9 Rules for Building a Tech Winner | Tony Seba | Talks at Google

So first off, for those of you who don't know me, my name is Christine Lee. I work in product marketing over at YouTube and thanks everyone for attending. This is the first in our marketing talks at Google speaker series. And I'm very honored to introduce our very first speaker to kick this off, Tony Siba. A little bit about Tony. He's an award winning speaker, author, consultant, entrepreneur, jack of all trades. He has over 20 years of experience in high tech, having founded his own successful company, Print Nation, as well as royal working in business development and strategic planning at big tech giants like Cisco and rsa, among others. He's a Stanford GSB alum and he teaches strategic marketing of high tech at Stanford. And he's frequently on the road, traveling around the globe, bringing his insight to various entrepreneurship conferences and international business schools. And he's also the author of Winner Takes all the nine Fundamental Roles of High Tech Strategy, which I think we have copies of the book here. Not 100% sure. Yes, we do. Okay. And he's here today to talk to you about nine rules for building a tech winner. And I've actually had the opportunity to take one of Tony's classes, so I know you won't be disappointed. So with that, please welcome Tony Seba.

Okay, thanks, Christine. So I started teaching at Stanford. Thanks for that introduction. After a 20 year entrepreneurial career, I started teaching at Stanford about five or six years ago. And if some of you remember, five or six years ago, 2002, 2003, those were tough years in high tech. A lot of companies were tanking and even great companies. Let me step back a little bit. That's my book and we're going to have copies here today. And that's me. And when I don't speak at Google and they don't bring copies of the books for everyone, I ask that whoever tells me where that picture was taken, I'll give a free book. So think about it. If you're here at the end, if you're here at the end, I'll ask the question that's a reason for you to stay. Okay, so back to 2002, 2003. Many companies died. Thousands of companies died. Many of you were in those companies. And when I was teaching in the open program at Stanford, many of my own students, class participants, were being laid off left and right. Sometimes 15% of my class was laid off in a given quarter, which is pretty painful. And if you read the media, it was all gloom and doom. It was the end of civilization or at least Silicon Valley as we Know it. So the question that I asked myself was, is it, Is it the end of civilization as we know it? Are there new rules in the web era? Is everything new? Because great companies were doing badly. Great companies were going flat. Cisco Systems was going flat, Sun Microsystems was going down, Siebel Systems were going down. What was new? What was new in this whole era? But at the same time, of course, there were companies like Google that were doing great. Google was doing great, Symantec was doing great, LinkedIn was doing great, Skype was doing great, Craigslist was doing great, et cetera, et cetera. So what I set out to do was compare these companies that were doing great with their peers. Not bad companies. So I set out to compare Google and Yahoo, Symantec and network associates, LinkedIn and all the 30 people who were competing with Sony and Apple. All good companies. All good companies. And I also did it across the board. I did it to see if rules were different for startups, for large companies, for web companies, for tech companies, product companies, service companies, business, basically across the board. And that's going to be the conversation today. What I found were nine rules, nine rules that I call the nine fundamental rules of High Tech strategy. And I subsequently wrote the book, and here it is. And since I'm an engineer, I like numeric proof. I like proof that this stuff works. So what I also did was two and a half years ago, even in the midst of writing the book, I published a portfolio, actually two portfolios. One of the companies that I was writing about, the Googles and whatnot, and another one of their competition. Because most of these two rules to be happy, nine rules to be successful. Do this and you'll be rich. They may work in hindsight, but they may not work in foresight. So I wanted to see if there was any proof that this stuff worked. And I published that two and a half years ago. And it's there to be seen by everybody up on my website. And of course, the fact that I am talking about it means that it worked, right? So let's get started with rule number one. Actually, I'm not going to go through this in order, I'm going to go in any order. So rule number eight, design products and services that are easy to adopt. Design products and services that are easy to adopt. So who has an ipod? Ipod. Okay, so the question is, who