A product recall can create agony for a startup, but the most significant risk is not executing the recall itself. Instead, how you communicate with your customers, staff, and the government will determine the long-term financial impact on the company.

A product recall

Companies should plan to establish a process for recalls. Planning should include customer communication, supply-chain investigation, government communications, and legal response. A recall involves sales, public relations, production, legal, and your research-and-development team. Ensure to integrate crisis planning into your continual monitoring of products, ingredients, and supply chain.

Have a plan

Great leaders overcommunicate, whether they are strengthening the brand identity of a company, the brand belief by employees, or solidifying the support of a board or investors. When explaining the situation, break it down into chunks: what happened, why it happened, what you are doing, and why people can trust this will not happen again. It's not impossible to restore customers' faith. You can neutralize a crisis and make your customers believe in the long-term vision.

Overcommunicate

A product recall is not about you. It's about making it right for your customer. A brand that spends all their energy trying to cover their tracks may find their integrity questioned.  Business owners should consider the Trust Equation - credibility, reliability, and intimacy divided by self-orientation. The more self-interest a company conveys, the less trust they convey.

Don't make it about you

Experts say a recall doesn't have to be the death knell of your company. But maintaining consumer trust takes both planning and deft, empathic communication.

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Marketing & Sales

business

Business

product

Product & Design

How to Recall a Product Without Alienating Your Customers

Obsessive-compulsive disorder (OCD) is a mental disorder that consists of persistent and intrusive thoughts, ideas, or urges (obsessions) which may include repetitive behaviors or mental acts aimed at preventing or reducing anxiety or distress (compulsions).In the past, OCD was considered an anxiety disorder, but after much research, the Diagnostic and Statistical Manual of Mental Disorders fifth edition (DSM-5) now has it in its own category.

What is OCD?

OCD is primarily characterized by obsessions or compulsions, or both. Obsessions and compulsions are "technically" both a part of our daily cognitive repertoire and can include intrusive thoughts that spontaneously pop into people's minds or the repetitive behaviors that are driven by cultural superstitions, religious beliefs, or useful habits like brushing teeth or nightly routines.

Obsessions and compulsions

OCPD marks the extreme of a conscientious personality style, which consists of the following traits: hard work, always doing the right thing, completing things the right way, perfectionism, perseverance, orderliness, prudence, and accumulation of things for future use. All these traits may sound admirable to you and they are advantageous for success at moderate levels. However, individuals with OCPD struggle to adapt to the demands of reality or meet their personal and professional goals due to the rigidity in their ways.

What is an obsessive-compulsive personality disorder?

A look at what OCD truly is and how to better classify related behaviors.

Understand yourself and those around you.

psychology

Psychology

mentalhealth

Mental Health

scienceandnature

Science & Nature

Are You Really OCD?

The Kelly criterion is a popularized mathematical formulation of a simple concept: Don’t risk everything. Stay out of jail. Don’t bet everything on one big gamble. Be careful how much you bet each time, so you don’t lose the whole kitty.The number one way people get ruined in modern business is not by betting too much; it’s by cutting corners and doing unethical or downright illegal things. Ending up in an orange jumpsuit in prison or having a reputation ruined is the same as getting wiped to zero—so never do those things

Kelly Criterion: Avoid Ruin

It is a game theory by Thomas Schelling. It’s about multiplayer games where people respond based on what they think the other person’s response will be. How do you get people who cannot communicate with each other to coordinate?Seems impossible, but you can use social norms to converge on a Schelling point. Suppose two companies are competing heavily and hold an oligopoly. Let’s say the price fluctuates between $8 and $12 for whatever the service is. Don’t be surprised if they converge on $10 without ever talking to each other.

Schelling Point: Cooperating Without Communicating

Negotiations are won by whoever cares less. Negotiation is about not wanting it too badly. If you want something too badly, the other person can extract more value from you.If someone is taking advantage of you in a negotiation, your best option is to turn it from a short-term game into a long-term game. Try to make it a repeated game. Try to bring reputation into the negotiation. Try to include other people who may want to play games with this person in the future.

Turn Short-Term Games Into Long-Term Games

Once you’ve been in a good relationship with somebody for a while whether it’s business or romantic life gets a lot easier because you know that person’s got your back. The most under-recognized reason startups fail is because the founders fall apart.A startup is so difficult to pull off, so removing potential friction points between founders can be the difference between success and failure. Also, It’s better to have a few deep compounding relationships than many shallow, non-compounding relationships.

