Selling Steve Jobs’ Liver: A Story of Startups, Innovation, and Connectivity in the Clouds.
Selling Steve Jobs Liver: A Story of Startups, Innovation, and Connectivity in the Clouds
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Slide Excerpts from the Reliqueree Pitch Deck.
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Some Liver Slices
The West Side traffic brought the limo to a standstill, leaving me, Ignacio, my partner and co-founder of Reliqueree, and Sheridan, the firm’s PR head, stranded in a long line of idling cars. After a couple of minutes, I decided to put the wasted time to good use. I pulled out my iPhone and checked our social media dashboard. “uLivv,” “TransLivvient” and “Reliqueree” were all trending on Twitter. The media coverage of the grand opening of our first store had generated almost a million more likes on our Facebook page. The CEO of HP had asked to connect with me on LinkedIn yesterday. Traffic on our Pinterest site was going to explode once video and pictures of the gala event hit the Cloud and the blogs.
Next I accessed our accounting system and compared December’s sales against November. I smiled as the numbers displayed onscreen. We’d killed it. And even though the holidays were over, January sales were projected to exceed December’s by 200 percent. Hmm. We’d calculated we had enough stock in reserve for years, but even I hadn’t forecast this level of demand.
“Call Michael,” I instructed the phone. Michael was my fiancé’s brother and also responsible for our important processing operations. He’d left early for the store with Angie to enjoy a private tour of the store. He answered.
“Hi,” he said. “Where are you?”
“Stuck in traffic just a few blocks away.” I knocked on the Plexiglas window behind the driver. It rolled down.
“Yes, Mr. Pennington?” he said.
“How long before we clear this? Should we just get out and walk? I’m from New York. I know where I am.”
“GPS says we should work through this in about 20 minutes. That enough time?" the driver said.
“Yes.” I’d given us an hour to reach the store and was ready to stop the limo and lead everyone on foot to 14th Street if need be. As I’d told the driver, I was native stock, nobility so far as the rest of the region was concerned. New Yorkers were arguing Thomas Paine when the hillbillies from New Jersey and Connecticut were still making their mark.
I resumed my conversation with Michael. “Have you seen the sales figures?” I said.
“I did. I had my doubts about this whole thing earlier, but it’s amazing how it’s taking off and...”
I interrupted him. “I’m worried about inventory. Are you sure we’ll be able to meet demand?”
“Relax. We have enough material to stretch from the Earth to the Sun two times and back. And that’s factoring in the estimated wastage. Years of sales.”
“Yes, but 25 percent is ‘dark matter.’”
“Still more than enough. And aren’t you planning a ‘Plus’ Edition?”
“Yes. It should be a killer if it’s positioned and marketed properly.”
“Angie says ‘Into the Blue’ orders are flooding in,” Michael said. “The platform is growing. I know I’m not a marketer, but I’ve learned a few things watching you in action. People are buying into the company’s vision. I’m not sure you’ll need the rest of the inventory.”
He was right, but I worry a lot. It’s because I care. Steve Jobs cared.
If you’re an entrepreneur, your middle name is “Worry.”
“What’s the turnout like?”
“The place is packed,” he said. “Every press invite was picked up half an hour ago. Pogue, Mossberg and Alison are here.”
“Terrific. How about Boris? Has anyone heard more about May?”
“Angie spoke to Illarion. He says it appears ICE screwed up. O’Connell is working on it. Should only be a couple more days. She spoke to Boris and he said he’d be there on time. She said he sounded fine.”
“Excellent.” With May gone, Boris’ stress levels had gone stratospheric, but with everyone’s help, he seemed to be coping. Once she was back, I was sure he’d calm down. “We should be there soon. Talk more then.”
“Wait, Angie wants to speak to you. She wants to know...”
Another call came in. I looked at the number. Todd Birnbaum. Amazon’s top biz dev guy. I hadn’t thought this day could become any better, but apparently I was wrong.
“Tell her I’ll see her in a few minutes. Amazon just called. I’ll fill her in when I get there.”
“OK,” he said. I disconnected and took the call.
“Nate Pennington. How’s it going, Todd.”
“Hi, Nate. Look, Jeff wants to discuss purchasing. And I want to clear up any misunderstanding from DEMO.”
The last DEMO had been held in September in Phoenix. Both Bezos and Birnbaum walked out on our presentation a couple of minutes after it began.
“Tell him not to worry about it. I’m sorry we didn’t communicate our vision to you more effectively. By the way, Forbes just moved Reliqueree into the number 15 spot in their top international brands list. I’ll bet we crack the top 10 within six months.”
“What’s wholesale going to look like?” Todd said.
I’d been looking forward to this moment for months. “I’m sorry, Todd. We’re not doing straight wholesale. We’re going wholesale plus MAP. We’ll be reasonable on the discounts. No problem with the non-disclosure agreement. But we control our pricing and brand equity.”
