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TODAY'S COCKTAIL OF TECH STARTUP STORIES:

Tech Cocktail

The latest cocktail of emerging technology news, people, startups, products, and innovations for the true tech enthusiast.

We're All Failures Sometimes, So Quit Worrying About It
Dirty Secrets of consulting firms and how to chose one

We're All Failures Sometimes, So Quit Worrying About It

12:00:19 PM

Austin Rory Hackett

I had an interesting train of thoughts last year during the presidential elections. It started when I read Mitt Romney's wiki page and saw his net worth. Instead of being blown away by the 9-digit figure ($400M at the time), I remember feeling moderately underwhelmed and actually muttering to myself, "Oh. well that's not much. I thought it would be more." I quickly realized the irrationality of my response, but I still felt almost disappointed.

This is because when I think about Romney, I don't think about him in comparison to average Americans; my brain buckets him in with his peer group, which is "Fabulously Successful Business Icons." Given the financial status of others that I put in that bucket, I just assumed he would be a billionaire, and when I learned that he's not, it was almost as if he had failed somehow. My first thought was what did he do wrong to miss out on that last $600M? Instead of oh wow, this guy's in the top one percent of one percent of one percent, which is pretty decent and better than I ever hope to do financially.

Romney's not the king of the mountain because there is no king of the mountain. In fact, the mountain doesn't even have a top, so there's no possible way to reach it and nowhere for a king to sit. Think about it this way: Bill Gates isn't as cool as Jay-Z, who isn't as rich as Bill Gates. Neither of them are as powerful as Obama, who isn't as rich or as cool as they are, and doesn't even have as many Twitter followers as Bieber. Everybody is eventually a failure in comparison to somebody else.

Imagine that you have a startup company that does extremely well, and after five years and a few rounds of financing, Google acquires you for $200M. By most accounts, that sounds like an unqualified success. But for you, as the founder/CEO, you have existed in a new peer group comprised of other tech companies at a similar stage: other portfolio companies of your investors, your competitors, and every acquisition that has happened that same year.

Among that peer group, your $200M selling price probably isn't that impressive. Your friend cashed out double what you did when his company got acquired, the guy in the next office building over didn't "have to sell" his company because they had an IPO, and hell, Instagram sold for 5 times what you did in 1/5 the time. So, clearly, your big acquisition is actually a bit of an embarrassment - something people whisper about behind your back.

Now obviously that's an exaggerated example, but my point is this: pretty much everything about failure and disappointment is a matter of perspective. When I went through an accelerator program with my startup, there were some companies that didn't make it out alive. If those founders judge themselves in comparison to the companies that got funding and continued on, they could see themselves as "failures," but if they turn around and compare themselves to the thousands of startups that apply to those programs and never get in, they're unqualified success stories. And those thousands of companies that never got accepted anywhere still had the guts to start something, which makes them hugely successful in comparison to the timid legions that never dared to try.

Fear is an enormously paralyzing emotion. It is a plague that limits successful entrepreneurship and innovation. So much of that fear is tied to the idea of failure. For me, accepting the fact that everybody loses at some level, that we're all just scrambling up different side peaks on the same uneven, subjective mountain, helps me see failure in a different light. And in that bright light, it's not as scary. It's like when I teach kids how to rock climb: I make them go up until they have a little bit of slack and then just let go. It's only once they realize that they're safe, that falling isn't so bad after all, that they can be free to focus on and enjoy the climb.

The post We’re All Failures Sometimes, So Quit Worrying About It appeared first on Tech Cocktail

Dirty Secrets of consulting firms and how to chose one

10:00:53 AM

Jinesh Parekh

Everyone understands that they should outsource something to the experts in the world. But you certainly fear doing that to the wrong company. If you understand the dirty secrets of the consulting world, it can work in your favor and help you chose the right company for the tasks you want to outsource.

We're a consulting company ourselves and have seen what goes on here. That gives me the authority to write about this topic. I might be shooting my own foot with this article, but nevertheless, it will be in the favor of customers, and hence, us consulting companies eventually. So let's get those dirty secrets out and give you pointers on choosing the firm that best fits your needs.

IGNORE THE SUPERLATIVE TERM, BEST

Best is a superlative word. However, most consulting companies claim to be the industry’s best on their website and sales pitch. As a smart evaluator, you must learn to ignore the superlative terms used by the people vying for your business. And, if the frequency of these superlative terms is very high, you want to evaluate if the company is truly a business leader or is only making false claims. In either case, you don't want to work with any of them. More on this suggestion below.

