Deep Insight - Daniel Kahneman: Beware the ‘inside view’

How many times do you remember projects, ventures and adventures turning out faster or easier than expected?  Better than expected returns, financial or otherwise, are not uncommon, but easier or faster, next to never.  Why?

Here is Daniel Kahneman's  insight in his words (whole post reported below):

Why the inside view didn’t work   (a book writing project)

This embarrassing episode remains one of the most instructive experiences of my professional life. I had stumbled onto a distinction between two profoundly different approaches to forecasting, which Amos Tversky1 and I later labeled the inside view and the outside view.

The inside view is the one that all of us, including Seymour, spontaneously adopted to assess the future of our project. We focused on our specific circumstances and searched for evidence in our own experiences. We had a sketchy plan: we knew how many chapters we were going to write, and we had an idea of how long it had taken us to write the two that we had already done. The more cautious among us probably added a few months as a margin of error.

A watershed event in US IP and innovation practice - Patent Office -- "First to File'' Bill (2011)

Little has been heard in the news and few individuals will be directly affected, but the Patent Office's changeover to "First To File Rule" is likely to have a profound effect on innovation, the process by which inventions find their way to market.

For details read Patent Office -- "First to File'' Bill (2011)

The rest of the world has been on the First To File (FTF) all along. Only the US has managed the granting of patents by the First To Invent (FTI) rule and the difference is profound.

As I have written elsewhere in this blog the FTI rule creates the poorly understood consequence of allowing an inventor to claim "prior art" against an issued patent and obtain a disallowance of the patent in whole or in part. For RIM (Research In Motion), makers of the Blackberry, it played out in a disastrous chain of events (details see Blackberry).

FACT CHECK: Are rich taxed less than secretaries? | The Associated Press | News | Washington Examiner

Political expediency and demagoguery always tries to take voters for a ride with simplistic arguments phrased to sound commonsensical and outrageous at the same time. However, careful analysis of the data always exposes the trick for what it really is. We owe it to ourselves to know better when the facts are easily verified.

FACT CHECK: Are rich taxed less than secretaries? | The Associated Press | News | Washington Examiner:

'via Blog this'

A Pirate's mind

Supreme Court Justice Potter famously said of pornography "I know it when when I see it".  After 35 years of serial entrepreneurship I felt "I feel it when I read it" reading Michael Harrigton" Are You A Pirate? -

"... That thrill of your first hire, when you’ve convinced some other crazy soul to join you in your almost certainly doomed project. The high from raising venture capital and starting to see your name mentioned in the press. The excitement of launch and…gulp…customers! and the feeling of truly learning something useful, you’re just not sure what it is, when the company almost inevitably crashes and burns.Now that person is interesting. That person has stories to tell. That person is a man who has been in the arena. There are lots of things that I will probably never experience in this life. Military combat. Being dictator of a small central American country. Dunking a basketball. Being a famous rock star. Or walking on Mars. But one thing I have been, and will always be, is an entrepreneur. And damn it that feels pretty good. Because if I was a lawyer right now, even a rich lawyer, I’d always have wondered if I had what it takes to do something a little more adventurous with my life than work for someone else."

I do not know about the pirate analogy but the profile of the entrepreneur is laid bare in that final description. My first experience in the arena at 27 instantly created an addiction that determined my future. I do think that entrepreneurs at least try to reduce risk any way they can. That may explain why we keep looking fro insights from Steve Blank, Nathan Furr and other brilliant analysts of "pirates and pirate ventures". But I also know that they offer only warning flags along the trail - Watch out for this - Consider that - Do A before B - Avoid C - helpful warnings derived from careful study. 

The risk remains high and either you like it or you don't. For most, the Wagnerian golden ring at the end of the quest, in most cases, will prove to be illusory, what drives is the temperament, foolish most would say, to confront the dragons along the way, often alone or in a small band of fools for the quest as much as for the gold. On that path, the point of no return is the first step. . If Michael's closing summary speeds up your heart, you owe it to yourself to try, at least once, stepping, alone, into the arena. You may never get out and if you do you won't be the same.

Marco Messina

Mentors, Coaches and Teachers | Customer Development | Startups | Steve Blank Podcast – Clearshore

It was my great fortune to have great teachers, coaches and mentors. To all of you I owe a large measure of my professional success and happiness. By your example you also gave me the desire to give back in my turn, however useful that may be.

Steve Blank put in words the value of that contribution better than I know how. All I can do is to bow to you (that is why you received the email directing you here)

Mentors, Coaches and Teachers | Customer Development | Startups | Steve Blank Podcast – Clearshore

Brand Names and Global Marketing

These two stories made me reflect on the strategic considerations in naming businesses and when taking brands global: 
This French Billionaire Is About To Invade America  and  FRENCH INVASION: Flash Sales Juggernaut Vente Privée Announces Plans To Kill Gilt Groupe. 

One has to presume that the combined marketing staffs of Vente Prive'e and AMEX must have considered how their brand may be pronounced by non French-speaking US consumers.  Or, may be not.  Memories of Chevy entering the Mexican market with the Nova (in Spanish pronounced No Va = Doesn't Go) come to mind - it became a classic of international brand screw-ups cited in international marketing courses.

