Complexity is the defining business and leadership challenge of our time. But it has never felt more urgent than this moment, with the coronavirus upending life and business as we know it. For the next few weeks, we’ll be talking to leaders about what it takes to lead through the most complex and confounding problems, and about Brody Moments (from Jaws’ Police Chief Brody and his famous line “you’re going to need a bigger boat”) related to the coronavirus.
Today we talk with Jim McKelvey about his new book, The Innovation Stack, and how the coronavirus is impacting business leaders and entrepreneurs. He is the co-founder of Square, was chairman of its board until 2010, and still serves on the Board of Directors. McKelvey also founded Invisibly, a project to rewire the economics of online content; LaunchCode, a non-profit that trains people to work in technology; and Third Degree Glass Factory, a publicly accessible glass art studio & education center in St. Louis. In 2017, he was appointed as an Independent Director of the St. Louis Federal Reserve.
Continued from Part 1
David and David: You talk about trust as a “precious and delicate thing.” Do you have any insights to offer when it comes to leveraging, strengthening and/or destroying trust at defining moments?
Jim: People tend to value love, but trust is more precious than love. When someone you both love and trust betrays your trust, you can still love them, but you’ll never trust them again. Trust is something you never get back.
I researched customer trust in the context of pricing, and found that the companies that survive for decades or centuries create trust by never getting the last nickel out of their customer. During the pandemic, Square has started to give away something that we used to charge for because our customers need online products. For various businesses that are now forced to go online, we have a dozen products that are currently free. It will remain that way until things start to recover. The point is, a company with truly loyal customers should reward them when times get tough.
Trust is really expensive - hard work, good deeds, consistent behavior, and not taking advantage of every advantage you have. In times of crisis - like the pandemic - trust goes on sale. If you show up at a time of need, and the customer recognizes that you’re not exploiting your advantage, that’s a fast way to build trust.
David and David: What lessons do you find yourself drawing on as you navigate the coronavirus? If you were writing an addendum to The Innovation Stack to cover invention in the face of a pandemic, what insights would you share?
Jim: As it happened, I picked the worst week since the 60’s to launch a new book, but ironically, the topic of the book is now relevant to everybody.
I missed one key observation, or at least didn’t highlight it enough: most entrepreneurs didn’t choose to be entrepreneurs, to be adventurous problem-solvers. They were trying to do something relatively straightforward (like IKEA offering affordable furniture) and found themselves in a war. In impossibly bad situations, these people innovated, kept working, and built something. I didn’t realize the extent to which world-changing innovation is tied to disasters.
And now we all find ourselves there. You’re going to see a bunch of new entrepreneurs who weren’t entrepreneurs, realizing that they’ve got to do something differently because the usual solutions don’t work. No one ever chooses to drive when it’s foggy, but sometimes you have to. You can see 20 feet ahead and that’s not enough to drive safely. But if you don’t move at all, you’ll never see past that next 20 feet. Drive 10 and you’ll see a little further. You can still make progress even in murky environments.
David and David: Have you had any new “perfect problems” find you during this crisis?
Jim: Two of them. The first is how to save the economics of journalism, how to get journalists earning more money than people who make up stories that are false. I believe the solution lies in giving people more control over how their eyeballs are bought and sold. That’s what we’re doing at Invisibly.
I’m also very interested in funding and supporting medical research to combat the virus. An excellent medical school in St. Louis was already doing research on this virus as early as January and I (and a few others) didn’t want them to wait for funding. If we can keep that research going at a pace that will bring the economy open three weeks or even one day earlier, we should be doing that.
David and David: As the dust clears from the present crisis and we’re into a “new normal” in business, do you believe the world of entrepreneurship will have changed in any meaningful way?
Jim: Yes. The basic function of the entrepreneur, which is to do what hasn’t been done before, won’t have changed a bit. But the world in which we ply that craft is changing hourly, and in the entrepreneur’s favor. Chaos, disruption and uncertainty paralyze certain people, and those who are less paralyzed have an advantage. And now, that situation has been writ large across the global economy.
There’s going to be a ton of new entrepreneurship. I can’t teach people how to be an entrepreneur and I certainly can’t give them a checklist to follow. What I can do is tell them what other people’s journeys have looked like, make them familiar with what they may encounter, and better prepare them for their journey.
David and David: Do you have any other advice you can offer? Parting words?
Jim: Most great entrepreneurs weren’t volunteers. Get that hero myth out of your head.
My other recommendation is to start forcing yourself to do things that make you slightly uncomfortable. This has two benefits. First, the area of things that make you uncomfortable slowly shrinks. Second, the experience you have doing things you’re less comfortable with is good preparation for entrepreneurship. Though you can't prepare for exactly what you’ll be doing, you can prepare for how it feels when you’re uncomfortable.
Original article posted on Forbes on May 14, 2020
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