In the MAP model, the manufacturer controls and set their pricing. In straight wholesale, the retailer. Amazon enjoys controlling pricing models and regards MAP as a Tool of Satan. Only companies with strong brands and sky-high demand can insist on MAP.
“Amazon doesn’t buy under MAP. You know that, Nate. We buy straight wholesale.”
All Apple products are sold to Amazon under strict MAP agreements. The reason is if you can’t buy an iPhone from Amazon, the customer will go somewhere else. And then keep returning to that somewhere else to buy other stuff.
“Yes, Todd. You know, there’s an industry rumor going around that your boss and Tim Cook crossed paths at a TED talk in Vancouver and Jeff muttered the words ‘straight wholesale’ where Tim could hear it. The next day, Jeff gets a phone call and after it’s over, leaps on a plane to Cupertino, takes a taxi to One Infinite Loop, changes into a wetsuit, and is escorted up to Tim’s office where he sits in a chair and balances a colored rubber ball on his nose while clapping his hands together going ‘arf,’ ‘arf,’ ‘arf.’ But I’m sure it’s just idle buzz.”
There was a long pause on the line, then Birnbaum said, “Uh, yes. Let’s connect tomorrow and resume our talk. We’re going to be looking for 40 points. Good luck with the store opening.”
“Thanks, Todd. Talk to you.”
Beth spotted me immediately and watched with dismay as I walked into the nearly empty cafe and strolled up to his table. His iPhone and MacBook Air were set up next to a couple of empty plates which held the remnants of his lunch. I sat down across from him.
Seth had taken over the position of San Francisco’s best-known technology incubator as its “bright sherpa” after he’d cashed out on two startups and moved into the venture community. His first company had created a payment app infrastructure for interactive vending machines. Your Butterfinger could now reach out and ask you to eat it. He’d repeated the play with an IoT (Internet of Things) flexible screen technology that married your kitchen appliances with the Cloud. Your coffee maker could now implore you to buy better beans while your toaster oven nagged you to purchase expensive whole wheat bread instead of cheap white.
As my bright sherpa, Seth had mainly assisted theTogetherHood and the other startups by spending minimal time at brightstart. Instead, he focused on discussing the value of mentoring, collaboration, and providing practical business advice to entrepreneurs at the numerous seminars, conferences, and events running on a 24/7 cycle in the Valley. When he’d first come on board, I’d asked him about the qualifications I should look for in a CFO. Seth hadn’t had time to answer but had suggested I attend a Silicon Valley Meetup Group talk he was giving next month where he’d cover that topic. He had been nice enough to give me one of the “Make Mistakes” T-shirts he sometimes brought to the office.
“Hi, Seth. How are things?” I said.
“Hi, Nate. It’s been a busy morning.” He glanced at his Apple Watch. “I’d like to talk, but I have to run now.”
He smiled at me nervously, closed his laptop, and started to stand up. I smiled back, reached across the table, grabbed him on both sides of his face by his startup-executive-laser-graded-length beard and guided my Sherpa back to his seat. Seth’s 6’3″ and I’m 5’10,” but he’s licorice-stick thin and I bench press 275. He sat back down.
“Ow. Let go of me, Nate. That’s assault!”
“Shh, Seth,” I said in a soothing voice. “I’m not assaulting you. We’re communicating directly without any digital smog cluttering our interaction.” I gave his beard a friendly tug and he winced. “I just want to know what’s going on and hear it from your own mouth. That’s all. Once I’m up to speed, we can resolve this amicably, and you won’t have to go back to brightstart looking like wolverines ate your face.”
His eyes widened, then he relaxed. “OK, OK. Let go and I’ll tell you what’s happening. How did you find me?”
“Seth, for a man who’s managed two app/hardware hybrids to successful monetization events, I’m surprised you don’t know more about the capabilities of that marvelous example of Cupertino technology you own.” I nodded towards the iPhone. “Carrying one of those is like painting a GPS locator beacon on your chest in neon pink glow paint. You can be found anywhere. Even when it’s turned off. And when Ignacio is on the case, I could find you if you’re dead.”
I released his face, cocked my head, and gave him by best friendly-puppy look. “So? What’s going on?”
“Last week one of your beta customers contacted us. They were fuming.”
“About theTogetherHood’s ‘functionality.’”
“Seth, theTogetherHood is a community management and empowerment system.”
“Uh, huh. I remember your original pitch. But you neglected to mention some things.”
“Nothing about the system has changed. theTogetherHood is a risk management system for municipalities that enables them to manage a wide range of potential liabilities while protecting and enhancing revenues.”
