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It is Episode 46 of the “Law & Business” Podcast. This is a continuance of our mini-series with the Nessa Group. Here, the group talks about businesses who are resistant to change. One trademark infringement lawsuit comes to Anthony’s mind on the topic, because after the trademark infringement lawsuit, Anthony sent the client to Nessa Group because the client had a loss of one million dollars a year.
Anthony Verna:
Welcome to our fourth episode of our special mini-series of podcasts, a series on the NESSA group. And, once again, we’re here with the same team. My name is Anthony Verna. Jim Huerta, how are you doing?
Jim Huerta:
I’m doing fine. I’m glad to be here.
Anthony Verna:
All right, Barry Kolevzon, how are you doing?
Barry Kolevzon:
Great.
Anthony Verna:
Wonderful. Wil Jacques, what’s happening?
Wil Jacques:
Oh, not a whole lot, but I’m glad to be here.
Anthony Verna:
Glad to have you here as well. Justin Tripodi. Justin, how’s it going?
Justin Tripodi:
Doing great. Excited for the conversation today.
Anthony Verna:
Yeah, me too. Me too. So today we’re going to be talking about clients who are resistant to change and businesses who are resistant to change. And hopefully we will find businesses who are not resistant to change because change sometimes, especially when you bring in a group like us is what helps a business grow. Jim, Barry, the three of us worked on a particular business a few years ago and I know it’s more than a few years ago, but let’s talk about that for a second.
This was a client, a company that was sued for trademark infringement. This was a case where it wasn’t a full brand, but it was an apparel company that was using a design on its clothing that was similar enough to a registered trademark where the trademark owner filed a lawsuit. It really wasn’t worth defending. We were able to settle. The good news is that we were able to settle for $20,000 over a period of time and the company was able to destroy the offending products, we’ll call it that cause I don’t necessarily think it was infringing and move on with life. That part was I think was a great settlement. The three of us looked at this particular company’s books and the three of us saw a company that was $1 million in the red.
They’re selling jeans. A company that is selling jeans, in my opinion, should not be $1 million in the red. One area that I noticed was that they were buying too much product from their factories. They were not selling the product fully. And when they would sell their product, they would sell it over at overstock.com for a loss from what they bought it from the factory. So, Jim, let’s start here. What are some ways to avoid that red number when you know you’re purchasing too much from the factory?
Jim Huerta:
No, in this case it was tricky. I mean obviously inventory becomes a very important thing. I think a lot of companies don’t realize that if you have an excessive amount of inventory and you’re carrying too much inventory, that you’re not moving, it starts working against your P. and. L. it just has to you releasing prices that you can’t really work with. This company had more unique things going on when it came to this red number. They had a parent company offshore and the parent company was trying to move their inventory back to the local company. So, in order for them, the parent company to look better that they will be moving inventory, they will house it back into the local company who was getting beat up and was going into the red. But there was no communication what was going on. There was no idea where the stages of different inventory levels were at. There were an incredible amount of transportation costs. When we looked at it and we looked at some of it, we didn’t get enough information, we started to realize that a lot of this inventory was in transit because of the way they were structuring this movement.
You couldn’t really track the inventory and the dollars just kept on going up and up and up. And as Anthony pointed out, it hit $1 million in the red. They were in trouble.
Anthony Verna:
Jim, that description of how the money flows and how the inventory was transported is seems way too complex.
Jim Huerta:
It wouldn’t be complex if you wouldn’t have the relationship you had with the parent company and the local establishment. What was happening is that the parent company was actually working against, in their own way, working against the local silo or the company that had, or the sub company that had… They were coming up with a number that was looking good in their home ground, but when they were sending it out to the local guys, these guys couldn’t move the product.
