Startups (Invested in 1,300+ companies)
Premal Shah became president of Kiva (Crowdfunded 1 million+ microloans)

The founders sold Paypal for $1.5 billion 13 years ago, but as a result of sharing their journeys after that, they now have a combined net worth of over $20 billion.

Between them, they have created 7 billion dollar companies and invested in many more, generating over $100 billion in market value.

Supporting each other was the intention from the beginning. As Peter Thiel recalls, “When we started PayPal, I remember one of the early conversations I had with Max was that I wanted to build a company where everybody would be really great friends and, no matter what happened with the company, the friendships would survive.”

Your success will be determined not by how much you want to be successful, but by how many of the right people you connect around you who want you to be successful.

Your network is your net worth.

What can you do today to improve your network?
What can you do to add more value to the one you’re in?
How can you grow network value everywhere you go?

Today we live in a networked world. So thinking about growing network value is more important than ever. As Reid Hoffman says, “In the Networked Age, we’re all like the little kid from The Sixth Sense. If you’re not seeing networks when you enter a room, you might want to check your pulse.”

Have you ever been rejected for a job?

Have you ever been rejected for a job? Brian Acton has. After 11 years at Yahoo! and out of a job at 38 years old, Brian went job hunting... first to Twitter (rejected) then to Facebook (rejected).

What do you do when you’re 38 years old, competing unsuccessfully against 20-somethings for a job as a systems engineer? If you’re Brian, you go out and play frisbee...

Two years earlier, he had travelled South America playing ultimate frisbee with Jan Koum, who he had met while working at Ernst & Young as a security tester. Now, in the midst of his job rejections, he met up with Jan again for a game of frisbee.

It was while playing, Jan told Brian he was working on a start-up to create a new kind of mobile app, but he had run out of money. Jan had lived on welfare with his parents when he first arrived to the US from Ukraine. Not wanting to go back on food stamps, he asked Brian for advice on whether he should quit and start looking for a job.

Admiring Jan for his courage in starting his own company, Brian replied “You’d be an idiot to quit now. Give it a few more months.”

The topic turned to Brian’s success in getting a new job (which was non-existent) and it was only a matter of time before Jan (who had previously been rejected from a job at Facebook) had turned Brian’s advice on himself.

He persuaded Brian to quit the job hunt and join him on his start-up, creating a new messaging app, “WhatsApp”.

Brian and Jan had one thing in common - Ultimate Frisbee. Other than that, they turned out to be complimentary to each other in every other way. As Brian says, they are “Yin and Yang, I’m the naive optimist, he’s more paranoid. I pay attention to bills and taxes, he pays attention to our product. He’s CEO. I just make sure stuff gets done.”

In a job hunt, all your weaknesses are exposed. In a start-up, your weakness can be supported by your team member’s strength. So becoming an entrepreneur is easier than being an employee.

It took a few months of convincing but Brian finally decided to take the step, reject the rejecters, and join Jan.

Brian managed to raise some funds to keep the two going, while they worked out of the Red Rock Cafe in Mountain View. With no office and no overheads, they put 100% focus at growing WhatsApp as the messaging app with “No Ads. No Games. No Gimmicks.”

In the first year, revenue grew to only $5,000 a month, but user growth boomed. Brian and Jan would switch from “free” to “paid” for the app (charging $1) when users began growing too much. When they saw people would even pay for the app, Brian said “You know, I think we can actually stay paid.”

The company stayed on an exponential growth path and, four years later, Facebook - the company that had rejected both founders - bought WhatsApp for $19 billion, making both Brian and Jan multi-billionaires.

As a symbolic gesture to their difficult beginnings, the two signed the purchase papers on the steps of the building where Jan’s parents would pick up their food stamps.

And Brian remembers a second thing outside of Frisbee that the two have in common, and which led to their success: “We’re part of the Facebook reject club.”

It took 4 years from ultimate frisbee and ultimate rejection to Brian and Jan’s $19 billion success.

4 years from now will be the year 2020. Where will you be in 2020?

Where you are in 2020 will have everything to do with the decisions you make today.

> Are you focused at finding a job instead of adding value to those already around you?

> Are you chasing opportunities instead of seeing the ones that are right in front of you?

> Is your latest rejection hiding a doorway behind it? A doorway to an entirely new, more exciting adventure?

Sometimes, it just takes a change in focus.

“Sometimes the best gain is to lose.” ~ George Herbert

Mark Zuckerberg tells the story of when he asked Steve Jobs for advice

Mark Zuckerberg tells the story of when he asked Steve Jobs for advice:

"Early on in our history when things weren't really going well. We had hit a tough patch and a lot of people wanted to buy Facebook.”

“I went and I met with Steve Jobs, and he said that to reconnect with what I believed was the mission of the company, I should go visit this temple in India that he had gone to early in the evolution of Apple, when he was thinking about what he wanted his vision of the future to be.”

"So I went and I travelled for almost a month.”

Mark travelled to Kainchi Dham Ashram, in Nanital, Uttarakhand. The same place Steve had visited, and where he got clarity on his life purpose. For a month, Mark meditated in the temple and travelled through India.

“Seeing how people connected, and having the opportunity to feel how much better the world could be if everyone has a strong ability to connect reinforced for me the importance of what we were doing and that is something I've always remembered over the last 10 years as we've built Facebook.”

