Book Notes – “Pour Your Heart Into It” by Howard Schultz & Dori Jones Yang – Chapter 5

These are passages from the chapter that grab me, and notes.

“NAYSAYERS NEVER BUILT A GREAT ENTERPRISE”

They may help me think things more clearly, thoroughly, or differently so that I can improve, strengthen, and reposition for a better attack – but they need to stay in their lane, and I need to be careful about letting them overstep their boundaries and hijack ideas I care about passionately.

It’s actually a necessary ingredient for a ground-breaking idea, so be sure that box is checked, too. Just don’t give into it.

“Nobody ever accomplished anything by believing the naysayers. And few have done so by sticking to proven ideas in proven fields.

It’s those who follow the road less traveled who create new industries, invent new products, build long-term enterprises, and inspire those around them to push their abilities to the highest levels of achievement.

If you stop being the scrappy underdog, fighting against the odds, you risk the worst fate of all: mediocrity.”

The last sentence here makes me think of Amazon Headquarter’s building name: Day One. Even though they are one of the biggest organizations in the world, they always start fresh and treat each progressing day as brand-new, so that they can maintain a fresh, young, fighting entrepreneurial mindset, all of the time. I hope they never lose their spirit.

“Gordon and I visited nearly 500 espresso bars in Milan and Verona. We took notes, snapped photographs, and videotaped baristas in action. We observed local habits, menus, decor, espresso-making techniques. We drank a lot of coffee, tasted a lot of Italian wine, and ate some fantastic meals. We sat at outdoor cafes in that intense Italian light and sketched out different design schemes, figuring out how we could replicate an authentic, Italian-style coffee bar.”

Passion is necessary, but it’s not the only ingredient to success. And while an idea isn’t proven, it’s no excuse not to do as much research as possible around it. The allure of “fail often and fast” doesn’t excuse you from planning.

“Ron [one of Howard’s first investors] doesn’t invest based on financial projections but looks instead for honesty and sincerity and passion. He looks, in short, for someone he can trust….It was four years before the company started to make any money. Ron and Carol had no assurance they’d get their investment back at all, let alone any return on it. But once the company went public, and the profits and stock price started climbing, they were rewarded. The shares they bought for $100,000 grew to be worth $10 million.”

Whoa.

“At the time, I was thirty-two years old and had been in Seattle for only three years. I had experience in sales and marketing, but had never run my own company. I hadn’t had any exposure to the moneyed elite of Seattle.”

The more I read, the more excuses go away.

“Many of the investors I approached told me bluntly that they thought I was selling a crazy idea.

‘Il Giornale? You can’t pronounce the name.’

‘How could you leave Starbucks? What a stupid move.’

‘Why on earth do you think this is going to work? Americans are never going to spend a dollar and a half for coffee!’

‘You’re out of your mind. This is insane. You should just go get a job.’

In the course of the year I spent trying to raise money, I spoke to 242 people, and 217 of them said ‘no.’”

That’s an 89% rejection rate – not to mention the emotional and ego toll Howard must’ve taken. But this is also encouraging, because I need “no” to validate that I’m on to something brand new and potentially life-changing; and it’s either strengthening my pitch or testing how much I truly want something.

I’m also laughing at the rejection that people wouldn’t pay $1.50 for coffee. Look at them now, at $4-$5 a cup.

“There’s a fine line between self-doubt and self-confidence, and it’s even possible to feel both emotions simultaneously.”

This is comforting, because I sometimes over-think: “Is this pairing of self-doubt a sign I’m doing the wrong thing?” Of course – this requires deeper searching to the root, and I shouldn’t ignore it – but it doesn’t always mean that intuition is warning me. It could sometimes be telling me things are going to get interesting.

“What we proposed to do at Il Giornale, I told them, was to reinvent a commodity. We would take something old and tired and common – coffee – and weave a sense of romance and community around it. We would rediscover the mystique and charm that had swirled around coffee throughout the centuries. We would enchant customers with an atmosphere of sophistication and style and knowledge.

Nike is the only other company I know of that did something comparable. Sneakers were certainly a commodity – cheap and standard and practical and generally not very good. Nike’s strategy was first to design world-class running shoes and then to create an atmosphere of top-flight athletic performance and witty irreverence around them. That spirit caught on so widely that it inspired myriads of non-athletes to lace up Nike shoes as well. Back in the 1970s, good sneakers cost $20 a pair. Who would have thought anyone would pay $140 for a pair of basketball shoes?”

