读书笔记 - Blitzscaling (Part 2)

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读书笔记 - Blitzscaling (Part 1)

Blitzscaling is a book about "The lightning-fast path to build massively valuable companies", which was written by Reid Hoffman (LinkedIn cofounder) and Chris Yeh, forwarded by Bill Gates. Whether your business has ten employees or ten thousand, Blitzscaling is the essential playbook for winning in a world where speed is the competitive advantage that matters most. This book talks about "What is Blitzscaling", Business Model innovation, Strategy innovation, management innovation, broader landscape of Blitzscaling, and Responsible Blitzscaling. 

Blitzscaling is a strategy and set of techniques for driving and managing extremely rapid growth that prioritize speed over efficiency in an environment of uncertainty. Put another way, it's an accelerant that allows your company to grow at a furious pace that knocks the competition out of the water.

Whether you are a founder, a manager, a potential employee, or an investor, we believe that understanding blitzscaling will allow you to make better decisions in a world where speed is the critical competitive advantage. 

The term "blitzscaling" derives from the twentieth-century usage of "blitz" as a way of describing a sudden, all-out effort. The first usage of blitz in this way was to describe the "blitzkrieg" strategy that General Heinz Guderian devised for the initial military campaigns of Nazi Germany in world war II.

Blitzscaling is what we call both the general framework and the specific techniques that allow companies to achieve massive scale at incredible speed.

Classic start-up growth prioritizes efficiency in the face of uncertainty. Classic scale-up growth focuses on growing efficiently once the company has achieved certainty about the environment. Fastscaling means that you're willing to sacrifice efficiency for the sake of increasing your growth rate. Blitzscaling means that you're willing to sacrifice efficiency for speed, but without waiting to achieve certainty on whether the sacrifice will pay off.

Three basics of blitzscaling
1. Blitzscaling is both an offensive strategy and a defensive strategy
2. Blitzscaling thrives on positive feedback loops. In that the company that grows to scale first reaps significant competitive advantages
3. Despite its incredible advantages and potential payoffs, blitzscaling also comes with massive risks.

For business model innovation, the key is to combine new technologies with effective distribution to potential customers, a scalable and high-margin revenue model, and an approach that allows you to serve those customers given your probable resource constraints.  

For strategy model innovation, blitzscaling business tend to play in winner-take-most or winner-take-all markets. The greater risk for a successful, growing business is to move too slowly and allow its competitors to win market leadership and first-scaler advantage.

For management innovation, this is necessary because of the extreme strains placed on the organization and its employees by hyper-growth. Companies that blitzscale have to rapidly navigate a set of key transitions as their organizations grow, and have to embrace counterintuitive rules like hiring "good enough" people, launching flawed and imperfect products, letting fires burn, and ignoring angry customers.

Market size, distribution, and gross margins are important factors in growing a company, but the final growth factor (network effects) plays the key role in sustaining that growth long enough to build a massively valuable and lasting franchise. 

A product or service is subject to positive network effects when increased usage by any user increases the value of the product or service for other users.

Companies with a competitive advantage can quickly grow to the point where the increasing returns of network effects produce a winner-take-most or winner-take-all market. This also explains why the growth factor of distribution is as or more important to company success as the product itself - without distribution, it is difficult to reach the tipping point.

A significant number of operational issues arise simply because of human limitations. As much as we might wish that we and our colleagues could work tirelessly and seamlessly, regardless of the scale of the organization, the fact is that growth causes us to trip over a wide array of issues.

The power of modularity goes beyond just software development and engineering. The power of modularity, this principle makes it possible for a company like Amazon and its customers to build complex products out of smaller, standardized subsystems.

How the role of the founder changes in each stage:
Stage 1 (Family): The founder personally pulls the levers of hypergrowth
Stage 2 (Tribe): The founder manages the people who are pulling the levers
Stage 3 (Village): The founder designs an organization that pulls the levers
Stage 4 (City): The founder makes high-level decisions about goals and strategies
Stage 5 (Nation): The founder figures out how to pull the organization back from Blitzscaling and start blitzscaling new product lines and business units

读书笔记 - ZERO to ONE

Peter Thiel's book is about notes on startups, or how to build the future.