does not have an ipod? Right? The ipod came out in what, 2001 and suddenly it took over the market, right? Did it? So questions. Why did the ipod win when they Came late into the market by about two years in a crowded market. Why did Skype beat Vonage? Why did smart cards not make any difference in the US but they have in places like Singapore or France? So these were questions that I was asking myself. And back to Apple. Ipod. Apple entered and they won immediately. Right, because they were cool. Yes. Because of advertising. Yes. Itunes. Who said itunes? Brilliant. Brilliant. So if you look at the evidence, if you look at the evidence, cool will only take you so far. The evidence is Apple had never had ever a category winner, a number one in any category. So cool will only take you so far. Apple was near bankruptcy in 97. So advertising, remember that Think different campaign? That was brilliant. Just about the time Apple was like at its lowest point in history. And a year and a half, a full year and a half after the ipod was released, it was still going sideways. Not up, but sideways. It was not clear to anybody, not financial analysts, not anybody that the ipod was going to win. So look at the data. Apple was flat. The ipod was flat. Until something happened in October of 2003 that made the ipod take off. And after that, the rest is history. So it immediately doubled sales. Sales just 4/4 after were almost 10x. And the answer is itunes and itunes. Both the store and the player. Why? Most of us don't really buy that much online, but the player made a big difference. I had 400 CDs. I still do, somewhere in the basement. Who had an MP3 player before the ipod? Anyone? Yeah. How easy was it to transfer music? Very painful. Very painful. And you're an engineer and it's very painful. For me, it was very painful too. You had to type in the song names of every single one. And I had 4,000 songs. Not going to happen. So what Apple did was to bring together what's called the whole product, the whole service, which in their case, it was the listening experience. So everybody thought that they sold just this little MP3 player. And in fact, that's not what they were listening. They were listening at music. Listening experience. And when Apple figured that out, basically they took over the whole market. And that made it easy to adopt. It took me about five minutes to download itunes, make it work, and transfer my first CD to the iPod. Five minutes. That's it. And once I did that, then what did I do? I wrote about it. I told everyone so that everyone else would have the same experience. So that. And by the way, that is also why Skype beat Vonage. Because Skype was easy to adopt and Vonage was not okay. Rule Number three, add value, not features. Add value, not features. And there's a big difference between value and features. And especially here in Silicon Valley, it's where we develop products and we throw it over the wall for marketing to push out. In other words, we don't many times know the difference between value and features. Who invests in the market? Oh, very good. E Trade. Anybody? Now question, who do you trust when you make investments, who do you trust? I mean, there are more than 10,000 stocks in the U.S. there are 3,000 plus analysts who get what, 2,700 new or revised earnings estimates every day. Other than investing in Google, who do you trust when you make investment decisions? Anyone is your own instinct is What? Come on, 10,000 stocks? Give me a break. Yes, index funds. Index funds. So you follow an index fund. So you just invest in what? Technology, telecom. And you just go like, okay, this looks good. Boom. That's how I invest. You got to trust somebody, right? Why did E Trade go down a couple days ago? 50%. What happened? Those of you who invest through E Trade, because a financial analyst put a sell decision on that stock, the markets follow financial analysts for better or worse. At the end of the day, we end up trusting 3,000 financial analysts. But how do we know who are the good ones and who are the amateurs? How do we know if of the 30 or 40 analysts who follow Cisco Systems, one has been following it for eight or 10 years and know them pretty well and knows who their supply chain and knows their market as opposed to a recent MBA grad who just happened to be doing analysis on Cisco. We don't or we didn't. And that's why someone, Joe Gatto, started the company called starmind. And starmind was started precisely to analyze the analysts, to do numeric analysis on who were right on historically, because that had not been done before. So if you look back throughout the years, have they been spot on or not? So you assign a rating to each analyst and each stock, each combination. And he came up with this great graph. It turns out that stock price follows earnings estimates. Is that news? It's not news, but no one had done this. So guess what? If you invest billions