Crucial Conversations: Tools for Talking When Stakes are High

Posted by Margus Pala on June 28, 2014

sharedmeaningEvery once in a while you need to hold a conversations where stakes are high, opinions vary, and emotions run strong. For example it can be argument in work or family. It can be negotiating a business deal or a salary raise. People tend to use their worst skills in these situations where is matters the most. Situation is not better if you avoid the conversation altogether.

This books explains that in conversation it is important to hold safety and keep the dialogue going. It is very simple to slip into silence or violence and if you deviate from dialogue then both sides will suffer.

After having read this book I have noticed a lot of crucial conversations that I am involved in. Now I have much better idea how to behave when I am involved in one while before it just happened as it happened.

As there are many crucial conversations happening all the time then I believe this books is mandatory reading for everyone who wants to be successful.

See more from http://www.vitalsmarts.com/crucialconversations/

Topics: Linux | No Comments »

Thinking fast and slow

Posted by Margus Pala on April 30, 2014

Thinking, Fast and Slow by Daniel Kahneman  is a very long with book 533 pages and it is packed tight of useful scientific text. Although this book is a goldmine it takes a long time to process.

Once you have finished reading this book you know all of the most common judgement errors that everyone should know. You should be able to raise a red flag when you are about to make decision on shaky grounds.  This book will open your eyes and all the decision making mistakes will be especially obvious on other people.

I will list just a few examples in here

  • Cognitive ease – if it feels familiar then it feels true
  • WYSIATI – if you know only 2 facts out of 100 then you feel like 2 facts is all there is. You will make decision only based on these 2.
  • illusion of control – stock market experts believe that they have upper hand while statistics shows that majority is not doing any better than general indexes.
  • framing effect – If drug saves 50 people out of 100 then it is much better you say that drug kills 50 people out of same 100
  • duration neglect and peak-end rule – You think that 30 days of vacation in Cancun is 10x better than 3 days. However a bit later it does not make much difference in the memories. If 30 days of vacation is ended with 2 bad days then all of the vacation feels bad.

There are many more situations explained in this book. I gained a lot of valuable understanding and I feel significantly more confident about mu skill of making decisions. Or should I not because self-confident experts should be trusted only if they have considerable experience which still needs to be gained after reading this book? 🙂

Topics: business, tips & tricks | No Comments »

The Power of Habit – Book review

Posted by Margus Pala on April 30, 2014

Besides of being useful for self development this book is also a good read by itself. All the example cases are are good and interesting stories which give you fun facts from history. How did worst team even win the Super bowl and how people made billions with toothpaste while changing ad creating daily habits? You can get this book from amazon The Power of Habit: Why We Do What We Do in Life and Business

Main point of this book is examining how habits work. There is habit loop: cue, routine and reward. Once someone learns the habit then it will always be there good or bad, riding bicycle or smoking. At first doing something new is hard but the more you practice the less brain activity it takes and you almost don’t notice it anymore. Have you ever wondered if you locked the car door when you parked it? Probably you did and this habitual action is so effortless that you event don’t think about it.

However it is possible to switch the routine leaving cue and reward the same. AA is very good at this. If alcoholics feels stressed then he goes to bar, sees friends and becomes happy. Instead he can feel stressed, go to AA meeting, see friends and become happy.

I learned for myself how to create morning exercise habit. My cue is waking up, routine is exercises and when I finish I get to have breakfast.

Once you read this book then you will be much more skilful in building good habits in yourself and changing bad habits into good ones.

 

Topics: business | No Comments »

Simple Erply and Magento integration plugin

Posted by Margus Pala on April 1, 2014

Recently I helped a company to build e-commerce website with Magento. She had existing shops already and she uses Erply with almost 10000 items which she wanted to import into e-shop.