The product was being stalled, they were being sued. There was a whole bunch of stuff going on and it, it really just… How can I explain this? You cannot not understand the impact of inventory and inventory cost on your business if you don’t have some kind of a control of the flow of that cash. As I said earlier, for example, they were doing intercompany accounting. What did that mean? That means that the guys who was sitting at the local location was sucking up a cash if they were just bleeding cash because the parent company was making an entry that was bleeding the assets coming out. It’s up because they were moving the inventory. So when I say cash flow, it emphasizes the fact that if you don’t have a realization of how your inventory’s working, how well it’s moving, where it’s going, where it’s sitting, what are your traffic guys telling you about inventory that you’re going to stop with this pain no matter how big you are. And actually, it’s examples of very large companies have suffered the same problem very.
Anthony Verna:
Barry, when you see
a smaller company that’s $1 million in the red, but still has $1 million of inventory sitting in the warehouse with the cash flow that Jim has described, what are some of your thoughts on how to advise that company to get better?
Barry Kolevzon:
I think basically they have the inventory. I think that they have to sit down and change their method of operating, moving the product, selling the product, and also all the amounts of money to, in the storage warehouse that they have to pay for. And I think that they could change it and then start weaning it down over a period of time so somebody can look at it and say, “Oh, you’re at $1 million, work it off.” and maybe they can then do a basis to come back. But the what let the boats sink and lose $1 million is hefty.
Wil Jacques:
How does a parent company look good? And how was this other company organized where they as subsidiary? Because I don’t understand how one part of a company looks good and the other part of the company looks bad, isn’t it all the same books.
Jim Huerta:
The parent company was charging an astronomical amount for the inventory being shipped to this subsidiary. So their revenues will be pumped up to the point that when they did a consolidation of subsidiary, the pumped-up number coming from the parent was eating up the million dollar loss. So, the parent company was always looking, Hey, we’re okay. While the little guy that was being sued was getting hammered because of the fact they couldn’t meet those numbers. It wasn’t like they were, it’s almost like I was talking to 10 bucks and you marked it up and you were selling at a price point of 20. It was the other way around. My parents selling it to me at 20 and I can’t get more than 10 for it. So, I’m already the $10 short shortcomings and that’s not a good idea.
Justin Tripodi:
And Jim, just to make note, this conversation is focused on focusing on products with companies with physical inventory moving around. Cashflow management is also very important for technology-based organizations, virtual marketplaces, et cetera because of payment terms. There’s the revenue coming in the door. When you get that revenue, sometimes a question mark, especially if you’re a B2B player, and your costs might be on a different timeframe. So, you could be operating at a loss month over month, year over year if you’re not closely managing your cash flow situation. And just as a quick story at a company I work with in the influencer marketing space, very successful, would partner with small brands to reach influencers. We do a couple of hundred grand a weekend under their weekend burst, but because the payment terms and when the brand would pay them and when they would be forced to pay out the influencers, they are operating at a loss week over week and even though their revenues were phenomenal, their profits were in the red.
And that was because data and closely managed a cashflow operations. So it is relatable to both businesses with physical products who have to undergo shipping and have a cost of goods sold, but also technology companies as well.
Anthony Verna:
Justin, I think that’s an excellent point. But I think the other point for everything that we’re talking about here is also communication as well. Here is a company that didn’t communicate with its counsel because they never presented any particular apparel designs to counsel. And that’s one of the, again, just like in the previous episode, that’s how they got sued. Here’s a company that wasn’t communicating with each other to make sure that the cashflow was right. And, I think in Justin’s particular case as well, I think communication is needed to get the payment terms proper and to get the cashflow.
Justin Tripodi:
I think also comes down to recognizing you have a problem.
In my story, the problem wasn’t recognized or diagnosed or appreciated by the operating team and in your situation, the problem was diagnosed but actions didn’t pursue accordingly. And I think that’s a lot of what we see with small businesses is they know something isn’t working, but yet they’re very abrasive as part of the title of this episode to change. And that’s not to say we always have the right answers, we don’t, but when things aren’t working, you need to adjust. You need to operate outside of your comfort level. You do not want to end up like Blockbuster or Kodak who were against change and now are companies that are in the history and not in the future.
