I often ponder the odd milestones along our global journey from primarily physically “real world” based commerce and trade to our fastly approaching primarily digital future economy.

I just read the recent announcement from GitHub that they are being compelled by law to block developers from Sanctioned nations (Iran, North Korea, Syria, Crimea, and others) from accessing their service, and it got me thinking about the implications of what this means for both those countries and their developing economies, and the impact on freedom for those that live within these nations.

The dawn of the internet, and truly the promise of technology and our connected world, dramatically expanded global freedom. Whether through raw access to information, or simply interconnectedness created by free tools to interact with anyone in the world, the global ecomonic landscape has dramatically shifted. In my own business we have developers in India and Argentina, teams in the Phillipines, and remote employees across the country.

While this gives us access to inexpensive labor, it has also created a path to economic security for people that live in environments where this would otherwise be impossible.

The average annual salary for an engineer in Manila, Philippines is just $8,351 per year.

But, we hire them at $15/hr, a huge cost savings for us, but more importantly an opportunity for a Phillipino with a laptop and access to the internet to almost 4x their annual income by working with U.S. businesses.

This causes me to wonder how a ban to a critical tool to development, such as GitHub, impacts developers living in sanctioned nations, and by extension the companies they may do work with. Imagine a freelance developer in Iran, unable to work in his home country or simply one that has found outsized economic gains due to his effectiveness in offshoring his labor suddenly being cut-off from his main codebase. The business he works with will likely be impacted, but they will be able to secure alernative development resources. But the worker himself may be found without access to the critical tools he uses to make a living.

Not only is the United States strangling the sanctioned nations (intentionally, because that’s what sanctions are for) through their physical goods restrictions, but seeing this extend to digital could have some interesting repercussions. While workers themselves may be impacted, I wonder how many entrepreneuers or technologists that rely on internet infrastructure to support their products will be affected by this legislation. What are the long term economic impacts of removing access to core toolsets that underly much of what we use on the internet, and certainly much of what goes into new technology companies?

The internet has changed a lot in the last decade or so. We went from a place without walls, and with thousands of sites and content distributed across all of them of varying quality, to a walled off garden of platforms like Youtube and Facebook controlling the vast majority of traffic, and imposing their own rules on what content is allowed to be posted there.

There is an incredible podcast episode by Reply All (my favorite podcast) that talks about the impact of algorithm changes by Youtube upon the rise of exremist views and the nature of the content that gets created on the platform itself. Just by optimizing what content is shown for different variables, youtube drives massive changes in human behavior on the platform, and ultimately on the consumption of the content that is posted there.

The internet is largely controlled by the U.S. and these platforms specifically even more centralized in California (and even more centrally in San Francisco and Silicon Valley). The decentralized freedom of the internet at large appears to be on a trend towards more centralized and regulated platforms, whether that comes in the form of the state or the companies themselves.

It makes me wonder, are we creating a new first world/third world split in the internet itself? What kinds of implications does this have on freedom the world over?

Doing all the parts of work that look like work, but don’t actually help you make progress towards a real goal

Business theater looks like spreadsheets to organize tasks, meetings to “get on the same page,” projects that don’t have firm deliverables, teams without leaders, and discussions where a specific person is taking minutes.

Business theater is the result of the conflation between progress and work. Not all work results in progress, and confusingly not all progress is the result of things that look like work.

Everything is work. Some things are even “workier” than others. Making spreadsheets? Very worky.

Meetings also feel like work, which is why we like to have them when we are unsure how we make progress. When people don’t feel momentum, they like to do things that feel worky.

Progress is hard because it isn’t as tangible as work, and some work really leads towards progress while other work just fills time.

Just because you’re laying bricks doesn’t mean you’re building a house.

Work without a concrete goal is just work. The difference between building something and just moving stuff around is actually pretty difficult to discern if you aren’t the architect of the plan.

Progress is hard to measure, especially when a project is complicated and messy. If you’ve ever seen a building being built, there is always a moment towards the end of construction where it all comes together. When people see this, they think “wow that came up fast,” even if a week previous they were commenting on how the building has been under construction for a really long time.

