Bill Taylor, co-author of Mavericks at Work, explains that it is more than just John Lasseter:
…Pixar doesn’t just make films that perform better than standard fare. It also makes its films differently — and, in the process, defies many familiar, and dysfunctional, industry conventions. Pixar has become the envy of Hollywood because it never went Hollywood.
More than a few business pundits have drawn parallels between the flat, decentralized “corporation of the future” and the ad-hoc collection of actors, producers and technicians that come together around a film and disband once it is finished. In the Hollywood model, highly talented people agree to terms, do their jobs, and move on to the next project. The model allows for maximum flexibility, to be sure, but it inspires minimum loyalty and endless jockeying for advantage.
Turn that model on its head and you get the Pixar version: a tightknit company of long-term collaborators who stick together, learn from one another, and strive to improve with every production. Andrew Stanton, who directed Wall-E, was a key figure behind Finding Nemo, which won two Oscars, generated worldwide box-office of $840 million, and became the best-selling DVD of all time. But Stanton didn’t follow the success of Nemo by offering himself to the highest bidder or demanding perks and special treatment. He went back to his job as an employee of the studio, to pitch in on other films and eventually begin work on his next major project.
And Stanton is merely one of many superbly talented writers and directors who have staked their reputations on their work at Pixar. Again, in contrast to convention, these professionals have traded one-time contracts for long-term affiliation and contribute across the studio, rather than to just their pet projects.
According to Randy Nelson, who joined the company in 1997 and is dean of Pixar University, this model reflects “Pixar’s specific critique of the industry’s standard practice.” He explains it this way: “Contracts allow you to be irresponsible as a company. You don’t need to worry about keeping people happy and fulfilled. What we have created here — an incredible workspace, opportunities to learn and grow, and, most of all, great co-workers — is better than any contract.”
Definitely, read the whole thing. And with the Disney combination, the $$ can be more than just great story telling
“Cars” tells the story. The film was regarded by some critics as one of Pixar’s weaker storytelling efforts, and it generated soft foreign sales when compared with hits like “Finding Nemo.” But “Cars” has pumped billions in profit into Disney via a wide range of ancillary businesses.
The film racked up over $460 million in global ticket sales and has sold 27 million DVDs. Related retail products have generated $5 billion in sales. A “Cars” virtual world is opening on the Internet, a “Cars” ice-skating show will begin touring the nation in September, and work is under way to bring an entire “Cars” experience to the Disneyland Resort in California.
Remember how George Lucas funded the beginning of the Star Wars franchise — it wasn’t ticket sales.
When our friend Davis told us about the new Kleiner Perkins Caufield & Byers iFund, my first thought was “another sign of too much VC money, too few quality deals”. On second thought — the iFund looks like a very efficient way for KPCB to put $100 million+ to work. The deal pipeline can share the due diligence effort, stimulate cross-developer component development, and Apple’s involvement will certainly help. Odds are Apple development will be influenced by what the iFund pipeline needs.
The iFund will also put KPCB in an advantageous position to build a network of iPhone innovators — a potential hothouse of innovation for follow on deals.
I wondered how KPCB will deal with the reality that many of the entrepreneurs won’t need much money. I.e., given the marketing boost provided by Apple’s App Store, I would expect angle investor size rounds to cover most of the startups. Well, the iFund will do deals from $100K up.
If you have an iPhone or iTouch innovation that needs some $$, start here. You can apply online.
KPCB’s iFund™ is a $100M investment initiative that will fund market-changing ideas and products that extend the revolutionary new iPhone and iPod touch platform. The iFund™ is agnostic to size and stage of investment and will invest in companies building applications, services and components. Focus areas include location based services, social networking, mCommerce (including advertising and payments), communication, and entertainment. The iFund™ will back innovators pursuing transformative, high-impact ideas with an eye towards building independent durable companies atop the iPhone / iPod touch platform.
“A revolutionary new platform is a rare and prized opportunity for entrepreneurs, and that’s exactly what Apple has created with iPhone and iPod touch,” said John Doerr, Partner at Kleiner Perkins Caufield & Byers. “We think several significant new companies will emerge as this new platform evolves, and the iFund™ will empower them to realize their full potential.”
I liked this paragraph in the FAQ
Q: How much will the iFund™ invest in each startup company?
