This article originally appeared on TechCrunch.

Creating awareness for your brand and products is one of the lifebloods of technology startups yet in a world where so many companies are being created it becomes difficult to rise above the noise.

Ever notice how some companies tend to be in the press all the time and your big new product launch struggled for inches?

Mostly it’s because your marketing campaigns suck.

Or more directly – they are likely narcissistic resuscitations of your newest features or bragging points that nobody but your marketing team and your mom care about.

I recommend that companies move beyond narcissistic marketing to what I call “point-of-view (POV) marketing.”

Here’s what I mean …

Let’s start with what it takes for a journalist to want to write a story. Here’s what’s going through his/her head:

• Is this story “newsworthy” or am I being asked to publish a press release?
• Do I have an “angle” from which to write the story (first company to do X, company does biggest X, consumer behavior is doing X)?
• If I’m covering a company can I get evidence of what the competition is doing so the story is balanced?
• Do I have data or facts to present so the story has legs?
• Can I get sources to talk on-the-record or off-the-record to lend credibility to the topic?
• Will I have information that other journalists don’t have (otherwise known as a “scoop”)?

But mostly they’re thinking, “Will my audience even care about this topic?”

The ultimate measure of success for a journalist is viewership so if nobody cares about your shitty little company and the story you’re trying to pitch then the journalist doesn’t want to publish. And it’s their judgment that becomes the ultimate arbiter of this.

And beyond eyeballs they also care about “journalistic integrity” (aka their reputation) so they want to be sure they’re not being gamed. That’s why having long-term relationships with journalists matters and why having people close to the journalist who can vouch for you.

So how exactly do you break out then?

If you start with a POV rather than product features / functions or your own internal news story you’re already a long way down the track of answering the above questions. The idea is that you put out information with data and a point-of-view and that becomes the story rather than you.

Why would I want to have a POV rather than talking about my cool new features?

The major battle for press is a battle for “mindshare” and it’s exactly the reason I blog. I am a VC. I hand out money. How differentiated is that? But through expressing points-of-view I can raise above the consciousness of my customers (entrepreneurs and limited partners who invest in VC funds) in ways that I couldn’t without breaking through the noise of the hundreds of others of VCs who also have money.

Think about Luma Partners. They are an investment bank that targets the technology & media sectors. They basically help companies get sold and help buyers determine which companies to buy.

Their website proclaims,

“LUMA Partners is a different kind of investment bank. We provide strategic advice to digital media companies in a manner that reflects how corporate development is actually done. This more strategic approach produces better outcomes for acquirers and target companies alike.”

Can you imagine that ever getting inches in the press? Or somebody reading that and thinking “Yeah, I get it. Let me be sure to use me some Luma Partners. They’re different. More strategic. Must call. Now. Dialing.”

Of course not.

But everybody knows Luma Partners in our space. Why?

Because they produce the “LUMAscapes” which are essentially visually guides to all of the major players in a technology market. It’s brilliant.

Every corporate buyer of technology and/or technology companies knows the LUMAscape and uses it to figure out which vendors they should consider. And thus every technology company in that space fights to be sure they’re on the LUMAscape.

And every time a new LUMAscape is published it is newsworthy. Why?

A journalist has a visual chart they can use. That chart has information on it. Some people were added to the chart. Others were removed. There’s drama. Intrigue.

It doesn’t talk about Luma’s strategic approach. But everybody knows that Luma produced it.

Now of course there’s a lot more that goes into building a brand like the fact that the founders of Luma have long reputations in our industry and people respect them. Plus they run conferences with the top people (which is another form of POV marketing by the way).

But mostly they break through the noise of many other investment banks by having a POV.

One of the masters of this in the startup technology world is Flurry. Consider this blog post titled, “Christmas 2012 Shatters More Smart Device and App Download Records.” In the post they list four charts with data showing how Christmas day is a huge driver of downloads for mobile applications (obviously because many people get new smartphones for the first time). It’s why every major mobile app developer gears up for the holiday season by trying to be as high as possible on the charts because when the newbies come searching for popular apps in the app stores you get a huge additional bump if you’re already high in the charts.