This is because the parts that contribute to progress don’t look very worky. Installing electrical and plumbing is hard to see from a distance, and each floor requires infrastructure so it seems like its been taking forever. Yet, once the glass is put on the outside, the building all of a sudden looks finished.

Figuring out where to go and what to build is the hardest part of business. It’s what CEO’s get paid hundreds of millions of dollars for, and why investors put millions towards Entrepreneur’s vision of the future. It’s not that building a building is particularly hard, it’s that figuring out how the building works, where its located, what it looks like, and how to make sure it doesn’t collapse and kill everyone inside is pretty effing complicated.

People often find themselves in this rut where they aren’t sure which direction progress is, so they participate in Business Theater plays and create spreadsheets that get converted into powerpoints that get reviewed in meetings that have action items, yet they never seem to go anywhere.

The next time you find yourself in one of these plays, stop the meeting and ask “what are we trying to accomplish here?” If no one in the meeting can answer that question, get up and leave.

Knowledge Was Power

Knowledge used to be scarce, and therefore valauble. It was contained in books, which were contained in libraries, which were located on college campuses and locked behind degrees and professors and student ID’s.

Even worse! For particularly nuanced and obscure topics, it was locked in the heads of scholars and only ocassionaly written up in academic papers, which were in journals with a limited number of copies and a demographical barrier to entry.

In the world of scarcity, posessing high amounts of knowledge was incredibly valuable. Knowing the specifics of a cells anatomy, memorizing a formula, or knowing exact measurement conversions was key to being able to accomplish anything branching off that root of knowledge.

The world has changed. Knowledge is in abundance, and virtually ubiquitous. Nearly all known information is available on the internet, and almost all of it for free. If someone doesn’t know something, they can just check.

One of my favorite pieces of comedy lampoons this and that we have lost the wonder and mystery of not knowing things: watch

It hits on the key point though, which is that not knowing is a thing of the past, which makes the value of knowledge minimal. There is still a cost associated with knowing, particularly when that knowing is but an element in a robust framework that draws from many areas of knowledge. For most of us though, the thing we need to know is minimal and almost transactional.

I recently had an air switch installed in my kitchen. My plumber had never seen it before, and when he went to install it he gave me a look of confusion and helplessness. So I pulled it up on youtube, and there were hundreds of videos instructing how to install them. I watched one for 2 and half minutes and instructed him with hand motions and broken spanish how to install the switch.

This is remarkable and when we think about the economy and the development of the world around us, I believe this is the singular most powerful force changing everything around us. It’s one of the main reasons I work with Praxis. Their model disregards knowledge frameworks, the college degree, and instead seeks to help young people create documentation on their learning and problem solving skills in place of a degree. The fact that its working and these people are getting hired is even more evidence that the market has already adjusted, something that usually happens long before people’s mindset follows suit.

This is not to say that knowledge is valueless, it is simply in itself powerless. Combined with pattern recognition gleaned from experience, knowledge can drastically speed up the problem solving process. In practice though, this really just means that knowing the right search (“franke air switch” + “Installation” + “Video”) gets you to the answer faster than the wrong one (“how to install an air switch”).

The ubiquity of information has created an environment where knowing which questions to ask and how to proceed up the information tree has become vastly more valuable than possessing the knowledge. Anyone who has gone down a self directed modern learning path has seen this in practice. You start with “how do I sell products online?” and after many rounds of research and information gathering land on aliexpress searching for items under $10 with Dropshipping Provided checked off on advanced search.

The best part is that companies in the business of helping you learn and find things are working very hard to increase the transaction speed from query to knowledge, and we can only expect this to get faster. Ultimately, our mind to our fingers to a search to a click to reading to knowing is simple a number of steps that will get reduced. We are seeing the early stages of this with voice assistants, and while they are very early in their development asking Alexa “Where was Tom Petty born” is infinitely faster than going to the library or asking people, and even at 4 steps (think, ask, listen, know) is nearly 40% faster than a search on a smart phone (Think, open search, type, click, read, know).