Anthony Verna:
Sure. So when you, when you open up books of a company and you see the these particular issues, what are some of the, maybe not answers, but what are some of the other questions that you ask in order to help tackle the problem? What are some of those strategies?
Jim Huerta:
Well, from a financial review of say the financial statements, of P and L particularly, I would look at certainly the costs that are being always driven. I’d look at the gross margins. I would look at the below the lines. And what was happening in this particular case is that their gross margins were not, and when I say gross margin, it’s, you know, whatever you paid plus the cost of getting in. They were not looking at how to fix that nor below the line. Now when you sit in the middle of the line kind of thing, they still have the same payrolls. It’s still the same traffic guys. They still had always things that were sucking up cash on them and they weren’t making the adjustments. Like for instance weren’t sitting in saying, you know, we have, we have an overload of inventory. We’re so far away from our reorder point that we’ll never get to that unless we move this whole inventory. Well, the numbers are going to tell you, well, maybe one of the things to do is that you’re still going to take a loss, but you won’t be in the red for $1 million. You might be in the red for quarter of a million dollars. Me as sitting in the corner office. If that’s the choice you’re giving me, I’m going for the quarter million. Okay, I’m not going for the for the million dollars and they weren’t doing that. They just kept on loading it up and loading it up and it wasn’t working. It was a …
I think from my background, financials talk to you. Financials have a language of their own. You can have a lot of different expertise, but if you know the numbers, you’ve pretty much can tell what’s hurting the company and then go to specialists like we have in the NESSA group and say, this is your area. What do you think? Am I looking at this right?
Justin Tripodi:
I think that’s exactly right is that we don’t have a magic wand that we just wave and say, okay, all your problems are fixed. It’s a process that we follow. It’s our due diligence process. Whenever we get a new client on board, we need to learn their business as quickly and as thoroughly as possible. That is done through both conversations with that business to hear what they feel they feel is their business challenges today. And then we need to dive in to their books and to all the other requested due diligence materials for us to create our own idea set of what their problems might be because they might not be one in the same. Sometimes founders and business owners because they are entrenched in everything going on, might not have really an accurate understanding of what their challenges are or maybe they just have an open discussion with other people who have specific compentencies in different areas to figure out different solutions to going forward. But for us, it all starts with a strong due diligence process. The timeframe of which is very much valuable to the business itself. It could be a very quick one or two week due diligence process. I’ve done six months due diligence process because there was a lot uncovered.
Anthony Verna:
Barry, when you look at a company like this, what are some of the management’s gestures that you could make to help them improve?
Barry Kolevzon:
This goes back right to the base when the business was set up, they had the people that started in a CEO and all that stuff and I don’t think they ever looked at it afterwards with who had what responsibility and when it blew out, it was too late. Or the person that they hired in a critical area of the company was playing around with the money.
Anthony Verna:
Yeah, there’s no doubt that this was a company that needed some wholesale changes and really they didn’t really want to, I think be honest about what those issues were.
Jim Huerta:
They were embarrassed to be too, cause they wanted to say, look, we did it.
Barry Kolevzon:
The other thing they did, by the way, I think, Justin, you’ll probably appreciate some of the marketing points. When they started getting a feel that this was going nowhere in a hurry, supposedly they called up the few times they talked to the parent company, he said we can’t move this expensive pair of jeans. We need a lesser version on the Lastic version of something that’s different. So the parent company say, “Oh yeah, we can take care of that.” And they came up with a version that was costing them less money, but they will still tagging the subsidiary for the higher priced version. It was like how did that help the situation overall.
Anthony Verna:
Overall. That actually brings a thought into my mind. If you’re selling apparel like this, don’t you need like, like a good, better, best kind of model? If you’re selling apparel like this, like yes, we’re not going to be designer jeans, but we can have a retail $20 set, we can have a retail $40 set, we can have a retail…
Jim Huerta:
So that’s why Levi has been successful. True history. I mean we all grew up with Levi. You go into Macy’s for an example and there’s a Levi for everybody, every shape, for every price tag because they’ve actually worked on that and they actually discovered the fact I got this, my name is sufficient, but now I’m going to give you a little bit more, I’m going to let everybody be happy with my brand.