A: The iFund™ will invest anywhere from $100K of seed capital to $15M of expansion capital in mobile application and services companies.
Well, duh…
…who thought that developing world mandarins wouldn’t rush to buy a system explicitly built to undermine them?
Peg 2.0 offers some useful suggestions on amping up One Laptop Per Child into a for-profit venture. Negroponte argues that non-profit has been important for access to mandarins. Yes, he has had access, but the photo-ops with heads of state has produced almost no orders from those same states. A venture back entreprise has more advantages — such as slashing OLPC’s high turnover rate:
…OLPC’s problem is just that it doesn’t sell enough laptops, and that problem can be linked back to two big (and connected) problems: arrogance and ideology, and high staff turnover.
Let’s tackle high turnover first. This one is a no-brainer. When you work for a charity, you’re not getting paid much, and you can leave whenever you want. When you work for a startup, you have equity, and the urge to leave is often compensated by the urge to grow your company and cash your chips.
The main reason why OLPC could shoot for a $100 pricetag (and miss, by a mile) was thanks to an innovative screen technology, cheap and fitting for developing world conditions. Mary Lou Jepsen, the woman behind that, left OLPC to launch a startup around that technology. There’s nothing wrong about that: the profit motive is a legitimate one, and when you invent an innovative, useful technology there’s nothing wrong with wanting to profit from it. But obviously if OLPC had already been a company Ms Jepsen wouldn’t have had to quit to do that: her best hope to profit would have been to stay with OLPC and hope to monetize her stake; meanwhile OLPC would have kept its Chief Technology Officer. With a little capitalism, everybody wins.
Same thing with Walter Bender, the chief software guy, who left over OLPC’s decision to put Windows on the laptops (a frequent request from customers). Now obviously, in startups it happens that senior people quit over differences in strategy, and even start competitors (as Mr Bender did). But the exit costs are much higher. So there’s a lot to wager OLPC would have bled talent much less if it had been a company.
…And that’s the goal, isn’t it? To get laptops in kids’ hands, right? Or is it to aggrandize Nicholas Negroponte? If it is the latter, the VCs on his board would have told him to cut the bullshit and get his act together, fast.
In short, the best reason why OLPC would work better as a company is that in a company the shareholders can fire the CEO. Negroponte seems great at vision, and the $100 laptop may be one of the best ideas of the 21st century, but he’s proved abysmal at execution. In a startup it very often happens that the person who launched the company is not the best person to grow it, or run its main product’s execution.
Technorati Tags: OLPC
It’s a small practice with big implications: Companies don’t engage emotionally with their customers—people do. If you want to create a memorable company, you have to fill your company with memorable people. How are you making sure that you’re filling your organization with the right people? And how much are you willing to pay to find out?
A really excellent report on his Zappos visit by Bill Taylor. Excerpt:
Zappos has also mastered the art of telephone service—a black hole for most Internet retailers. Zappos publishes its 1-800 number on every single page of the site—and its smart and entertaining call-center employees are free to do whatever it takes to make you happy. There are no scripts, no time limits on calls, no robotic behavior, and plenty of legendary stories about Zappos and its customers.
This is a company that’s bursting with personality, to the point where a huge number of its 1,600 employees are power users of Twitter so that their friends, colleagues, and customers know what they’re up to at any moment in time. But here’s what’s really interesting. It’s a hard job, answering phones and talking to customers for hours at a time. So when Zappos hires new employees, it provides a four-week training period that immerses them in the company’s strategy, culture, and obsession with customers. People get paid their full salary during this period.
After a week or so in this immersive experience, though, it’s time for what Zappos calls “The Offer.” The fast-growing company, which works hard to recruit people to join, says to its newest employees: “If you quit today, we will pay you for the amount of time you’ve worked, plus we will offer you a $1,000 bonus.” Zappos actually bribes its new employees to quit!
Why? Because if you’re willing to take the company up on the offer, you obviously don’t have the sense of commitment they are looking for. It’s hard to describe the level of energy in the Zappos culture—which means, by definition, it’s not for everybody. Zappos wants to learn if there’s a bad fit between what makes the organization tick and what makes individual employees tick—and it’s willing to pay to learn sooner rather than later. (About ten percent of new call-center employees take the money and run.)
