Famous Failures

By Mike Myatt, Chief Strategy Officer, N2growth

Famous Failures

The response to the Michael Jordan piece I posted earlier today was overwhelming. Most of the e-mails I received asked for more inspirational videos to be mixed-in amongst the more traditional posts. In that vein, I thought I’d offer the above video on famous failures as a follow-up piece for your weekend enjoyment.

Michael Jordan and Failure

By Mike Myatt, Chief Strategy Officer, N2growth

Michael Jordan “Failure” Nike Commercial

In a previous post entitled “Don’t Quit” I espoused the benefits of staying the course and not giving up. In today’s post I wanted to share a short video with you in support of the concept that it is acutally those who have the fortitude to work through failure that often have the most noteworthy success. While this video is just a Nike commercial it nonetheless proves that when you look behind the public face of success you will most often find quiet determination, persistence, and a refuse to lose attitude…

Young CEOs

By Mike Myatt, Chief Strategy Officer, N2growth

Youth can be a two-edged sword...Young CEOs are becoming much more commonplace in today’s business world. It used to be that young CEOs were the exception and not the rule. However it is not at all uncommon to see 20 something and 30 something CEOs running very large and successful companies in today’s technology driven, global business environment. Regardless of how bright and talented these young CEOs may be, there are nevertheless certain challenges and obstacles they will face for the first time that more seasoned executives have encountered numerous times over the course of their careers. In today’s post I’ll share some thoughts on how to leverage the strengths of younger CEOs, while mitigating the inherent risks associated with inexperience…

In working with a number of Private Equity and Venture Capital firms who have young CEOs at the helm of their portfolio companies, or boards that have recently hired young CEOs, it is clear to me that most organizations realize the upside of younger talent. That being said, these engagements also serve as evidence that they are looking to hedge their bets by using me to help mitigate the risk associated with young CEOs. While boards and investors like the intelligence, commitment, enthusiasm, and boundless energy that young CEOs bring to the table, it is perhaps their relentless drive to make their mark on the world that can be most attractive.

On the positive side of the equation, young CEOs sometimes accomplish great things because they don’t have the experience to know what they are not supposed to be able to accomplish, and as a result sometimes appear to achieve the impossible. However more often than not, young CEOs operating outside of experiential boundaries are met with frustration, if not failure, by having what appear to be great ideas eventually unwound by unforeseen factors that were only unforeseen to them due to their inexperience or lack of discernment. It doesn’t matter whether a young CEO is college dropout, whether they possess an Ivy League MBA, or whether they spent a few years as a consultant at a top strategy firm…they are still likely sailing in uncharted territory more often than not.

The simple truth is that everyone, regardless of their age or title, needs sound advice and counsel. However this is particularly true of younger executives. If you were to speak with a 50 year old CEO and ask them how much he or she has learned over the last 20 years of their career, they would most certainly say the experienced gained during that time was invaluable. Let’s use the current state of the economy as an example…20 something and 30 something CEOs have never experienced a sustained period of slow economic growth, much less a global recession. They have no experience in growing a business in a declining market. Contrast this with a more seasoned executive who has lived through a few different business cycles and the experience gap becomes very clear…

The purpose of this text is not to discourage investors and board members from placing a young CEO at the helm, but rather to encourage setting them up for success as opposed to failure. A bright and talented CEO is only going to be that much better with someone in their corner charged with helping them navigate the complexities of situations they have yet to encounter. My strongest recommendation is to provide your chief executive with a dedicated resource to develop their professional skills through mentoring and coaching. Not only will you be happy with your decision, but the young CEO will shave years off their learning curve.

Public vs. Private

By Mike Myatt, Chief Strategy Officer, N2growth

Public vs. Private Public vs. Private finance…The question is, which option is better, and why? Entrepreneurs, investors, and advisors have very strong opinions as to whether you’re better-off with private equity or an IPO when seeking to finance, sell, or otherwise seek investment capital for your company. In today’s post I’ll share some recently released information which may help you make the right decision…

If you are successful in your entrepreneurial endeavors, you will someday likely find yourself at a crossroads where you attempt to cut through the ambiguity of public sentiment and conflicting opinions and find the answer to the age-old finance debate of public vs. private equity. The good news is that the results of a recent study by Ernst & Young concluded that businesses who received capital from investment firms substantially outperformed those who companies who received capital from the public markets.

The E&Y report which derived its conclusions from studying the trackrecord of the global buyout industry’s 100 largest exits last year found that the enterprise value of companies funded by private equity was twice that of publicly-held companies. Moreover, the report found that the EBITDA of companies who received private equity investments increased by more than 30% over that of their public company counterparts. Another meaningful difference between companies who received private equity was that the primary driver of value creation came via organic growth initiatives, whereas the public companies most often had an acquisition based model as there primary value creation driver.

In a previous post entitled “Capital vs. Influence” I made the case for seeking value added investment partners. The E&Y report seems to support my conclusions. The simple truth is that private equity investors stay engaged post funding, and add ongoing value to the enterprise. Contrast this with the IPO process which is a long, costly, and heavily regulated endeavor where the value add of your investment banking relationship laregly disappears once your offering has hit the market.

Let me pose one final queston…when determing the future of your company do you really want to hand it over to the regulatory and compliance ridden world of public finance, where your destiny is largely placed in the hands of analysts who assess whether your short-term performance is in alignment with Street expectations? From my perspective I would choose to seek capital from a world that focuses on the creation of long-term value through an engaged and proactive process that adds value beyond just the original investment.