of dollars, will you want something like this? Of course. So he went to investment funds with this technology and what did they say? That is cool. That is very, very neat. But he didn't get a single order. What's up? What they wanted after digging and digging and digging, what they wanted was the number. What do you mean the number? Sounds like Hitchhiker's guide to the galaxy 42. The number. So what they wanted was a number between one and 10. That's it. They didn't want this graph. They wanted a number between 1 and 10. Because why? They had their own infrastructure for analyzing stocks. They were not going to throw that out because this kid with this neat technology happens to think that he has the answer. So they wanted to put in the number into all those as part of that massive supercomputer infrastructure. So once he listened to them, he gave them the number. And that was the difference between having a technology that was cool and a graph that was neat and a great product. Because value is not what you say. Value is what the prospective customer says it is. Value is what they'll pay money for, not something necessarily neat. So that's rule number two. The rest, of course, is history. The company grew for the next few years, 100 plus percent growth. And it was recently announced that they got acquired by Reuters. So rule number two, value not features. Rule number three, focus, win, grow and then loop back, focus again. Win, grow and then. This is my programming background. So the company, the case that I want to use here is security. Symantec. So Symantec was a good company. Anyone from Symantec before you are, did you work there? When? In the 90s. Recently. Okay, recently. So in the 90s, Symantec was, oh, 400 million, 500 million, 600 million, up and down and up. So mostly sideways within this band, the stock, look at it, somewhere between four and eight and whatnot. It was a good company. In 1999, they did something and the company took off. And over the next four or five years, the stock went up six times, revenues went up three times. What did they do? ITunes? No, that's the other company. What did they do? Focus, focus. Let me tell you what Symantec was before 1999 or in 1999. An executive VP told me the only commonality between the products was the yellow boxes. They basically acquired a whole bunch of companies and they had what I call a spaghetti strategy. Throw it on the wall and see what sticks. If it doesn't stick, who cares? We'll buy another one. If it sticks, great. I'm a genius. So that's what they had. No real vision, no real strategy. They really didn't know who their customers were. No wonder they were going sideways. So you can build a company with spaghetti strategy. You just can't stay great and you can't be really, really great with spaghetti strategy. What they did was they decided to be an Internet Security enterprise and Internet security company. So all the boxes that did not fit into being a security company, they were tossed. They divested a whole bunch of products. People what not only focused on security, and you saw the stock how it did, the rest is pretty much history. So the formula is focus. Focus on one thing. Be great at that one thing. Now, the focusing strategy initially is scary because if there's no plan B, what are you going to do? I mean, Google, Part of the reason that Google beat what's the other name, the other company, Yahoo. Was that Google made it work. Google made search work because it had to. Because it had to. Right. It was a matter of survival. Yahoo did not have to. So focus, win, then grow, and then you start expanding and doing it again and again and again. That's pretty much the strategy. Rule number four, have a story. Have a story. Now, what I get usually is, what does a story have to do with high tech? Is this a marketing kind of thing? Stories? Does anyone use Netflix? Netflix. Good. Oh, wow. Nice. Why did Reed Hastings start Netflix? No. Can anyone tell me? Yes. He went to Blockbusters. And do you remember the name of the movie that he rented? Yeah. Apollo 13. When he came back, he had to pay 40 bucks in late fees. $40. The nerve of blockbusters to charge him 40 bucks for a movie. Now, do you identify with this? Does it make you, like, a little angry? Yes. See, that's a great story. It's got to be true, right? Because if it's in the paper, it's got to be true. So. And the day after he started the company. So you're not alone. Americans spent $1.3 billion in 2004 in late fees. So when you come up with a story like this, here's what happens. You start creating an emotional connection with your market. See, we're in technology. Technology is usually meaningless. It's bits and bytes. And I used to be in data security and encryption. Encryption. It doesn't get more complicated than that. How do you establish an emotional connection? Selling encryption stories. That's why. That's how you tell good stories. What