“If you ask any of those [original] investors today why they took the risk, almost all of them will tell you that they invested in me, not my idea. They believed because I believed, and they prospered because they trusted someone in whom nobody else had confidence.

Il Giornale has faded into history, remembered by only a few of its old customers. But those initial investors ended up earning a one hundred-to-one return on their investment. How that happened involved some strange twists of fate.”

Another thought that came to mind was that even though Il Giornale no longer exists, Starbucks became what it is today because it existed first. That’s why an idea doens’t have to be perfect in the beginning, and it’s impossible to be so, anyway. I just need to start, learn from the business, and let the universe present opportunities I wouldn’t have ever considered before – those that will never come to me beforehand.

That’s the leap of faith, that’s the passion, and that’s the execution-first part.

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Holes in the wall

I’m taking a moment to think about things I’ve accepted that I can’t do or can’t happen…and I’m changing the perspective, feelings, story, and strategy on them.

I’m finding holes in the wall, and a way through.

Last night I had a conversation with my buddy Dean Soto and he called me out on an unhelpful narrative I was telling myself & others; and almost instantly I broke free from my self-imposed prison.

Hope this encourages you to break-out, too. Care to share any?

Book Notes – “Pour Your Heart Into It” by Howard Schultz & Dori Jones Yang – Chapter 4

These are passages from the chapter that grab me, and notes.

“LUCK IS THE RESIDUE OF DESIGN”

“Whenever you see a successful business, someone once made a courageous decision.” – Peter Drucker

“Have you ever had a brilliant idea – one that blows you away – only to have the people who can make it a reality tell you it’s not worth pursuing?”

Not too often; because most of the time I’ve already started the idea quietly without consulting others lol! This is a good thing but also a bad thing – it helps to think things through, take a step back, and consult with godly people and people who have paved a similar way.

“Starbucks was a retailer – not a restaurant or a bar, they [his bosses, the founders] argued. Serving espresso drinks would put them in the beverage business, a move they feared would dilute the integrity of what they envisioned the mission of a coffee store to be. They also pointed to Strabucks’ success. The company was small, closely held, private, and profitable every year. Why rock the boat?”

I can’t remember where I read this, but when there is a similar explanation to: “But we’re making so much money” it’s a sign that complacency is taking root. According to a friend of Greg McKeown – author of “Essentialism” – “success traps are harder to get out of than failure traps.”

“Jerry was shocked [from unhappy employees since the Peet’s acquisition]. The company he had founded, the company he loved, no longer trusted him. In the months that followed, his heart seemed to go out of it. His hair grew grayer. The company lost its espirit de corps.

The incident taught me an important lesson: There is no more precious commodity than the relationship of trust and confidence a company has with its employees. If people believe management is not fairly sharing the rewards, they will feel alienated. Once they start distrusting management, the company’s future is compromised.

Another important thing I learned during that difficult time was that taking on debt is not the best way to fund a company. Many entrepreneurs prefer borrowing money from banks because doing so allows them to keep control in their own hands. They fear that raising equity by selling shares will mean loss of personal control over the operation. I believe that the best way for an entrepreneur to maintain control is by performing well and pleasing shareholders, even if his or her stake is below 50 percent. That risk is far preferable to the danger of heavy debt, which can limit the possibilities for future growth and innovation.”

The principle that “equity is always more expensive than debt” has been touted quite often; and while that is true that it’s a larger cost and investment in some aspects – being choked to death in debt will also kill a company, or won’t even let it fly to begin with.

I believe it’s a case-by-case situation, and I need to be very wary of these cliches and sayings, and test it against a company’s unique DNA.

In my personal case, I’ve experienced both. When my partners and I bought the rights to develop The Halal Guys, debt wasn’t even an option for us (thank goodness!). We were a startup with limited restaurant experience as a team, and no banks nor investment firms were willing to look at us. So we had no choice but to raise money; and even though we had to take a smaller percentage – and to this day, we still haven’t taken a distribution and are focused on investor repayment and reinvestment – we’ve grown to nine stores (soon to be eleven); have grown to an $18 million a year company; we’ve built a staff of incredible people who believe what we believe and execute at a high level daily; we’ve built great relationships with vendors and investors who trust us and would jump over the moon for us – which lead to other opportunities; and our company is now valuable to banks and private equity forms.

