Using Your Role Models to Find out Your Priorities

I’ve always loved reading biographies. Maybe it’s because I like stories about people who accomplished big things against the odds. Perhaps it’s because when I’m down, reading about other people’s struggles helps put my own life in perspective. But most of all, I think I read biographies to find new role models.

Most people know that having role models is a good thing; after all, they provide tremendous motivation and inspiration. This is definitely true, but that’s just the tip of the iceberg. The real value of role models is prioritization: figuring out what matters most to you.

Why is this so important? It’s simple: we can’t win every battle. There’s no way to be the best at everything, and if we spread ourselves too thin, we risk accomplishing nothing at all. The solution is to find out the things that matter most, and focus your energies on being mind-numbingly awesome (best in the world) at those things.

When I was in high school, I had a million different dreams. I wanted to be a professional musician, a contestant on the TV show “Survivor,” a successful politician, a best-selling author, and a self-made billionaire (among other things). Of course I had absolutely no idea how much work (and luck) any of these things required. But I figured that with hard work and persistence, anything is possible.

“Anything is possible.” It’s a line straight out of a bad movie, and it definitely isn’t true. Sure, there are a few people that accomplish the impossible. But most of us will earn more by focusing on the few things where we can really make the most impact. I soon figured how that my role models included authors like Malcolm Gladwell and Tim Ferriss rather than Bill Clinton and Bill Gates.  This knowledge helped steer me in the right direction. I’ll probably never be a billionaire or a politician, but I now realize that those things aren’t as important to me as being a successful author.

So how should you identify a good role model? Here are a few characteristics that I’ve always looked for:

-   Confidence: A good role model knows who they are. They play to their strengths and aren’t afraid to admit to their faults. Those who pander to the needs of others, rather than being true to themselves, are rarely people you want to emulate.

-   Uniqueness: A role model should be unique – ideally, in a way that you strongly admire. This can be a personality trait (like kindness, charm, or skill) or an accomplishment (publishing a best-selling book or winning the Nobel Prize). Always look for people who’ve set themselves apart in a positive way.

-   Someone Who Embodies Your Ideal Life: How do you really want to live? What do you want to be known for? These are important questions in establishing your personal priorities in life.

-   Someone Who Isn’t Afraid to Fail: Few great things are accomplished without some level of failure. Good role models have experienced failure – possibly many times over  – and understand what it takes to rebound. You don’t have to limit your learning to your role model’s successes; take time to figure out what they did wrong and how you can do it better.

Do you have role models? Have they helped you figure out your priorities?

Lessons Learned From The Decline Of Yahoo

Whatever happened to Yahoo? At one point, it was the most popular website in the world, a dominant force in the world of the internet. In recent years, it has languished, falling far behind Google and Facebook in terms of influence…and profitability.

Now it's hit rock bottom, laying off hundreds of employees, shutting down once popular services, and paying its CEO Carol Bartz tens of millions of dollars for making a bad situation even worse.

A few weeks ago, I stumbled upon a pretty cool infographic that showed the rise and fall of Yahoo over the last 16 years. It's really good, so I'll just let it do the talking for me =).

The Brutal Decline of Yahoo!

Research by Scores.org

It's a sad story, but as I read through this, I realized that there was a lot to be learned, not just in running a business, but also in how we lead our day to day lives. Here are some of my biggest takeaways:

Be Cautious

Like most companies, Yahoo got completely caught up in the dot-com frenzy. In the heat of the moment, it made a series of really bad acquisitions (notably Geocities and Broadcast.com), that ended up hurting the company after the bubble burst.

This is human nature; when times are good, we tend to think they will be good forever. Instead, we should do the opposite and exercise caution when things seem to good to be true. 

As Warren Buffett says, "When people are greedy, be fearful. That way, when they are fearful, you can be greedy."

Focus Is Important

As Yahoo expanded, it tried to be everything to everyone. They started dabbling in e-mail, video, social networking, auctions, lead generation, content production, and dozens of other business opportunities. 

The problem was that Yahoo lacked focus. On the other hand, companies like Google, Facebook, and Ebay aimed to completely dominate one or two core offerings. Google owned search and e-mail, Facebook took over social networking, and Ebay is killing it in the auctions market. 

It's easy to get distracted. One of my own weaknesses is that I tend to focus on too many business opportunities, which dilutes my chances of success. Lately, I've realized that it makes more sense to focus. Maximize value in one area before you expand to others.

