The Art of War

Cover via Amazon

Lately I've been reading the book The 36 Secret Strategies of the Martial Arts (basically the same 36 principles of the Art of War) and am intrigued by the fact that these principles are being applied time and again in modern day business.

One of the strategies is translated into "Sacrifice the Peach to Secure the Plum".  Applied to business, an example may be that you give up a small market segment to your competitors and in order to secure your position in the more profitable market segment. 

The strategy states that leaders lacking talent may be easily distracted by a limited loss (think of those that fail once and just somehow can't suck it up and get back on their feet again); the right question to ask when you incur a loss is: in what way can the loss be linked to future gain?

Business is War.  Why else would they rank the "winners" on different lists and categories?  YOU are fighting everyday, to secure that new account (from that other sales agent), to get products to market (faster than your competitors), to increase your market share (at your competitor's expense).  Sometimes you just can't play nice (but you always have to play fair, no nasty tricks people!)

Hiring Salespeople

We've put up our ads on Monster and other channels in a search for additional salespeople.  (I figured after a post about getting fired I should give my readers some hope and talk about hiring)

My advisors and I have chatted about the types of salespeople we are hoping to attract and what types of compensation packages we would be looking at.  We have received our first flow of resumes and have decided to schedule interviews with about 20% of the applicants.  Taking a look at the base salaries that they require, it triggered me to think about one conversation that I had with one of my advisors where we were wondering if some of these high-paid salespeople could justify their high base salaries of $80,000 to $120,000 per year.

Doing some simple math, since PeerFX bases it's pricing model on service fees, these reps that are aiming to get paid a base salary of $80K to $120K should be delivering at least double that to earn their keep with the company right?

OK. so that means they need to be generating at least $160K in gross revenues for the company.  Our service fees are 0.5% so that means they need to have a customer portfolio of $16M in completed transactions.  Great.  If somebody has the ability to bring business like that to us I would be VERY willing to pay them that base salary.

Back of a napkin math - justify your value before your throw up a random number for your desired base salary.  Thank you very much.

You're Fired

The theory that founders usually get fired as the company finds a scalable model and product it in the market has come up quite a few times in conversation.

I've been asked before whether I worry about this day coming.  I say I worry about this day not coming.  When it does, it means my baby has found a sustainable, repeatable, profitable model that will grow into a large company.  Beyond the startup phase, beyond the early revenue phase, to a growth and expansionary phase. 

I can't predict the future and foresee whether my board at that time will replace me or not, but if we can agree that someone with a different skill set more suitable for managing the company in its new phase, then I don't want to stand in the way of my company's opportunities. 

Anyway, I still believe that the whole "firing the founder" theory is...a theory.  We will see what happens when the day comes for the board to evaluate whether I'm still suitable to keep running the company - my goal now is to improve myself for the better everyday, so that when this day comes, I will be prepared :)

In the meantime, let's keep working and get to that point.

Why Google may not be Making a HUGE Mistake Leaving China

Image via Wikipedia

Over the past week there have been many articles popping up on forbes.com rss feeds and other blogs that I follow that say it's a HUGE mistake for Google to leave China.

The main focus seem to revolve around the 1.3 billion people that are in China making up the potential userbase for Google. The articles also reference the large amount of growth in internet usage in China and that it's projected to keep increasing.

My thoughts.  SO WHAT?  Google management may be thinking that it's not the right timing for them to continue expanding in the China market right now, with the government regulations and hackers amongst other issues that they have run into in this market.  Why are the writers making it sound like they are leaving China forever?  They almost sound like they have read and know of Google's management direction. 

Plus, focusing on the huge population in China as the main reason why Google shoudn't leave the market is silly.  That's pretty much the same as entrepreneurs that pitch: "if we only got 1% of this market, then we'll be rich."

If Google does end up leaving the China market temporarily, I think they are taking the time to regroup their market re-entrance strategy and will come back stronger than before.

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