Flurry doesn’t talk about all of their analytics features and functions. They offer a point-of-view about their market. And they back it up with data. And journalists eat that shit up because it has all that they’re looking for: facts, charts, an angle, news, something that their readers care about, etc.

And Flurry always gets mentioned. So when somebody is going to the purchase aisle and thinking about buying a mobile analytics platform they have the brand recognition that matters.

Final example. PwC. They sell accounting services. You can imagine the press release, “New innovative model allows us to do audits differently than the competition!” Or I guess that was the slogan for Arthur Andersen. Ouch. Kidding!

But look at what PwC actually does in this report, “CEO Surveys for Business Growth” which has a POV, two charts and a video to watch. They have configured the charts to be easily downloadable and sharable directly from the page and the video to be embeddable. Their marketing team ought to gets some pats on the back. Making it extra easy to copy charts / data just increases the lift the story gets.

By publishing your data on a blog (as in the case of Flurry and PwC) you get the added benefit of driving traffic back to your website as the journalists often link to the “full report” and thus you get all of the SEO juice to drive future search traffic also.

So next time you’re thinking about how to get coverage for your new downloadable widget that third-party vendors can install and instantly get optimized gobblygook for some feature they didn’t know they needed and want a journalist who doesn’t give a fork about optimized gobblygooks and frankly doesn’t even understand what that is … think about leading with POV marketing instead.

When you get your potential customer talking about your brand, linking back to your website to learn more and show curiosity that’s when you want to hit them with, “have you ever thought about …?” But by then that person is a qualified lead that has shown enough interest in your website to pay you a visit.

If you want more marketing & PR tips I summarized a few of them over here on my blog, BothSidesofTheTable and I’ll add to the mix over time.

And I’m sure it’s not lost on you that my tips and my blogging are, in fact, POV marketing. After all, my money has the same president on it as everybody else’s in the US.

It is with great pleasure that I can finally announce that we have added Greg Bettinelli as a partner at GRP Partners.

If you don’t already follow him on Twitter please click link and follow. You won’t regret it. The guy has knowledge.

It is the first time in 6 years that we’ve expanded the partnership as is reported expertly here.

So why Greg and why now?

I first met Greg about 4 years ago or so. He had joined a young startup in LA called HauteLook and was interested in getting to know the local tech community.

Because my role as a VC requires me to take and endless stream of meetings I long ago decided I need to learn as much as I can from the meetings I attend so I often just ask tons of questions and assimilate knowledge. I love learning so this is a great process.

I instantly hit it off with Greg because we was a fountain of knowledge. He shared tons of information about how how they were using marketing to quantitatively make marketing decisions at HauteLook and acquire customers for prices that were far cheaper than similar companies.

On each subsequent meeting I’d learn a little bit more. Greg was the first person to share with me the insights of mobile conversion and why with a simpler product selection and conversion funnel they would get higher conversion on mobile than on the web. He was also the first one to challenge my conventional wisdom that it made no sense for tech companies to advertise on television. He walked me through both the logic and the math. He always had an angle for how he could acquire better, faster, cheaper than others.

So I started introducing him to portfolio companies. I always tried to be respectful of his time because he had a day job but he was always happy to attend dinner sessions, take a quick call from a startup or grab a coffee.

The feedback was always universal, “that was the most helpful marketing meeting I’ve every had.”

I always felt the same.

Greg was the CMO at HauteLook from the early days all the way through growing the business to 12 million registered users and far in excess of $200 million in annual sales. In 2011 the company was sold to Nordstrom for $270 million in a deal that has been widely seen as a success for both buyer and seller.

After that you could tell that Greg was really “all in” on the LA technology community. He co-founded a prominent accelerator in Los Angeles called MuckerLab, that has produced a number of impressive companies and he mentored more than 20 of them.