Build It, Don't Buy It

To me, the key difference between Google and Yahoo is that Google focused on doing things themselves, while Yahoo tried to solve it's problems by buying companies. 

The same principle applies in our own lives. I know lots of people who spend lots of money on marketing or equipment before they even have anything to sell. 

Instead, focus on building something valuable yourself. Google didn't spend a single dollar on advertising for the first 10 years of their existence, and yet grew far faster than Yahoo could have ever imagined. This is because they dedicated their energy to creating value, rather than on spewing money in search of a band-aid.

What do you think we can learn from Yahoo? 

Autonomy, Mastery, and Purpose

 

A few years ago, my friend Carlotta was going through a real career slump. She was working full-time as an executive headhunter. She had gotten into the recruiting business because she enjoyed connecting people, but she felt more like a cutthroat salesperson working on commission. She made decent money but was having trouble motivating herself to get up every morning. She wasn’t bad at her job but felt depressed because she believed she had more potential.

Fast-forward to today: Carlotta owns a small but thriving executive matchmaking service. She helps her clients with all aspects of their dating lives. She loves her job and looks forward to getting to work every morning. The interesting thing is she doesn’t make more money than she did as a recruiter and she works many more hours -  yet she is much happier. Clearly, the financial reward was not my friend’s primary motivator.

So if money and other rewards don’t drive us, then what does? Author Daniel Pink offers one approach in his new book, “Drive: the Secret to What Motivates Us”

The secret to high performance and satisfaction—at work, at school, and at home—is the deeply human need to direct our own lives, to learn and create new things, and to do better by ourselves and our world.”

As I read through the book, it all started to make sense. We want independence – the ability to make the decisions we feel are best. We also want to be the best at something – that recognition is what makes us a unique, valuable individual. And finally, none of this means anything without purpose: the feeling that we are doing something good for society.

Carlotta is happy in her new job because she has found autonomy, mastery, and purpose. She is her own boss, is great at what she does, and genuinely feels that she’s doing well by the world. This stands in stark contrast to her previous job, where she reported to others, wasn’t the best at her work, and didn’t believe she had much value. The money was the same and the hours were actually better, but that’s not what was important to her.

We’ve all had jobs we don’t like. Maybe some of you still do and don’t feel you easily change them. However, you shouldn’t let that get in the way of finding autonomy, mastery, and purpose in some aspect of your life. Develop a new hobby or start a side business that you are passionate about. You will not regret it.

What motivates you most – Autonomy, Mastery, or Purpose? Please share in the comments

How To Increase Your “Rewards-To-Effort” Ratio

First of all, happy new year!

One of my heroes is Fred Wilson, a venture capitalist who has invested in companies such as Twitter, Etsy, and numerous other internet successes. In addition to being an excellent businessman, Fred has a popular blog and spends a substantial amount of time with his wife and three children. As if that weren’t enough, he somehow finds time to hike, ski, and travel around the world.

How does he accomplish so much?

To me, Fred Wilson is a classic example of someone who has maximized his “rewards to effort” ratio. Simply put, Fred focuses his time and energy on activities that will pay off big-time – whether that’s in his business, his family life, or in his personal adventures.

Fred isn’t the only successful person following this recipe. Most rich people are extremely good at identifying where their time and money is best spent…and here’s how they do it:

Continue reading How To Increase Your “Rewards-To-Effort” Ratio →

Don’t Worry About What You Can’t Control

Happy holidays everyone!

To many people, the holidays are a time of great stress, and today I'd like to share a little story about how you can reduce your stress and free up your energy for the things that really matter.

Several months back, I was helping a high school student through the college admissions process. For most teenagers, this is a stressful time – years of effort resulting in a series of large and small envelopes that will dictate their entire future. After countless hours of work, we were finally ready to send everything off.

A few weeks later, I got a call from the student. “Vik, I keep thinking we left something out of the application; I just have this feeling that we missed something, you know? I’m really stressed and I’m not quite sure what to do.”

Continue reading Don’t Worry About What You Can’t Control →

5 Business Lessons From Wikileaks

Wikileaks – terrorist organization, or advocates of free expression? Earlier this year, Wikileaks leaked hundreds of thousands of confidential government documents, garnering a ton of mainstream media attention.

