“Lenny, I'm not going to wait a lifetime to bequeath some foundation,” she said. They had known each other a long time and didn't pull punches. That could be a good trait among cofounders.
“Besides,” Allison continued, “I'm not interested in funding a service. I want to spend my time being involved. I want to work in an organization that cares about people in trouble, that”—she waved her arm—“that cares about people, period. This is a chance to change what we don't like.” She paused for a moment. “And you're right. I want to build a legacy company, a place we can be proud of, where people work hard, and care about what they do and respect each other. I want a place I can believe in, in every way—what it does, what it stands for, how it works. I don't want to wait for my ship to come in before I can afford to start. Why wait when we can do it now?”
Clearly Lenny had failed to sell her one of his Deferred Life Plans.
They were an even odder combination than I had imagined: Lenny with his one-dimensional, bottom-line view of business, and Allison with her lofty ideals about people.
Lenny glanced at me—clearly fishing for support. Now, as Allison finished her rejoinder, he simply turned to me, shrugged, and held his hands out, palms up, as if to say, “Hopeless. What can I do?”
“I don't think I can help you with this one, Lenny,” I said. Maybe ten years ago. Not now.
It was another instance in which, were I still Lenny's age, I would have agreed with him. Sure, business was about money. That's what makes it business. But first and foremost, to be successful, business is about people. It took me a while to learn that lesson.
I STARTED MY BUSINESS career as a negotiator, a deal guy. I was trained to take advantage, to get the upper hand, to beat down the other side. I was an assassin. My job was to win at any cost, and I took some satisfaction in doing it well. I didn't understand much about the human side of business. In my mind, there was not much room for humanity on the bottom line. That point of view didn't particularly comfort me, but that's the way business worked, I thought. Given those constraints, I also figured my days in the world of business were numbered. But before I decided to chuck it all and become some freelance tour guide, I met Bill Campbell.
I was working at Apple, but was on the verge of leaving the legal department because it was restructuring. My boss encouraged me to meet Bill, who, at the time, was leading a spinout of Apple's software applications business. The purpose of the spinout was to reduce Apple's dependence on Microsoft software.
Bill was moving like a lightning bolt to arrange things. He corralled me into an empty conference room, didn't bother to turn on the lights, gave me the three-minute pitch, said I'd come well recommended, and asked whether I'd join him. Now. Given no time to think, I checked my gut and heard myself say, “Yes.” Without any details about the job, my title, or my compensation. As Bill marched off, I heard him say, “Great. You're the first cofounder. Let's get moving.” It turned out to be one of my best decisions ever.
We called the company Claris, and we had big dreams. We were going to beat Microsoft by employing the philosophy of the Apple computer and operating system: making the power of the technology accessible by creating great software that was easy to use, not just stuffed with complicated arcane features few people wanted or needed. A key part of my job at Claris, of course, involved doing deals. I negotiated the spinout agreement with Apple, and I negotiated Claris's acquisitions of technology and of numerous software companies, both of which were key strategies for building the business.
I barely knew Campbell, but others called him “Coach,” ostensibly because he had been the head coach of Columbia's football team, but in reality because of his dedication to mentoring his people. He was in his mid-forties, stern to eye, but warm and caring through and through. He wore his countless football scars and rugby wounds like badges of honor. You'd follow this guy anywhere.
And we did. What you noticed about Bill, after you worked with him a bit, was that he spent a lot of time talking about people. He ate, drank, and breathed people. You couldn't talk about anything at Claris without the issue coming up. I found it irritating at first, a distraction. Whenever we sat down to make decisions, somebody always asked, How is this going to affect that individual, or this group of people? What are they going to say? To feel? Will they know why you made that decision or will they think you did it arbitrarily? When we talked about product support, it wasn't evaluated as an expense line. It was a service—for people. The focus was always on the value you could deliver to your customers, employees, partners, and shareholders—and what they and others thought about it and about you. You might not hear it in the first session. You might not hear it in the second session. But, unless you were deaf, by the end of the first few months, you heard the theme loud and clear. Bill had an underlying faith that if we focused on the people issues, worked hard, and did a great job, the business would take care of itself. That was Campbell.
In the beginning, despite my respect for him, I resisted Bill's philosophy. I strongly believed in the notion of business as a manageable, predictable, and quantifiable process. I believed everything should be crisp, clear, and buttoned down. Managers made the trains run on time. Campbell's approach seemed inefficient to me. Too many soft, murky, and complicated issues to grapple with. Let's just focus on the stuff we can measure, I contended.
For some reason, Campbell, thank goodness, didn't give up on me. There were times he probably should have fired me because I was such a pain in the ass. My work brought me in contact with all parts of Claris, and I would outspokenly and constantly challenge anything that didn't appear to contribute directly to the bottom line. I was often out of step with Bill and the rest of the executive team.
