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HIC! – Automattic.com is innovative

November 2nd, 2009 by admin No comments »

Last week I had the great pleasure of talking with Matt Mullenweg, of Automattic Inc.

mullenmattMatt is one of those young entrepreneurs who creates his businesses out of his love for the “game” – in this case the “game” being the blogosphere and the open source tools supporting the growth of the growing online news industry. Mullenweg is the founding “developer” of WordPress Inc.  WordPress, while not the first  technology innovator in the blog space, is certainly well-designed and refreshing in the way that it has paid close attention to the needs of its customers and has built life-long believers. Mullenweg was a big part of that.  But, Mullenweg’s mother ship, Automattic (formed in 2005) is something innovative in my mind based on the new types of tools that it is producing and spinning out each year.  In its 4 years of start-up existence, Automattic has launched many products for online writers including:

  • Akismet – open source tool for monitoring spam, that helps
  • bbPress – forum/discussion software to enable stickyness on the blog
  • IntenseDebate  (acquired)- open source add-on that super-charges reader/commentor feedback
  • PollDaddy (acquired) – an innovative online surveys/poll add-on
  • Gravitar (acquired) – portable avitars you can create/use as your persona on multiple web services
  • VideoPress – slick video encoder/player that can be used on WordPress and other blogs

All of these companies complement WordPress ….and all these entities come under the umbrella of wordpressimageAutomattic — thus, I view Automattic as the “IdeaLab” of the blogging and Opensource world (“thou shall not use the world “incubator” in 2009 in vain”).  Funded initially by angels, True Ventures (SF-based), Polaris Ventures and the NY Times are the dominant investors in this company-of-companies.  The last round of $30M in 2008 gives the company a development and acquisition war-chest…and Seems like a GREAT FEEDER of INNOVATION for the NY Times.

Recently,  Automattic announced the acquisition of  “After the Deadline“. Available under Opensource license, AtD uses artificial intelligence and natural language processing technology to find writers/bloggers’ errors.  It then offers suggestions for replacing words or gramattical errors.  What’s unique is that the technology makes use of the neuro-net to “learn” from mistakes others’ have made and so it gets SMARTER over time and the more it is used.AtD is a spell-checker. This is a spell-checker that plugs into the braincells of the Internet in a very new way…and it hints at the future of shared knowledge for writers and/or other artists over open-source.A high-level overview of AtD can be found here.

Packed with a lot of bright young net-savvy writers, programmers, and creatives – I pick Automattic.com as a HIC (highly-innovative company) that will be rewarded in the future by the market for its unique approach to harnessing Open Source and the broader neuro-network of the web.

10 Ways Leaders Create Innovation

October 19th, 2009 by admin 2 comments »

Successful entrepreneurs are not only able to create a product or service that fits an unmet market need – but they also seem to have a knack for unleashing the creativity of their team. In my work with some 60+ companies as an angel, board member, venture capitalist or “mentor”, I’ve seen some very innovative companies – and most of them were innovative because the leader(s) or Founders put in some brain-power time to determine early-on what they could do to nurture creativity within the company.

Here are 10 ways that the most successful entrepreneurs created a truly innovative environment:

1) Foster an environment of experimentation and risk-taking – the great ones ensure that employees feel that they can experiment with risk – particularly in marketing, product development, and relationship management areas. I recall one company I was on the Board of that took the risk of trying out a new form of banner advertisement that incorporated e-commerce transactions right into the banner ad. Twenty-four months after launching, the company was purchased for $100M + and the entrepreneur who came up with the idea of e-com banner was handsomely rewarded.