Compounding Relationships Make Life Easier

Price discrimination means you can charge people based on their propensity to pay.You can’t charge people different amounts just because you don’t like them. You have to offer them something extra. Something rich people care about.It works because rich people are willing to pay more. You just have to give them the extra little things they need to signal they’re rich or that little bit of comfort they want.A lot of enterprise software companies use price discrimination, especially with freemium products.

Price Discrimination: Charge Some People More

Consumer surplus is the excess value you get from something when you pay less than you were willing to pay.I’ve made some money and get a lot of joy from my Starbucks coffee. So if my coffee cost $20, I would pay it.But Starbucks can’t price the coffee at $20 just for me, because they’re selling the exact same product to others. So I’m getting a lot of consumer surplus out of the coffee.All businesses generate consumer surplus. Amazon might be a trillion-dollar company, but I’ll bet they’re generating trillions in consumer surplus through people’s willingness to pay for convenience.

Consumer Surplus: Getting More Than You Paid For

You’re joining a startup and getting stock options, and the founder says, “This company is going to be worth $1 billion, and I’m giving you 0.1% of the company; therefore, you’re getting $1 million worth of stock.”The founder is negotiating based on what it’s going to be worth in the future. You have to figure out what it’s worth today by applying a discount rate, or an interest rate, that accounts for the massive risk startups face. You’ll end up with the amount the company is actually worth today. That’s the price at which a venture capitalist would invest in the company.

Net Present Value: What Future Income Is Worth Today

An externality is where there’s an additional cost imposed by whatever product is being produced or consumed, that’s not accounted for in the price of the product. The environment is finite and precious, so we have to price the product properly and fold that back into the cost of products.If people are wasting water, or polluting in other ways, society should charge them what it costs to clean up the pollution and return the environment to a pristine state. But if you raise the price high enough, you’ll knock out pollution. That’s much better than feel-good measures like banning plastic bags.

Externalities: Calculating the Hidden Costs of Products

Compilation of ideas from Naval Ravikant's tweetstorm on wealth creation in the modern era

startup

Startups

entrepreneurship

Entrepreneurship

personaldevelopment

Personal Development

How To Get Rich Naval - Every Episode

Kelly Criterion, Compounding Relationships and Calculating Hidden Costs of Products

The oldest form of leverage is labor, which is people working for you. It is the worst form of leverage that you could possibly use.
You want the minimum amount of labor that allows you to use the other forms of leverage.
Capital is a powerful form of leverage. It can be converted to labor. It can be converted to other things. It scales very well.
If you have specific knowledge in a domain and if you’re accountable and you have a good name in that domain, then people are going to give you capital as a form of leverage that you can use to then go get more capital.

Labor and Capital are Old Leverage

Product leverage is where the new fortunes are made
The new generation’s fortunes are all made through code or media. Joe Rogan making 50 to 100 million bucks a year from his podcast, Jeff Bezos and Mark Zuckerberg are all code-based leverage.
Add in Capital and you have a magical combination.
Coding, writing books, recording podcasts, tweeting, YouTubing, these kinds of things, are permissionless. 
Also, the robot army is here, They’re inside the computers. All the circuits, It’s very cheaply available the bottleneck is just figuring out intelligent and interesting things to do to them.

Product and Media Are New Leverage

It’s the nature of code and media output that the same product is accessible to everybody. Status goods are limited to a few people. 
The best products tend to be at the center, at the sweet spot, the middle class, rather than being targeted at the upper class.
If you care about ethics in wealth creation, it is better to create your wealth using code and media as leverage because then those products are equally available to everybody.
Technology products and media products have such amazing scale economies that you always want to use the product that is used by the most people.

Product Leverage is Egalitarian

An ideal business model has network effects, low marginal costs, and scale economies.
Scale economies: the more you produce, the cheaper it gets. This builds up an automatic barrier to entry against competition and getting commoditized.
Technology products especially, and media products, have this great quality where they have zero marginal cost of reproduction.
Joe Rogan is working no harder on his current podcast than he was on Podcast number 1, but on Podcast number 1,100 he’s making a million dollars whereas for the first one he probably lost money.

Pick a Business Model with Leverage

Bob Metcalfe, coined Metcalfe’s Law: the value of a network is proportional to the square of the number of nodes in the network.If a network of size 10 would have a value of 100, a network of a size 100 would have a value of 10,000. It’s not just 10 times more, it’s 100 times more, because of the square.A network effect is when each additional user adds value to the existing user base. Your users themselves are creating some value for the existing users. Things that have zero marginal costs of reproduction very often tend to have network effects. Money and language are great examples.