So let's consider a possibility: Vente, pronounced by a Yank and partly thanks to Starbucks will morph into Venti (itself a confusing term to many Starbucks customers unaware that Venti=20 in Italian, which is the size of the drink - apparently a fork in the road offering a choice between ease for the consumer and marketing mystique was traveled toward the latter). Since Starbucks commands more "brain share", Vente may well evoke images of "large paper cups".

As to Prive'e, since the accented e is not conveniently available on US keyboards, it is inevitable that it will soon be lost to create Privee, in turn most likely to be pronounced Privy by many Americans, evoking visions of toilets.  Is "Large Cup Toilet" the image one would want to attach to one's brand entering a new market? I wonder.

These may all be conjectures, and yet possible outcomes. If you were launching your new startup in a new market, would you prefer avoiding a handicap even even if only a potential one?  If you were the king of global reach (AMEX) would you not have international staff able to recognize the risk of a trap? Or did pride in one's extremely (domestically) successful brand deluded the marketer into believing he can tech French to the locals (traditionally a distinctly unsuccessful effort)?

Stay tuned you may soon hear of VP, VenPri, or some other variation on the theme. 


PS If you are sufficiently opportunistically entrepreneurial to buy all domains with word combinations that could solve the above problem, let me know.  It will make for a nice story on entrepreneurship.


Marco Messina

LUCKY OR SMART? Secrets To An Entrepreneurial Life

A refreshing an honest reflection on: luck, making one's luck and knowing the difference; discovering what we are psychologically fit for and what not; learning to look for luck where we are fit and able to create it. Great lessons in business and self understanding.

LUCKY OR SMART? Secrets To An Entrepreneurial Life

Read the whole series of posts here

Marco Messina

Learning to dance

Ballroom dancing is not an innate skill. Most people have to learn the basic technique that most other dancers are likely to use because it is the shared knowledge that makes possible for two near-strangers to move in step and unison on a dance floor. It often pas to learn it before stepping on the dance floor with a new date, or a new in-law at one's wedding.

The same can be said of learning to deal with investors. It is not an innate skill, although, as in dancing, some have an easier time than others. Learning the skills and preparing the relationships before being in a hurry to close a funding deal is likely to help the entrepreneur find a better match and a smoother dance when the time comes. Like in dancing it goes both ways, investors too can gain by being open to meeting not-yet-ready but up-and-coming entrepreneurs.

The following post says it well. Take a look.

If you can't buy your investor a beer, don't take their money - Sachin's Posterous

Shall we dance?

Marco Messina

The Crisis of Credit Visualized | BusinessBlogs Hub

In the public interest: this is the best explanation of the debt crisis that I've seen in non-technical terms. It took ten years to create a financial industry bomb, will it take ten more to fully digest the consequences? The optimist says yes, only ten: plan accordingly.

The Crisis of Credit Visualized | BusinessBlogs Hub

Is France Plotting to Kill the Free Internet? : Tech News and Analysis «

Is France Plotting to Kill the Free Internet? : Tech News and Analysis «

The basics of business-to-business sales success - McKinsey Quarterly - Marketing - Sales & Distribution

The basics of business-to-business sales success - McKinsey Quarterly - Marketing - Sales & Distribution

Belief is the key

As a serial entrepreneur I have experienced many times the thrill of following my own path to success, however I  defined it at that time of my life: change the world, make a fortune, make an insight into reality, whatever.  Eventually all ventures evolved into a state of mind best explained by this picture.  The only way to go forward was to "press on" no matter what, believing that the top of the mountain was not far and then it would be, oh so sweet, downhill all the way.  My mother often asked "how far do you still have to go?".  The answer, always, "I am below the rock, I cannot see, I cannot stop, but I am an optimist, it is not far".  And so the rock slowly got pushed up the mountain with minor "strategic" directional adjustments to suit the landscape, but moved primarily by total commitment powered by belief.

Belief (not stubbornness) is the root of achievement, that internal voice that makes us persist in the game.
Toady we see one such game playing in front of our eyes, on Jeopardy.  It is the latest chapter of IBM's pitting  the machine against the human.  The last match was in 1997 and Garry Kasparov was our knight.  He had belief to spare.  He lost to Deep Blue and went into a deep depression as a result - some mountains are too tall and rocks too big, but letting go is always tough.
How would you like to be the Humans' knight in shining armor: Brad Rutter or Ken Jennings?  It takes true grit and great belief.  In the other corner, despite appearances, it is not Watson, it is the IBM team behind that multicolor-cyberface-cum-mawhawk, with seven years and $1-2 billion worth of dreams and persistence on the line.
 
It is a quixotic battle: like that against Deep Blue before. Watson will eventually win for no other reason that IBM will find the Rutter and Jennings of artificial intelligence and put them to work pushing that rock to the mountain top. In this sense defeat of the Humans is inevitable. It may happen tonight or tomorrow or by an average of three nights (BTW Deep Blue won not all matches, only 3.5 to 2.5 over 7 matches). Perhaps we'll have to wait longer yet, but it will come. Our brightest Humans can make machines "smarter" over time but we have not yet found a repeatable and fast way to make ourselves smarter.

Regardless of who wins Jeopardy, the human ability to imagine, belief and commitment will have won again.  And now go back to pushing your rock, you don't have far to go.

Marco Messina