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I have largely taken a break from writing these because I have found that my podcast has been much more time-effective.  The other issue is that, in all honesty, I have been committing a huge amount of my time to this small social enterprise that we are trying to get off the ground.  I’m on something of a roller coaster ride where I undulate rapidly between believing that we are going to pull this off (yes, our first work experience trainee got a job!), and worry that we’re going to crash (crap, my biggest customer might leave because we’ve been stuck with a big cost increase, and I can’t operate safely at the margins I’m left with). I have been talking to a lot of people who are on the other side of this startup phase, and it’s great to speak to them, but perhaps like having a baby, you forget just how difficult it is until you are actually back in it.  I thought it would be useful to post up a couple of things about what I think I could do differently, for those who come behind.

 

Here’s where I’m at:

 

The Great:

We’ve been able to provide job experience to 10 people in Sydney and Melbourne who are from some of the most hard-done-by countries in the world.  Iraq, Syria, Afghanistan, Ethiopia, etc.  That’s great.  This is right in line with our mission of giving a chance at the first, and most importantly a pathway to the second, jobs for the most disadvantaged communities in Australia.

 

The Tough:

At the management level, I’ve got two guys who are working their butts off trying to keep this thing running day-to-day and create systems/processes which simply didn’t exist before.  They are also rapidly growing skills that they didn’t have before.  In exchange for this, they don’t get paid much at all, and they work really long hours.  This is hard on anyone.

 

The Bad:

I’m getting squeezed by my suppliers, who keep torquing up my prices, and by my customers who are all about supporting the most vulnerable people in Australian society until you pass along price increases, then they go to market and see what they can get for cheaper.  This is why I’m ‘in the middle’

 

The Temptations:

  • Give up the mission ‘for a while’ and then come back to it, or ease the parameters on the mission.  Essentially, operate more like a conventional company, hire Australians who are literate, numerate, and have experience. Here are my fears if we hire experienced people who don’t meet our mission.
    • Then the business will indeed start to be more productive.  We may get/fulfill more orders in the short term.  These people will then create paperwork, processes, and even purchase machines that can’t be used by someone without their education level.  Part of the reason I loved this company was that it required no literacy, no numeracy, and no prior experience in most cases.  I don’t want to create an environment where that is no longer the case.
    • What are these people in it for?  We’re likely going to have to pay them a significant premium to what the guys on the floor are making (though I’m open to having this hypothesis tested if someone wants a challenge and catches the mission).  That means that I’m going to have a pay gap between my workers and my managers that is huge.  How does that sit with management if they are bought into the mission?  How does that sit with the guys on the line to know that they are making significantly less than the experienced Australian guy?  Certainly hard for them to believe that they are just as valuable.
    • Key-man risk.  When we took over the business, the previous owner didn’t take a day off sick in ten years.  It was his business, it was his choice, and that’s fine.  If I hire someone from outside with a high salary, then I can only pay one of them (and I’d probably have to trim staff to do it, honestly).  As more work was concentrated in the hands of this key person, then we couldn’t operate without him or her.  What’s the temptation then, well, ironically, I’ve seen it from some of the folks who believe they are irreplaceable already ‘give me a higher salary, don’t worry about the mission.’ In that situation, I can’t say no because I’ve now got a key-man risk.
    • What happens to the heart of the organization?  If I tried to bring in well-qualified people, then I’ve got to start making people believe that what we’re going to do in the future is so awesome that they should stick with it until we get there.  OK, maybe I can do that, but here’s the truth, not many of our customers are actually willing to change their behavior despite us already helping ten people in nine months.  Let’s call that 10% (which in my experience connecting with other directors across our customer base is actually pretty optimistic).  If I need to start making people believe in a ‘vision,’ then naturally some people won’t believe, but they would already come from the ~10% who are willing to change behavior.  So I’m taking the 10% change and reducing it by some percentage of believability.  That’s external, but internal, it’s hard for me to remind the guys that the point isn’t making paper tubes, but making people.  If there’s no one around anymore that we are even helping, then what are we there for?
  • Cut corners on safety
    • It’s an interesting human tendency to believe that if something doesn’t happen for a year or two, then it will never happen.  It’s why people still build on fault lines and hurricane-prone areas.  We have competitors in our city that have pulled people’s arms off in the last year because they didn’t worry about investing in safe practices.  The customers probably do care that our facility is safe, and reliable, but in the short run, the only signal the market gives them is that the cost of the competitors tubes is lower.  So that puts me into a spot.  I can fix the problem and save potentially life and limb (literally) and hike prices.  Alternatively, we can enforce the lines in the contract that say these were the responsibility of the previous owner. This leads to unneeded shouting matches about what lines in the contract and safety inspection mean.  When I’d really like to have the previous owner on-board because he’s got such a depth of experience. Well I didn’t cut corners, and it cost me an important relationship.
  • Do it yourself when your guys are stressed.  
    • I can step in and do more, I’m already working four days a week at Google, and spending most evenings and weekends on this, but I could do more.  Here’s what I’ve learned about stepping in.  When people are stressed and tired, and you step in, they say ‘thanks’ and then let you to it. You can’t pull yourself out of those situations very readily, because the person has moved on to the next are that is urgent, and you have just made yourself an indispensable part of the team.
  • Get frustrated with your advisors/spouse/people
    • This one is sooo easy. I really wouldn’t have thought it before. To your advisors ‘well that’s easy for you to say, you don’t have: half-million dollars at risk and the next enterprise riding on this…the exact experience…the amount of time working with this…etc etc.’ to people who are trying to help you.
  • Give up
    • Yep, I’ll admit it.  I’ve thought about giving up, or ‘reinvesting my time elsewhere.’ I’ve got plenty of things to do.  I’m a Major in the Marine Corps Reserves, a father, a husband, a Google employee, and I’ve even got a cult following on my podcast. All of those things are worthwhile in my estimation, and all of them have suffered because of my time and mental energy deficit. I’m even mathematically savvy enough to be able to tell you the potential number of lives saved, or human quality of life improved by ‘reinvesting’ elsewhere.