happens when you tell good stories is you engage the audience they identify with. You think Apple for a second. Do Apple Mac consumers buy a computer only? No. They. They buy into a whole identity, into a whole way of seeing the world. And that is the power of stories. And we've known this, by the way, for a long time, that stories make a huge, huge difference. Politicians have known this for many, many centuries. And another thing that happens when you tell good stories for example, David and Goliath, Netflix versus Blockbusters, Yahoo versus Google, or now Google versus Microsoft, Red Sox versus Yankees. What happens is that suddenly everyone else disappears from the map. All those search companies, all those other baseball teams just disappear from the map. So when people talk about this category, they talk about these two companies. This is the one I like and this is the one I hate. So the rest goes away. What happened to the Intelliflix and the peer flicks and the DVD overnight and the 20 or 30 other DVD companies in our minds, in the mind of the basically public consciousness, they simply disappear. Suddenly there's only David, Netflix and Goliath Blockbusters. There was a great book by Howard Gardner at Harvard who said that who set out to study leaders throughout the 20th century. And what he found out was that leaders achieve their effectiveness through great storytelling. Isn't that interesting? Leaders, political leaders, religious leaders, they achieve. Even in science, they achieve their effectiveness through great storytelling. We love stories. My four and a half year old niece comes up to me, uncle Tony, can you tell me a story? All the time. We love story. That's what makes us humans. So the connection with technology is exactly that. Great leaders, technology or otherwise, achieve their effectiveness through great stories. Stories of hard work. Two guys, PhDs at Stanford. Hard work. Nobody understood what they were doing and 10 VCs turned them down. 20 VCs turned them down. Nobody understood them. And suddenly the whole thing took off. And who was born? Yahoo. Who else? Google. Who else? Cisco. Who else? Apple. Who else? Is this coincidental that two guys or two gals in a garage in Palo Alto start a company, hard work. Nobody understood them and blah, blah, blah, suddenly they get venture money and they're big. There's a reason for these stories, because we love them and we identify with them. So tell great stories, okay? Rule number one, feel the pain. And then develop your product. And this is upside down from what most Silicon Valley companies do, which is develop the product, throw it over the wall to the marketing people and see what happens. Feel the pain. What does that mean? Let me give you a story. Story, a case. Alpha Smart, two friends, they worked at Apple and they were in the education division at Apple. And of course, all PC companies wanted to push their enterprise PCs to the education market no matter what. So it's a matter of selling, selling, selling. But as they went out there, what they kept hearing from the teachers was, you don't understand us. Don't keep pushing these $2,000 laptops. This is 1994ish. Don't keep pushing these laptops. We want a product that works for us. Now imagine laptops. Not imagine their batteries last, what, an hour, two hours? Does this work for kids? What about 30 plugged computers in a classroom? Does that work for kids who run around the place? I mean, that's a lawsuit waiting to happen there. And so on and so forth. So all they wanted was the basics. Writing, keyboarding, what else? Reading, arithmetic. That's 70, 80% of the time. They don't want to surf. They don't want im. They don't want games. All they want is that. And by the way, we want it for 300 or 400 bucks. We don't want to pay $2,000. Can you do that for us? And that's what they did. They went away. They designed a computer that was specific for that market. And that's what I mean by feel the pain. Feel the pain of the educators. Feel the pain of the kids who are being fed these $2,000 computers. So this is what the computer looked like. It was a keyboard, basically. A little keyboard. $300 keyboard. You dropped it, you picked it up and kept working. It was nearly indestructible. It lasted forever. Check this out. AA batteries lasted six months. Six months, a whole semester. Compare that to a $100 battery that lasts an hour. Is there a difference? Maybe I want one of these. And it was simple and focused on the basic things that teachers wanted. So the result is they bootstrapped the company. It was a success from the get go. 50% gross margin, all that good stuff. IPO 2004, and the rest is history, right? The interesting thing is by listening to that pain, you keep developing new products. So once teachers love this product, they said, look, I have to set it up and wrap it up. I have to take it from the third grade to the fourth grade. And it's a pain to do that. Why don't you come up with a solution that I can take everything, wheel it back to the fourth grade, and in five minutes. So here's what they designed. 