This trend will only continue, and we will watch the number of steps decrease to at least 2 (think, know) in our lifetime. This renders it paramount to get really good at the first step, because those that can think of the right way to ask a question and find the right place to ask it are the ones that have the power. The knowledge is ubiquitous, the will and ability to access it, scarce. For the first time in human history:

Thinking Is Power

Originally posted on connorjeffers.com

Now, for those uniniated to the world of eCommerce driven by paid advertising, basically its a funnel. At the top you have your ad spend, then how much it costs to get a click, then how many of your clicks add something to their cart, and then how many of those people actually check out. The graphic below is a good visualization.

So basically, whenever we test a new concept for a store, of which this is just one, the first metric we pay attention to is how expensive it is to drive traffic to the site. Gordon accidentally discovered that when we targeted This Country, our CPC (cost per click) was incredibly low. So, we set to work ramping up ad spend and making great creative. However, we quickly discovered that we were getting a ton of Add to Cart actions, but very few orders. This was perplexing to us, since if you have enough people adding items to their cart, even with a loosely optimized site, you would expect at least some transactions. We knew this was a problem.

So we looked into it, and we discovered that The Country has a massive payments problem. Unlike the rest of the world, which utilizes international Visa and Mastercard for payments, allowing online shopping anywhere in the world, They mostly use local debit cards with local banks that don’t allow international payments. So we contacted a local payments processor and got a local payments system up and running on our site. Orders began coming in, but still not at the volume we wanted. Upon deeper searching, we discovered that The Country operates a primarily cash economy, where people are inherently skeptical of credit and debit cards. So how do people pay for things online?

Boleto

This is the craziest thing I’ve ever seen. A Boleto allows a consumer to make a purchase online, be emailed a bar code, physically take that bar code to the bank, and then pay in installments. The bank is responsible for sending money to the business (us), and the customer is now on a weird layaway plan with their local financial institution. Oh, and they have to do this within 5 days of their online purchase. This really messes up our funnel from before and adds a lot of steps. More steps in your funnel means less money comes out the other side.

So, we started to optimize. Normally, we can usually just manage a single conversion point and improve it through additional marketing communications like so:

If we only have 1 drop off point in our funnel, typically abandoned carts, we can use abandon cart techniques like remarketing and product promotion or discounts to drive those drop offs back into the funnel. However, this strategy isn’t enough when you introduce Boleto’s into the equation, because what was once an order ends up becoming a whole new potential drop off point. People don’t look at Boleto’s as transactions. They look at them as a slightly more commital add to cart. But its still a huge drop off point. We initially were capturing less than 5% of the Boleto check outs, despite these being the lions share of orders through our store.

So we had to approach Boleto’s the same way that one might approach a free trial or similar intent based pre-transaction. We built out text alerts and facebook messenger bots to remind our customers with unpaid Boleto’s to take their soft commits and physically go to a bank and finish their purchase, which you can see below:

And this worked! Boleto conversion was up to 30%. We were actually getting transactions and having customers check out successfully. Initially, we got excited about the first couple weeks of revenue and felt pretty impressed with ourselves. However, it doesnt take long to realize that we have no idea if we are actually producing a profit. You see, normally Advertising driven eCommerce has a simple formula

Ad Spend — Product Costs — Fixed Costs — Processing Fees = Profit

As long as that equation comes out positive, you should start ramping your ad spend and improving your machine. After all, a business is simply a machine that you put money into one side and get more out of the other with varying degrees of efficiency. Shopify does an amazing job of breaking this all out for you as a business owner s you don’t need to run your own numbers. This is one of their biggest value props as a platform.

However, we have a pretty complicated situation going on. Our products sold information lives in Shopify, but because we had to use a foreign payments processor our transaction data lives in the payments system in a totally different format. This is further complicated by multuple currencies. Gordon is in Canada, so our ad spend is in CAD. Product cost through Ali Express is in USD, and all of our revenue is in another foreign currency. We then have to figure out which products each person bought, as Shopify only contains transactions data and because payments are managed via the processor, only they know whether payment was completed. Enter lookups.

We have raw exports from both the payments processor and Shopify, as well as a table of our product costs. But none of these are related in a singular table, which means we need to create some sort of key across each one. This ends up being a combination of Email and Order number. We need to use the email to lookup against our Costing table using the formula below

=lookup(R2,‘Costing — Static’!A:B,‘Costing — Static’!B:B)

This formula pulls our costs in by finding the Product name in our costing table and pulling in that product cost.