But I gradually began to internalize Campbell's frame of mind, and some of my own personal values, long subordinated to the bottom line, began to resurface. I couldn't argue with Bill's results: What appeared to be a sometimes inefficient process was creating extraordinary success. Our customers liked us. They valued our products. Our partners respected and trusted us.
Our employees were highly motivated and committed. Often I would be working late, and I'd look up from my computer at eleven or twelve at night to see a crowd, all working just as feverishly. Why was I there late? Because I needed to finish my piece of a project, so I could hand it over to somebody else, so she could get on with what she needed to do, so the next person could do what he needed to do, so the company could achieve its objectives. There was an intense sense of loyalty, responsibility, and camaraderie; a locking of elbows with everybody around you.
The change in my perception of Campbell is summed up by one of my favorite Mark Twain quotes: “When I was a boy of fourteen, my father was so ignorant I could hardly stand to have the old man around. But when I got to be twenty-one, I was astonished at how much he had learned in seven years.” Likewise, in a short time I had learned what wisdom Campbell carried; he could do things I couldn't quantify. He had a highly intuitive sense of people. He could inspire them to be better than they already were and to work together as a whole to create something greater than the sum of the individual parts.
Still, some lessons came hard. We had an opportunity to buy a company called Quark, a pioneer in the then-new software category of desktop publishing. I stayed up all night and flew to Denver to get a letter of intent signed. It would be a great deal. But subsequently, when we entered into definitive negotiations, we stumbled on the issue of warranties. They wouldn't give me something I believed they should. I was indignant. I remember telling them, “I'm paying you good money, you're selling me the company, and you've got to agree that what you're selling me is yours to give.” They were offended. They thought they were joining the Claris team; that's what they said they wanted to do. But my focus on the warranty issues—on the cold, hard facts of business, on getting the best deal—estranged them and made them feel like outsiders. We went back and forth a bit, and then they simply refused to work with me
anymore. Bill stepped in to try to save the deal, but it couldn't be saved. I had blown it irretrievably. The disagreement could have been mitigated with other legal remedies, but I had adamantly opposed them on principle, and there was no backtracking. That was a dumb mistake. Quark would have been an incredible asset for Claris.
In addition to a sense of professional failure—this was the first time I had ever blown a deal—I felt I had let down my company. I had let us down. It was our deal, and I dropped the ball for everybody, including myself, in the process.
I started to pay attention. I made a break with my old legal habits. I began to apply Campbell's thinking to doing deals. My job was to find intersections of interest between the negotiating parties—not differences, but commonalities—and to build them into a solid relationship and transaction. I started zeroing in immediately on those requirements of the other party that were consistent with my requirements, and I threw my energy into bringing them into the deal, instead of ignoring them or reactively opposing them in order to use them as bargaining chips later. My focus became less on just satisfying myself and my company and more on satisfying the other party as well. Sure, certain points were bound to be contentious, but negotiating became a creative opportunity for me to solve problems and build relationships, not to play poker.
My final Claris lesson came when we sold the company back to Apple. We had intended initially that Claris would eventually go public. But when Apple discovered in our draft prospectus that we planned to develop software for Windows, not just for the Macintosh, Apple execs decided to reel us back in rather than suffer the embarrassment of watching their offspring consort with the enemy. They had the contractual right to do so; however, the spinout agreement we had negotiated forced them to pay a multiple of the anticipated IPO price for the privilege. It was a lucrative deal for all of us.
But it was a Pyrrhic victory. With our spouses, we all gathered at the home of one of the founders to celebrate our good fortune. Together we drank the celebration into a wake. We were proud of the price we'd gotten from Apple—there was reason to celebrate—but when we looked around the room at each other, the deal's downside hit us: it was unlikely we would ever work together again. The exhilarating experience of the Claris startup made few of us eager to return to the larger Apple fold.
Our checks were in the bank, but we were morose. What the heck was that, I wondered?
Campbell had a better bead than any of us on what was happening. He knew he'd given up his baby, even as the rest of us were skirting around the edges of that loss. I later realized what a rare privilege it had been to work with this group of people, in a place of our own making that gave us the opportunity to reach and stretch, to have impact, and to be great. Building a $90-million-a-year, market-leading business was a hard thing to do. Claris gave us, as a team and as individuals, a platform for growing and a chance to build a legacy and a culture that would contain our DNA in its values for decades to come. You couldn't put a price on it, and I didn't realize that until our company was dead and buried.
BUSINESS, I told Lenny and Allison, is about nothing if not people. First, the people you serve, your market. Then the team you build, your employees. Finally, your many business partners and associates. Sever the chain of values between leadership and the people translating strategy into products and services for your customers, and you will destroy your foundation for long-term success. The culture you create and principles you express are the only connection you will have with each other and your many constituencies. It may not be Allison's utopia, but it was a far cry from Lenny's soulless machine.