Network effects: value grows as the square of the customers

From low to high specific knowledge, accountability, and leverage. Laborers get paid hourly and have low accountability.General contractors get equity, but they’re also taking accountability and risk.Property developers pocket the profit by applying capital leverage. More specific knowledge, there’s more accountability and risk, and now you also have capital leverage because you’re also putting in money into the project.Architects, large developers, and REITs are even higher in the stack and finally, real estate tech companies apply the maximum leverage.

Eg: From Labourer to Entrepreneur

In an age of infinite leverage, judgment becomes the most important skill
Everything else that you do is actually setting you up to apply your judgment. That's why CEOs get paid more. If you’re steering Google or Apple, and your judgment is 10 percent better than the next person’s, society will literally pay you hundreds of millions of dollars more because you’re steering a $100 billion ship
Judgment is knowing the long-term consequences of your actions. The best way to do that is to study everything, including a lot of philosophy. it makes you more stoic, less emotional. so better decisions

Judgment Is the Decisive Skill

No one is going to value you more than you value yourself. Set a high personal hourly rate, and stick to it.Say you value your time at $100 an hour. If you decide to spend an hour driving across town to get something, you’re effectively throwing away $100. if you want to get rich, it has to be your top priority. It has to come before anything else, which means you can’t penny-pinch.If you can outsource something for less than your hourly rate, outsource it or don’t do it. Your hourly rate should seem and feel absurdly high. If it doesn’t, it’s not high enough.

Set an Aspirational Hourly Rate

You should be working on your product and getting product-market fit, and you should be exercising and eating healthy. That’s about it. That’s all you have time for while you’re on this mission.

Product and Media as new leverage, picking a business model with leverage and building your judgement.

Instead of trying to brainstorm startup ideas, look at your own life for a problem that needs solving. Chesky says he learned the best ideas often comes from finding a solution for a personal problem.

Solve a problem

Know your industry's laws and regulations. Airbnb has run into problems with local and national hospitality laws. Part of that comes from starting a tech company that must work with laws that don't consider the sharing economy - people as businesses. They didn't know whether to view Airbnb as a person or business. The best solution is knowledge and an open mind.

Get informed

Chesky says that it's better to have a hundred people that love your company than a million that sort of like it. A hundred people that like you will tell ten people. It is also easier to focus on the needs of a smaller core of customers.

Prioritise your core customers

Chesky considers about 20 to 30 entrepreneurs as his mentors. Every time you don't know how to do something, there's someone else who does.

Find role models

Startups can be daunting, but when it comes to getting your business off the ground, Brian Chesky has some tips to help you make your mark. Get social with Inc. on: Facebook: http://on.inc.com/ilqUryJ Twitter: http://on.inc.com/8FGInRj LinkedIn: http://on.inc.com/gt7KsIn Instagram: http://on.inc.com/wLObvE2 Pinterest: http://on.inc.com/8lPoT0r

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Creativity

Startups can be daunting, but when it comes to getting your business off the ground, Brian Chesky has some tips to help you make your mark.

Get social with Inc. on:
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Twitter: http://on.inc.com/8FGInRj
LinkedIn: http://on.inc.com/gt7KsIn
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Inc. Magazine delivers advice, tools, and services to help business owners and CEOs grow their businesses more successfully. You'll find information and advice covering virtually every business and management task including marketing, sales, finding capital, managing people, and much more.  Visit Inc.com for the latest!

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Airbnb Co-Founder Brian Chesky Shares His Top Tips For Disrupting an Industry | Inc.

<ul><li>Product Market Fit. The first is a product that people actually consider a “must have.”</li><li>Instrument for Growth & Define North Star Metric. it's important to define an overall success metric. </li><li>Growth Team, Process & Organized Learnings. In this stage you should focus on building a growth team that can effectively execute a growth process.</li><li>Align Team & Testing Around High Impact Opportunities. It’s time to start trying to maximize impact.</li><li>Company-wide Growth Culture & Mindset. As you run higher impact testing, you should start to see some big wins.</li></ul>

The Milestones to Growth

A lot of people are asking how Dropbox became the fastest growing SaaS business ever, reaching a $1B revenue run rate in record time. I saw signs of this explosive growth when I joined Dropbox in an…

The Growth Pyramid Revisited

<a href="https://medium.com/u/54636e9d79f2?source=post_page-----44b3203da99f-----------------------------------">Josh Anderton</a> first started working on Upscribe in December of 2016. he joined a Facebook group of Email marketers and asked them what they needed. They said they’D use it if it could be embedded in the medium. He launched it, beat out a hot competitor, and will hopefully soon support his family full-time with it.

See the form above?