Indeed, CEO Tony Hsieh and his colleagues keep raising the size of the quit-now bonus. It started at $100, went to $500, and may well go higher than $1,000 as the company gets bigger (and it becomes even more difficult to maintain the all-important culture and obsession with customers.)
I do hope Branson’s venture becomes a Harvard Business School case study in entreprenuership.
Virgin Group head Sir Richard Branson unveiled the latest addition to his air- and spaceline fleet at the Mojave Airport in California today, accompanied by the craft’s chief designer, Burt Rutan.
The White Knight 2 is a four-engine jet that will carry an 8-seat spaceship called SpaceShipTwo to an altitude of 48,000 feet so that the spaceship can drop off and fire its rocket engine for a brief run to suborbital space. Branson’s Virgin Galactic hopes to begin regularly scheduled passenger service to space in 2010.
White Knight 2, Branson, and Rutan: Virgin Galactic owner Richard Branson (left) and air- and spacecraft designer Burt Rutan wave from the cockpit of the White Knight 2. Photo by Michael Belfiore
Rutan’s company Scaled Composites made history in 2004 with the world’s first privately funded manned spaceflights by its three-seat SpaceShipOne, which was carried aloft by the original White Knight. The White Knight 2 features two fuselages, each with its own cabin, connected by a single continuous wing arching between them, where the spaceship will ride. With the wing span of a B-29 bomber, it is the largest all-carbon-fiber aircraft yet built.
On hand to christen the White Knight Two outside a Scaled hangar was Branson’s mother, Eve. Not coincidentally, Eve is also the name of the mother ship. “If you’re going to name a mother ship,” Branson quipped to a gathering of perhaps two hundred reporters and dignitaries, including Apollo 11 moonwalker Buzz Aldrin, “you might as well name it after your own mother.”
That may be a trick question, but I don’t think many would answer “Switzerland”. But Will Wilkinson went straight to the source for the graph at left, the OECD Factbook 2008: Economic, Environmental and Social Statistics. We know from experience that our Aussie and Kiwi mates are immigration-friendly. Does anyone know factually why Switzerland ranks even a bit higher than Australia?
My guess is a key driver is the falling Swiss fertility rate — which at 1.42 has dropped to almost the basement level of Italy. Absent strong immigration, Switzerland will become just a place on the map. But given a progressive immigration policy Switzerland’s low fertility is a good news story, as admission to Switzerland (or Australia or NZ or America …) is an opportunity for the immigrant to learn from the success of his neighbors, and for the Swiss et al to benefit from the entrepreneurial drive of the immigrants. A bit like Uplifting, but without the genetic modifications.
The OECD Factbook is a primary source — highly recommended. I do hope you will bookmark the powerful visualization and analysis provided by Google’s free Trendalyzer. This is Swedish economist Hans Rosling’s marvelous GapMinder work. Here are two earlier Seekerblog posts on Prof. Rosling: Gapcasts, and Gapminder & Human Development Trends.
If you are depressed because the daily “news cycle” makes you feel like the world is going totally wrong, you owe yourself some time to get perspective from the real data. For an animated example, see the Gapminder presentation “Has the world become a better place?” [you can download the Flash presentation].Google’s purchase of Rosling’s Trendalyzer has made these visualization tools invaluable aids for students — or anyone who is trying to understand complex data.
Lastly, here’s my recent post on the free Google tools. I recommend studying the ten example videos at Gapcasts to get your intuition going on how you can use the tools.
Technorati Tags: Immigration
Whilst researching Amyris Biotechnologies I found this Time survey of several interesting startups, which in addition to Amyris mentions some of our favorites like Nanosolar and Serious Materials.
Are your children going to invention camp? I sure hope so. This is all part of Invent.org which is doing some impressive innovating to champion inventors everywhere. There are billboards, and do check out the video of the Lost Cat Magnet field testing.
Be warned — this is one of those “jazzy Flash sites” that is difficult to navigate. The web-consultant crowd has fallen in love with Flash — I just hope the fad wears off soon.
The Ad Council and Commerce Secretary posted a bulletin on the Inspiring Invention Campaign, which includes links to the video of the Bandage Puller, Lost Cat Magnet and PDF of the billboards.