As I talked, Lenny had been sneaking looks at his watch. “We'll have to continue this discussion another time,” Lenny said. They needed to be off to the airport for the flight home, to arrive in Boston at midnight. Coast-to-coast day-tripping was a hard life.
He and Allison stood and thanked me for my time and help.
“Lot to think about,” Lenny changed the subject. “I'm very optimistic. I believe this is going to happen. I can feel it.”
I wasn't sure he had heard a word I said.
Connie drifted by as they were walking away.
“Got the money, huh?” she said.
Clambering into his rental Neon, Lenny gave us a big grin and a thumbs-up.
I could only shake my head.
Chapter Eight
THE ART
OF
LEADERSHIP
I SPENT THE REST of the afternoon in a long, drawn out session with Chris, the founder of one of the companies I work with. He had enough problems and challenges to push any thoughts of Lenny temporarily from my mind.
Chris had done a terrific job building a core team, raising seed capital, developing patented technology, and launching an Internet service for the on-line searching of audio/video content. But the business wasn't happening, and he was not up to the task of bringing in strategic industry partners—big portals and entertainment sites. Sales were negligible. Chris was an engineer with a great concept, but he was running out of steam. His management team was having second thoughts, given the lack of progress in the market.
The company needed new leadership, badly. While Chris was able intellectually to concede this, it was hard for him emotionally to deliver his baby to someone else's charge. As much as the company needed a new CEO, it couldn't afford to lose Chris's creative vision and passion. I couldn't separate Chris's success from the company's success. We had come to that quintessential tough moment in a startup's maturation you hope won't occur: time for the founder to consider giving up the reins.
Silicon Valley veterans share a tacit understanding that what a startup needs isn't one CEO, but three—each at successive stages of the startup's development. Given my deep regard for man's best friend, I tend to think of each in terms of best of breed. The first CEO is “the Retriever.” From the muck she must assemble the core team, the product or service, and the market direction—all around a coherent vision. She must also raise the money and secure crucial early customers and partners. She is prized for her tenacity and inventiveness. The second CEO is “the Bloodhound.” He must sniff out a trail—find the market and prove the business. He needs to build an operating team and establish a market beachhead. He is prized for his keen sense of direction and company-building skills. The third CEO is “the Husky.” She must lead the team, pulling an operating company that grows heavier by the day with people and public company responsibilities. She is prized for her constancy and scalability. None of these, to me, is top dog. All are equal in importance, just different in skills and temperaments. I mentor the founding CEO so she can go as far as she wants or as far as her abilities permit. And when she decides to pass the mantle, I help with the transition to new leadership. We all hope, when that time comes, the company won't need a Saint Bernard.
After hours of discussion with Chris, there still wasn't any resolution. I didn't arrive home until nearly dinnertime, and I was mentally exhausted. I piled my stuff on the dining room table, patted the hounds, poured a glass of Merlot, and sank into my office chair. On autopilot, I hit the power button and logged on. My inbox held a message from Frank.
* * *
TO: [email protected]
FROM: [email protected]
SUBJECT: Deceased
Randy,
FYI, Lenny pitched the partners this morning. We'd like to do something with this market, but I think we're going to pass on Funerals.com. Lenny's probably got some potential, a diamond in the rough. Maybe too rough. He still doesn't seem to have a good way of coming to grips with this opportunity. Not sure he knows where to go with it. And if he doesn't know, we just can't get excited. Thanks for your help.
I have another deal I'd like you to look at. Gimme a call.
Frank
* * *
I wished Lenny were here now, so I could grab him by the lapels and tell him to pay attention.
Lenny was right in assuming that Frank and the other VCs weren't r
unning charitable institutions. But the best learned through trial and error that investing in a passionate group of smart people, with a big idea for a big market, provided the greatest odds for success. Lenny was shortchanging himself and Allison by focusing on how to build an opportunistic business, a casket discounter. Sure it might work, but Frank and his partners had bigger fish to fry. Lenny needed to embrace his earlier, bigger idea. At least there was something in that to sink your teeth into, something worth working hard for.
* * *
TO: [email protected]
FROM: [email protected]
SUBJECT: A Second Life
Frank,
I understand completely and agree. Still, a second discussion with Lenny— along with Allison—makes me suspect that Lenny may be his own worst enemy. What if their business were about building communities for families and friends coping with the deaths of loved ones? A content site and directory of local services? What if it gave families a place to gather from wherever they were, anywhere in the world, where they could share their grief and help each other make arrangements and decisions? This could include family Web pages and chat. What if the revenues came not only from the commerce they're talking about now, but also from the advertising of support services, providing qualified leads to people who can help, and delivering premium on-line services to interested parties? I don't know what those are yet, but if the site got up and running, the users would tell us. This business could work in partnership with local providers of related services and funeral directors, and lock them all into a referral network.
The Monk and the Riddle: The Art of Creating a Life While Making a Living Page 12