“But because I saw what happens when trust breaks down between management and employees, I understood how vitally important it is to maintain it. And because I saw the harmful effects of debt, I later made the right choice to raise equity instead. These two approaches became critical factors in the future success of Starbucks.”

Something my old boss Dan Rowe at Fransmart said that came to mind when reading this: “Would you rather own 100% of 1-2 stores? Or 10% of 10,000 stores?” You can modify the percentages – but you get the idea.

“…mid-level managers and even entry-level employees become impassioned evangelists for risky, bold ideas. It’s important that managers listen to those ideas and be willing to test them and implement them – even if the CEO is skeptical.”

“To me, espresso was the heart and soul of the coffee experience. The point of a coffee store was not just to teach customers about fine coffee but to show them how to enjoy it.”

Quality isn’t enough – there will always be a competitor who can put that at risk; if you pair that with education, care, convenience, service, and other differentiating factors – you can iron-clad customer loyalty and insure your company’s growth.

This is my moment, I thought. If I don’t seize the opportunity, if I don’t step out of my comfort zone and risk it all, if I let too much time tick on, my moment will pass. I knew that if I didn’t take advantage of this opportunity, I would replay it in my mind for my whole life, wondering: What if? Why didn’t I? This was my shot. Even if it didn’t work out, I still had to try it.”

I crave for this feeling. I want the feeling of passion that’s so impossible to contain; that consumes me day and night; that’s bigger than my fears.

“My close friend Kenny G later told me about a similar experience in his life. In the 1980s he was in an established band, with a secure position and income. (This was long before he became famous as a jazz saxophonist.) But he realized that he would have to leave the band if he was ever to find his own sound. Musically speaking, he went out and did exactly that. If he hadn’t, today he’d just be a saxophonist player in some little-known band.”

I think of two important moments in my life: My leaving college with only one semester left, to open a restaurant with absolutely no experience; and my leaving a decade-long career at Fransmart – a company whom I loved and was thriving at – in order to create margin to consult and do more projects that are true to me. Both have changed my life.

“Part of what constitutes success is timing and chance. But most of us have to create our own opportunities and be prepared to jump when we see a big one others can’t see.

It’s one thing to dream, but when the moment is right, you’ve got to be willing to leave what’s familiar and go out to find your own sound. That’s what I did in 1985. If I hadn’t, Starbucks wouldn’t be what it is today.”

Throwback devotional 01.11.18 – Stop working

“As Jesus and his disciples were on their way, he came to a village where a woman named Martha opened her home to him. She had a sister called Mary, who sat at the Lord’s feet listening to what he said. But Martha was distracted by all the preparations that had to be made. She came to him and asked, “Lord, don’t you care that my sister has left me to do the work by myself? Tell her to help me!” “Martha, Martha,” the Lord answered, “you are worried and upset about many things, but few things are needed—or indeed only one. Mary has chosen what is better, and it will not be taken away from her.””

Luke 10:30, 38-42 NIV

In this passage, there is no credit for being busy and doing a bunch of stuff; but there is more weight for those who just spend time with the Lord. I want to increase the ratio in which I seek Him, love Him, and find ways to include Him.

Devotional – 01.13.19

ANXIETY ABOUT MONEY – DAY 2

“The story in Exodus illustrates our dangerous temptation to turn God’s gift into a god itself. In Exodus 12:36, God gives the Hebrew slaves favor with the Egyptians, so that on their way out of Egypt they take Egyptian gold with them. These riches are a gift from God to his people, a reminder of his love and power. Yet when the people worry that Moses is taking too long on Mount Sinai, they urge Aaron to use the gold to make a new god. The people feel more comfortable with a fake god they can make themselves than with the real God who demonstrated his love and power over and over again. It shows just how easy it is to confuse money with God, particularly when anxiety makes us forget the ways God has provided in the past.

Just a few chapters earlier, God had given the Hebrews an antidote to forgetting him, in the commandment to celebrate the Passover. In Exodus 13:3 Moses instructs the people to celebrate God’s faithfulness by abstaining from leavened bread for seven days. This is to remind them that God brought them out of Egypt and that he is sovereign over everything.