…Half of all new college graduates now believe that self-employment is more secure than a full-time job. Today, 80% of the colleges and universities in the U.S. now offer courses on entrepreneurship; 60% of Gen Y business owners consider themselves to be serial entrepreneurs, according to Inc. magazine. Tellingly, 18 to 24-year-olds are starting companies at a faster rate than 35 to 44-year-olds. And 70% of today’s high schoolers intend to start their own companies, according to a Gallup poll.
An upcoming wave of new workers in our society will never work for an established company if they can help it. To them, having a traditional job is one of the biggest career failures they can imagine.
… Without knowing it, we have been training a whole generation of young entrepreneurs.
And who is going to dissuade them? Mom, who is a self-employed consultant working out of the spare bedroom? Or Dad, who is at Starbuck’s working on the spreadsheet of his new business plan?
…Entrepreneurial America is likely to become even more innovative than it is today. And that innovation is likely to spread across society, not just as products and inventions, but new ways of living and new types of organizations.
The economy will be much more volatile and much more competitive. In the continuous fervor to create new institutions, it will become increasingly difficult to sustain old ones.
…This higher level of anarchy will be exciting, but it will also sometimes be very painful. Entire industries will die almost overnight, laying off thousands, while others will just as suddenly appear, hungry for employees.
…Scary, exciting, liberating, frustrating, infinitely ambitious and thoroughly amnesic. If you live in a high-tech community like Silicon Valley or Redmond or Austin, you already live in this world. It’s hard to imagine more exciting places to be.
Don’t miss Michael Malone’s essay “The Next American Frontier“. And did you notice Apple’s product placement? And thanks to Growthology for the link.
…In April 2007, when the trio informed Google they were leaving, they didn’t give any specifics, just that they were going to do their own thing. Without even knowing what their idea was, Google wanted them - and their project - to stay. “They told us, ‘Here’s a blank check,’” recalls Knapp, a baby-faced former track star at Stanford. “I said, ‘You’re asking me to be a surrogate parent.’” Knapp and his pals would do the hard work, in other words, but Google would own the product. Instead, off they went, leaving behind the perks, the 20% time, and a combined seven-figure pile of unvested options. (Google declined to comment on Knapp’s account.)
A year later the company the three founded, Ooyala, is precisely the kind of budding success Google wants to be creating inside its walls. Ooyala’s 28 employees are building a system that runs videos for independent Web sites, and eventually they plan to sell video ads in the same way Google (GOOG, Fortune 500) hawks text ads for other web publishers. The startup has raised $10 million in venture capital, which doesn’t even come close to matching Google’s resources. But the Ooyala founders say what they lack in institutional backing they make up for in speed and the ability to communicate with one another by turning around in their chairs and talking. Google was like that too, about eight years and 18,000 employees ago.
It would be easy to dismiss the exodus of some of Google’s best people if it were an isolated occurrence. It isn’t. Paul Buchheit, an early Google engineer who coined the “Don’t be evil!” battle cry, is a founder, with three ex-Google colleagues, of a social-networking company called FriendFeed. Yanda Erlich, once a popular Google product manager, started an instant-messaging company called Mogad. Nathan Stoll, who managed Google News, is hard at work on his new company, Mechanical Zoo. (It’s in “stealth mode”- no details.) Former business-development guys Salman Ullah and Sean Dempsey have a new venture capital firm, Merus Capital, that aims in part to fund startups founded by ex-Googlers. (That’s employees, in Googlespeak.) The departures have grown so numerous that the exiles have formed an informal alumni club of ex-Googlers turned entrepreneurs. David Friedberg, another former biz-dev executive, who started a company called WeatherBill, which sells insurance pegged to climate risks, recently attended the club’s first meeting at a conference center in Palo Alto. “I was surprised by the number of things that were being done that could have been done at Google,” he says.
Google has been consistently innovative internally — fostering creativity and risk-taking. And they have been extraordinarily successful at recruiting the very best and brightest. Combine that venture-nurturing with the value of those Google stock options and you get what I thought would happen “any time now”, new startups draining brains. The only way that wasn’t going to happen was a skid to oblivion. Fortunately that hasn’t happened.
Can anybody name some important Microsoft-originated startups? I’m sure there must be some, I just don’t have first-hand knowledge of any.
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