30 computers. And the beauty about that is Instead of selling one computer at a time, they started selling a $12,000 little cabinet with 30 computers and a router and a server and all that good stuff. And soon after they did this, this bundle became 50% of company revenues. So feel the pain. Rule number five. It's a risky world. Sell confidence. And this works in both tough times and when you're a small company. This works especially when you're a small company and during tough Times. So the case here is Sycamore. Sycamore networking company. They went through the roof in 1999. Stock went from 12 to 189. Revenues went up. Everything was great, and suddenly the market tanked. Five years later, revenues have dropped 90%. 90%. The stock was $3. The company. Even though they had a billion dollars plus in the bank, nobody even wanted to buy them. Not even for the cash? Not even for the cash, which is unbelievable. It looked like people only wanted to buy from Cisco Systems. What's up? Cisco was more expensive, way more expensive, more difficult to work with. Service was not that great. But everybody piled up and wanted to buy from Cisco. Why? Because nobody got fired for buying Cisco or IBM or Oracle or the familiar names. In tough times, people run for cover. Why? Technology, especially new concepts, new technologies, new things, are difficult to evaluate. They're difficult to test. I mean, anybody who does testing here knows that. And it's difficult for us. It's even more difficult for other folks. Buyers face many risks. Financial risks, personal risks, environmental risks, legal risks. In tough times, people want to go with a safe choice. So what do you do? I mean, if you start a company, if you create a new technology, what do you do to get people on board? So because I wanted to look at startup companies, I looked at a startup company called Clickability. San Francisco started in 1999, just before the tech recession. And during the tech recession, it went from 0 to 400. Little company. Four guys from Stanford went from 0 to 450 to 80% revenue growth. All that good stuff. What's up? They were competing with large companies, established companies. Now don't people go to safety during tough times? Why would a Clickability succeed? So that's what I wanted to know. It was interesting interviewing the CEO of Clickability because to him it was obvious what they needed to do. Go in, talk to customers, see what risks they're facing. Instead of pushing your stuff, just talk to them and deconstruct their risks, deconstruct what they're going through and offer solutions for those risks, whether it's money back guarantee. Oh, you don't think we'll be able to execute? How about this? We'll put in, we'll install the software, we'll leave you with 90 days. 90 days after we install it, for you to use it. And if you don't like it for any reason, we'll give you your money back. 90 days. Not after purchase, but after installation. You want to talk to someone else? Okay, I'll let you talk to someone else who is installing the technology right now. So they're going right now through what you're going to go through in a few weeks, should you decide to come with us. And that'll show you not the successful cases, but the cases that actually we're working with right now. So those are the kinds of things that he did. And so the result was 0 to 400 in a few years. And now they're growing like gangbusters. Rule number six, Convert champions, not just deals. Convert champions, not just deals. So LinkedIn, who uses LinkedIn? Oh, wow. Very good. In the land of Orkut. So LinkedIn, you all know LinkedIn. I don't have to say it. What? They are founded 2003. Unbelievable. Just four years ago. And at the time, just like when Apple came in with the iPod, there were 30, 40 social networking sites. That's four years ago. Friendster had 4 million people. And growing like Gangbusters. Rise, which was more of a professional thing, had 40,000 and growing. Why would LinkedIn be successful? Why would anew, just the number 33, be successful? Here's what they did. And they thought about this before they launched. Before they launched. How do I know? Because the VP Marketing is a friend of mine. So basically, I stayed in touch through the duration. So they focused, of course, on Silicon Valley. And what do professionals in Silicon Valley want more than anything? Anyone? The next big thing. Right. We want to work for the latest and greatest technology for the latest and greatest company. So we want to work for. We want to have the best job around, where we can have fun and where we can make a lot of money pretty much. Now they wanted to attract us Silicon Valley kind of professionals. So what do they do to attract us? They attract the folks who