Two more Souls:

September 20, 2005
The Soul of a New Company

While attending this week's CMO Perspectives conference, I was reminded of Tracy Kidder's famous 1981 book, The Soul Of A New Machine. Why did a conference of Chief Marketing Officers, showcasing brand reinvigoration efforts at McDonalds and Dove (whose "Real Beauty" campaign I absolutely love, by the way), remind me of a geeky cult hit about the development of Data General's latest big iron machine?

Simply put, all the talk about brand attributes and personality reminded me of the importance of "soul" in a start-up.

Keynote speaker Charlotte Beers (who had great stories about her experience in Washington when she was tapped by Colin Powell in October 2001 to run the US PR campaign in Arab countries after a long Madison Avenue career running Oglivy & Mather and J. Walter Thompson) talked about the importance of company executives, particularly CMOs, personifying the brands of their companies. Although the CMOs of Pepsi and WalMart, who were in the room, took her advice as very relevant to their global branding efforts, it struck me as even more critical to the little start-ups we VCs deal with every day in a very different way.

VCs tend to approach start-ups with cool, analytical rigor to get to the bottom line answer: "Will this make me and my limited partners money?". Entrepreneurs tend to approach start-ups with extreme emotional attachment beyond any rational borders, seeking the answer to the question: "Will anyone love and appreciate my [professional] baby (which, by the way, I hope makes me money so I can retire and get back to spending time with my family)?" Anyone who's been involved in starting a company knows what an incredibly emotional adventure it can be.  The ups and downs are incredibly exhilirating yet terrifying.  One moment you're king of the world, the next you're afraid you're going to run out of money, and then it flips again.  The tension between that emotional roller-coaster that the founders/insiders are feelings as compared to the cool, analytical perspective of the rational VC/outsiders is an extremely healthy one - over-weighting one side or the other will result in a sub-optimal company-creation process.

And it is that tension that gets to heart of the concept of the soul of a company. You don't have to be a religious person to appreciate that every start-up has a soul. Webster defines the word as "the immaterial part of a person". The soul of a start-up is thus the immaterial part of the company that personifies its unique character and culture. The soul of a company typically comes from the founding team, although I have also seen it come from mid-level hires, often young, who so completely embrace the company's mission that they begin to deeply eminate it in all of their activities.

The importance of nuturing the soul of a new company can't be under-estimated, but can be very difficult as the start-up grows and evolves. Too often, that soul can erode when VCs come in to start-ups and begin to engineer the process of bringing in the "grown ups" (by the way, how old do you think you have to be to be considered a grown up at a start-up?). If the board and management team aren't careful about preserving the soul of the company during growth, "grown-ups" and founder transitions, the company can easily lose its way. Perhaps not on a rational level (strategy, finance, products), but on an emotional one (culture, passion, commitment).

Think of a start-up. Now picture who represents the "soul" of that start-up. It's probably a pretty easy exercise. Now imagine that person missing from the start-up. Ouch.

Nurturing and evolving the sould of the start-up is as critical a part of the stewardship of the company as nurturing the product strategy.  Boards and founders shouldn't be afraid to use this emotional language when describing what they are creating.  After all, it is how they are feeling.

Seeing Both Sides
VC Perspectives From A Former Entrepreneur

Sunday, February 06, 2005
The Soul of a *New* Machine?

Ted Leung writes about a reinventing of capitalism to enhance its positive social effects.

I happen to be reading an arguably related book of essays, and poetry of all things. Poetry does not have the same cultural reception here in the US as it does in other parts of the world. This book, ("The Heart Aroused", by David Whyte, who I knew briefly 18 years ago when I lived on Whidbey Island just north of Ted's Bainbridge Island) addresses the problems of capitalism as they occur in our everyday work life.

Here is part of David Whyte's essay on Beowulf...

    Business and politics profess to be hardheaded, but how many businesses, and even countries, have been ruined through decisions that were ostensibly hardheaded but which had more to do with the relutance of those in charge to face fears or vulnerabilities?

    This reluctance to enter the deeper waters of the psyche is not confined to modern participants of corporate life. Fifteen hundred years ago in the Old English poem Beowulf, an anonymous bardic author confronted his listeners with a frightening image of this inner lake. His listeners were almost certainly rough warriors used to getting their hands dirty. He found them equally shy of that dark water.

    Beowulf is a masculine story of descent into the waters of the unconscious, but where the restoration of a profound inner feminine power is essential to his survival. In that context it is a compelling story for both women and men working in a masculine workplace sorely in need of a commensurate balancing power. In a corporate culture still dominated by the image of the warrior archetype, Beowulf's plunge into the waters of the unconscious seems to be equally instructive for both sexes.

    The early English teller of Beowulf asked his listeners to drop beneath the surface of their daily existence, where the rational mind continually prays for dry feet. Since that time the physical details of life may have changed. The elemental motifs have not.

Making it stick
Posted by Patrick Logan at 1:22 AM