Sometimes we need a concrete reminder that God is the source of all good things. If you’re having anxiety about money, consider trying a simple fast. If you typically buy lunch every day, or coffee at a coffee shop, take a break for a week. Eat more simply or more cheaply, and see how your anxiety level changes. Perhaps a fast will remind you that God has done good things for you in the past, and he is taking care of your needs today.”

I’m reading the @YouVersion plan ‘Anxiety About Money’. Check it out here:

This is a great explanation of how impatience and anxiety tempted the Hebrews to take the matter into their own hands and create a sinful and absurd way of dependency.

I can see myself being guilty of this as well; and need to resist my initiative sometimes – a gift that can also can be a detriment. I also need to resist the “my way or the highway” tantrums I tend to have when things aren’t happening the way I want them to, when I want them to.

This takes patience; prayer; being open to His plan and not mine as the infinitely better direction; and maybe a little fasting to remind myself that He has been faithful, He’s in control, and He provides.

Throwback devotional 01.10.18 –

“Why, LORD, do you stand far off? Why do you hide yourself in times of trouble?”

Psalm 10:1 NIV

This reminds me that it’s okay to argue and complain to God, and attempt to call Him out. He is God and He can take it; or shows I care and am seeking

Him; and either He will respond directly, or I’ll realize that it’s me that’s been distant.

Throwback devotional 01.10.18 – circumcision (ouch)

“You are to undergo circumcision, and it will be the sign of the covenant between me and you.”

Genesis 17:11, 14 NIV

When you come to terms with the Lord, there will be commitments and sacrifices that needs to be made; and it will be painful – hence the reference to circumcision.

This could mean cutting out bad habits, bad relationships, and bad dependencies in our old lives that are not making space for God to dwell in us, or bottlenecking the amazing things He wants to do to and through you.

Throwback devotional 01.10.19 – what business should I get into?

“He told them, “The harvest is plentiful, but the workers are few. Ask the Lord of the harvest, therefore, to send out workers into his harvest field.”

Luke 10:2 NIV

Talk about getting into a business where the demand (harvest) is always higher than the supply (workers) – which costs nothing on our part, and has been paid for by Christ. It’s a market that will never go out of fashion; it has no cycle and lasts far into eternity; the returns are infinite; and you are truly impacting peoples’ lives. Serving the Kingdom is a worthy, infinitely rewarding; and will never lose.

Devotional 01.10.19 a Wisdom readily & reliably available

“If any of you lacks wisdom, you should ask God, who gives generously to all without finding fault, and it will be given to you.” James 1:5 NIV

I believe that there are no excuses of lack of wisdom and tools when it comes to making the right decision. I have You readily available, whenever I need – through the Bible, being aware of signs, talking to godly people, obedience, doing everything in love, and waiting in faith.

I want to be better at seeking You first and throughout – versus resorting to what’s visible, quick, easy, comfortable. I don’t want to look for knowledge that only serves my purpose. I don’t want to succumb to sin. I don’t want to do anything without You.

Devotional – 01.08.19

“Seek the Lord while he may be found; call on him while he is near. Let the wicked forsake their ways and the unrighteous their thoughts. Let them turn to the Lord, and he will have mercy on them, and to our God, for he will freely pardon.”

Isaiah 55:6-7 NIV

While I’m here on Earth, I can call on You. I can work to get closer and closer to You. I can spend every waking and sleeping moment in service to the Kingdom – in obedience, sharing Your glory, loving others, and fulfilling my purpose. I can do this by praying more, conversing with You more about anything and everything, and I can run all thoughts, behaviors, and decisions through Your filter of christlikeness, glory, the Golden Rule, and assessing consequences.

My biggest regret would be to not take advantage of the grace,

good health, love, peace, and calling that You give me that gets stifled from my selfishness, sin, and being distracted. These are all things that You give me power to escape from, and don’t add any value to my life.

I am thinking about how busy I am with dumb pursuits like most emails, not being able to say “no”, money-based decisions, and comfort over obedience.

Please help me make a hard stop on bad and unhelpful thoughts and actions; have the obedience and faith to turn back around; and return to You. I am thinking of my cussing; and my talking bad about people.