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Purpose-Driven Companies

I picked up Behind the Cloud by Marc Benioff after meeting with Larry Brilliant at Skoll Global Threats Fund. We were talking about the humanitarian and environmental utility of Planet Labs’ data and product: namely, how do you structure a company that has great public benefit as well as commercial utility?  This post is a summary of the book he recommended in this context, and the points that stood out for me around creating a purpose-driven company. I do recommend this as a quick-read business book; skip the movies on the next SF to DC plane trip and pick this up instead!

Summary:

  • 10 year reflection of building Salesforce.com (note: 1999-2009 and was written before for the financial woes of 2009 set in)
  • Marc seems to be a great leader, as evidenced by his ability to see cloud computing coming and its new business models for enterprise clients, sticking to his business vision in hard times, and creating a thriving culture and multi-billion dollar company
  • Marc is clearly a good salesman, so read for his anecdotes about marketing and PR stunts, leaking internal memos to the press, maintaining close relationships with the press, using each employee as an extension of marketing and sales for the organization, and being aggressive with the competition
  • On the financing side, Marc was in a good place to raise money non-traditionally; he put in $6M of his own money and had many corporate colleagues able to put in additional million-dollar checks.  He avoided the traditional VC route, mainly due to inability to agree on valuation, and this is something that many entrepreneurs don’t have the luxury to do.
  • Marc started both salesforce.com (the for-profit) and salesforce.org  (the non-profit) from the very beginning.  He also adopted a 1-1-1 model for doing good: 1% of equity, product, and employee time from the dot-com goes toward the .org at all times.  Marc does point out that all of this is good business as well – it helps to recruit a younger workforce, retain top talent, builds your brand and be a differentiator amongst his competitors for key clients.  Not only is it the right thing to do, it is also good business.

On doing good, there are many instructive lessons for the entrepreneur with the 1-1-1 model as pioneered by Salesforce.com.  For the equity-side, he started his non-profit from the beginning and that makes great sense.  The longer you wait to give out equity, the more stakeholders need to be involved in the decision.  If you are just getting started, I would suggest that you earmark a % of the company in common class to your future .org.  Do consult your lawyer on the matter, but allocate founder shares and/or early employee shares before you seek investors. If done correctly, you may be able to avoid formally starting the .org by instead signing a promissory note to avoid the 100+ hours of filling out the 1023 before the complete operational understanding of the .org is known.  If you already have investors, then before your next round (and when you have built credibility and momentum for a growing business) go to the major investors, state your vision, and invite them to come along.  Form the .org before your next investment round, give them some of your employee shares, and make it a fait accompli for the next round of investors.

For the 1% product and 1% of employee time (I have also heard people use 1% of profits go to the .org), this is a bit more complicated.  This is great in times of boom, and shareholders won’t be making a fuss, but in hard times they will be sure to voice their concern.  This means that the .org is beholden to the quarterly ebbs and flows of the .com and makes the .org staff uncertain about their operating budget, which affects their ability to invest in longer-term projects and achieve their charitable mission.

Instead, I would suggest that you do a contract between the .org and the .com. A very instructive one was done between Alexa Internet and the Internet Archive, written by Brewster Khale in 1997.  In this contract, the Internet Archive received Alexa data and can use it for scholarly and historic research after a 180 day embargo period.  Even with the sale of Alexa to Amazon.com in 1999, Jeff Bezos honored the contract, which has allowed Archive.org to endure, and continue to achieve its mission.

For example, a carefully crafted contract between the .org and the .com of a given organization (written, as Marc would say, with a ‘light and love’ contract (see his global chapter)), could give the .org independence and access to the company’s data and/or product for specific market segments.  The .org can be given exclusive rights to non-profit markets with the .com’s products.  The .org could choose to give their product out for free up to a certain number of licenses, and then charge a massive discount compared to the .com pricing.  This still generates revenue for the .org which allows it to attract its own employees, have its own account managers, and enhance the product to best serve their customers – in addition to generating excess revenue to give back to their communities. I understand that this is similar to how Salesforce.com and .org are operating today.

