After hearing dozens of company pitches over the last week or so, I noticed a common theme with how CEOs told the story of their business. They typically expended great energy explaining what their company’s product or service does. They will talk about features and functionality that no other player in the market has. Where appropriate, they will dive into a demo to show exactly how their product is such a game changer. While this is important, in some respects, I think it is putting the cart before the horse.
Personally speaking, I think a good story for a business starts with the problem that is being solved. It’s hard to fall in love with a product, if you don’t believe it solves a big problem. A problem worth solving is one that is a high priority issue for the one experiencing it. It is a problem that is experienced to a similarly high degree, by a large and common constituency. It is also a problem that people are willing to pay, and sometimes pay substantially, to resolve.
In every company pitch, the CEO will try to tell me what the company does. But, you may be surprised that in many pitches, the CEO may neglect to really spend time articulating the problem their company solves. Sometimes when I ask very directly what problem it is that they solve, the response will be a description of product functionality, not in fact a problem. This to me is a telltale sign that the company was started to create functionality, not necessarily to solve an important problem.
If we were ever to get into due diligence on a company, we will likely spend as much time validating the magnitude and priority of the problem the company solves as we do on the merits of the product. If we love your product, but are unconvinced on the problem it solves – we are unlikely to get across the finish line on an investment. The reality is a company can control how a product evolves and develops. But, the problem is what it is – so choosing the right problem to solve is critical for the ultimate success of any business.
So my simple advice is that when you tell the story of your business, start with the problem. If you convince people of the problem your company is trying to solve, you have laid the foundation for them to love what your company does.
It happens every day. You visit a website. Information on your visit is passed to a third party (such as an ad network). That third party uses the data for purposes that is not something you’ve explicitly condoned. For example, go to Zappos and look at your favorite red shoe. Then go about your daily web life – and notice how that red shoe will show up in Zappos ads on other websites unrelated to Zappos. This form of advertising, called re-targeting, happens because Zappos has given information from your site visit to various third parties who then run the ad. But, what if you didn’t want Zappos to give any information on your visit to any retargeter? What if you didn’t want your data given to any third party for any purpose at all?
A myriad of solutions have been proposed to address this problem, but they all revolve around the same fundamental framework. The framework is that your browser communicates to the website you’re visiting whether you consent to being tracked through your data being shared with third parties. And that website complies. Here are some of the competing philosophies:
- Every website has to explicitly ask you what your preference is when you visit it and then lock in that preference for future visits (e.g. certain EU countries).
- You have to proactively opt-out of tracking in your browser settings, otherwise there is implied consent for all websites to track you (e.g. U.S. Do Not Track Legislation).
- The default setting of the browser should turn off tracking (e.g. Microsoft).
While a disproportionate amount of energy has been spent arguing about the merits of these varying philosophies, they are all based on an assumption that is flawed. The flawed assumption is that if a website receives notification from your browser that you don’t want to be tracked – they can actually technically comply with that request. Think for a moment how hard that is. The instant you hit a webpage, your tracking preference is communicated, and somehow that website has to turn off all tracking applications in the website before any of those applications run. It all has to happen in a nanosecond.
To date, there have been two primary approaches to addressing this technically. Both have their flaws.
- Comply, after the fact. This is referred to as “un-pixeling”. The way this works is your browser communicates your tracking preference at the time of your visit, but the website does nothing differently. You are still being tracked. After your visit, though, the website communicates to the various third parties that they shared your data with that you did not want to be tracked – and then they expect that third parties honor that request by deleting your information in their records. The flaw with this approach is it’s not actually compliant at the time of your visit, and there’s no guarantee of compliance after your visit either.
- Centralize all tags. Given that all tracking applications are tag-based, this approach involves putting every tag-based application on a website into a single tag management system (TMS). By having all of the tags in a TMS, the website can then control whether the applications run after receiving your tracking preference information. The flaw with this approach is two-fold. Most websites don’t use a TMS, though I personally expect that to change very quickly. The more important issue is that even in the most comprehensive TMS deployments, it’s never the case that every single tag across a company’s web properties sits in a TMS. So, complete compliance in this model is not realistic.
So, where do we go from here? Are we destined to have all of this debate on Internet privacy philosophies and policies, all the while lacking a realistic means to implement any agreed upon policy? That was the case until recently. Just this week, Volition portfolio company, Ensighten, received a patent on a novel approach to consumer Internet privacy management. It’s finally a practical and easy way to comprehensively comply with your privacy preferences. How does it work?
Ensighten’s privacy management platform is both simple and brilliant. It only requires that a company puts a single line of code in the header of their webpage. It then auto detects all existing and new tags on the page. Then, when you visit a webpage with Ensighten’s privacy service running, it can automatically suppress any and all tag-based applications that require suppression based on your stated preferences and the regulations of your country. Importantly, Ensighten can do this prior to any of these applications running. This solution also does not require the deployment of a tag management system. Simple, comprehensive, and real-time privacy compliance has arrived.
So let the debate rage on. Whatever the final answer is, there will now be a way to act on it.
Periodically, some of the partners at Volition will do network television spots on shows related to business and technology. Today, I paid a visit to 30 Rockefeller and the MSNBC studios to participate in J.J. Ramberg’s show, “Your Business” (also author of It’s Your Business). The show won’t air until later, but this will give you a sense of what happens behind the scenes.
People often ask me whether or not I know what questions will be asked before going on the show. In general, I know the topics that will be discussed, but the questions actually asked are far more fluid. So, generally I prepare comments around the topics and then hope that the questions asked align with what I’m prepared to talk about. If not, winging it is the only option. But, the preparation still helps to think quickly.
It’s always a bit intimidating when you arrive at the studio, and you realize it’s the same studio used to tape all of the same shows you watch on TV. In this case, the studio for MSNBC is at 30 Rockefeller. The Today Show was taping when I arrived. And, no, I did not run into Tina Fey.
After making it through security, I’m ushered up to the green room. Before I visited a green room, it sounded like a fancy place where the big TV personalities hang out. In reality, it can be a rather humble room in some cases. Typically the show that you will be participating in, if it’s a live show, is playing in the green room so you can get a feel for what’s going on.
I didn’t appreciate how important make-up is until I saw myself on TV without make-up. Not a pretty sight. It’s non-obvious when you’re watching a show, but everyone on camera has substantial make-up on. It looks normal on TV – it looks abnormal in person.
If it’s a live show, typically I get brought into the studio during a commercial break and have less than a minute before we go live. It’s somewhat nerve rattling that right after the technician gets your microphone hooked up, you hear someone else counting down, “In 5, 4, 3, 2, 1…” Today, it was a taped show, so there was a little less pressure.
When we’re on air, we’ve been coached not to look at the camera. We’re supposed to ignore the cameras and simply have a conversation with the host and any other folks on the panel. You can see all of the final segments on Volition’s “On Air” section of our website.
That’s the whole process in a nutshell!