attract us. And who are they? Colleagues. Yeah, but how do they attract those colleagues? So if we're following the latest and greatest, who has the latest and greatest? Who has that knowledge? VCs. VCs have the knowledge, VCs have the insights. And they invest in those companies. So they LinkedIn set out to attract VCs, and if VCs went, the rest of us would follow. So that's what they did. They attracted VCs and they attracted the headhunters. How are we doing for time? Good. Okay. And so what they did was attract champions. So rather than take a social network, put it up there and see what happens, they thought about it and they started attracting the folks who would attract the rest of us. They thought about this before launching. Why? Because they had to because there were already dozens of social networks, and today there are hundreds and thousands of social networks. So how do you compete with the big companies out there? Well, you think about it, right? And what happens is that again, technology is no different from everything else in life. Adoption is a social process. Adoption of anything is a social process. How did you first get to use LinkedIn or Craigslist or ebay? Is the answer the same? Yes. A colleague told you or you read about it? Yes. Is there any other answer? I worked inside. Right. That's another answer. But most of us don't get to do that. So that is the answer. The answer is it's a social process. A friend told us we followed some kind of authority figure, a champion wine. Does anyone drink wine? Come on, you can admit it. Only a billion people are going to see us. So how do you choose your wines? How do you choose wine? Spectators. So you follow the authorities, right? How do you choose it exactly? You ask your dad. So see, this happens for wines, for restaurants, for technology. I'm just about to buy a digital SLR camera. Who do I ask? My friend, the photographer, of course. I've been emailing him, saying I want a $1,000 camera. And he's like, oh, this $5,000 camera is just great. No, no, no, you don't get it. But anyway, that's who I go to. Not only is he a friend, he's an authority, he's an expert. And I won't think about it twice before I actually buy it. And this is true of high uncertainty products. And I'll get back to this in a second. But social proof is a very, very powerful mechanism in psychology. We determine what is correct by finding out what others think is correct. Isn't that interesting? I mean, we can double click on this statement and talk for hours and days. It says something about us as people. And the higher the uncertainty, the more we run for safety, which makes total sense. And we follow experts and authority figures. And this is true for a lot of hunger. High uncertainty products, like when you travel, what restaurants do you choose? You read about them, you talk to friends, et cetera. And technology is usually high uncertainty. So the result is that LinkedIn 5% of the members have brought in the other 95%. No promotion, no nothing like that. For Google, same thing an initial number of users have brought in through word of mouth and word of mouth, all the other 95 or 98% of the users. So sell to champions. Design your products to sell to champions, who will in turn bring in the other 95% of customers. It's much cheaper this way, by the way. Rule seven, choose the right partners and manage them well. Choose the right partners. And again, partnership is one of the most abused words in Silicon Valley, if not the English language partnership. Everybody's a partner. Companies have thousands of partners, if that's possible. So first of all, I want to talk about a company called F5 Networks. And what you will notice is I go back and forth from hardware to software, from startups to public companies, Web and whatnot, because I wanted to see how these applied across the board. Same story, F5 Networks, they went up, then they went down with the recession, but they went back up. How did they do that? How did they go back from 107 million to 200 million after they nearly crashed? The answer is partnerships. Most of that growth, almost 100% of that growth from 100 million to 255 came from partners. Partners is not as in a PR statement, partner is not something that you say, oh, we're partners. Google and Verizon, we're partners, right? I don't know. Let me doubt 99% of the partnerships out there. Okay, here is a way to determine. Remember the ipod? They developed the whole product, which in their case was the whole. The music listening experience. F5 Networks got embedded into somebody else's whole product. So that when somebody acquired say Siebel CRM or Oracle or they're one and the same. Now, basically F5 would take a piece of that action. So they weren't necessarily buying F5, they were buying the whole pizza. And it's great if you're the cheese, if you're in the pizza market, right? As long as you take a little slice. In their