This is exactly the brand that GRP Partners wants to embody. When I think about what defines us as a VC I think:

• Operationally knowledgeable / strong startup competence
• Quantitative & analytical
• Natural mentors – a desire to help
• Community builders
• Open & transparent
• Approachable

And Greg was a perfect match for all of these. So I began talking to him about joining the fund. It was perfect timing since in 2012 GRP raised its fourth fund bringing our total assets managed to nearly $1 billion.

And there was instant chemistry and where we both saw our respective futures.

We both wanted to build a practice that would make Los Angeles proud but where we would travel tirelessly to other locations to make investments in the best entrepreneurs wherever they were. GRP’s biggest winners over the years have not only come from LA (Overture, CitySearch, TrueCar) but from Chicago (Envestnet, Ulta), Las Vegas (HDI), Baltimore (BillMeLater), New York (DealerTrack), London (LastMinute.com) and other locations. Like any firm we of course invest in the San Francisco Bay Area where 33% of my personal boards are.

We both wanted to put energy into GRP’s platform of services that provide more value to our investments than merely capital.

We both wanted to invest in a select number of companies and spend more time with those companies rather than invest too broadly.

We both wanted to continue to build a world-class staff at GRP from which to build future leaders in either tech startups or in our investment firm.

So we talked about his joining.

I made some reference calls. They were effusive. Especially from those that had worked with Greg over his many years at eBay. One of his biggest accomplishments there was championing the acquisition of StubHub. One senior eBay executive told me, “many people suggested buying StubHub. Only Greg had the persistence and persuasion to champion it through the behemoth that eBay had become. He was stubborn. He wouldn’t give up until they understood why they HAD to buy it.” After PayPal, StubHub is widely seen as eBay’s second most profitable acquisition.

Another reference I called who is ex eBay and now a prominent VC said to me, “If I were organizing a marketing panel on online marketing and I wanted to pick the top 5 marketers to be on the panel Greg would be on my list.”

And then we settled in on his role. We knew he had to be an investment partner. He has the skills, gravitas, experience and temperament for it.

We settled on Venture Partner as is now being reported and also picked up here.

What does that mean?

He is an investment partner exactly like I am. He has full investment authority and attends all of our Monday partners meetings and investment committee meetings. The only difference is that he will be half time at GRP.

What? How can you do a job half time?

Pretty well as it turns out. If you do half the number of investments of a full-time partner. You are on less deals but for the same amount of time.  And we’ve designed the economic incentives so that Greg is aligned with the overall performance of GRP in addition to his investments so I’m excited to get him involved across all of our portfolio companies helping provide fresh perspectives on the important topic of growth.

What will he do with his other 50% time? Golf more?

Well. I’ve been to his house and he did build a little putting green atop his patio deck in the hills above Brentwood that has spectacular views. But luckily for his wife I don’t think he’ll be spending much extra time there. His plans are still solidifying but will likely involve some later-stage activities in the eCommerce & retail sectors unrelated to early-stage venture capital. And largely synergistic with what we do – which is awesome.

So is that it for change at GRP for the next 6 years?

Hardly. Many more improvements afoot. Much more of our fee income poured back into our community, our offices, our staff, our portfolio company – where it belongs.

Watch this space.

But for now please welcome Greg to GRP and if you want to get a sense for his knowledge base feel free to watch this discussion I had with him on This Week in VC.

Every decision has consequences. We often don’t fully perceive the consequences because they are often hidden by the compromises that make us feel better.

Every step forward requires a decision. Or the inverse – indecision. Or as I call it, “decision, by indecision,” which is insidious. It rots the core very slowly until you don’t realize you’ve accepted mediocrity.

Consequences.

Let me start with a story.

About a year ago I was working with a team whose performance had not gone as expected. This was not the first discussion I had had with the CEO. He believed we had a weakness with his CTO. I had suggested that if he was sure there was an issue we should move on quickly even if it implied short-term pain.

He said we couldn’t make a change yet. He was deeply committed to change. But this was too sensitive of a time. It might destabilize the team. It might affect fund raising. It would be yet another distraction for this fledgling CEO and he felt he needed to focus on biz dev, sales, marketing and fund raising.