Anderton spun up his first startup project when he was 18. he wanted to create a similar interface as Online travel agencies (Otas) like kayak.com but for Online stores. The problem was he didn't know how to code. So he Outsourced development to a team in India. It took a month to build and a healthy amount of traffic ended up coming to the site, but visitors rarely bought anything.

The first flop was called One Buy and Sell.

His second project was called MusePages, a subscription for landing pages where customers paid $9/month for access to a ton of custom one-page Wordpress themes that Anderton designed and coded. But he had to shut it down due to user frustration.“I couldn’t build the pages quick enough,” Anderton said. “I couldn’t say there were 100 landing pages and launch with 10. You need to have more than content when you launch. People grew frustrated so I killed it.”

The second flop showed him one of the pitfalls of pre-selling an idea

Anderton’s brother was a personal trainer. His brother had a network of personal trainers and they were frustrated with all the forms they had to have their clients sign.“We asked if one of his clients would prefer a [software] application instead of physical forms,” said Anderton. “They said we sure would.”“So we built it, but nobody wanted to pay for it.”The lesson learned was that just because there’s a problem, it doesn’t mean people will pay money to solve it.

The third flop taught him that a good idea no one wants to pay for is not a good idea

“I was starting with&nbsp;MY&nbsp;idea and trying to convince people my idea was awesome,” he said. “What I should’ve been doing is going to an existing group of people with an existing problem that I could solve for them and that they would be willing to pay for.”

All of these startup experiences taught Anderton one central, crucial lesson:

Upscribe is a paid referral system where if someone clicks through and signs up, users get 50% of the first payment. If someone clicks through and signs up, users get 50% of the first payment (Upscribe’s pricing tiers start at $9/Month). It’s a paid referral system where if someone clicks through and signs up, users get 50% of the first payment.In October 2018, Upscribe had over 10,000 registered users and 250 paying users.

So he started Upscribe 

Medium's revenue and publishing model has shifted from an open platform to an editorially Curated membership publication. "because Upscribe is a Leadgen form, medium has been in contact with me in the last year about working on keeping the Ux authentic," said Anderton. The vast majority of Upscribe’s users are on medium. "it’s kinda scary because they can shut [me] off any day," said the founder.

“Kinda scary” — Anderton on building a business on Medium

On a tactical note, Anderton makes it a high priority to get in the trenches with his users using one powerful tool.“Intercom has been awesome,” he said. “I was using Gmail for customer service but it got out of hand. I switched to Intercom and live chat and it’s been amazing.”

How to learn exactly what your users want

<ul><li>Actually talk to your customers before every stage of the way.</li><li>If you’re trying to keep your idea secret, the fear is that someone will copy. Keeping your idea a secret ends up hurting you more than it helps.</li></ul>

Parting advice and the two most important lessons

Josh Anderton talks to his users through Intercom on his phone in the morning while walking to his full-time job at a marketing agency outside Vancouver. He returns to his side business, called…

How This Medium Plug-In Makes $50k a Year as a Side Project

As a quick refresher, ICE stands for:&nbsp;<ul><li>Impact: How impactful do I expect this test to be?&nbsp;</li><li>Confidence: How sure am I that this test will prove my hypothesis?&nbsp;</li><li>Ease: How easily can I get launch this test?&nbsp;</li></ul>Each of these criteria is graded from 1–10 and the average is presented as the ICE score.

 The ICE Score

ICE is sometimes criticized as being too subjective. The arguments are:<ul><li>if multiple people score an idea to test, they would all score it differently.</li><li>the same idea might be scored differently by the same person at different times. This difference would then affect the final prioritization list.</li><li>team members who wanted their tests prioritized could simply manipulate scores to get tests approved (though let’s face it, if you’re worried about this, you have bigger problems than the wrong tests being run).</li></ul>

Critics of the ICE

The ICE score is not intended to be the perfect system for prioritizing individual ideas. It is actually a system of relative prioritization. The goal is to prevent you from being bogged down in trying to fine-tune the score too much. Think of the ICE Score as a minimum viable prioritization framework. It’s not objectively perfect but it’s good enough to get the job done.

