Business Leaders: Guy Kawasaki

We analyse the former Apple genius; famous for his usercentric approach, ideleogy and writing the bible on 'bootstrapping' a start-up to success

Name: Guy Kawasaki
Born: 1954
Expertise: Technology evangelism, internet business, ethics and start-ups
Known for: Being a business guru for the internet generation, his ethos of ethical and decent conduct in business and ‘the art of being a mensch’
Best-known titles: The Art of the Start (2004); Rules for Revolutionaries (2000); The Macintosh Way (1990)

Who is Guy Kawasaki?

Guy Kawasaki worked at Apple Computer Inc in the early 1980s, eventually becoming chief evangelist.

He has subsequently built a reputation for cultivating a progressive way of doing business, much of which grew from his experience championing the Macintosh computer. It was at Apple that the seeds of his ‘secular evangelism’ began to germinate.

He remains a bright light in the technology sector, but in recent years has crossed over to the mainstream, evangelizing to a wider audience a highly customer-centric approach to product and service delivery, allied to a strong moral compass, via his books, public speaking and in his consultancy roles.

In 2011 Kawasaki co-founded Alltop (a website which aggregates popular topics on the web) and was founding partner of Silicon Valley investment firm Garage Technology Ventures.

What is Kawasaki known for?

Although he has started at least three technology companies since leaving Apple in 1987, it is for being an author, prolific blogger, speaker and technology investor that Kawasaki has become best known.

Guy’s most widely recognised book is probably The Art of The Start. Published in 2004 and quickly embraced by internet technology companies (as a bible on ‘bootstrapping’ a company from an idea through to investment), the advice is not specific to the tech sector.

It is as much an indirect manifesto on human interaction as it is a how-to guide for the uninitiated who might be looking to start a business, or someone trying to innovate at an existing company.

A vocal proponent of ‘focusing on the customer’, Kawasaki also introduced ‘the art of being a mensch’ to the collective consciousness of a generation of entrepreneurs.

‘Mensch’ is a Yiddish term used to describe someone who acts ethically, is decent and admirable. These are the two core themes which Guy has returned to throughout his writing career: of a morally defensible approach to doing business and a laser-like focus on what your customers want.

The concepts

The Macintosh Way focused on the promotion and marketing of technology products. It includes many anecdotes from his time at Apple, evangelizing the then revolutionary Macintosh computer.

Kawasaki further relays the lessons from these heady days in How To Drive Your Competition Crazy, explaining what to do and what not to do to gain a differential advantage, particularly as an underdog in the marketplace.

He then built on these experiences to form what the author himself described as ‘a weapon of mass construction’ with The Art of the Start, a remarkably accessible dissertation on getting an idea off the ground.

Shunning many traditional management habits, two key principles (creation of meaning and menschood) stand out as over-arching values with which to run your business. These two principles sandwich many smaller practical concepts.

Create meaning

If one word had to be used to describe the book, it would be evangelization. The gospel being evangelized in this case is described by Kawasaki as a mantra for your business.

The right mantra will help to prioritize the customer, focusing on what is important for your business and discarding what is not. Kawasaki promotes the idea that you need to understand and embrace what ‘meaning’ you are trying to create as a business, from which everything else can follow.

Ideally, this should be articulated as a three-word mantra, representing a meaning which can be communicated to your employees and embraced as a core part of the business culture.

Kawasaki gives examples throughout of traditional thinking versus his approach. The Red Cross, for example, whose mission statement reads ‘To help people prevent, prepare for and respond to emergencies’, he hypothesises would be better served with the mantra ‘Stop suffering’.

He argues that to create meaning in a business by evangelising a mantra, rather than a mission statement, is more effective, evoking power and emotion in your disciples – exactly what you need to be a successful entrepreneur.

A mantra stands in contrast to a dry mission statement, which often describes an operational activity using overused weightless words such as ‘best’, ‘quality’ and ‘leader’ to describe a business.

The book is full of practical advice which can be applied at each step while starting whatever it is you want to start, such as the following:

  • Choose a good name. Begin with a letter early in the alphabet, choose something which has potential to be used as a verb, avoid the trendy and make sure it ‘sounds’ appropriate to what you do.
  • Position your business as opposite to your competition, avoiding overly used words which carry no differentiation. Make it personal, e.g. instead of ‘Reduces the size of the ozone hole’ you would say ‘Prevents you from getting melanoma’.
  • Presentations should follow the 10-20-30 rule: 10 slides for a 20 minute pitch using 30 point text (meaning you can’t over-fill the slide with content).
  • When raising investment, write an executive summary in plain English (max. four paragraphs) and use it to spark interest – not deliver every detail of your business plan.
  • An agile approach to product or service development. Forget investing months in research, instead get something out there in the wild as fast as possible.
  • Especially when starting a new venture, ‘niche thyself’. Strive to be unique and provide value to your customer.
  • Focus on doing one thing really well first; this simplifies everything.
  •  On recruiting: Trust your gut and be disciplined about following up references before an interview. Note the dangers of hiring from a corporate world, where someone may not be used to getting his or her hands dirty. Always try to hire someone better than yourself.