It is my job to be a sparring partner for teams not the decision maker. That’s how I see the role of a VC. Founders have to live with the day-to-day consequences of their decisions and are closer to the nuances of the business. So I fight. And then I pull back and accept decisions even when I didn’t carry the day.

In this case I did not.

The consequences?

Another 9 months of poor performance. Another $100,000 in drained money (salary plus benefits of just one poorly contributing individual).

And far more importantly:

• lost productivity
• lost opportunity to have had a new leader on board for at least 6 of those months
• cultural decay. organizations perceive a poor effort. and they don’t respect organizations that don’t fix them. this last one is one of those that people who avoid decisions least perceive. the unintended consequences of indecision.

So.

Here we were 9 months later and facing the same decision we had avoided previously. Except this time I wasn’t sparring, I was instructing.

“I have never worked with this individual so any negativity we together feel about his performance is simply me reflecting your frustrations back at you.

The only difference between you & me is that I am emotionally removed from the consequences of the decision so I can see it more clearly.

I’m done with procrastination – we’re moving on. I want a plan in place by the end of the week.”

This was said in the context of a board meeting in which I was advocating a view. The board was unanimous and the CEO accepted the consequences of our group decision. He himself now felt it was the right answer whatever the past. So we turned to the how not if.

We talked about what a fair settlement would be. The CTO had at-will employment with no notice period. He had vested 18 months or so.

Our company had limited cash and – like most startups – an unsure future.

I proposed that the CEO sit down with the CTO and walk him through the legal obligation of the company, which is zero notice, paying for all days worked and all accrued vacation time, and allowing vesting through that date. Then on top of that I proposed we offered 2-3 weeks of pay (with a view of settling around 4 weeks) and that we vest an extra 3 months.

He wanted to offer 2-3 months’ pay. My response was NFW. Taking the extremes: 3 months vs. 1 month was about $25,000.

He said, “For the sake of $25,000 I would rather have the peace of mind that we treated him fairly.”

Fairly?

My view was he had already earned 9 months extra pay.

Hidden consequences are opportunity costs.

What else could we have done with $25,000? Wouldn’t it be better to have put $12,500 in the pockets of two of out great performing team members? Wouldn’t it have been the “fairer” thing to do since we were terminating this guy for lack of performance?

$25,000 is a lot of money. Wouldn’t it be better to surprise two unsuspecting people with an unexpected reward? Don’t the performers deserve more spoils than the unmotivated, uncommitted and non-performant?

Or are we merely buying off our own personal guilt from the economic and societal consequences of the hard choices we make? That’s the easy way out. We sleep better at night. It’s egocentric.

Leaders allocate resources wisely and prudently. They use resources to reward and to motivate. And my vote is for motivating the team on the field rather than the team on waivers looking to get picked up by another team. Let them deal with motivating that person.

It is no fun being the leader.

The CEO made bad choices as defined by me. And being clear – it’s subjective. He may feel otherwise.

After our board meeting where we pushed him hard on appropriate resource allocations he called other CEOs to try and get datapoints and “prove” that I was being too mean spirited. He found takers. You can always find takers. They suggested 6 weeks. So he sent me the emails from these CEOs confirming I was wrong and a message saying he had already fired the employee and paid him 6 weeks (actually, it was two employees for what it’s worth).

He won the battle.

But at what … consequence?

No additional money to bonus the team on the field. Eroded confidence from his most important advocate on the board – me. Somebody slightly pissed off that he was cast in emails with other founds as the “cheap VC board member.” Me, again.

It was never about the money for me. He could have convinced me to bonus our best performers $30,000.

It was about doing the right thing by the people who deserved the resources the most. It was showing me he could make tough decisions. And the right decisions.

Every decision has these consequences. He just didn’t perceive the costs of the board losing a small amount of confidence in him that day. He sold it cheaply – for $6,250.

I’m sure he’ll look back at the sequence of events and see things differently than I do.

But I do know that I have heard this story too many times to not point out the obvious: Every person who faces tough decisions gives you the reasons why “their situation is different!”