“Yes, Nate. I’ve heard the spiel and went to your demo. But you didn’t spend much time showcasing the system’s nuts and bolts. Most community management systems don’t track multiple types of homicides and accidents such as car crashes, domestic abuse, playground fractures, drug overdoses, municipal pool drownings and a couple dozen others I can’t recall. Never mind the municipal incidents database. The first selectman falls in love with the head of the PTA and they fly off to Venezuela with the school fund? The chief of police is caught raiding lobsters from a local seafood restaurant?”
“All ripped from today’s headlines,” I said. “Seth, this is a dangerous world we live in. Your brother’s a lawyer. Wasn’t he the one who filed suit against Sausalito last summer? When those kids boat-jacked a 30-footer, got drunk, and a girl went over the side and drowned? What was the cause of action? Oh, yes. That the boat owner and marina hadn’t ensured the location of the life preservers was properly marked. We added that to the system.”
“That’s not the problem. The ‘Community Risk Heuristics and Hedging’ feature is.”
“What’s the problem with it?” I said “It’s easy to use and set up.”
“It is. The interface is a triumph of responsive design. The problem is what your software does. It runs ghoul pools. Last week, one of your beta customers called us up and threatened to sue brightstart. They weren’t joking. Apparently, some of the town’s IT admins were digging through the theTogetherHood and stumbled across the domestic pet incident tracking feature. The one that enables you to calculate liability ratios in the event Rover is hit by a Ford or Felix lands inside a coyote.”
“I guess you’ve never heard of that famous case in Connecticut?” I said. “A woman’s pet chimp went berserk and ripped off her best friend’s face? I wonder how much the town paid to settle that mess.”
“I don’t know about that. What I do know is that some of your ‘beta testers’ set up a ‘contingency fund’ to pay off in the event Rover or Felix had an accident. The next thing, pets start disappearing all over town. I wonder why.”
Dad was interred in Woodlawn Cemetery, about a 15-minute drive from Riverdale. We weren’t visiting an actual grave. Woodlawn is a historic landmark and you need to be wealthy to grab a plot of real dirt in the place. After his funeral, Dad was cremated and interred in a mausoleum niche with his name, date of birth and death, and the inscription “Beloved Husband and Father.” Well, I’d liked him.
We called it a night and went to bed in accordance with the EEE/RRR rule. Early to bed, early to rise, early to arrive so that you show up refreshed, relaxed and ready. We were at Illarion’s office a couple of minutes early and a receptionist escorted us into a small conference room where I placed my Mac on the table. At 10:00 am sharp, Illarion stepped through the door.
Back in New York, Ignacio and I met to sign the paperwork necessary to transfer the $3.5 million into the Reliqueree account. I was pleasantly surprised to discover that while I was in Shenzen, he’d advanced us enough to open our offices and begin equipping them. Our new headquarters was located in an older but well-maintained building. As Ignacio and I looked through our suite, Illarion paid us a visit.
“I would like to discuss Boris,” he said. “I have told him about the company and the uLivv and he is excited. When can you talk with him?”
I looked over at Ignacio. “Any reason why not tomorrow?”
“No. If he’s good, we need him yesterday.”
“Send him over at 9 am tomorrow. Ignacio and I are eager to meet him. Have him email his resume to us.”
“I will tell him.”
At 9:45 am the next day, a large, bear-shaped person walked into our place as Ignacio and I were configuring the office network. Boris, we presumed. We were already unimpressed. You don’t arrive 45 minutes late for a job interview and expect to be hired. Even if you are the chief investor’s nephew.
“Excuse me. I am Boris Samsonov. My uncle Illarion sent me here to speak with you.” Our visitor spoke with a thick Russian accent and was carrying what appeared to be a battered laptop case. Late twenties? Early thirties? Hard to tell.
“You’re late,” I said. “You were supposed to be here at nine.”
“The subway train from Brighton was slow.”
“Forty-five minutes slow?”
Boris said nothing and refused to make eye contact with me or Ignacio. After a second, I said, “OK. We’ll let it pass this time. Did you send me or Ignacio your resume? Your CV?”
“I didn’t receive anything yet,” Ignacio said. I hadn’t either.
“Here is resume.” He reached into the pocket of his jacket with his large, furry hand, pulled out a crumpled paper document consisting of three pages stapled together, and handed it to me. “I brought two copies,” he said, reaching back into the same pocket and handing the other document to Ignacio.
I scanned the resume and sighed internally. It was barely English and littered with misspellings. It also sported a yellowish stain I assumed was either tea or coffee. This would not be a long interview.
“Why didn’t you email this?” Ignacio said.
“Uncle Illarion said I should be careful about sending out too much information about myself online. He has asked me to keep a low profile.”