 

The Close:

This is all getting a bit negative, and I’m sorry about that. These ones aren’t easy to solve, as they are constantly there, needling me, or at least I haven’t found a way to push them back yet.  I do have some constructive suggestions as well for those who are interested in actually embarking upon a similar journey.

 

On the positive side, (and if I’m honest I’m really pushing myself to stay in a positive mindset). [As an aside, when you push your families’ finances, put people you care about into an organization, and take the best brainpower you can find and put it on the board.  You can create an environment where you really don’t have a lot of support struts left.  I have personally dealt with this in part through my podcast. Sorry to all of my listeners.  I’ve been reaching out to people who are smarter and farther along than I am. Listening to them at least three times each has been really beneficial for me.] If someone else wants to try this, then I would encourage you to think about your support struts.  Now we’re starting to roll on the positives.

 

These guys (only a few of them pictured). 

The way I run this, they see me physically at max once per quarter.   That is as it should be, in my opinion. They don’t know how much I pray for them, am excited when I hear about their development, and want to constantly step in and help.  They don’t have any idea what’s going on behind the scenes, and that is how it should be.  No matter what happens, I know that some of them have learned ton, and a few of them have just learned a lot, and at least one has parlayed some experience into a second job. Nothing can take that away.

I have learned that my wife is a truly, deeply caring person.  While I’ve been doing this she’s taken on over $40K of pro bono refugee work here in Sydney, and tolerated me tearing my hair out thinking about where I’m going to get the bandwidth for a second child. She’s let me put even more money into this than the already-sizable sum that we did, and has agreed to sell our house.  I truly, and deeply appreciate what she has given up for this.  She is a special person.

I have also learned that a great many things are outside of my control.  It is possible to say that religion is the opiate of the masses, and I’m being delusional in a tough time.  Say that if you will, but for me, constantly reminding myself that there is a greater power in control has been a tremendous balm to me.

 

Interesting stuff since the last post (slowed down, sorry, completing Command and Staff College at night, and have limited time).

Finance/Econ

  • I only put this here because the author is the head of one of the most successful investment companies out there, but Principles, but Ray Dalio, is quite applicable to everyone http://a.co/5sVJrSH

MISC

  • Jordan Peterson: https://youtu.be/-5RCmu-HuTg 
  • American Caesar: Douglas MacArthur 1880-1964 by William Manchester.  It’s interesting to reflect on the highs and lows of this man’s career.  Top of his class, the youngest brigadier General in WWI, then busted back down afterwards, made his way back up to Chief of the Army, then basically retired to the Philippines, then war breaks out, and he loses less men in his entire campaign than in the Battle of the Bulge.  He non-vindictively reconstructs Japan, creating a constitution that stands to today.  Then war breaks out in Korea, and again he executes a brilliant campaign to retake the peninsula, then gets fired for shooting his mouth off to the President.  If there ever was a life of highs and lows it is his, and I hope that I can keep my own little patch in perspective…
  • Great example about how to disagree about religion [Radiolab] Match Made in Marrow
    http://podplayer.net/#/?id=43118246 via @PodcastAddict
    Sent from mobile device: tiny keys, squinting eyes, and apologies
  • A huge concern of mine, how do we get out of the tehc that creates the echo-chambers that don’t challenge us?  [Entrepreneurial Thought Leaders] Making Technology Less Manipulative – Tristan Harris (Time Well Spent) http://podplayer.net/#/?id=4310673

 

 

 

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