2) Condition the team to a “Freedom to Fail” attitude – a cousin to the idea of risk taking is “freedom to fail” . Leaders who allow their team to sometimes try things, knowing that they might fail but also knowing that the team will learn something from attempting a new idea. This creates an environment where the team “fearlessly” approaches new markets and relationships without “sweating the small stuff.” (see Innovation Sparks, 9/24 and 10/2/09 entries for several great company examples)

3) Give control and responsibility to your “Creatives” – by creatives I include engineers, artists, editors – depends on the type of business. A great creative leader allows his creative team to have some control over the quality of their work and the output – rather than have to cater to the bureaucracy of an organization. One of the most famous examples of this was Steve Job’s Macintosh team. A more modern example are the scientific teams at Genentech.

4) Build a great physical environment –setting up an environment properly can ensure that employees have amenities to assist in their creative mindset. For example , IDEO’s campus includes a wide variety of playful rooms for client work, several well-stocked cafeterias (stocked with free food) and outdoor meetings spaces.  Google’s office complex (the “GooglePlex”) is run like a university campus and is so nurturing that an unconfirmed rumor has it that a recent summer intern spent the entire summer eat, slept, worked and recreated at Google ….and no one at the company realized that he used the GooglePlex as his home for 10 weeks.

5) Set up both intrinsic and extrinsic rewards for your employees – physical environment and other “perks” are extrinsic rewards (along with base pay and bonus/commission) that can, of course be an effective way of motivating creativity within the company. But truly innovative leaders also look for a variety of intrinsic rewards to give employees – such as public recognition, control over . At Netflix, for example, workers compete in an annual Waffle breakfast event – and take great pride in creating the winning recipe and eat-in each year…over 30 teams competed this past year.

6) Introduce stress into the team and key individuals – Impose deadlines, challenges and “stretch” opportunities for your creative teams. If the competition in the market doesn’t do it, it’s up to you to insert some stress into the system. Philosopher and entrepreneur, Renn Zaphiropoulos, believes that creativy cannot exist without some personal stress. See his video clip for more clarity on this concept…

7) Building a culture of communication, collaboration and “smart peers” – in my class at UC Berkeley, students love the Harvard Business Review article on “How Pixar Fosters Collective Creativity” by Pixar CEO, Ed Catmut. In the article,  Catmut describes the process by which teams at Pixar handle peer-driven problem-solving and creation of the next big hit movie.  The company creates internal and cross-company networks of peers who communicate directly over problems, work in a learning environment and and collaborate on solving complex production and creative issues.  I noticed a similar culture at The Active Network (San Diego), Facebook, Google, and many other young companies.

8) Set up internal processes for problem resolution and opportunity generation: although it may seem counter-intuitive that a “process” is needed to encourage the freedom to create – but in start-up companies the key to moving the business forward is being able to solve problems. Teams that have a process in working together to solve problems, can carry forward the momentum of the company. The best ideas come from intersections among departments, cultures, customer/business and more. “Intersectional innovation” borrows from one field and applies it in a new field (a great book on this is Frans Johansson’s The Medici Effect). One of the best-known processes for problem solving was developed by Sid Parnes at State University of Buffalo, NY – where the “Creative Problem Solving Institute” is located.

9) Envision yourself as a metaphor --– great leaders envision their role metaphorically as “shepherd”, “gardener”, or “producer”. S/he may not realize the metaphor until much later (although more experienced serial entrepreneurs may realize faster than others). The role they’ve playing in the success of the company was one of “herding” the sheep toward the right goals and projects, and “enabling/nurturing” the creative skills of the engineering/artistic team to create great products.

10) Learn to Balance and Embrace Opposites – Great managers are able to harness the power of opposites, such as success/failure, autonomy/control, or stress/fun. More on this in my next blog entry!

Creative Abrasion vs. Creative Collaboration

October 2nd, 2009 by admin 5 comments »

Much has been written about collaborate teams within organizations to encourage creativity and much has been written about “Creative Abrasion” – creating a culture where ideas are challenged and new “intersections” are constantly made.   The two ideas are not mutually exclusive; they can co-exist within one organization, even though they may seem to be Opposites.   In fact, companies that are able to encourage both behaviors seem to be benefiting in the present economic environment.

Can a company culture support both?