Justin Tripodi:
Yeah. Barry mentioned something just before… I knew you used the word embarrassed. Alright. And going back to the title of this episode, resistance to changes or why would a business owner, who knows he needs help be resistant to change or recommendations of a team, who are working with his best interest in mind. And this is where the psychology of business works in. And, for any of you who still in school are looking to back to school, I would heavily suggest taking a psychology class to compliment any of your business classes. Because at the end of the day, businesses deal with people. I’m a big advocate that business is not difficult. People make business difficult. And in this case, and with this topic, it’s people making business more difficult, whether it’s because they’re embarrassed or their current position or embarrassed to admit that they made a mistake.
And would you dealing with large companies where people are accountable for their decisions, sometimes they’ll fight back just so that person is not wrong. So you have to understand the corporate structure of who you’re working with. Don’t understand how that might play out because sometimes you can have great conversations on the phone, get brought in house to meet the team and conversations don’t go accordingly to plan. It could be that some founders don’t want to lose control of their business. They feel that if they’re doing something that wasn’t their idea, that they’re losing the control going forward to their business. Some people unsure of what a deviated path might look like because that’s not the path they’ve been on. And that’s understandable. But your business does need to change in order to grow. It needs to change in order to compete and continue competing.
If you do not change and evolve, your business competition will pass you by quicker now than at any other point in history.
Jim Huerta:
To your point too, Justin, offices still exist. I know you’re involved with the universities and stuff. When I went to school, there was a thing called consumer behavior was part of the marketing curriculum. Absolutely. And I don’t know if it still exists, but I remember that very point that you are making, they would drill the people, listen to what these guys, the consumer’s thinking and the way they’re reacting to what you’re saying. And that’s important. That was the topic of that class.
Justin Tripodi:
So it’s the psychology of a founder and there’s no set psychology. I’m not a psychiatrist, so I can’t comment on that. But you do have to tap into the emotional side. And it’s not hard.
These people, these founders, these entrepreneurs have invested their life and sometimes their life savings into trying to accomplish something and sometimes we have to say what you’re doing is wrong or what you spent your money and time on has to be changed. And that’s scary. And I get that. So, there’s that emotional side of the business that we need to be relatable. And I find a lot of times that yes, it does have to do with poor planning. Maybe the product wasn’t positioned in the marketplace. But a lot of times founders are just trying to do too much too quickly. They’re trying to build their entire vision, something they dream about and think about all day overnight and they fail to break it up into digestible linear steps that is also in sequence with their budget. Many times it’s just us advising you need to scale back.
You can’t start with this shiny new Ferrari. You need to start with a Toyota. And then work your way up slowly. I make a lot of weightlifting references as a former weightlifter. You know, if I try to jump up to what I used to do back in the day, the bar wouldn’t move off my chest, it would just lay there. But if I start small at a weight I can do now and increment slowly over time, I’ll get back up to that that weight. And that’s how a lot of small businesses and startups need to focus their efforts, especially when they are resource constraint.
Jim Huerta:
Yeah. And there’s a lot of hidden things too. You know, in this case, I know my last word on this particular case cause it, it just defies everything I was taught and everything. I practice this particular client, but I believe the parent company, their actions had to do not with marketing, not with the product, but had to do because they were offshore and their investors were offshore.
And when they had those board meetings, they were telling their investors, look how good we’re doing. And most of those board’s guys weren’t not caring what the subsidiary was being crushed about. They just saw this wonderful number that was always in the black and why would they bother? So that’s a piece that could cause that resistance. It doesn’t have to do with the market, it has to do with my investor. I’ve got to keep them happy cause I’m going for another round. So I’m going to do everything I can on the books to make this guy think I’m walking on water. That wasn’t the case here. They will eventually going to get caught up.