There is a lot of controversy surrounding Wikileaks. But what interested me most was how a tiny organization with almost no financial support could generate such publicity. The more I read, the more I realized that Wikileaks was actually a tremendous opportunity for business learning. Here are some of my biggest takeaways:

#1: Fear Is The Greatest Motivator

One of the most famous frameworks in marketing psychology is Maslow’s hierarchy of needs. Maslow believed that humans faced five major “needs,” and ranked them in order of importance.

Clearly, security is VERY important to humans. In fact, it is second only to the most basic needs of food and shelter. This is why Wikileaks is such a big deal right now.

The big takeaway here is that when we are trying to gain media attention for our own companies or services, we should consider appealing to very basic human needs. Fear is a powerful force, and any product that claims to solve a major “fear factor” is much more likely to get noticed in a crowded market.

#2: Build Your Brand Through Controversy

I’m a big believer in building your personal brand, and sometimes, a controversy like this can present a golden opportunity.

On December 14th, documentary filmmaker Michael Moore announced that he would be donating $20,000 towards bail of Wikileaks cofounder Julian Assange.

Immediately, hundreds of news outlets started buzzing about this announcement. Many were appalled by Michael Moore’s desire to help Assange, while others supported his move as a political statement in protection of free speech.

The big winner, of course, is Michael Moore. For a mere $20,000, he has generated a tremendous amount of publicity for himself. 

#3: Move Quickly To Protect Your Reputation

Although controversy can be an opportunity, it is also a dangerous double-edged sword. This is especially true for large, stable corporations with trusted brands. When Wikileaks became a big issue, many larger companies such as Amazon and PayPal also came under fire for supporting web hosting and enabling donations to the organization.

These companies risked losing many paying customers, and they wisely decided to cut off service to Wikileaks in order to protect their brands.

Basically, controversy is a good opportunity if you’re trying to get noticed (like a small company or media personality), but it can be dangerous if you have a lot to lose (like PayPal or Amazon)

#4: Large Numbers Sound More Important

A big part of the Wikileaks sensation was the number of documents leaked – more than 500,000 in total. The truth is that most of these documents are probably relatively unimportant from a security perspective. Only a small percentage of them are actually likely to contain any relevant information.

However, the large number makes a big leak seem even bigger. 500,000 is a large number, and it is much more impactful than simply saying “Wikileaks leaked 3,000 documents that had relevant information.”

Perception is reality. Play up the numbers, and you will get more attention.

#5: Sensationalism Sells Products

I recently read a CNN article about how one game developer created a online game spoofing the wikileaks saga. It was an instant hit, generating more than one million viewers in its first five days.

T-shirt manufacturers are also capitalizing on the craze by selling wikileaks themed merchandise at a substantial markup. These opportunities are usually short lived, but (moral issues aside) they can be a great way to earn some quick money. 

A few final thoughts: Wikileaks is obviously a really sensitive issue, but regardless about how you feel about it, there's no doubt that we can all learn something. Instead of venting about it, take it as an opportunity to develop your business skills and analyze a unique situation in a whole new light. 

 

Why 16 Year Old Rob Rammuny Dropped Out Of School

This past November, my friend Rob Rammuny decided to drop out of high school to pursue a career as an entrepreneur.

He is 16 years old.

To many people, this might sound crazy. What about education? What about getting a job and being successful?

But Rob isn't your typical high school student. In fact, he has been making more than $4,000 per month in revenues for nearly a year now. Next year, he plans to make much, much more.

After Rob made his announcement on Twitter, I thought that people might like to know exactly how he had come to this decision. It couldn't have been easy and there's certainly a lot to think about. Rob was generous enough to give some of his time to answer my questions:

What got you started in internet marketing? Why did it appeal to you?

Rob: After a long road of being mislead by bad marketing and a long journey of mistakes, I decided I wanted to take the route to actually help people make money online. 

I was drawn to the Internet marketing community because the people in it operate on the same mindset, "How can we make the most money and help people at the same time?"

You currently make around $4-5K per month from your web marketing business. Where do most of these revenues come from?

Most of my revenue comes from affiliate marketing, but in 2011 I'm opening up new revenue streams.

You recently made the decision to drop out of  school to focus on your web business full-time. What were the key factors driving this decision?

I actually stopped the traditional high school route when I was 14 years, at that point I was given an opportunity to enroll as a college student. Looking back on it now, it has been one of the best choices I made because I would have dropped out of high school regardless of the opportunity I was given to go to college. 

After spending roughly 2 years studying on a college campus and 2 semesters as a college student, I realized that school isn't something that's for me. My motivation and desire is to beat the odds and go beyond the "normal" lifestyle, I want to take my life to a whole new level and that's something I would be unable to do if deciding to stay in school.