With respect to the 1% of employee time, many companies today don’t have formal time off.  Employees are trusted to fulfill their obligations no matter how they get it done and to be sure that they don’t leave their team in a pinch.  But without formally stating that this is a value for the company, busy people often won’t make time for it.  I think that with today’s flexible, trusting work schedule, there is room to innovate here.  As I write this now, one of our individual contributors is spending 9 days in Kentucky at a girls’ Space camp during her ‘vacation.’  This is giving back to our community and I look forward to understanding how we can incentivize others to do the same.

I’ll leave you with the a summary from Marc’s book, “How to build and Employee-Inspired Foundation”

  • Start from the Very Beginning
  • Canvass Employees About Their Interests
  • Establish a Formal Strucutre to Elicit Employee Involvement
  • Make the Foundation Part of Your Company by Making It Visible
  • Recognize the Efforts of Employees
  • Foster the Foundation in Good Times and Bad
  • Let if Evolve and Change

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Save the World with Open Science

Michael Nielson provides a quick, powerful treatise of the coming open science revolution in, “Reinventing Discovery.”

The book is a great read, pouring through recent examples of citizen science projects such as Galaxy Zoo and Fold.it and providing an optimistically sober perspective  toward open science with partially open data and/or data delay for big scientific projects.  This shift will be reliant on the incentive systems we have for scientists (current a “publish or perish” model), requirement levied by the funding organizations, and the desires of the sub communities.  The last three chapters are a must read for those interested in designing tools and systems to create a reputation economy and break the academic race to write papers valued by the published scientific community, and instead, bring about an open data and open science approach for 21st century scientists.

“[T]ools can be used to amplify our collective intelligence, in much the way that manual tools have been used for millennia to amplify our physical strength.”

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Looking Forward

During @bobby_braun’s receptions this week, Charlie had his last chances to dig into the “School Kid” for being so young.  There is something profound, however, about relatively young leadership at NASA.  Bobby is a generation of leaders whose first memory of NASA was not the Apollo landing, but of the Viking landing on Mars. It was this feat that inspired him to become an engineer and work at NASA.  He is part of a new class of leaders at NASA that were inspired not by the Moon program and competition with USSR, but by robotic exploration and the Space Shuttle program.

Viking Lander on display at the Smithsonian

Technically, my first memory of space was receiving a Space Shuttle alarm clock from my father (now, why a 6 year old needs an alarm clock I don’t really know). however, my first substantial memory of space is of being shuffled into the elementary school auditorium and witnessing the Challenger disaster.  I don’t believe this affected my psyche as a 7-year-old, but it does paint a picture as to the real events and space experience that average 35-year-old-ish people have: Challenger disaster, the unprecedented discoveries of Hubble Space Telecsope, another tragedy with Columbia, and yet more unprecedented discoveries with Mars Exploration Rovers (MER).  “Failure is not an option” was a popular slogan for the NASA of the 60’s, but the NASA I grew up with lived that term year-to-year.  Hubble launched a failure and required follow-on missions to become successful, and engineers at NASA have kept the MER rovers alive an order of magnitude beyond their design lifetime.  The NASA I know learned from its failures and earned its successes as a result.

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Extended Leave

Today is my first day of extended leave from NASA and it feels great. There have been many good wishes from people and for that I am very fortunate.