“Boris, I don’t think he meant paper resumes,” I said. “Let’s go into the conference room and find out more about your skills and if you’re a fit to the Reliqueree culture.” We walked into the conference room and seated ourselves around its oblong table. In his chair, Boris began a slow, barely perceptible rocking motion.
“Boris, I’ll assume Illarion provided you with details about Reliqueree?” I said. “About the uLivv and the skillset we need?”
“A few.” He said nothing else.
“Um, OK. Do you mind if I ask why you’re interested in working at Reliqueree?”
“I am not interested in working here. I would like to work at Apple.”
Ignacio snorted. “Yes. Well,” I said. “Why aren’t you working there?”
“I have mailed several resumes. They have not responded.”
“I wonder why.”
Chapter 1—Not Too Together
Chapter 2—Two Minds as One
Chapter 4—Meeting Mother Cabrini
Chapter 5—Visiting Dad
Chapter 7—Item for Sale
Chapter 8—Innovative Thinking
Chapter 9—Crossing the Yangtze
Chapter 11—The Big Apple Mandate
Chapter 13—To the Land of the King
Chapter 14—The Transaction
Chapter 15—The Toast
Chapter 16—Meeting Miss Fancy
Chapter 17—Business Plan
Chapter 18—Grey Chinese Blob
Chapter 19—Trip to the Middle Kingdom
Chapter 21—Gathering Momentum
Chapter 22—Angie Goes East
Chapter 23—Angie and Boris
Chapter 24—The uLivv Lives
Chapter 25—The Magic of Gruezén
Chapter 27—Advertising Quest
Chapter 28—Boris and May
Chapter 29—Temptation and Desire
Chapter 31— Reaction and Guarantee
Chapter 32—Brilliant Advertising
Chapter 34—Reaction and Legal Strike
Chapter 35—Legal Battle
Chapter 36—The Return of Landon
Chapter 37—Retail Dreams
Chapter 38—Cousin Yuri
Chapter 39—Legal Triumph
Chapter 40—Cathedral of Commerce
Chapter 41—The Sorrows of Boris
Chapter 42—Grand Opening Preparations
Glossary of People
On Being an Effective Startup CEO
Strong startup CEO leadership is marked by the ability to blend effective micromanagement with selective amnesia.
If you’re over 40, don’t come.
The high-tech industry regards the age of 40 with the same affection bestowed on 30 somethings in the old Sci-Fi movie “Logan’s Run.” In the film, 30-plus means “Last Day” and being spun up into the sky on a carousel and vaporized. There are periodic rumors a similar device will be introduced at DEMO, or possibly TechCrunch, which is regarded as the more avant-garde of the two shows.
On Memories of Steve Jobs
“The guy’s a Valley saint. I know people who still won’t sell their iPods and become choked up every time they’re applying scratch polish.”
“A quick market overview. Our new enterprise is built around the inescapable reality that everyone dies. That’s an unpleasant truth people prefer not to dwell on, but we believe it’s that ubiquity that opens the path to major new markets and revenue opportunities.
“The downside of death is, obviously, dying. The upside is that it’s a universally shared experience that creates a huge set of expectations and shared challenges across every country, culture, and market. Steve Jobs himself recognized and spoke to this issue directly at his famous commencement address at Stanford in 2005. You can watch the entire speech on YouTube. It’s extremely moving.”
“Master race?” she said. “China was civilized when you white people were avoiding baths for fear of miasmas while keeping plague rats as pets. Meanwhile, Chinese fleets were exploring the world while our scientists created gunpowder.”
“And yet somehow it all went wrong,” I said. “From those lofty heights, China descended into a nation whose principal interests were foot binding, spitting, and conditioning yourselves to eat increasingly disgusting food, like bats. And thank you for the Corona Virus, by the way. This all culminated in a society where everyone’s favorite pastime was sitting around smoking opium in a vain attempt to forget that you were living in China. Making it worse was the fact that when the Emperor cracked down on the drug trade, everyone was too stoned to put up a decent fight against the British and the French. My God. You people actually lost to the French.”
On Resisting Disruption
When Steve Jobs had released the iPod and created the buck-a-song download model, the music community had fought against the rising tide with disastrous results. Bands and singers had been forced to perform in front of live people to make money and the record companies had seen their revenues plummet. Drug allocations for performers and music executives were slashed to the bone. Both industries were still recovering.
On Resisting Change
“Steve Jobs fought against the dying of the light until the end. There was a reason he was one of the first people to have his genome sequenced. Why he flew from California to Tennessee to move ahead on the transplant waiting lists. Steve understood that there’s a time for everything under heaven. Including fighting change.”
When I look at it, I don’t see the organ,” I said. “I see the beauty of Steve Jobs’ DNA and how it enabled him to achieve so many extraordinary things. And that molecule’s work isn’t done yet. Being dead doesn’t have to mean not being productive.”