The challenge of the future
Question received ideas and rethink business from scratch
What important truth do very few people agree with you on?
Most people think the future of the world will be defined by globalization, but the truth is that technology matters more.

Party like it's 1999
make incremental advances
stay lean and flexible
improve on the competition
focus on product, not sales

All happy companies are different
if you want to create and capture lasting value, don't build an undifferentiated commodity business.
in business, money is either an important thing or it is everything.
Monopolists can afford to think about things other than making money.
monopoly is the condition of every successful business.

The ideology of competition
Creative monopoly means new products that benefit everybody and sustainable profits for the creator.

Last mover advantage
Escaping competition will give you a monopoly, but even monopoly is only a great business if it can endure in the future.
For a company to be valuable, it must grow and endure, but many entrepreneurs focus only on short-term growth.
Will this business still be around a decade from now?

Characteristics of monopoly
1. proprietary technology
2. network effects
3. economics of scale
4. branding

Building a monopoly
1. start small and monopolize (every startup should start with a very small market)
2. scaling up
3. don't disrupt (avoid competition as much as possible)
4. that last will be the first (you must study the endgame before everything else)

You are not a lottery ticket
The most contentious question in business is whether success comes from luck or skill.
Can you control your future? Indefinite pessimism, definite pessimism, definite optimism, indefinite optimism
Our indefinitely optimistic world: indefinite finance, indefinite politics, indefinite philosophy, indefinite life
Is indefinite optimism even possible?
A startup is the largest endeavor over which you can have definite mastery. You can have agency not just over your own life, but over a small and important part of the world.

Follow the money
Money makes money.
We don't live in a normal world, we live under a power law.
Venture capitalists (VCs) aim to identify, fund and profit from promising early-stage companies.
The biggest secret in venture capital is that the best investment in a successful fund equals or outperforms the entire rest of fund combined.
every single company in a good venture portfolio must have the potential to succeed at vast scale.
why people don't see the power law?
If you do start your own company, you must remember the power law to operate it well.
The most important things are singular: one market will probably be better than all others, one distribution strategy usually dominates all others.
In a power law world, you can't afford not to think hard about where your actions will fall on the curve.

Secrets
Every one of today's most famous and familiar ideas was once unknown and unsuspected.
What important truth do very few people agree with you on?
What valuable company is nobody building?
How to find secrets?
The best place to look for secrets is where no one else is looking.
Unless you have perfectly conventional beliefs, it's rarely a good idea to tell everybody everything that you know.

Foundations
Every great company is unique, but there are a few things that every business must get right at the beginning.
Thiel's law: a startup messed up at its foundation cannot be fixed.
When I consider investing in a startup, I study the founding teams. Technical abilities and complementary skill sets matter, but how well the founders know each other and how well they work together matter just as much.
ownership, possession, and control - it is not just founders who need to get along. Everyone in your company needs to work well together.
Cash is not king. Any kind of cash is more about the present than the future.

The mechanics of Mafia
Every company is a culture. A startup is a team of people on a mission, and a good culture is just what that looks like on the inside.
From the outside, everyone in your company should be different in the same way.
On the inside, every individual should be sharply distinguished by her work.
The best thing I did as a manager at Paypal was to make every person in the company responsible for doing just one thing.

If you build it, will they come?
Customers will not come just because you build it. You have to make that happen, and it is harder than it looks.
If you have invented something new but you haven't invented an effective way to sell it, you have a bad business  - no matter how good the product.
Superior sales and distribution by itself can create a monopoly, even with no product differnentiation.
Your company needs to sell more than its product. You must also sell your company to employees and investors.
If Linkedin had tried to simply replace recruiters with technology, they wouldn't have a business today.