Creative Friction

What do we mean by Creative Abrasion and what  causes this sort of friction within companies?

The terms was apparently created by Jerry Hirshberg, founder and president of Nissan Design International (NDI).  Xerox Parc leader John Seeley Brown refers to “creative abrasion” as: ideas that really rub against each other productively as opposed to destructively.”

A good example of creative abrasion was the birth of the Apple Macintosh computer.  It’s a well-known fact that Jobs took the original team out of the mainstream organization, created a sort of “skunk-works” within Apple, to complete the entire product (hardware, software) without having to deal with the hierarchy or politics of Apple corporate.  What is less often discussed is WHY this particular team was so successful.  Jobs – a stickler for detail – who often became involved in the smallest of details, created an environment of creative abrasion among team members.    The heart of creative abrasion was DIVERSITY, although it might not have seemed this way from afar.  The team members themselves, where hand-chosen by Jobs – and included a very wide array of artists, musicians and deep thinkers – even though you could label them all “software programmers”.

Diversity of talents, viewpoints, cultural differences, etc – this is what enables abrasive behavior, because the team with diversity will challenge itself.  Here is what Jobs himself had to say about this:

Creative Collaboration, too

At the same time, many  companies deep in creative culture stress the importance of collaboration among employees, across departments and even with customers.  Ed Catamult, CEO of Pixar, writes about the “peer driven” collaborative process for problem solving and creating movies: “Everyone is fully invested in helping everyone else turn out the best work…it’s all for one and one for all.”    Collaboration, on the surface, seems to make sense.  If the technology group at Pixar, can work well with the Production and the production team can work with the story-writers, and they all can work with the technologists to create incredible graphics, then it would seem collaboration is key to success.

Some good definitions and thoughts on forms of collaboration were discussed recently by Hagel, Seeley Brown and Davison on the Harvard Business School Publishing blog.

Collaboration seems to be the opposite of Abrasion – or is it?

Creative abrasion and collaboration can co-exist

The way these both can co-exist if leaders determine the best spot in the problem-solving or ideation process for each of them.  For example, the typical problem solving process goes like this:  choose/identify specific problem à generate (ideate) possible  solutions to the problem à choose from among best solutions à test out possible approaches, refine à choose best solution and create action plan for it.

When  creative abrasion occurs in the identification of problem, or identification of best solution, then politics, opinions and different ways of looking at the world may get in the way of making decisions.  If abrasion  occurs, however,  in the Ideation step, however, it allows for a confluence of opinions, options and ideas to emerge.  Creative abrasion can be very helpful because it unleashes the Power of Diversity.

When collaboration occurs during Problem Definition and refinement, and in Solution-gathering , the organization benefits – the company components are all working together in setting up for success.  But like-minded thinking and collaboration in the Ideation or brainstorming phases of a project may lead to “ho-hum thinking and lack of new ideas.  Pixar describes it like this – during meetings peers work together, but once the process of ideation is over, the ultimate decision as to which ideas to implement falls to the movie’s directors.

Ultimately a skilled creative leader is able to recognize the needs for both collaboration and  and organize the process, participants and stages of development in such as way as to benefit from both “Creative Abrasion” as well as “Peer Collaboration”.

Freedom to Fail – Part 2

September 25th, 2009 by admin 1 comment »

In my last post, I talked about Vinod Khosla’s “freedom to fail” thinking.  But, how do entrepreneurs develop this? Is it acquired or are they born with it?

Freedom to Fail Learned?

One wonders: where does “freedom to fail” come from? Some of us seem to be born with a “spirit of exploration” (one that tends to drive our parents nuts in early years). Think of Ted Turner in his younger years (dropped out of Brown U) –probably exhibited a high “freedom to fail” component in many things he did – a certain irreverent personality. Picture Bill Gates dropping out of Harvard undergrad (failure to finish Harvard? so what!).  Or, modern day repeat, Mark Zuckerberg on an even faster race to financial freedom.  It doesn’t appear that they harbored a concern with failure.  I’m sure there were some healthy debates with college-paying parents, but ultimately the some of the greatest entrepreneurial examples of our times seem to exhibit a freedom to fail.

