Good Impact Investing Requires DIET and Exercise

BSG logo - smallI moved to Austin in the mid-1990s as part of an expansion of BSG Corporation, a company for which I was a co-founder. In 1996, two things happened that shaped my engagement in community and social ventures for the next 20 years to present day.

First, BSG was acquired by another large services company for several hundred million dollars. Second, I was accepted into the 1996-97 class of Leadership Austin.

Up until then, my only community activity had been supporting my church and the schools my young children attended. Outside of those activities, all of my energy was poured into helping BSG grow and succeed. Consequently, while I traveled around the country to our offices in locations like New York, Atlanta, Chicago, and Seattle, I didn’t even know the names of the streets on the adjacent blocks around my new home in Austin.

So, when we sold BSG, I had a hunger to get to know my community better and was blessed with the means to take the time to do it. After some discernment, mightily enabled by my Leadership Austin experience, I thought that lending my services as a non-profit leader could be a worthwhile way to get engaged in a high impact way.

easter-seals - 75 yearsLong-story short, I interviewed for and won the CEO position (equivalent to Executive Director for many non-profits) at Easter Seals – Central Texas. This is the “Exercise” part of good impact investing, per this post’s title.

Being the CEO of a major regional non-profit (we had a $multi-million annual budget with a 22-county Hill Country territory) gave me the opportunity to see the social services sector from the inside, for which I’m grateful.

The experience was critical for learning the importance of exercising head and heart in different ways. It also enabled me to see how business practices I had learned and considered second nature were under-valued, under-represented, or completely absent in social services.

At the end of my one-year tenure as CEO, performing the real-life exercise as a hands-on social venture leader also helped shape the opinions that I carry today about the strengths and weaknesses of the sector.

Since so much of the non-profit sector competes for social venture dollars, I’ve learned to guide my criteria for judging an organization’s ability to succeed by criteria that are not unlike those of any other new venture I evaluate — non-profit or for-profit.

In fact, I don’t really think in terms of non-profit or for-profit. I think of high-margin, low-margin and no-margin ventures…to me, the financial side of evaluating a venture is all about growth and sustainability.

But, even before the financial sustainability question and its corresponding element, the business model, the four most important issues that I look for can be summed up with the acronym DIET, standing for : Demand, Idea, Excellence, and Team. (Yes, this is where the “DIET” part of the DIET and Exercise title comes from.)

Having been a both social venture leader and in the business of launching new ventures, as I have for years as a principal with Powershift Group, I’m looking forward to going deeper on the DIET and Exercise concepts, sharing my perspective as an impact investor, during our SXSW panel, Sunday, March 15. I hope you can join us and I look forward to your questions and comments!

wannabe_1024pxPS: If you have a moment, and are an educator, a student, or the parent of a high schooler, please take a look at one of Powershift Group’s most recent social venture projects: the Wannabe mobile app. You can download it (free) for all iOS devices, from the iTunes AppStore.

Experience matters; brains, maybe not

Back in the 1990s, I used to say that my brother Frank and I both worked in outsourcing, just different industries.

Frank was a champion tennis player in high school and ended up playing Big 10 tennis on scholarship for Indiana, before graduating and going to work for WTS International.

The core of WTS’s business is managing fitness clubs, resorts, and spas, primarily around North America…basically, they outsource the management of health clubs.

I, on the other hand, spent most of the ’90s at BSG Corporation – primarily responsible for publishing, communications, and marketing programs – where among other things we developed custom client/server applications.

As BSG grew, we began outsourcing portions of the IT operations of larger enterprises, the most significant being for the oil and gas services company, Tenneco in Houston.

Neither of us is with those companies any longer, but when we were together over the recent Thanksgiving holidays, we got to talking about our respective experiences at those firms and how great they were as training grounds for what we do today.

As we visited over a glass of wine, we got to chuckling about how all of those years of experience can be boiled down into a series of statements that we seem to say over and over again in our different fields.

Frank, who now serves as an executive in the publicly-traded fitness firm, Town Sports International (NASDAQ: CLUB), rattled off the following six-point list of things he finds himself saying repeatedly at the clubs he travels to:

  • It looks okay
  • He (or she) is a really good instructor
  • Cut housekeeping
  • You gotta sell more
  • You guys need to pick up the trash (variation, when referring to a customer entrance outside: you guys need to pick up these cigarette butts)
  • Everything looks safe

We laughed, because as simple as these things sound, when they are said with the voice of authority from years of experience, they carry the sense of the profound, the wise, or the expert.

In turn, I rattled off my own six-point list, but from the perspective as a publisher / producer, coming up with the following:

  • It’s too long (“it” referring variously to a sentence, paragraph, article, etc.)
  • I’d like a draft (or, if a lengthy assignment, an outline) by tonight
  • Double-check the spelling of the names and call the phone numbers
  • Try it in Internet Explorer
  • Have someone else read it first
  • Look at it (the picture, the logo, the chart, etc.) in black and white before finalizing

What does all of this have to do with technology innovation – which after all, is loosely (not always) the subject matter domain of this blog?

Turns out a lot, because in essence what these examples refer to is an artifact of rapid cognition, as popularly described in Malcom Gladwell’s best-selling book Blink.

More recently, this notion of rapid cognition and our ability to impart a superior version of such capability in machines was announced by IBM in the latest update to the company’s artificial intelligence technology. A version of the company’s software named “Watson” will compete with prior stars of the game show “Jeopardy” in February 2011 to see which competitor is the ultimate knowledge champ.