Anthony Verna:
Yeah. And, I think that the embarrassment is a good key here because this was a company that I think could have hit a home run. And, the way it was structured and the way they were ordering and the way that they were spending money on shipping and spending money on inventory and spending money on warehouse fees. All of that just really rippled into something bigger so a company like this just couldn’t grow. And yeah, they were embarrassed. But you know, we were there to help and, and you’ve got to communicate, you’ve got to listen. And that’s a part of the key here. Justin, I think you have a happier story for us.
Justin Tripodi:
I do it. It’s definitely challenging when a client comes to you to help and they push back again. So, your recommendation is, again, it’s not to say we’re always right, but something does need to change. It’s the definition of insanity. Do the same thing over and over again and expect different results. But in one case I was working with a first time founder who had a really innovative idea for the costume industry and I’m not talking just Halloween, but, millennials has paved way to the cos play industry, cosplay, live action role play. I mean, there’s hundreds of events that now go on across the world every week, every month. And people are dressing up because they want to experience what they watch on TV. I believe it’s called the Game of Thrones phenomenon that people want to dress up like the characters, not just watch them.
So he had, he had an interesting idea or concept and when he came to me, he had already spent a couple of hundred thousand dollars on technology and initial marketing. And when my business partners, and I jumped in to kind of our due diligence process, we realized that what was designed and built and spent already, it was really no different than costumes.com. There was nothing innovative in physical presence. Now his concept still had merit, but it wasn’t delivered the right way. So when we sat down and realized, well, what should be the positioning of this product? We saw a large opportunity to combine both experiences or these costume events with suggested costumes. No one surprising was doing that. No one was really aggregating these costume events across different segments like cosplay and LARPing, et cetera. And then we began to pivot the company away from what he was doing towards this new intersection of events and costumes.
We created a new online platform, first catered around events. We had to create new business material and new financial models and essentially a whole new company. And when it came to the technology, the unfortunate part was we had a third party do a technology audit of the existing code and it was found out to be what’s referred to as spaghetti code or unusable code. So, a couple of hundred thousand of dollars that was spent for that was essentially thrown out the window. We couldn’t build on top of it. Now we did explore litigation to get that money back against the development partner.
Anthony Verna:
But I’m sure that at the end of the day you kind of think to yourself, well, gee, even at $300,000, that may not be worth it.
Justin Tripodi:
And that’s the predicament we’re in was how much are we going to have to spend to get this money back versus what we need to spend to launch this company. Now, the good thing is, as a first time entrepreneur, he was very open to our recommendations and understood what he didn’t know or knew that he didn’t know everything. And he embraced our ideas. We were able to re-pivot the company. We already get investor interest and he successfully launched the new version of his website in beta.
Anthony Verna:
Wow. I think that’s impressive. So how are sales looking for this particular client right now?
Justin Tripodi:
I have to check back with them. It’s been a year and a half. Okay. My position with him was it was to help him re-pivot or pivot the company and launch. So thereafter my role ended. I’m sure the journey for him in no ways ended there because essentially his, his business as a virtual marketplace for costumes also had a heavy supply chain aspect to it. Similar to rent the runway. Rent the runway, the website is actually the largest dry cleaning company in the world, I believe. So, he had similar challenges that he had to face as well. He made a lot of great connections in terms of building that supply chain, but that was a completely different function he had to tackle.
Wil Jacques:
Why did he make the change? What was the tipping point? Well, what was it that made him finally accept your recommendation and move forward?
Justin Tripodi:
Well, he was never too resistance to our recommendation. I think it just it took some time for us to figure out what that recommendation would be. Because you know, sometimes starting from scratch is easier than building upon something that’s there. And in this case, we were trying to build upon something that was there and we were trying to work within those parameters and it proved too challenging, and not intelligent to go forward with from a time or money point of view. So, once we realized that, especially getting the feedback from the technology audit, we realized we were free to go in a completely new direction, that he was going to have to report to his investors the money that was invested was lost, that there was probably going to have to be a down round of investment. We’ll explain that in another episode. Tune back in. We carefully articulated the problems of the business and the risks we saw going forward. He took the time to understand them and talk to his advisors and colleagues as well and with some back and forth, he understood that this was the best path forward despite the lost money of the past.