Even though Erply and Magento both are market leaders then importing the data from Erply to Magento was poorly supported. I took existing github project, forked it, upgraded to magento connect version and fixed many issues in it. It is still not fully stable but usable, expert help is still advised. You download the plugin from here https://github.com/smartman/magento-integration

Simplest way to integrate Erply and magento is to:

  1. Install Erply plugin from Magento Connect service http://www.magentocommerce.com/magento-connect/erply-inventory-management-for-magento-1.html
  2. Download source of fixed plugin from https://github.com/smartman/magento-integration/archive/master.zip
  3. Copy/merge folders design, code and etc from magento-integration-master/erply/app/ to app folder in your magento installatation. This overwrites old broken files.
  4. Enjoy

Issues fixed are:

  1. Missing price, description and some other fields import
  2. Fixed big number of product import
  3. Fixed category import
  4. Many more small things

Issue with large number of product import was that it takes very long time. PHP script execution may time out and process never finishes. See the rest of this entry…

Topics: apache, freelancers, tips & tricks | 3 Comments »

Total cost of working in a startup (read: opportunity cost)

Posted by Margus Pala on March 30, 2014

opportunity costI have seen many starting business saying that cost of running their operations is very low. Usually they say that they have to pay for servers, maybe some ads and that’s it – a few people working and total cost just under 100EUR.

Unfortunately people often forget the biggest cost – opportunity cost. Lets take simple example that you are a good programmer and building your very own business without taking any salary.  You also have great value server from Hetzner with monthly payment of 50EUR. Total cost of running this business is 50EUR a month because no salary is taken or is it?

Because you are a good programmer the you could work for any other startup(or Google/Facebook in Silicon Valley) and get 4kEUR of net income every month. You could also hire exactly as good programmer as you are with exactly same salary to build your business. When adding up the 4000EUR of salary and 50EUR of server fees you get 4050EUR of the monthly burn rate.

What is the difference from business point of view in above 2 situations? In both cases there is one good programmer working full time on the business. In both cases you end up without any money in the end of the month and of course each month there is 50EUR of server fees. Situation is exactly the same.

If you look further then actually there is slight difference. If you hire someone then because of the taxes you have to pay approximately twice the amount taking 4000EUR up to 8000EUR. This would suggest that working on your own is more cost effective than hiring someone. However if Google is hiring you then it also sees you creating value of at least 8000EUR a month.

Make sure that when calculating the ROI of your business then you consider the real total cost of 8050EUR instead of 50EUR. I also recommend you to ask yourself if the business even theoretically is able to bring back that money? Consider also need for many people: developers, salespeople, support, QA, managers etc. Your burn rate can be 100kEUR a month very easily. If it is hard to make that kind of a income then maybe it is worth helping other more potential startups make it happen?

 

Topics: business, startups | No Comments »

Founder Equity Agreements – required but only if you want to start making money when establishing a new startup.

Posted by Margus Pala on March 30, 2014

startup_foundersLets say that you get a brilliant business idea with your friend. You will establish a company 50-50, change the world, earn a lot of money in the process and live happily ever after. Statistics have shown that plans like this usually don’t work out. It is fairly common to have changes in founding team. If there is also money involved and everything is not clearly written down beforehand then major problems can happen.

Its clear that everyone in the company must be compensated according to his value. Simplest way to compensate is with salary – you will work and I will give you money. For entrepreneurs the compensation is also in form of the shares. Entrepreneur will work and get the shares in a company as a result. Funded company founders usually get mix of shares and salary.

It is fairly uncommon to pay workers 3-4 years salary upfront when joining the company for obvious reasons. Similarly business partners should not receive full amount of company ownership immediately on the day of establishing company when building full company takes at least 3-4 years.

There are different approaches of how the shares are earned by the entrepreneur. Common thread is having vesting schedule with contribution requirement, for example both founders will get 1% of the shares every month of full time contribution. When investors are involved then they are very interested in long term partnership which may add condition to term sheet that minimum vesting period is 1 year. If founder leaves the company before first year then he is considered compensated only with the salary he got an no equity is received.

One example of reasonable and popular founders collaboration agreement can be downloaded from http://www.seedcamp.com/2011/09/seedhack-founders-collaboration-agreement.html. Read also http://www.inno-hub.com/wiki/view/20 for in-depth analysis of Equity agreements.