The going away party for @schingler and @bobby_braun

Here is the e-mail I sent to the OCT team earlier this week describing my intentions:

Continued…

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Centers as Settlements

Discussing the new directions contained in the 2011 budget roll-out with employees, Charlie Bolden announced a new Headquarters office called Misson Support, to be lead by Woodrow Whitlow from NASA Glenn Research Center. Mission Support will bring all NASA facilities and their operations under one umbrella, recognizing the important role these groups play in achieving NASA’s mission. This will allow greater insight into operational challenges, and more strategic investments into creating an integrated NASA workforce.

by Raymond Cassel, 1st place 2009 NSS Art contest

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Random Hacks of Kindness

rhokWe are started, and Craig Fugate, the Administrator of FEMA, just gave his keynote. Sitting 3 miles away from NASA Ames Research Center at the Hacker Dojo, we are creating a community of developers for the emergency response community. This meeting is bringing technologists and developers together with subject matter experts to understand each other – learn what technology already exists, and which ones need to get created. After Administrator Fugate, we have a dozen 5-minute lightening talks, both from technologists and subject matter experts. On organizing the event, asked people to come up with problem statements – or featured hacks – and have seven of them defined on the wall (including one submitted by the Department of State). After lightening talks, we will open up into a hack-a-thon as well as have rooms available for barcamp-style discussions. We’re going all night, and teams submit their programs by 1pm tomorrow, present them to the community, and a panel of judges will give out awards to the best hacks created at the event.

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On Expectations

I have unreasonably high expectations for people, and as Jessy put last night, that shouldn’t change.  I should, however, adapt how I feel and react when expectations are not met.  Additionally, I should be able to identify my role in the bar not being reached.  As in most relationships, whether it is an intimate relationship, a friendship, or a business partnership, it all comes down to communication — and communication goes both ways.  There are two rules that I follow when it comes to interpersonal relationships:

  1. Relationships work as long as you are in it for the same reason.
  2. The way you get out of a relationship is the way you get into it.

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Three Years

When a good friend of mine took a new job his father gave him some good advice, “Be sure to stay for three years.”  Three years, I thought, sounded forever. In looking back at the friends tenure in the job for three years, I can see the benefit.  He was able to personally and professionally grow into the job, gain a lot of support from his stakeholders, redirect the organization, provide focus, and then execute.  He took the organization out of the red and left it in a very stable position.

3yearsThe attraction of a new job and an adventure is completely intoxicating.   The honeymoon, however, of a new job with new opportunities can short lived.  You are faced with people, processes, and entrenched world views.  The challenges are similar whether you are in government, non-profit, or for profit organizations.  The larger the organization, the greater the institutional memory and momentum to remain in status quo.
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Different Conversations

The June/July visit to the Choza with @hancher, @jessykate, @toddicus, etc. was the first time that Todd visited the Choza.  His fluency with Spanish and deep understanding of the Latin culture, enabled deeper conversations, better dialogue, and more meaningful connections with the community around the Choza.  We had an excellent evening conversation with Erick and Solein kicked off by Jessy’s question of “What defines progress,” which was greatly enabled by Todd’s simultaneous translation.  The Garcia brothers had a different perspective on role that technology plays into “progress.”  If their five year age gap plays a role, this is testimony to the tsunami of change coming at the Concepcion community, and a cause for pause in thinking through the role we are playing.

Apex of the rancho roof Continued…

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Science Partnerships as International Leadership

“Education and Innovation will be the currency of the 21st Century,” declared President Obama in a speech last month.  This ‘Cairo Speech’ outlined a science and technology partnership strategy with the Muslim community, but its message is for any country.  NASA is uniquely positioned to be support the Obama Administration with this vision of international engagement through scientific and technical partnerships.

Artist conception of SAC-C spacecraft

Artist conception of SAC-C

Historically, space has created a unique environment for scientific and technical collaboration outside the realms of political ideologies to pursue aims of international peace and stability.  While there has been a strong element of national competition associated with space activities, the nature of science inherently provides room for research and tangible benefits which transcend borders.  Some notable examples are the Apollo-Soyuz Test Project in 1975 (Russia), the progression from Space Station Freedom to the International Space Station (Russia) or the retirement of the Argentina’s Condor II Medium Range Ballistic Missile (resulted in the establishment of Argentina National Commission on Space Activities – CONAE – and an agreement on the Satelite de Aplicaciones Cientificas – SAC – series of satellites with NASA cooperation). Continued…

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