Should be a fascinating test; whether or not it makes for good TV is an entirely different question. But I, for one, will be DVR’ing it – mainly because I want to see Ken Jennings and Watson’s go mano-a-machino!

Print Is Good

The news is full of stories about e-books and the shift from print to digital. While I support that shift and am a heavy consumer of digital content, I still love print for certain things. Here are a few of them:

I like print for handy, domain-specific data and tips. Take a look at the print items below, for example.  They are from various collections I’ve kept over the years from my days at two of the historic “Big Eight” consulting divisions. 

The first image is four, two-sided cards from Arthur Andersen (now Accenture).  They were laminated to last and sized to fit in a purse or suit coat pocket.  The examples shown are for effective presentations, effective written communications, management tips, etc.

The next image is a set of nearly a dozen similar pocket cards from Coopers & Lybrand (now part of IBM Global Services).  Each one was a guide – a checklist, really – for different aspects of microcomputer services, from design to testing of systems and everything in between.  Unlike the Andersen cards, these would fold out.

Speaking of IBM, the next image is a couple of IBM pocket cards that I used for quickly troubleshooting code in Assembler, JCL,  or COBOL.  I’ll admit, they are a little bit like the slide-rule equivalent of paper.  But, man, once you got proficient with these things, they were instant reference tools.
In every case, these print materials are like flash cards for business – info rich, easy to carry, quick to search, and not reliant on a power or network source.

I also like print for “right brain” publications. Go to the magazine rack and pick up a magazine on architecture, design, or other specialty subjects. A couple of my favorites are below. 

The first is from a multi-content magazine of poetry, short stories, criticism, and other writing and art, named Fishes.  And, yes, that is a fish hook tacked to the cover.  You can only find that kind of innovation with a print publication.

The other example is the most awesome vendor-sponsored newsletter I ever received.  The four issues I got in the mail are below.  Look at the amazing diversity in cover and interior typefaces and artwork.

Here’s another example of an interior spread – look at the page layout and the full bleed for the large image from Leonardo da Vinci on the left.

In addition to the innovative content, the form factor itself was innovative.  In the next image, you can see an example of one of the issues in relationship to an issue of Good Housekeeping and one of Craft magazine.  The Good Housekeeping is the typical magazine size you see in a bookstore or supermarket.
I consider these high impact publications which could only have the effect they produce through print.  They may be dangerous (as in a fish hook) or expensive (the “World Tour” issues must have cost a fortune), but no PDF could ever duplicate the impression they leave with the reader.
Perhaps my most favorable, old-school bias towards print is that I prefer to have at least one item that is principally designed for print for any company, organization, or major project (like an event, for example) that I run. 
Whether it’s a glossy, sixteen-page, full-color brochure or a suit-jacket sized pocket folder with a space for a business card and other on-demand inserts, I find that there remain too many situations where having something that you can physically hand to someone helps differentiate you from others and keeps your brand physically present on a table or the desk of the recipient.
Again, just because it’s print, doesn’t mean you can’t leave as innovative an impression as you would working only in digital form.  A couple of examples include the image below, where a company where I worked prototyped a version of the book that you see on the bedstand tables by most medium- to up-scale hotels.  Only, in this case, the book was intended to be another reminder of our “high touch” customer service to complement our high tech services. 
The sleeve on the upper cover of the book was designed to hold the business card of the customers, to personalize it.  Inside the book were:
  • a personalized welcome and thankyou letter from our company’s chairman to the customer,
  • business cards of our client service team assigned to the customer,
  • pre-posted business reply post-cards that could be mailed to our company at no charge to the customer indicating issues going poorly or well,
…and other customer- and project-specific materials.

The other image, below, shows examples of various print pieces produced for internal, company purposes – all focused on mission / vision / values, and important contacts.  They are all business card sized and could easily fit in a pocket or notebook.

Pardon my pop-psych analysis, but my opinion is that these kinds of unique uses of print have a way, by their very physical presence, of sub-consciously producing a recipient’s greater trust in the “real-ness” of the company or organziation.
The last instance I’ll admit to preferring print is for most of my book reading.  The preference is health-related in two ways: in one way physical, and the other way financial.
Regarding physical health, I’ll share that I probably spend half of my book reading time in bed at night.  And I don’t know about you, but I just can’t get comfortable with an e-book in bed.   But far more importantly, there are some early warning signs that the electronics of e-books may be bad for you – especially at night. 
For example, in a June GigaOm post, one commenter chided Om for not giving enough attention to the negative consequences, writing:

Reading for extended periods on an ipad (or similar device) in bed prior to going to bed has a significant effect on melatonin production and other key neurotransmitters and biochemistry…. drastically impacting the the immune system and your ability to have restorative sleep.

There is a huge difference between reading a regular book which reflects low ambient light into the eyes compared to direct observation of an intensely illuminated surface… bottom line .. this trend will lead to a broad epidemic of auto immune disorder in the coming years…

For the financial health side of things, I love that you can get all of the print books you want from libraries at no cost (well, almost no cost, if you don’t count the mandatory $4 per year library card renewal and the optional library donation of $20 or so). 
Our own local library even reminds you how much you have saved in books, movies, and other content you might check  out during the year, with a little receipt it prints every time you visit.  As you can see from the image below, barely half-way into August I’d saved over $2,200, mainly on books. 

While you can get books on CD or DVD and tape, many library collections remain limited compared to print and e-book content almost universally comes with a cost, for anything other than the classics that are available for free download.

So there you have it…at least four instances why I think print is good.  Will we ever have a paperless society?  To me, that’s like asking will we ever have a garden-free society or a bicycle-free society.  Yes, we could, but why would we?  Let me know what you think.