Quotes by Guy Kawasaki

Try stuff. I also used to believe that it's better to be smart than lucky because if you're smart you can out-think the competition. I don't believe that anymore--this is not to say that you should strive for a high level of stupidity. My point is that luck is a big part of many successes, so (a) don't get too bummed out when you see a bozo succeed; and (b) luck favors the people who try stuff, not simply think and analyze. As the Chinese say, "One must wait for a long time with your mouth open before a Peking duck flies in your mouth."

Ignore schmexperts. Schmexperts are the totally bad combination of schmucks who are experts--or experts who are schmucks. When you first launch a product or service, they'll tell you it isn't necessary, can't really work, or faces too much competition. If you succeed, then they'll say they knew you would succeed. In other words, they don't know jack shiitake. If you believe, try it. If you don't believe, listen to the schmexperts and stay on the porch.

Focus on cash flow. I understand the difference between cash flow and profitability, and I'm not recommending that you strive for a lack of profitability. But cash is what keeps the doors open and pays the bills. Paper profits on an accrual accounting basis is of no more than secondary or tertiary importance for a startup. As my mother used to say, "Sales fixes everything."

“(Big name research firm) says our market will be $50 billion in 2010.” Every entrepreneur has a few slides about how the market potential for his segment is tens of billions. It doesn't matter if the product is bar mitzah planning software or 802.11 chip sets. Venture capitalists don't believe this type of forecast because it's the fifth one of this magnitude that they've heard that day. Entrepreneurs would do themselves a favor by simply removing any reference to market size estimates from consulting firms.

“Patents make our product defensible.” The optimal number of times to use the P word in a presentation is one. Just once, say, “We have filed patents for what we are doing.” Done. The second time you say it, venture capitalists begin to suspect that you are depending too much on patents for defensibility. The third time you say it, you are holding a sign above your head that says, “I am clueless.” Sure, you should patent what you're doing--if for no other reason than to say it once in your presentation. But at the end of the patents are mostly good for impressing your parents. You won't have the time or money to sue anyone with a pocket deep enough to be worth suing.

Catalyze a Virtual Community

Many companies think that building a virtual community is as simple as throwing up a cool Web site that compels people to visit every day. Dream on. These sites are commercials, not communities. If you want to build a virtual community, here are the principles to implement:

Community before commerce. In the words of John Hagel III and Arthur G. Armstrong (authors of Net.Gain), "put community before commerce." That is, the purpose of these efforts is to build a community, not sell more stuff, so cool it on the commercialism. The community exists for its own benefit, not yours.

Communication comes next. Build in the capability for people to communicate with each other via message boards and Internet mail lists. Peer-to-peer communication is more important than being able to communicate with the company. You're hosting the event, but it's a cocktail party, not a lecture.

Place the community's interests above your own. The big picture is that a vibrant community will help you, but getting to this place means sacrificing short-term interests. For example, people should be able to freely discuss and endorse competitive products.

Tolerate criticism. Not only should peple feel free to plug competitive products, they should be able to criticize your own. This freedom produces two desirable results: first, good public relations because tolerating criticism on a company-sponsored site is unheard of; second, free and voluminous customer feedback.

Encourage "personalities." Remember how one of the keys to the success of MTV was veejays with an attitude? The same is true of a Web site, so encourage your employees to develop online personalities to show that corporate thought police don't control your site.

Let’s say a startup is hot. It ships something great, and it achieves success. Thus, it’s able to attract the best, brightest, and most talented. These people have been told they’re the best since childhood. Indeed, being hired by the hot company is “proof” that they are the A and A+ players; in fact, the company is so hot that it can out-recruit Google and Microsoft.

Unfortunately, they develop a fixed mindset that they’re the most talented, and they think that continued success is a right. Problems arise because pure talent only works as long as the going is easy. Furthermore, they don’t take risks because failure would harm their image of being the best, brightest, and most talented. When they do fail, they deny it or attribute it to anything but their shortcomings.

And this is the beginning of the end.

My theory is that when you're young, you should work eighty hours a week to create a product or service that changes the world.

If someone tells you like you eat like a bird, the implication is that you don't eat much. Yet for their body weight, birds eat a lot. The peripatetic hummingbird, for example, eats the equivalent of 50 percent of its weight every day. (If you're a 200-pound male, imagine eating 100 pounds of food every day!)

Chances are no one will tell you that you poop like an elephant because elephants poop 165 pounds per day. So far you're probably thinking, "Guy is into the weirdest things. No wonder Apple had so many problems." However, there two are messages for revolutionaries in these biological facts.

First, a successful revolutionary relentlessly searches for, consumes, and absorbs knowledge, about the industry , customers, and competition. You do this by pressing the flesh of your customers, attending seminars and trade shows, reading journals, and browsing the internet.

Second, you need to spread the large amount of information knowledge that you've gained--pooping like an elephant. This means sharing information and discoveries with your fellow employees and occasionally even with your competitors.

Death Magnet #1: The best product wins

....  Unfortunately, the best products don't necessarily win if another product is, at a minimum, sufficient plus quick to market, well promoted, and revised (churned) accordingly.

Why? Because of the Law of Increasing Returns. The more a product sells, the easier it is to sell. Other products may be better, but people get locked into a product and sales snowball even though it may be inferior.