Topics: business, startups | No Comments »

Book Review: “The Lean Mindset: Ask the Right Questions” by Poppendieck-s

Posted by Margus Pala on March 17, 2014

While most people think of The Lean Startup: How Today’s Entrepreneurs Use Continuous Innovation to Create Radically Successful Businesses as THE Lean book then The Lean Mindset: Ask the Right Questions is great resource for second point of view. Angle of approach is also different. While Lean Startup is more like a guide to startups of how to build it then Lean Mindset is short but useful book about lean mindset in general.

I liked the books extensive references, all its claims have strong references like a doctoral thesis to keep sceptics busy. I am not going to explain here all the principles of lean but my key takeaways from this book are:

  • Make your customers LOVE your product, exceed their wildest dreams.
  • Keep your team happy
  • Follow scientific process to make it happen

I definitely recommend this book for newcomers into lean world or people who want to have a quick reminder of how things are supposed to work. I also recommend to check out good Lean principles at Poppendiecks home page

 

Topics: Linux | No Comments »

Speed reading – first impressions are positive

Posted by Margus Pala on March 13, 2014

Some time ago I decided to start reading best-selling business books an hour a day every day. My current book is Thinking, Fast and Slow which is super useful but also over 500 pages long. It takes weeks to finish it so I decided to give a try to speed reading. At first my reading speed was around 200 words per minute. After a few weeks of practice I can do at least twice the speed with still much room for improvement. Considering English is not my native language then I am happy so far.

There are several important concepts which help you read faster.bypass_subvocalization

  • Re-reading (Regression) – Read everything only once.Some sources say that reading sentences over can waste 20 minutes in every hour. If you resist re-reading then you can increase speed by 50% alone (40min to 60min an hour). First you can feel that you did not understand the text but I have seen myself understanding the text even without re-reading.  Most books explain concepts thoroughly which helps you understand it with following sentences and it really works.
  • Subvocalization – Don’t listen to voices in your head, it slows you down.
    This is actually the hardest part. When you read and hear someone talking the text in your head then your maximum reading speed is limited by the speed of your talk.
    Key here is to see words as images. When you watch a house for a fraction of second then you get huge amount of information: door, windows, color, roof etc etc. This proves you that you don’t need to describe loud all details of house for understanding what it is. In the same way you can take words as images and you will comprehend much faster.
  • Fixation – Take in several words at a time
    There is tiny pause between your eyes focusing from one word to next. During reading your eyes are usually focused 200-250ms a time and pause between fixations is 20-40ms. When making less fixations your reading speed can be up 10% from fewer pauses only. When spending same amount of time looking at 2 words a time instead of one then your reading speed is doubled.

Don’t forget that every skill needs practice and you cannot become expert speed reader in a few hours just like you cannot become chess master immediately after learning the moves. I recommend free online tool http://spreeder.com/ for practising speed reading. Go ahead and ramp up your speed to 600wpm which overwhelms your subvocalization so your brain needs to start working differently to understand the words. Be relaxed and don’t try too hard to understand everything at first. This is just the practice before you can start to really exploit the new skill.

Good luck in tripling your reading speed and learning ability!!

Topics: Linux | No Comments »

Book Review: “Outliers: the story of success” by Malcolm Gladwell

Posted by Margus Pala on March 13, 2014

outliersBooks is all about people and groups who stand way out from the crowd. Now I understand why Steve Jobs and Bill Gates are so much more successful than most people. Unfortunately for all of you it was less about their personal greatness and much more about right timings and coincidence although personal ability is precondition.

Learn how to see the opportunities and exploit them by getting the book from Amazon

Bill Gates case was that he was born exactly right time so when he was in 8th grade then his Lakeside private school got limited access to mainframes at 1968. Mainframe access was very hard to obtain at time. Another major coincidence is that in nearby University of Washington and he could get his hands on mainframe for free between 3am to 6am during the night. Some more opportunities and he was way ahead of other with 10 000 hours of practice when time was ready. If such early access was immediately available for millions of people then nobody would even know the name Bill Gates.