We summarize our costs by pivoting out order number and order total so we can aggregate multi item carts. We then use a lookup to populate this sheet with Email based on a lookup to our order number sheet (left). We then need to lookup against our orders sheet to pull in the email address for each order, which will be our key to relating this data elsewhere. Our lookup looks like the below and it pulls in our email.

=lookup(B3,‘Paid Orders 9/8 -Import’!A:B,‘Paid Orders 9/8 -Import’!B:B)

We need to do the same thing on our Payments sheet to summarize who payed, how much, and what our processing fee for that transaction was. We can then lookup against this sheet, using email as our key.

The pivot to our right is the raw data off the Payments import, and the image below is the table populated but scrubbed of email addresses.

We pivot out our transaction data so that we can summarize each of these values by email. We can then run lookups to our cost sheet to pull in all of our relevant data, as well as calculate whether we are making or losing money.

Our Cost index: =index(‘Costingpivot — Calc’!$A:$C,match(A2,‘Costingpivot — Calc’!$A:$A,0),3)

Our Profit Calculator: =IFERROR(((B2–D2)/3.2)–E2,0)

Now, we can sum up everything despite all of our crazy data sources and figure out if its working. The number above is pre ad spend, and as much as I’d like to say we are rolling in cash, we’re not. But, we are just barely in the red and have only known our business model for a very short period of time. We’ve just started to optimize and we are already seeing massive gains. Hopefully in just a few weeks we will start to see real returns.

Regardless of whether we make anything on the store, if we can get this streamlined and really understand the target market, we can sell this as a service to any eCommerce store looking to expand into new markets. We can quickly build our janky google sheet into a sophisticated platform built in SQL or on Salesforce and sell it into these businesses as a product.

The main learning here is that learning things has value, because people will pay for knowledge in one format or another.

Originally published on connorjeffers.com

Salespeople, much like the sales process, exist in a variety of different formats but can usually be placed into one of three categories.

1. The Hunter
2. The Storyteller
3. The Caretaker

The Hunter

The hunter finds the right person to tell the story to. They network through organizations to find the audience for their story. The job of the hunter is to never waste the prospect’s time. The hunter is not trying to get people on the phone or into a demo, they are trying to find someone who will be receptive to the story.

Any time spent speaking with someone who is neither

a.) willing to direct you to the right person

b.) the right person

Is a waste of time. Great salespeople know this, they aren’t trying to get in front of anyone, they’re working to get in front of the right person.

The bad hunter schedules time with anyone who will give it. The good hunter only books meetings with the people that can both appreciate and benefit from the story. They are focused on describing their product or service as an investment. They inform the prospect about the potential if the prospect will listen to the story and just give it a chance. They write the book descriptions on the inside cover of the novel that gets someone to open it up to a chapter. They assure the prospect that this story will add value to their business.

The Story Teller

The job of the salesperson is to weave the narrative of success. The prospect doesn’t know what success is, they don’t know what’s possible, and they certainly don’t know how to get there. If they did, they wouldn’t need to interact with a salesperson.

A sales call should never be a recitation of product features or an interrogation about the prospects needs. Bad salespeople ask questions about the business looking for shaky opportunities with which to align their products. Good salespeople take the prospect on a journey with them, showing the prospect the magical dreamland where all of their business needs are met, and without any need for them to experience pain. They paint a vision of the promised land and outline the path to get there.

Bad salespeople sell prospects products that don’t fit their business needs. Good salespeople tell a prospect when the solution they’re selling isn’t going to solve their needs, and guide them to the right person and company that can solve them. Bad salespeople think of prospects that don’t buy as idiots who failed to see the value in the product. Good salespeople understand that if the buyer was right for the product, they must have failed to show them what was possible and take their experience to heart, improving their story telling abilities.

The Caretaker

The post-sale salesperson is a caretaker. As a gardener, they know the importance of weeding, planting, and watering. They make sure that the customer’s journey to the promised land described by The Story Teller is painless, and even pleasant. They make sure the promised land is real, and that it meets the customer’s expectations.