Man and Machine
Will a machine replace man?
Substitution vs complementarity?
Globalization means substitution
Technology means complementarity
As computers become more and more powerful, they won't be substitutes for humans, they will be complements.

Seeing Green
cleantech bubble
1. Can you create breakthrough technology instead of incremental improvements?
2. Is now the right time to start your particular business?
3. Are you starting with a big share of small market?
4. Do you have the right team?
5. Do you have a way to not just create but deliver your product?
6. Will your market position be defensible 10 and 20 years into the future?
7. Have you identified a unique opportunity that others don't see?

The Founder's Paradox
Founders are important not because they are the only ones whose work has value, but rather because a great founder can bring out the best work from everybody at his company.
Everything important to use - the universe, the planet, the country, your company, your life, and this very moment - is singular.
Our task today is to find singular ways to create new things that will make the future not just different, but better, to go from 0 to 1. The essential first step is to think for yourself. Only by seeing our world anew, as fresh and strange as it was to the ancients who saw it first, can we both recreate it and preserve for the future.

中美创业感悟 by Dr. Datong Chen

第一次在湾区听成功人士的创业感悟，而且是中文的。这个周一晚上，在InnoSpring 公司(类似国内的孵化器) ，陈大同博士介绍了他在美国和中国先后创业的个人感悟和宝贵经验。此前不了解陈博士，尽管当年在国内的时候听说过展讯公司。在近2个小时的介绍中，他剖析了2次成功创业的历程、经验和心得。可能就像他说得那样，没有被成功和荣誉捧杀的他，创业中的艰辛、挫折、挑战、机遇、激动、成功，从他口中出来，没有激情昂扬，只是低调叙述。葛优说的淡定，就是说得这个境界吧。

那什么是创业呢？在回家的路上，反复琢磨他演讲中一些印象深刻的话。我从字面意思上理解，创业应该是创新＋企业。湾区说的startup就是创业，少数几个人为了共同的目标信念开个公司，做些有意义的事情。陈博士说的”不安分“是创业的催化剂，当你看到未来10年的生活时，应该感到彷徨和危机，当初他离开国家半导体，就是不想一直做半导体工艺，而是想创新，做半导体设计。“被创业”其实也是他内心的想法，Follow your heart，做有挑战，有风险，有创意的事情，是创业者的特征。一直做程序员的人我，不能完全体会他所有的话，但有些印象深的还是罗列出来供以后参考。

不安分 （有冲动）－ 在OmmiVision前，他还介绍了新岛的故事，时刻思考着，寻求改变。
不满足 （有想法）－ 2个公司都上市了，没有退休享乐，而是去做风投，帮助新一代的追梦者创业。（优秀的运动员退役后会做教练员，优秀的创业者成功后会做投资人）
不信邪 （爱挑战）－ 不懂设计，自学设计，不知co-founder而做co-founder， 不了解3G，偏做3G
用最新的技术做最新的产品，没有见到成功的
对市场机遇的把握非常重要
预测一年后的市场比较容易，三年后的就很难了
分析家对新产品的预测总是太乐观了，实际需要的时间是预期的两倍
唐僧是优秀的CEO
做80％用户接受的产品，太完美会错过市场机遇
挂羊头卖狗肉－应对市场需求和风投期望
世界经济向中国转移，中国市场潜力无穷
创业是折寿的实验，Co-founder的生活跟常人不一样
创业失败被抹杀，创业成功被捧杀
烧尽在黎明前的黑暗中（资本风险）
做个蓝海企业，不要红海企业
大企业靠品牌和收购，小企业靠创新和速度

创业的故事，能够讲出来的只有百分之一，因为创业大约百分之九十的时间是用来开会，做研究等繁琐的事情，剩下的百分之十， 又有百分之九是不能说的故事，真正讲出来而且大家又感兴趣听的，就剩百分之一了。这是他的开场白。在他的叙述中，也感到了这点，但其中的百分之一也有不少可以让人琢磨的了。

Stay hungry, stay foolish! 他用乔布斯的话结束了他的演讲。