Seen through the eyes of other companies they boldly proclaim, “They should have just fired that co-founder. I would have! They should have shut down that product line faster – it was obviously not working! I would never have delayed changing my organization when it was clear we weren’t shipping product on time!”

Expect when it’s actually you. Because “we’re different.”  It’s a different situation. I can’t afford to lose my head of sales right now – who would pick up the leads? [that was my excuse for delaying firing my head of sales for 6 months.]

But It’s Not Just About Firing People

How about promotions?

Have you ever noticed how many leaders are afraid of offering promotions to individual superstars because they’re worried about the impact on the rest of her teammates?

Me? I’d rather have my single best performer called out for greatness. I’d rather give everybody else in the organization something to shoot for. A role model. An achievement not yet earned. A statement backed by action sprinkled not only with titles but with economic rewards and decision-making authority. I have done this throughout my career and have never regretted it once. Never.

In any organization only a few key players make all the difference between excellence and pretty good. Sure, it takes a team to perform. But it takes leaders to inspire a team.

For every superstar you hold back at the expense of wanting to be “fair” to the masses you miss the opportunity to offer that extra motivation, that extra adrenaline hit that superstars thrive on. You favor the pretty good over the excellent.

And that’s a choice. It’s a decision. It seems like a decision avoided to keep the peace. But that is a decision unto itself.

Which is why your superstar is already dreaming of her next big thing.

And it may not be with you.

I believe that groups coming together to make tough decisions driven by consensus tend to make poor decisions.

This is especially true in startups where speed matters and where there is a need to constantly calibrate direction and where these decisions can have existential outcomes.

• Should you increase your burn rate by adding 2 senior hires who will help you ship faster or sell more but then have less time for fund raising? Or maybe their existence itself will help accelerate fund raising. Who the fuck knows? But YOU have to make that tough judgment call.
• Should you raise $3 million in stead of $2 million even though it means more dilution so that you will have a longer runway?
• Is it better to have 2 VCs in the deal at 12% each or one at 24%? There’s no right answer.
• Do you ship your product in what you don’t feel is feature complete so that you can be in market first or should you hold back and deliver a product you believe will get better reaction from the market but is 3 months later?

It’s hard being a leader. By definition leaders make hard choices given incomplete information. And by tough decisions I mean it is clear that some people’s views will end up on one side of the fence and others will end up on the other side.

But you need conviction.

Leaders need to be respected, not loved.

It’s why I look for strong leaders in companies that I back. A person who can inspire others to believe in the tough choices she makes and really get behind the tough choices made rather than than half the organization grin-fucking her.

I have seen the sclerotic pace of decision-making by some co-founders who don’t have a common sense of purpose or the ability to resolve conflict when different opinions result in delayed actions.

It’s why I caution people about whom you choose as your co-founder.

I believe in “benevolent dictators.”

They make tough decisions that they believe are in the best interests of the whole even when the collective consciousness of the whole doesn’t perceive it until much later.

I believe in people who are willing to put their reputation on the line and willing to be wrong. People who have a bias for action.

People who don’t always put themselves first even though the fact that they make tough judgment calls often makes others feel they are in it for themselves. People who go the extra mile behind the scenes to make sure that employees get topped up on options because you didn’t get their paperwork done before the 409a valuation even though said employee may not even know you did it for them.

Or firing people.  On the surface it can elicit negativity or a feeling that you have a sharp edge yet in some ways your benevolence might come from the fact that you are increasing the probability of success for everybody who stays. Increasing the chances of success for the people who put in their evenings and weekends and sweated their butts off for success when the people terminated may not have pulled their weight.

You’re the leader. It is your job to face these decisions early rather than put off that which is unpleasant. It is your job to absorb the uncertainty so that others can concentrate. Your job to face the naysayers, the haters, the skeptics, the back-benchers, the soft. And to take shit from all of them while still turning up at work with a smile on your faces and moving forward.

You’ll get your accolades. People will notice results. You’ll get public pats on the back and attaboys (girls). But you’ll have an equal chorus of, “She’s difficult to work with. She far too opinionated. Tempestuous.”