The Caretaker is responsible for finding places where the company can add more value to the customer. The bad caretaker bothers his customer and pesters them to try new products and services that do not align with their business. The good caretaker anticipates the customer’s needs by being informed about their business, the projects they’re working on, and what the company can do to contribute. The bad caretaker asks his customers for introductions without adding value. The good caretaker is introduced by his customers to colleagues and friends because his customer wants them to experience exactly what he has.

The caretaker ensures that the hunt was worth it, the story was true, and that the customer believes that the company can add value.

While there is much to be said about aligning these 3 salespeople towards a common goal, facilitating handoffs, and a plethora of other nuances to leveraging an effective sales organization, when businesses see the 3 roles and are able to segment their sales force according to their functional roles they often see immediate results.

Pokemon GO has been a smash hit. Adding $7.5 Billion to the company’s value is impressive, but it’s just not enough to thrust Nintendo into the modern realm of gaming, a realm that is ruled almost entirely by mobile.

Nintendo as a business has historically had a specialization in making 3 things.

• Hardware
• Software
• Intellectual Property

But there is a problem with those specializations in a world ruled by Mobile. Apple, and increasingly Samsung, make the hardware, and the software is built by an increasingly distributed number of mobile gaming companies. Not to mention mobile games have shifted from device specific iterations to games adapted for touch, motion, all age levels, and fueled by millions of dollars of in-app purchases.

Unsurprisingly, this shift to mobile has hit Nintendo hard, with more than two thirds of their value toppling off since the dawn of the iPhone and the move to smartphone-based gaming as the new format. Celebrating that last little uptick really doesn’t capture the grim fall from grace for the Japanese gaming titan.

This shouldn’t come as too much of a surprise. It’s sort of hard to sell someone a device that’s 3x the size of their phone, only plays Nintendo approved games, and costs $150 when they can get a smartphone that’s an all around better piece of hardware with much more functionality on the software side beyond the infinitely superior number of games at virtually the same price.

So that leaves us with Nintendo’s last piece of specialization, Intellectual Property, and they have some amazing intellectual property. Pokemon Go, if nothing else, has shown us how immensely valuable the Pokemon IP is. Not to mention Nintendo’s other blockbuster properties like Mario Bros, Legend of Zelda, and Donkey Kong.

Nintendo used to be amazing at monetizing this intellectual property. They’re just not anymore. From multiple missteps on their path towards mobile to preventing gamers from streaming their games, they’ve shown they’re terrible at understanding where the gaming space is headed. In 2011 they flat out said they would never go mobile.

So what now?

Nintendo without hardware or software is a lot more like Disney. They used to be a company that makes things, they should transition to a company that manages and licenses Intellectual Property. If you understand capitalism, you understand the real winner in any exchange is he who owns the capital. Thats where the money is. The vast majority of their value is built on their intellectual property, and it has to be given their last 5 years of sales numbers.

So, if Nintendo is to survive, it is going to have to embrace their new position. They need to go on a buying spree, much like Disney has under the leadership of Iger. Disney owns the box office because they make sure they buy the most valuable IP, and then use their resources and expertise to ensure its success. Marvel, Star Wars, and Pixar manufacture films everyone wants to see, and even more importantly IP that can be licensed into toys, games, and a variety of other mediums. Disney’s revenue is not divided only be franchise, but assuredly by whether that revenue is directly from films or through licensing fees.

So, now that we have fast forwarded to a world where Nintendo has rightfully pivoted into an Intellectual Property management machine, now what?

Nintendo should buy Machine Zone. If you haven’t heard of Machine Zone, they’re the company behind Game of War and Mobile Strike, and if you haven’t heard of those you clearly haven’t seen a single ounce of media because they bought $630 Million of TV in 2015, and spend more on Facebook every single day than anyone else. Oh, and they have this guy.

Oh and her

Machine Zone has the perfect pairing with Nintendo in expertise and execution. Their IP isn’t that great (hence the massive spend on Arnie and Blondie). But they kill it at customer acquisition and software, which is the name of the game in mobile.

Granted, this would be just about half of Nintendo’s war chest at $6 billion, but as they say, “ya gotta spend money to make money.”

Nintendo can always reduce MachineZone’s spend given their impressive performance with the Pokemon GO virality. Want to know what’s cheaper than Kate Upton? An adorable animation of Pikachu telling you to download Pokemon Go.