I got myself another very practical knowledge regarding raising kids. If you compare kids aged 6 then exactly 6 years and 6years 11 months have relatively different abilities so older ones are always seen as more brighter and thus developed more. Thus older kids get more practice and eventually get much better than just a few months younger companions. This is very easily seen in Canadian hockey teams where most of people are born in beginning of year rather than end. If you see such situation with your child then you must be able to notice it and give extra push on your own to level the playing field again.

In general most of the stories in book is about getting early opportunity to something to become perfect with 10 000 hours of practice when time is right. You never know what the next big thing is but if for some strange reason you are well prepared when it hits then you have high chance of becoming successful.

Topics: Linux | No Comments »

How to win Seedcamp week from winners perspective

Posted by Margus Pala on February 27, 2014

I am one of the founders of GoWorkaBit which won the Seedcamp week London in February 2014. Here you will find here ideas about what is crucial for winning the event and becoming top 1% of European startups.

In case you have not figured it out Seedcamp week means having aroundseedcamplogo 20 startups together in a free and intensive business development training. If your business looks impressive then you will win the Seedcamp week which means getting small investment and access to Seedcamp family together with all the benefits listed on their webpage. Bear in mind that you are not competing with other teams for winning the event but you are competing with yourself. There is no predetermined number of winners and you will win if Seedcamp team finds something extraordinary in you above the threshold.

Firstly and most importantly the startup must have the baseline by having solid business with good management team and it must be able to communicate it very clearly. Communication is important from day one and needs good preparation. Event itself starts by having introductions and practice pitches on day one followed immediately with day two where you pitch in front of the 10-15 investors who are the people making the actual decision during the week.
These people will be following you all week as many of them will take part in mentoring sessions also. In addition the Seedcamp team will ask from other mentors what they felt about your startup.
Pitch is its own big category. It would be best to master the pitch before you stand in from of the decisionmakers but anyway you are guaranteed to have great pitch by the friday due a lot of practice and assistance from Seedcamp week people.

Secondly the team must be full of energy, know what they are doing, have clear responsibilities and share the vision. Carlos and Reshma are watching you very closely and you can expect to have private conversations during the day or parties in the evening alone with one founder. If founders stories don’t add up then it comes out very quickly.

We also printed a roll-up and paid a lot of money to take it with us in the airplane. We rolled it open everywhere, even when we went to coffeeshop in the morning to discuss our idea with the team.We was asked to relocate the roll-up only once which is good because we were noticed and found the limits.
We made even more preparations by taking enough local sweets to share with mentors during the session as you normally do when meeting business partners. People liked it, they were more positive and only a few times it was called “bribery”.

Olle-Kaidro-Margus-Pala-Gerli-Veermäe-Kei-Karlson-at-Seedcamp-2014Seedcamp team is looking for progress during the week. Most visible progress is pitch. Another way to see progress is what you actually say about your idea in the beginning and end of the week. With such an impressive list of mentors you meet is not logical if your business idea will not become much more sensible and clear. If you don’t make any changes to your plans then most probably you are stupid beyond help or pure genius(which happens not so often).

Last crucial item is preparation ahead of arrival to Seedcamp. The most important preparation is for meeting with mentors. It is best to think of your business and write down everything you need to know about it during the once in a lifetime opportunity of discussing it with up to 100 experienced business people. If you have the questions then you can browse the mentor list and direct the question to specific mentor. We also tried to browse mentors and think of question to ask but it did not work out because its very time consuming and you don’t have much free time available. I even recommend to have accommodation near the facilities to save time on travel. ROI will be good enough.
I already mentioned the pitch, even if you are trained well during the week then pitch must be still great when you arrive. Also please take care of gadgets, business cards and other stuff to share. When you have the prerequisite, good business with great team, and follow the advice in this article then you can be confident that you will win the Seedcamp also. Please send me feedback if this advice helped you, I will be very grateful.

Topics: business, networking, startups | 1 Comment »

« Previous Entries Next Entries »