The Purpose of the ICE Score

Think of the ICE Score as a minimum viable prioritization framework. It’s not objectively perfect but it’s good enough to get the job done. The GrowthHackers team has been using the ICE score to…

The Practical Advantage Of The ICE Score As A Test Prioritization Framework

<ul><li>You won’t fail after $10M Arr or so if your customers love you.&nbsp;</li><li>Find the VP you need. You can Miss a quarter intentionally to get something bigger done.</li><li>Truly beloved products win. That is where you should double down.</li><li>It's fine to talk honestly about exit goals.</li><li>If you need a salary raise, ask. Whatever is fair is fine.</li><li>Play to your strengths.&nbsp;</li><li>It's okay to sell some shares later.</li></ul>

What I Wish My Board and VCs Had Told Me

1. Power laws are real. $1m MRR is when it gets great. No, it doesn’t get any easier then, per se. It never gets truly easier. But you won’t fail after $10m ARR or so if your customers love you. It…

10 Things I Wish My Board and VCs Had Told Me

The number of plastic pods accumulating in landfills each year is north of 10 billion. To solve this problem, Josh Wilbur created the first patented coffee Steeping system. Each coffee bag is made of a Non-Gmo food grade Biodegradable material that you can drop in your garden or toss in your green bin. It takes years of experimenting with grind settings, materials, and filter density to allow water in and flavor out, said the founder.&nbsp;

The next Coffee Wave

<ul><li>1st Wave: Coffee consumption grows exponentially.&nbsp;&nbsp;</li><li>2nd Wave: The definition and enjoyment of specialty coffee takes off .&nbsp;&nbsp;</li><li>3rd Wave: Purchasing coffee based on its origin and artisan methods of production becomes all important.&nbsp;&nbsp;</li></ul>

The “waves” of modern coffee in 50 words

To solve this problem, Wilbur created the first patented coffee steeping system — a single-serve bag of specialty coffee that you place in a mug of hot water. It’s like tea, but not quite. Its name, you guessed it: <a href="https://steepedcoffee.com/">Steeped Coffee</a>.Unlike tea leaves, coffee starts to go bad as soon as you grind the beans. In order to preserve the freshness, Steeped Coffee bags are sealed with nitrogen — so no oxygen can touch the grounds.

10 Billion Plastic Cups Of Coffee

Steeped Coffee is the first patented methodology to combine the quality and ethics of speciality coffee with a convenient Single-Serve unit. For steeped coffee to succeed in changing people’s (often religious) coffee habits, Wilbur and his team will have to make it through the bowels of the startup J-Curve.

It’s a nut that hasn’t been cracked yet

Howard Love writes that a startup usually follows this path. The six phases are:&nbsp;<ul><li>Create a product&nbsp;</li><li>Release it into the wild and gain feedback&nbsp;</li><li>Morph accordingly (i.e., pivot)&nbsp;</li><li>Establish the right business model&nbsp;</li><li>Step on the gas and scale&nbsp;</li><li>Harvest profits and satisfy stakeholders&nbsp;</li></ul>

The “Startup J-Curve”

Imagine you’re camping overnight in the woods. You wake up in the morning and light your pocket rocket mini stove to heat water for breakfast. Once the water boils, instead of a Starbucks Via pack — something Wilbur regards as artificial and gross to drink — or a cumbersome french press set up, now you can tear open a Steeped Coffee pack and plunge the bag into your steaming cup of hot water. In four minutes, you’re sipping on a fresh cup of premium Joe.

The Value Of Steeped Coffee

Josh Wilbur has an IQ of 152, is Dyslexic, and listens to Audiobooks at 4X speed. He thrives on four hours of sleep, finds himself pulling an All-Nighter at least once a week, and works hard to somehow still Prioritize relationships and family, he says. In January 2017, the initial investment for steeped was $250,000 and it literally emptied everything in Wilbur’s pockets.

Going all-in to bring the vision to life

The more players in the game the better for steeped coffee. "competitors are partners," said steeped coffee's founder. "whoever wants to sell their beans in a steeped bag can," he said. It's not a like a like a windows or Mac decision. It's more like a laptop, tablet, desktop decision.

What it takes to compete with Keurig

Startup founders are Stone-Cold machines when it comes to risk. One sold her house to buy Adwords so that she could scale her App’s user activity and glean deeper audience insights. A new method of coffee brewing is in the works. Steeped coffee isn’t a thing, but it’s a way to find out. The taste changes character depending on how long you steep it. Steeped coffee isn’t a thing, but it’S ..

How an entrepreneur weighs the risk

Josh Wilbur, a surfer from Santa Cruz who often wears a well-worn cap that says “Captain Fin” on it — his daughter’s name is Finley — is on a mission to replace the K-Cup machine in your kitchen with…

How to Recall a Product Without Alienating Your Customers

Are You Really OCD?

Kelly Criterion, Compounding Relationships and Calculating Hidden Costs of Products

Product and Media as new leverage, picking a business model with leverage and building your judgement.

Airbnb Co-Founder Brian Chesky Shares His Top Tips For Disrupting an Industry | Inc.

Kelsey Smith