To aid your operational roadmap weave a ‘MAT’ or set of milestones, assumptions and tasks. The milestones are not sector specific:

  • prove your concept
  • complete design specifications
  • finish a prototype
  • raise capital
  • ship a testable version to customers
  • ship the final version to customers
  • achieve break even.

Then list every significant assumption relating to your organization, from gross margin to sales cycle length to the cost of your bill of materials and team remuneration. Continually measure and amend these, as real-world experience proves them right or wrong.

Your list of tasks should be those things which, although not critical, are still required to achieve your milestones; such as renting office space, getting insurances etc.

Then Kawasaki comes full circle back to evangelisation: seed the clouds to make it rain. Let ‘a hundred flowers blossom’ by enabling test drives of your product or service for free, thus lowering the barriers to entry. You must seek out the influencers and embrace them – if B2B they may not always be where you expect in the hierarchy of a target organisation.

Menschood

The final chapter asks us to behave throughout our business dealings with good will and embrace ‘the art of being a mensch’, a Yiddish word which in practical terms means you should:

  • help many people
  • do what is right
  • pay back society.

All the advice in his book has passed through these three filters.

For any entrepreneur it represents a reminder of what should be important when running a business.

As examples, he cites observing the spirit of agreements, not just the letter (e.g. a commission payment not due because an agreement lapsed seven days before it should be paid anyway), paying for what you get (e.g. a supplier undercharging you should be reported) and focusing on what is important (e.g. this may not always be simply to win at all costs).

He argues that your company and each employee in your company operate in the wider context of society. Kawasaki is not promoting being soft in business, rather, that doing things which are bad for society does not scale. That ultimately, it will not generate longevity of shareholder value.

How real companies use Kawasaki’s concepts

Start-ups

AirBnB is a website which enables people to rent space in their homes to others. It started after the founders, Brian Chesky and Joe Gebbia, stumbled upon the idea after visiting San Francisco in 2007 and wanting somewhere affordable to stay.

They stayed on someone’s floor on an air mattress. AirBnB was born. They had a tough, bootstrapping first year and survived by embracing guerilla tactics. This created some buzz, but not the flood of customers they needed.

At one point, the founders had literally lived their own customer experience for months, moving from place to place – using their own site to find living accommodation. You can’t get much closer to your customers than that.

Although not yet hitting hockey-stick growth, the determination and innovation of the pair did persuade the founder of the business incubator program ‘Y Combinator’ to enroll them on his course.

In 2010 AirBnB raised $7.2m in funding from two Silicon Valley venture capital firms on top of its earlier seed funding of $600,000. Today the founders maintain that the lack of money helped to define a culture of frugality and forced them to focus on what customer wanted.

Both founders regularly speak at events attended by hundreds of entrepreneurs, a sign that the success has not gone to their heads. Their self-deprecating presentation demonstrates a desire to give back to the ecosystem and have others learn from their mistakes – a big step toward Kawasaki’s menschood.

Corporates

Apple remains one of the champions of delivering a usercentric product experience. Its revolutionary iPod and iPhones have become the trend setters in their markets.

This ability to deliver something which is very customer focused in its design remains the primary reason for Apple’s success and continues an approach which crystalized while Kawasaki was still at Apple.

Bricks and mortar

At Pret A Manger, a UK sandwich and coffee chain, even senior staff have to work at the tills before they take up their managerial roles, and customer service evangelized as a priority to all employees.

Staff are empowered to make decisions that enables them to serve customers well.

Validity today

A lecturer at Santa Barbara’s Technology Management Faculty says he has given out The Art of the Start to his New Venture Creation class for the past five years.”Quarter after quarter”,he says ‘it has inspired and enlightened my students.’

Anecdotal evidence in 2011 would suggest that The Art of the Start remains both relevant and timely.

Today, the ability of any web-related company to iterate its product service at speed (i.e. testing and optimising its offering live in the marketplace) is reshaping traditional business thinking on how you take a product to market, the incumbents you are able to challenge and the size of the associated funding required to do so.

This customer-focused approach, led by market testing, is the very gospel preached in The Art of the Start. The barriers to starting a business in any sector continue to fall.

The Art of the Start captures the essence of a new philosophy of bootstrapping rapid development and launch: build it, try and get it out to customers and iterate on their feedback.

Arguably, ‘the art of being a mensch’ has not been as universally embraced as much of Kawasaki’s more practical business advice.

But there are exceptions. At one end of the scale, ‘ICE’ is a group of entrepreneurs who commit to helping one another on the basis of trust and not for profit.

At the opposite end, Bill Gates has established the Bill and Melinda Gates Foundation with an endowment in excess of $40bn, literally changing the world for the better. Leadership must come from the top. Who better to be led by than a mensch with a mantra?

Business Gurus, edited by Ian Wallis and published by Crimson Publishing, is available to order now.

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