case, that was great. So that's what they did. They took on the right partners who will deliver the revenue. And number two, of course, is how do you manage partnerships? Because asen you've heard that 2% perspiration and no inspiration and 98% perspiration. Partnerships are like that. Think about your own life, about partnership. You have to work hard. So these are some of the things that you need to do in order to make partnerships work. And in my opinion, clarity is the key to making partnerships work. Here's why I'm here. Tell me why you are here. Here are our goals. Here's a way to measure our goals. Are we doing well? Are we not doing well? How often do we go out for lunch? How often do we communicate all that good stuff? So clarity is a way to manage Your partnerships. So here are the rules. Actually, this is eight rules, right? I said it was nine. So the eight rules are pretty much for building a winner. The nine rule is you've won your grade. Congratulations. Now change or die. So let me show you something. Top 10 software companies in 1984. Now this is Jurassic era, I'll admit in 1984, but look at the top 10 software. This is not startups. This is not two guys in a garage. This is the top 10 software companies in 1984. Who is alive, still and thriving out of those 10? One. The others have been acquired, have died, just fizzled down. One out of the top 10 companies are alive 20 plus years later. Now, when I say this, a lot of people go like, well, they made stupid mistakes. We would not make those mistakes. Of course, hopefully you won't, but you'll probably make other mistakes. It's only human. Now let me show you something closer to home. Who's the top search company today on Earth? Wait. We know the answer. Who was it in 1999? Who was it 1999. That was not that long ago. I still remember 99. Who was it number one? Come on, you know it. Yahoo. Of course. Who was number two? Excite, who else? Tell me the top ten. Excite, Lico, Salta Vista, who else? Where was Google? So here's the top 10. See how Yahoo and Google flipped. But look at the top 10. Where is Google? Where is Google in 1999? In a garage in Palo Alto maybe, Or something like that. Does that make you think? Hmm? Of course. You would not make the same mistakes that Google, that Yahoo did, right? I mean, come on, you guys were founded by, I don't know, two Stanford guys. You guys are funded by, oh, Sequoia, and to be specific, by Mike Moritz. Unlike Yahoo. Right? Wait a second. And on and on and on. So thinking, thinking, thinking. Okay, so I looked at companies like IBM and Apple who had changed their business model. And there's a lot of information here, but IBM went from minus $8 billion to plus $8 billion basically by changing themselves from a hardware company with some services to a services company with some hardware and software. Apple I already talked about, they had to change. They had to change. And the key is you gotta change before you face bankruptcy. Like IBM did or like Apple did. But here's the problem. It's not that we're smart. Everyone in this room is smart. Your executives are smart. And so are Yahoo's, and so are Microsoft's and Cisco's. The problem is that that we happen to be human. And change is hard. There are cognitive, cognitive reasons why change is hard. Now look at aol. When do you know, at which point do you know that you got to change your whole business model? At what point do you know that you've got to give it up? So I won't talk about all these, but some of the things that prevent us from changing are some of the things that help us be successful because we're confident or overconfident that we can succeed and we can make things work. The same reason, groupthink bias. The tendency for people to just ignore data that doesn't fit into their worldview. And this happens over and over and over again. But change, you must, you gotta do it. So what do you do? Well, some of the companies that I looked, the number one thing I would say is ask yourself, how would I kill this company if it was me and I got 100 million in funding? How would I kill this company? But inside you know the weaknesses, don't you? But also look for outsiders to help you through that process. If I gave you 100 million to destroy me, what would you do that would give you maybe more information than you need to know at the time, but it's great information long term. Mind your value chain. So look at the value chain where the money is being made. Because IBM was the leader in PC, but their value chain, meaning from them to customer, was eaten away by intel, who by the way IBM saved from bankruptcy and Microsoft, who by the way was a partner with IBM. They ate away all the value in IBM's value chain. So these are the things that you got to look out for. And importantly, watch out for two Stanford guys or gals in a garage in Palo Alto because It may be 1999 in some garage somewhere, all over again. Thank you.