As of right now, I'm currently still in school and I'm fishing my final 2 weeks of school (barely). After that, I will decide whether or not I will continue college or not. 

How did your parents/guidance counselors/friends feel about this decision? Who were your supporters, and who told you to stay in school?

My mother, grandfather and grandmother felt very strongly that I should stay in school. They were raised in the "traditional" times where general education was engraved in their heads. 

When I decided to bring this issue up to my counselors, they knew this was something I thought deeply about and they only wanted me to make the best choice possible. They encouraged me to stay in school, but it was definitely the words that my college adviser said to me that had the biggest impact on me, even until this day ". . . even if you decide to drop out of school and pursue your business, I'm still going to check up on you and see how you're doing." I think those words had the biggest impact on me. 

My biggest supporters were my friends who only wanted me to do what I felt best, which meant a lot to me. They gave me their opinion's on my choice to leave school and told me they support me 100%.

How did you feel the day you finally made your decision? 

The day I told myself "I won't be in school much longer" my whole world shifted. I suddenly knew I have no fall back plan, so failure was not an option for me. It made me determined to work harder to ensure that I will not regret the final decision I will be making.

My forward plans is to show the world that you can do anything you put your mind to. All you have to do is apply yourself, work your ass off and most importantly never give up.

What are your plans going forward? Products, blog, long-term goals?

As we're closing in here on 2010, I want to enter 2011 with high goals of at least 1 very successful product launch and a huge shift to my blog. 

(Note: Since this interview, Rob has decided that he will be moving away from the traditional blogging model and exploring other opportunities. Please check out  his site – http://www.robswebtips.com – if you'd like to learn more)

What would be your advice for someone who's thinking of dropping out of school? 

My best advice is not to drop out just to drop out. What you need to know about me is that I have thought about this for over 8+ months now and I was not going to make a decision until I was firm about it. 

Taking the risk of dropping out of school is huge and understand by taking that risk you might have to struggle a bit before you live the life you want. Like Steve Jobs said after he dropped out of school – It was one of the best decisions of his life, but he also spent several months living on the floor in his friends bedroom, picking up bottles off the street and getting one warm meal per week from the shelter.

And most importantly, get multiple perspectives from your friends and family. See what their thoughts are and if they have had any experience dropping out.

Also, because the intensity of the topic of this interview I want to make a clear disclaimer: Even though my decision is to leave college, I'm making sure I have a high school diploma secured before I drop out completely. 

________________

Rob definitely has some great insights and I wish him the best of luck. For more information about Rob and his business, visit http://www.robswebtips.com

What would it take for you to take a risk like this? How do you feel about Rob's choice?

How to Profit from the Talent to Demand Ratio

I’m a big fan of business history; I really enjoy reading stories about up-and-coming entrepreneurs – everyone from Walt Disney to Steve Jobs. Lately, I’ve been thinking a lot about one question: is there a common thread – a “secret sauce” that allows these enterprising people to be so successful in different fields?

There are certainly a number of personality traits involved. For example, all of these individuals do a great job of playing to their strengths. But what else? Is there something about the opportunities they pursue that enhances their chances of success?

One day, I had a realization: the common thread was simply that these successful entrepreneurs went into a space where there was a low “Talent to Demand Ratio.”

What does this mean? Basically, it’s all about identifying opportunities which meet two requirements:

a)      There is a lack of talent (not very many high-quality business minds)

b)      There is a large amount of buyer demand (which translates into money to be earned)

Let’s take Walt Disney as an example. In the early 1900s, Disney was starting in the entertainment business and noticed a unique problem: there were no businesses which focused on entertaining the entire family. There were movies for adults and movies for kids, but nothing that would bridge the gap.

It seemed like a huge opportunity. But Disney ran into problems when he tried to raise money. Investors claimed that “this wasn’t really a solvable issue, and Disney should instead go a more mainstream route. After all, that’s where all the money was…”

But Disney was undeterred. The opportunity was real, and what was better was that no one was even willing to compete. All the industry talent was focused on making conventional movies and shows. So Disney created the Mickey Mouse character as a device to appeal to entire families, and the rest is history. Mickey became an iconic American figure, and all of a sudden, other studios were trying to get into the “family entertainment” business…but Disney already had a huge head start. This “first-mover” advantage was what helped Disney dominate the family entertainment market and grow into a multi-billion dollar enterprise.