Get In Shape

By Mike Myatt, Chief Strategy Officer, N2growth

Its really not that bad...You knew this was coming…it was only a matter of time. I don’t think I’ve addressed the topic of physical fitness more than once or twice since the inception of this blog, and then only briefly. Sure, we’re all busy, some of us are getting older, and others aren’t athletically inclined…so what? The simple truth of the matter is that the physical, emotional, and intellectual benefits of remaining fit are clinically supported, fully substantiated, and undeniable facts. The reality is that there is no single valid reason for not putting yourself in a position to leverage all of the benefits afforded by increasing your overall health and fitness level. So, this begs the question why are so many senior executives and entrepreneurs out of shape? In today’s post I’ll share my theories on the subject at hand, provide a few tips, and even offer a few links to websites worth looking into…

Let me begin by stating that I’m not so vain and narcissistic that I’m promoting physical fitness for the sole benefit of looking better in your business attire (not a bad side benefit however). Physical exercise, a sound diet, good sleeping habits, and the avoidance of harmful vices (yes, I’m talking to you die-hard nicotine addicts) will simply allow you to have more energy, increase your intellectual capacity, lower your stress level, and even-out emotional swings. Why is this such a bad thing? If you think about anyone who has achieved success over the long-haul (flash in the pans don’t count), you’ll find that it very likely that they have incorporated some type of health and fitness routine into their lifestyle. Not everyone can or should be an ultra-marathon runner, but everyone can and should be fit.

Following is a short representative list of just some of the options available to you: walking, hiking, running, rowing, swimming, biking, weight training, yoga, dance, gymnastics, rock climbing, calisthenics, martial arts, golf, tennis, water skiing, snow skiing, kayaking, volleyball, racquetball, basketball, softball, etc. You can workout indoors, outdoors, at home, in the office, or on the road. Why not get off your duff, out of your chair, and be an inspiration to your employees and to your family. I noted above that there are no legitimate reasons for not being in shape, but the following list offers a look at the top four excuses I hear from new clients:

  1. I’m too busy at work and just don’t have the time – Don’t stay in shape and its only a matter of time until you crash and burn and work will no longer be a valid excuse, nor your biggest problem.
  2. By the time I get home from work I’m just too tired and I don’t want to cut into family time – workout before work, while at work (for the last couple of years I’ve actually had a treadmill in my office), or incorporate exercise into your family time. I don’t think I’ve ever regretted asking my family members to go for a run, lift weights, play golf, etc., and fortunately I don’t think they’ve ever regretted it either.
  3. I’m too out of shape or I’m too old to workout – You cannot be too out of shape to begin getting back into shape. If you’ve ever watched TV’s “The Biggest Loser” you’ll see that it is never too late to regain control over your life. As far as the I’m too old to exercise excuse goes there are any number of 60, 70, and 80+ year old marathoners now days. Last time I was in the gym I watched a 64 year old man bench press 400 pounds. I’m no spring chicken anymore and I can still drop down and do 100 push-ups. Age is a state of mind…if you think you’re old you will be.
  4. I’m not very athletic and I just don’t want to make the investment into learning something new at this age – More of the same…How athletic do you have to be to walk, swim, bike etc., and last I checked it doesn’t cost anything to walk around the neighborhood.

Following are my favorite fitness websites that will hopefully give you some motivation to get up and going (warning…not for the feint of heart):

  1. Crossfit.com
  2. Beastskills.com
  3. Ultramarathonman.com

Incorporating fitness into your lifestyle doesn’t have to be work, as it can actually be quite fun. However it does take a commitment. You either care enough about yourself and those around you to take care of yourself or you don’t. I know which group I choose to be a part of, how about you?

The Bears Are Back

By Mike Myatt, Chief Strategy Officer, N2growth 

The Bear is BackIt was just a matter of time until it became official…The Bear Market has returned. The Dow Jones Industrial Average closed today at its lowest point since the summer of 2006 falling more than 166 points and finally coming to rest at 11,215.51 at the closing bell. Those of you who read this blog frequently know that I’m perhaps the antithesis of a pessimist, but I do consider myself to be a realist. While today’s close wasn’t necessarily any great surprise, it nonetheless merits coverage as this is just another piece of the economic puzzle that will vex many an unprepared CEO. In today’s post I’ll take a brief look at yet another sign of the rapidly declining US Economy…

With the US housing market in the tank, oil breaking $144 per barrel, The Fed exhausting its intervention options and Bernanke now warning of inflation, and the US dollar still hovering near its lows, it was just a matter of time until the stock market fell into line. It is “officially” considered a Bear Market when Blue Chip stocks close more than 20% off their highs for an extended time. You might be thinking that a 20% correction isn’t all that bad, but let me put it into perspective…The US stock market has lost more than $2.1 Trillion dollars in value since last January. That’s Trillion with a capital T

I’ve been warning readers about the waning economy for well over a year now and as the avalanche of negative correlations continue to fall into place it doesn’t take a rocket scientist to figure out that the US economy is in trouble. As inflation begins to show itself as a highly probable outcome and spending becomes even tighter, your business will have to work that much harder to compete in the marketplace. 

I’ve said for a while now that the economy will get worse before it gets better, and I still believe that to be the case. While many companies will not fare well in the weeks and months ahead, for companies with excellent leadership this economy is not only survivable, but it provides an opportunity for companies to prosper under the right direction. My advice is this…be smart, reexamine your business model, get very tactical, and get very aggressive in your marketing and business development endeavors.