Anthony Verna:
So Jim, Barry, let me ask you about this. When you hear when you hear that somebody has a business and an industry that might be a little outside of your range, like I could understand somebody saying a costume company like for events and people go there, I could see a little skepticism. What is your thought on an industry that might be a little outside of your expertise like this?
Barry Kolevzon:
I would think the easy thing is if it’s a company that’s very big beyond our capability, which we determined when we would go in and initially and find out and we would have to say honestly what we found out and see if they want to change what they’re doing, which was one of the companies that we talked about earlier in this section. I think our motto is we want to help the companies. We want them to succeed and to do that, it’s as we’ve been talking about, it’s people where now you see right through it…
Anthony Verna:
The business of the business is the business…
Barry Kolevzon:
That is unfortunately, it’s below the water level,
right?
Jim Huerta:
I fought in my situation, I, and maybe it’s not a weakness, I’m too nosy not to say, yeah, I can handle it. But when I don’t know a business and the customer approaches me and it’s an area I don’t know…Wil and I have had this experience with my current enterprise… I do my homework and that’s what we’ve been talking about a little long. I get into the industry and not because I want to be smarter than the people who came up with the idea because I never can be, that’s in their heart. What’s in my brain’s different. But at least my homework leaves me two people who know that this is, and I can pick up the phone and say, “Hey Harry, you don’t know me. Let’s have a cup of coffee. I need you to talk to me about this.”
And that’s what we’ve done. And I think consultants, there’s plenty of consultants out there who would have different specific areas. I don’t see many that do what we do. I mean there is big companies that we do but our size company, and I just think that, I don’t ever want to say no, I can’t help you because what you’re offering is that intellectual capital and that experience that saying I saw something like this and I know where it went and make that analogy and then do your homework. And that’s what we’ve been talking about through this always sessions is that we are asking our clients to do their due diligence and we’re asking of ourselves to do the same thing.
Justin Tripodi:
So yeah, I tend
to be, or at least try to be industry agnostic and I think there’s a couple of benefits of doing so. One is working in different industries gives you insights that you could borrow some industry dynamics to another industry. Maybe shake it up a little bit. But also to me, consulting, advising, whatever you want to call it really just comes down to problem solving. And we’re all curious individuals and I think the trick is asking the right questions. If I’m being brought into a company to help them with a specific function, I’m not expecting myself to be the subject domain expert. And that’s not how I pitch myself. I pitch myself to help them tackle business challenges or struggles that’s preventing them from growing. That is done by asking the right questions and collaboratively coming up with the answers with that business or with their founder or with that CEO.
And I think the second point of that is a real asset that we provide that we haven’t really talked is, and you touched upon it, Jim, is bringing in the right talent that’s necessary depending on whether it’s the automotive industry or renewable energy or online marketplaces or whatever the case may be. Once we diagnose the problem with the entrepreneur, with the CEO, and we kind of have an idea of, of what these problems are, what a solution could look like, we’ll help bring in the necessary assets or key individuals to take the tactical execution to the next level, whether it’s industry contacts, industry subject matter experts, maybe legal experts within the industry. Anything that we don’t feel comfortable handling ourselves, we will surround ourselves with the right talent and I urge all startups and small businesses to very much do the same because it will speed up your solution set considerably.
Jim Huerta:
We said it earlier in the earlier episodes. We all have gone to a lot of
academic study, all of us. And we know that there is people who we refer to who
were the theorist, who were the people who first came up with the ideas and the
foundations of those ideas. And I think they’re genuine to all industries. Like
you said, agnostic because they’re the basis of the foundation. Now when we do
beyond that foundation is weeping, the little filler, little carpentry and the
little plumbing in the stuff that we have learned because of those theories. We
add that and then we tell our clients, we don’t expect you to know all this.
That’s what you got us involved. And I think that’s important. I think the NESSA
group as a whole is very keen on the whole idea that there is basic foundations
that need to be structured, whether it be patents, trademarks, the marketing,
operations, finance, we see that and we come from that place and then we build
up. And I think that’s important.