Yet, for others, environment definitely shapes our “Freedom to Fail”.  It comes with maturity.  Did parents use an encouraging touch? Were influential teacher allow students to make mistakes and learn from them. Did peers reinforce mistakes or mock them? Tim Brown, Found/CEO of IDEO talks about this “freedom to play” in his TED Talk from 2008 Serious Plan conference.

Pixar’s “Peer Culture”

Greg Brandeau, SVP of Pixar loves to talk about the culture of Pixar that the executive team has developed. The company strongly values collectigregbrandeauve creativity – the “peer” culture in which employees are encouraged to help one another out. Greg points out the “culture makes the team” – by that he means that keeping a culture where it’s safe for one express their opinions, make mistakes, learn from others (Pixar University has an incredible number of topics/courses for employees). Key to this is attracting VERY talented people – the rule of thumb is hire someone brighter and smarter than yourself. However, at Pixar “the Team builds the culture” – the company is run as a meritocracy (the better ideas float to the top) and innovation is all about the concept itself not whose idea it was in the first place. All of this basically creates an environment where an extremely bright set of people are not afraid to express their creativity.

Setting the Creative Culture

Patty McCord, the SVP of “Talent” and architect of Netflix’s unique culture, says that allowing people to fail at what they doPatty1_image is one of the most critical elements of the success of Netflix. At Netflix Inc., CTO (“Chief Talent Officer”) Patty McCord and founder, Reed Hastings, have taken this one step further, creating the “Freedom and Responsibility” culture. The company has deliberately built its culture in a way that allows employees the freedom to experiment, take on challenges and sometimes even fail. In essence, by giving employees the freedom to create and solve problems on their own accord, they fight off bureaucracy and control issues at the company grows.

You can see Patty’s Freedom and Responsibility Culture posted in PPT format. Patty is joining me on October 7th at UC Berkeley for my class on Innovation, Creativity & The Entrepreneur and the unveiling of a virtual case study on Netflix that we filmed at Netflix.

Freedom to Fail – Part 1

September 23rd, 2009 by admin No comments »

This past month, I was struck by something that Vinod Khosla brought up at the Haas School while accepting a “Lifetime Achievement” award, and have been turning it over in my mind many times… Khosla is responsible for major successes at Daisy Systems, Sun Microsystems, huge portfolio wins at Kleiner Perkins (KPCB) over the years, and is now responsible for at $1+ billion new fund at Khosla Ventures. What would you guess contributed most to his success: an eye for technology? Luck? Choosing the right teams?

Khosla’s secret to success

When asked what most contributed to his success over the years, Vinod boils it down to this: the Freedom to Fail. According to Khosla and many others, if we feel that we have the freedom & ability to push ourselves to the limit, create new ideas, and start companies we believe in – we are more likely to succeed. An entrepreneur who allows FUD (Fear, Uncertainty, Doubt) to creep in about his/her abilities and leadership, and fears failure is more likely to fail. More on this in a video of Vinod from SDForum awards 2 months prior.

Lessons from Early Yahoo

As part of the original Yahoo team, I observed this first-hand. There as a general feeling among the team that “hey, if this doesn’t quite go the way we imagined, we’ll fix it and try something else.”  If the worldwide web (or Yahoo)  didn’t quite take off, some of us would  just go back to their happy lives as grad students at Stanford and continue on.   Of course that didnt’ happen.  And, it was later on, after the company tasted big success that fear of failure crept in.

So, I have been wondering: what’s the link between “freedom to fail” and creativity in a start-up?  Do most successful entrepreneurial environments include this element? Is Freedom to fail learned or are some of us born with a certain “chutspah” that keeps us from thinking about failure? Can an entrepreneur deliberately set up a “Freedom to Fail” culture?  (More next post –>)