Another great example is Google. When Google was first developed in 1997, the internet bubble was already pretty big. However, no one thought that search was the way to go, instead preferring to build online communities using e-mail and news. But founders Sergey Brin and Larry Page thought differently. They believed that search solved a real problem – namely, people finding content they were actively looking for.

For nearly two years, Sergey and Larry bootstrapped their tiny search engine from a small house in Palo Alto, California. Finally, in 1999, they managed to raise money from venture capitalists and started to scale their business. Through the dot-com crash of 2001-2002, Google continued to grow and eventually became wildly profitable. In 2004, the company filed for a $25 Billion IPO.

Their competitors were stunned. How could Google have created such a cash machine from a simple search tool? It was simple – while Microsoft and others were fighting with each other over more traditional technology businesses, Google had quietly dominated a large new category. Microsoft certainly had the talent to build a great search engine, but they hadn’t seen the opportunity. Search was an area where (at the time) there was little demand and significant demand, and Google took full advantage.

Fast forward to 2010. Numerous companies, upon seeing Google’s success, have tried to compete with a better search engine. Microsoft has sunk billions of dollars into Bing. But Google already had a huge head start. Even six years later, Google still owns the vast majority of searches done online.

So what happens with the talent-to-demand ratio is too high?

It’s pretty simple: you see a major speculative bubble. Look at the Great Depression, the dot-com bust, and the recent financial crisis. The common theme is that there were hordes of talented people flowing into an industry that couldn’t realistically support their fat paychecks. There were only so many buyers for unprofitable internet companies and credit default swaps. Talent was too high for the total demand. Once the market caught on, everything collapsed.

Ok, so we know what’s worked and failed in the past, but where are the opportunities today?

That’s a great question. To be honest, if I knew for sure, I’d be a rich man already! But here are a few thoughts…

-   Emerging Markets: Countries like China, India, Brazil, and Korea are growing rapidly. There is an inflow of capital and a surplus of opportunity. However, there are not enough talented entrepreneurs to use all of the resources effectively. I was recently speaking with a venture capitalist in India who lamented that she didn’t have enough good investment opportunities. She struggles to find fundable entrepreneurs. Contrast that to Silicon Valley where it’s difficult to even get a meeting with an investor because their schedules are so booked.

-  “Boring” Businesses: It’s easy to get caught up in the sexy industries like finance, entertainment, and technology. The media makes it seem like these are the only areas you can really make money. But there are many untold stories of people who make fortunes in more traditional, uninteresting businesses. One investor I know made tens of millions of dollars for himself by buying and fixing up a call center company. It wasn’t exactly a high-growth business, but it filled a need and just needed some operational changes to become very profitable. The investor was successful because he picked an industry where there was real demand but not too much competition.

-  The Intersections Between Different Disciplines: The world is very interconnected, and there is a shortage of people who are experts in more than one thing. Lots of talent is focused on solving problems, but there are fewer people who are tackling the space in-between. A good example of this is IronPlanet, a highly profitable company that has bridged the divide between purchasing capital equipment and online auctions. There are many people who knew about each of these topics individually, but very few people who understood the value that could be created by combining them into a single business model.

What do you think are good business opportunities with a low talent-to-demand ratio? Please share in the comments.

Relaxation 101: A Guide to Destressing

Two years ago, I was stressed all the time. I woke up every morning with some responsibility or pressure weighing on my mind. One day, I looked in the mirror and asked myself if this was really the right way to live, and I concluded that being stressed was actually a terrible use of my time and energy.

Stress drains our emotions and leaves us with less time to focus on more productive activities – such as finding new business opportunities. It also makes us less fun and interesting to be around, which hurts our earning potential.

With that in mind, I resolved to change this part of my life. Since then, I’ve substantially reduced my stress levels and actually become more productive along the way. Here are the steps I took; I hope they help you as much as they’ve helped me.

Continue reading Relaxation 101: A Guide to Destressing →

How To Fail Before You Begin

Sometimes it’s best to fail before you start.

Several years ago, I had a vision: to build my own independent record label. I’d always been passionate about both music and business – what better way to combine the two?

I decided to call one of my friends – Sachin Rekhi – for advice. Sachin had co-founded a music startup and am worked at Imeem, the online music streaming site. I walked him through my whole pitch – why I’d be good at it, and how to find the best artists. After I’d finished, he asked me a simple question:

“Do the numbers work?”

Continue reading How To Fail Before You Begin →