Fuck ‘em.

Don’t feed the trolls. Know that you signed up for this and it is why you are a leader.

I know, I know.

It’s 2013 and I’m supposed to believe in the “wisdom of the crowds.” We’re supposed to all allow side projects. 20% time. Total transparency. Everyone has a say. Free food. A chef. An on-premise masseuse.

And that’s fine.

Except that all of this “can’t we all just get along” mentality produces slow decisions. Group think. Compromises that lead to mediocrity. Avoidance of bold moves.

Think. Steve Jobs. Marc Benioff. Larry Ellison. Larry Page. Mark Zuckerberg. Bill Gates.

See any common threads?

Decision makers. Visionaries. Leaders. Chart their own course against the constant chorus of second guessers.

How many people thought Jobs was crazy when Apple first opened retail stores? How many lambasted Bezos for not delivered on profits at Amazon in aftermath of the dot com crash. He told people he was building for the long-haul and if they didn’t like the vision they shouldn’t hold the stock.

Bravo.

Don’t get me wrong. I am not saying that you should make decisions without other people’s input.

My motto is “always triangulate.”

I constantly ask people their opinions about topics and listen to how they argue them. By having many views and mixing it up into a pot and then sorting it out with a logic structure that informs my decision I often feel I get better results.

I don’t believe in turning up to a group discussion to form my opinion. I believe in sequential debates with the participants before I arrive. I then have a nuanced view of everyone’s position to make the most informed decision accounting for everyone’s views.

I know I kind of have a gene missing that allows the long, slow, consensus-building required to make infinitesimal progress on what are obvious decisions in side of my head. And it’s why I can never run for public office.

And I know that for every leader with whom this post resonates I will producer others who are affronted.

It’s subjective.

If you’re one of the ones with me just have the confidence to stick to your guns.

And the temerity to follow through on the vision of the future that is forming in your mind.

“In 15 Years From Now Half of US Universities May Be in Bankruptcy.” Such was the quote of Clayton Christensen followed by, “… in the end I’m excited to see that happen. So pray for Harvard Business School if you wouldn’t mind.”

Who else does Clayton pray for? Apple. Yup! Watch the 30-minute interview to hear why but summary notes below.

Let me start by saying that Clayton is one of the most influential people on my thoughts about markets that led to both the concept behind my first startup and my main theses in investing. I have written about Deflationary Economics (one of my most read posts ever) & The Innovator’s Dilemma before. In a discussion I had with Fred Wilson at the Invesco LP meeting Fred said the same about the influence of Clayton.

So it was a real pleasure to be asked by Derek Anderson of Startup Grind to be able to interview Clayton for an audience of thousands (many in person, others by live broadcast).  Startup Grind was a truly awesome conference and Derek the consumate host. I hope to be asked back for next year’s event.

Clayton Christensen certainly didn’t disappoint. It was one of funnest discussions I’ve held with a senior leader and he was surprisingly open and frank. If you have some time I highly recommend watching it.

So what did he actually say?

Disruption of Education

He talked about how for centuries education had “no technological core” (meaning it was bound by physical locations) and thus disruption was very difficult. Obviously that barrier has been brought down with low-cost ability to capture, stream and distribute content over the Internet.

Today’s higher education is responding by making more courses online and available to people outside of physical boundaries.

But while universities are developing online content they are not fundamentally disrupting learning because the method of delivery is not a new business model. “Online education is truly going to kill us.” He talked about the need to have content delivered closer to those in the work force who could immediately apply what they’re taught and then immediately be back in the classroom to discuss the implementation.

We spoke about how there needs to be a change in how employers view educators. This is why I am such a big fan of General Assembly both because they’re teaching more tangible skills but also because they’re working directly with employers to fund classes as well as to onboard the more successful GA students directly. In my discussions with GA I know we share a vision for where practical education in the US needs to go.

Back to Mr. Christensen, “We subsidize their education in fields for which there are no jobs” he said in referring to the fact that many courses at universities are still taught with skills that aren’t relevant to the 21st century needs of the US workforce.