Justin Tripodi:
And the key is there that a of the functions that you just listed need to be
considered together. And at the same time.
Jim Huerta:
It’s people.
Justin Tripodi:
It’s people, but it’s realizing the interrelations between me trying to figure
out what my marketing positioning is. Me trying to figure out if I can get IP
behind the solution set I’m bringing forward, me trying to figure out if I can
get a trademark on the brand I want to go forward with, me trying to figure out
what my supply is. A lot of these
questions overlap, and play off each other. And an answer to one or failure to
answer one could dictate an answer and another business function. And this is
where we find a lot of founders and young businesses making a mistake. They
silo different business functions and don’t have them talk to each other. And
almost a hundred percent of the founders I work with who do this, do not reach
the level of success that they expect or it’s much slower to get there.
Wil Jacques:
It’s a reason it happens. And so no side can fall to hubris, so to speak. So,
you look at particularly high technology, biotech, physical sciences, hard
sciences, medical technologies. When you look to entrepreneurs who bring those
kind of products or skillsets, you know, I have to remind myself, that I cannot
discount what they’re saying, so I’ll use it. I’ll use just a kind of funny
example I guess. Let’s say you were around when the person first invented
polyester. And so as business people, we sometimes have a lens, we have an
optic around how we might commercialize that and what that particular material
might be in terms of making a fabric, that sort of thing. But I can also
remember as a child laughing, well, maybe smiling would be a better term when
we realize that this thing could literally go up in flames.
Even though this was this wonder fabric, it had a certain danger to it, because
you know, we did not take into account, not just the business aspects but the
technology. And so you want to make sure that you embrace your technologists,
you keep them involved in the process, but yet also educate them that it’s not
just about the technology. So again, to all of our points, it’s a team effort
and everybody needs to be there. And it’s just a matter of asking as many questions
and certainly the right questions as you go to develop these businesses or help
turn these businesses around.
Jim Huerta:
I think, Wil, that we’ve all said the same thing. That how important
the sharing of different disciplines and why our battle cry is an
interdisciplinary communication. We as a group believe that success comes from
a team that brings in different knowledge and at the same time, we’re also a
group of people who don’t pamper down creativeness. I know a lot of consultants
come and say, “Oh no, they shouldn’t be…” We don’t do that. Be as creative as
you want, but we’re going to kind of guide you through that creative activity
cause we need to do that for you. I don’t want to stifle someone’s creative
activities.
Justin Tripodi:
There’s a term over in Europe that I think is more popular than here and it’s
called execuvation. We’ve all heard about incubation where startups get
incubated by larger firms or excuvation has a different model to almost the
opposite. It’s allowing startups to thrive in an environment that they create
for themselves by separating out innovation activities from core business
functions. The innovation activities is their solution. It’s their creativity.
It’s how they’re different in the market. The business functions are more of
what we’re talking about today. Can the business sustainably survive?. So by
again, that’s excuvation It’s a model that I try to endorse because I don’t
like the incubation model. I think startups, not all, but in, in general, once
you go into an incubator or an accelerator, need to conform to that incubator
accelerators strategy or functions. And a lot of times startups are at
different points of their life cycle and have different needs. So, you have that
challenge of conforming and still growing, which I think slows up their
process. So this idea of excuvation, allowing them to thrive in their own
environment, supporting them with the key business functions that they need
while allowing them to creatively go forward is a nice area to sit in on one, I
know we try to sit in.
Anthony Verna:
So, on that thought. Justin, thank you everyone. This is the end of episode
four and Jim, once again, how can people find the NESA group online?
Speaker 2:
I keep saying it’s http://thenessagroup.net/. Look us up at LinkedIn, Facebook.
You’ll find us and leave us a note and we’ll get back to you pretty quickly.
Thank you.
Anthony Verna:
Thank you so much, Jim, and thank you everyone for being here and thank you in
the audience for listening. Thanks.
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