Mark returned from the trip, rejected all the offers for the company and committed to push on with his mission to “connect the world”.

That one piece of advice from Steve Jobs, that one decision to take action on it by Mark Zuckerberg - and leave his company and country for a month to follow it - has proven to be worth over $35 Billion as Facebook has grown to connect over one billion people today.

Today, who can you learn from?

Today, what action are you willing to take?

Earning always follows learning.

“I realized my mission in life was to learn more, not earn more.” ~ Surya Das

3 Steps to $30 millions, Yahoo bought 17 year old Nick D’Aloisio’s iPhone app

This week Yahoo bought 17 year old Nick D’Aloisio’s iPhone app, Summly, for $30 million. When Yahoo was founded in 1994, Nick wasn’t even born yet.

What’s he doing with $30 million? As Nick says, "I can't even buy a car because I don't have a licence yet." So he’s going to buy a new bag. Why? “Mine is broken; it’s old and the strap’s not working.”

3 STEPS TO $30 MILLION

Nick’s app has delivered over 90 million news summaries in the four short months since he launched it on his 17th birthday in November. But Nick isn’t even old enough to be a Director of his company, so his mum is the Director while he sits in as Company Secretary.

What has gotten Nick to success so quickly in 15 months when so many of us are still struggling after 15 years? Here’s 3 steps his journey has in common with most super-success stories:

PROBLEM + PASSION = $300K SOLUTION

Nick’s Summly App was the solution to a real world problem that no one else was solving well. As Nick relates, “I was 15 years old and I was revising for some kind of history exam. The problem was I was trying to find information that was useful to me.”

Searching Google on his phone didn’t give him enough detail to know what was or wasn’t a useful link. So he put his own iPhone app together. The app quickly rose up the download ranks and Apple featured it in their store.

Then came a fateful email: “About a month later, the private fund of the Hong Kong billionaire Li-Kashing cold emailed me and expressed an interest to invest, but they didn’t realize I was 15...It turned out that they actually liked my age because it demonstrated I was net-native, so I’d only grown up with the Internet. They flew to London about a month later and invested $300,000. That kick-started this whole journey.”

$300K FUNDING + EXPERTISE = $1.3M REPUTATION

Nick used the money to bring in world experts to help relaunch the app. At 16 years old, he teamed up with the leaders in Natural Language Processing, Stanford Research Institute (Who create Apple’s SIRI - named after the company’s initials, SRI).

In between high school classes in London, Nick worked with SRI in the US by phone and text messages to build the new app. SRI’s solid reputation and Nick’s focus on approaching well known celebrities to help him attracted high profile investors Stephen Fry, Ashton Kutcher and Yoko Ono who invested $1.3 million. Nick made the most of his investors, with Stephen Fry starring in the launch video for Summly.

$1.3M REPUTATION + SINGLE-MINDED FOCUS = $30M STORY

With world class partners and world class investors, Nick gave up full-time school at the end of 2011, with his parent’s blessing: ““I talked about it with them and my headmaster and we decided it was a once-in-a-lifetime opportunity and it would be silly not to run with it. Now, looking back, I can say it was a massive gamble. But it was a good gamble.”

From a standing start to $30 million, Nick has taken the age old 1-2-3 formula of solving a problem in a smart way, then using the resources he attracts to bring in the best talent, and leveraging that to attract the most influential partners.

What made him think he could just go and knock on the door of the best companies and most well known people in the world? As he says "I was naive. I didn't know I couldn't."

Nick is now reflecting on this week’s news: “Numbing is probably the best word to describe it. It’s a shock to be honest. The only thing I can take from this is that I’m genuinely kind of proud that I’ve been getting a lot of tweets where young people are commenting and saying, “This is really inspirational, I want to go and start my own thing.”

How many of these 3 steps in the 1-2-3 formula have you taken in your business? What can you do to upgrade your product, your talent or your partners?

Or maybe it’s time to be a kid again, be naive again, when you didn't know you couldn't. And start something entirely new.

Top 10 Startup Mistakes

Four things make up 79% of all business failures:

#1 - Building something nobody wants (36%)
#2 - Hiring poorly (18%)
#3 - Lack of focus (13%)
#4 - Failing to market & sell (12%)

How to best avoid these failures:

#1 - Always start with the customer, not the product. Get your beta group / user group of customers and work with them to deliver what they love. People will pay you to do what they love, not to just do what you love.

#2 - Outsource to experts who manage themselves, not workers who need to be managed. Hire people who let you do more of what you do best, not people who take you away from your talents because they need to be managed.

#3 - Once opportunities begin to grow, don't get defocused. Anything that doesn't add to your customer's experience isn't worth doing.

#4 - Don't fail by having a great product that no one knows about. Don't rely on someone else to sell your product until you have more sales than you can handle. Don't make sales by closing customers. Create buyers by opening relationships.

#5 - More than all of the above, maximise failures that steer you (testing and measuring) and avoid failures that sink you (when you run out of money and time). Fail passionately and fail often, earning and learning with each failure, so it's you that keeps failing (and learning) and not your company!

"The biggest risk is not taking any risk.. In a world that is changing really quickly, the only strategy that is guaranteed to fail is not taking risks."
~ Mark Zuckerberg

And...

"Never, never, never give up."~ Winston Churchill