It’s not that I don’t believe in liberal arts, humanities and the like. I do. In many ways I think general purpose writing & thinking skills are as valuable as math skills. I believe, though, that they need to be taught more in the context of helping people develop meaningful careers that position them to succeed financially in the changing world in which we live.

We talked about how business school historically hasn’t positioned entrepreneurs well for success. I wrote about that before in a post about “whether MBAs are necessary for entrepreneurs.”

But I pointed out a professor at HBS (Tom Eisenmann) who teaches a course where blogs are a part of the classroom reading material. His class reading lists could be a primer for any entrepreneur, not just MBAs.

And I have been impressed with Steven Kaplan and others at University of Chicago (my alma mater), who have been encouraging entrepreneurship through the Polsky Center for Entrepreneurship, through angel investing, seed conferences and changes in teaching.

Internationalization of Technology

We spoke about what succeeds early in technology market evolutions. Clayton spoke about how in early phases Proprietary architecture often wins.  As markets grow, the more open and modular systems win. Proprietary systems are pushed to the ceiling (in terms of having more complexity / features) and the open systems capture volume. That’s why he “prays for Apple” because in envisions a world in which Android captures much more market share even if the open system it provides may not be as quality or feature-rich as Apple’s.

We also spoke about technology systems in the perspective of global competition. He believes that one of the financial metrics taught at business schools and reinforced by Wall Street has accelerated offshoring of industries. He spoke about ROCE (return on capital employed). The numerator (return) encourages more sales, which is fine. But “on capital employed” encourages companies to push more off balance sheet and thus into offshore & outsourced situations.

I reinforced this view by referring to a very interesting article I had read by Andy Grove (co-founder & former CEO of Intel) on car batteries, china manufacturing and the problem of US outsourcing.

Freemium

We had a brief chat on his views of “Freemium.” He spoke about the early days of Napster & Kazaa where free music as open system thus hard to use. Apple came along with proprietary infrastructure, which made it easy. So they could monetize and people would pay.

Venture Capital

We spoke about the disruption of VC through crowd funding. I don’t believe it. Neither does Clayton. Unsophisticated money pours into a system as it did in the 90′s through AIM, Neur Markt, Nouveau Marche, etc and burned many investors. We talked about Liquidation Preference, Voting Rights, and all of the other valuable terms crowd-funding investors don’t understand. I think I’ll save a deep dive on this topic for another post.

By he did bring up a very interesting other area of which I had never heard. He talked about a unique model where you don’t have to become liquid in venture capital and can target singles & doubles. VC can’t don’t invest in these kinds of companies because they can’t get out (no liquidity event). New company in Boston with a model called “royalty capital.” Money is not debt or equity but a “license to use their capital.” No royalty paid until there is revenue. Then there is a royalty rate. The faster the ramp, the more the royalty comes down. As royalty hits 3x value then we say it’s paid in full. No minority shareholder. Pay it off with pre-tax money. Liquidity is a process not an event. Some money out of every investment. Not 1′s and 0′s.

How You Measure Your Life

And finally, a very interesting discussion emerged at 25:30. Mr. Christensen has published a new book, “How Will You Measure Your Life.”

I told Clayton how influenced I was at a young age by “7 Habits of Highly Effective People” because it dealt with life skills.

In Clayton’s new books he takes on similar themes with the three major ideas being:

How to be sure ….

1. Have a Happy with Career
2. Your Family is a Source of Joy, Not Pain
3. Stay Out of Jail

He said shocking number ended up divorce and family situation was a source of real pain with kids being raised by other people in new families.

I thought he was joking about the last one – he wasn’t. Two of Clayton Christensen’s classmates spent time in jail – one was Jeffrey Skilling who was implicated in the scandal of Enron.

It will be the next book I read and a bit thank you to Derek Anderson for sending me a copy!

By the way, if you want to watch Clayton Christensen’s other video from Startup Gring where he speaks about Innovator’s Dilemma it is here. He was interesting, as usual.