A HANDFUL OF ROCKSTARS

Every consulting company boasts of having a great team. The fact is that every consulting company only has only a handful of rockstars with them. The rest of the team is a compromise they had to make to scale up the team in lieu of large business that comes in. These rockstars are easy to spot from the company blogs and who shows up in the new client meetings.

Evaluation criteria:
So when you choose a consulting firm, you want to understand who their rockstars are and see if they will be available for your project.

IT'S ALL ABOUT TOP LINE

Though consulting companies are truly passionate about the things they claim, they have high expenses to retain the team they have. Hence they are under constant pressure to generate sales. Since the sales team has a target to attain, at times they take up projects even if the project does not fall into their sweet spots. For these reasons, during low times, they are forced to pick up projects which do not fall under their forte.

Evaluation criteria:
Understand the forte of a consulting company. The website copy should tell you most of it. Try to match it with your requirements to understand if the company truly specializes in the task.

One might think to hire the best in the industry for the task at hand. However, hiring the best in the industry might not be in your best interest. There are industry leaders in all consulting fields. However, it's not always in your favor to hire the best if you are a small business or a startup.

So let's take a closer look at the problems you face when you hire the best:

BEST IS EXPENSIVE

If you do happen to consider the best in the industry for the task, you might be surprised at the minimum amount of project they undertake. I recently tried hiring the best UX and Content strategy company with a combined budget of $80K. Their minimum was $200K and $150K respectively.

YOU WONT GET THEIR BEST

Its obvious that the best will have their best talent reserved for bigger clients than your startup. Hence, they will only engage mid-level or junior talent for your project. Guess what? Now you are no longer working with the "BEST in the industry." Oh, but look - your billing rate does not reflect that change.

YOU WILL ALWAYS BE THEIR SMALL ACCOUNT

Even if you manage to meet their minimum requirements, you are always treated as a small account, and they will not be as flexible as you would want a vendor to be when you are paying them so highly. You won’t get the attention you deserve.

THEY ARE NOT DYING TO EARN YOUR TESTIMONIAL

Imagine the work one would deliver to a client whose testimonial is worth promoting on their website. They would surely run a few extra miles to delight the client. However, if you are a small business and choose to work with the BEST, your testimonial might not even get on their website, as it would look awkward to see yours listed with their Fortune 500 ones.

YOU WILL HAVE TO LISTEN ALL THE TIME. THEY WONT.

Since they are the best, you will not be able to raise a voice to be creative and do things differently. In fact, they will tell you what you should be doing all the time. If you are lucky, you are allowed to "whisper" a few times in the conversation, though .

THEY JUST WANT TO QUICKLY GET DONE WITH YOU

If you are really very unlucky, they will have bagged a big Fortune 500 account just after they started working with you. Now, they want to focus everyone on that account, and your small project is becoming a hurdle, so they sure know that you are soon not going to be able to afford them.

YOU ARE JUST A ONE NIGHT STAND

If you are a small business or not their biggest client, you will not fit in their network. It is important that a vendor relationship works out beyond wrapping up a deal for identifying new clients and mere networking. However with such an engagement, it’s more like getting the sales figures for the couple of months up, and nothing beyond that.

SO WHAT SHOULD YOU DO?

Choose a consulting company where you will be an important client. What happens now?

They will put in their best to keep you with them.
Your testimonial matters, and they are going to run a few extra miles to delight you.
They will try to be as creative, different, and good as they can to build their portfolio.
You will be working with their best talent because they want you to stay.
You are in a better negotiation state.
Chances of strategic partnerships are much higher.

This blog is my personal experience having worked with some of the real thought leaders in the industry and also hiring the best talent in my past life.

However, I must talk about one exception that I have experienced. I would say that Bentley Motors deserves to refer to themselves superlatively. When I went to visit their Chicago Downtown showroom, I told them upfront that I was not even thinking of buying anything, just looking at their beauties. The salesperson welcomed me, saying, come on in and dream it so that you will want one in the future, and we will be able to serve you.

Now these are 1 of those 10 exceptional vendors that you would want to work with as they truly care about what people say about their company.

Happy outsourcing!

The post Dirty Secrets of consulting firms and how to chose one appeared first on Tech Cocktail