Don’t Bet Against The Midwest

If I was to share the following facts with you, what part of the US would you think I’m talking about:

  • Represents over 20% of the US GDP
  • Nearly 25% of all research in the US is done here and 25% of all patents in the US are granted here
  • In the last 5 years, 52 companies that are based here have either gone public or been acquired for over $1 Billion.  In total, these 52 companies represent over $140 Billion of aggregate shareholder value
  • 1 day car drive to 60% of the US population

While the headline of this post obviously gives it away, most people would see these figures and think of Silicon Valley or possibly the Northeast.  But instead, these facts are about the Midwest and its why I decided to plant my own entrepreneurial flag here with Rockfish and The Brandery.  And thankfully I’m not alone in that sentiment with stories like:

Since the downturn of 2008 – 2009, a pretty amazing entrepreneurial renaissance has started across the Midwest.  The stats above prove it and it’s something I’ve watched first-hand since leaving P&G in 2010.  When we opened the Rockfish office in Cincinnati, the company had ~70 people total and our office was just three of us.  Fast forward to today and Rockfish is nearly 4x that size and the Cincinnati office is now nearly 80 people.  And at The Brandery, we are graduating our 5th class of companies next year and nearly 60% of those Startups have stayed in Cincinnati after graduation.

Yet the interesting thing is that despite this existing foundation of success, there is untapped potential for the Startup investment community.  Case in point is that only 7% of the venture capital in the US is invested in the Midwest.  And that is despite that 25% of research here.  And despite the $140 billion in aggregate shareholder value created here.  Warren Buffett famously said to “Be Fearful When Others Are Greedy and Greedy When Others Are Fearful.”  While I don’t believe it is fear in this case, the essence of Buffett’s wisdom holds true when it comes to the potential in the Midwest.

This same untapped potential exists for Brand Marketers as well.  The reason 25% of patents are issued in the Midwest are because of our concentration of Fortune 500 (P&G, Ford, etc), research universities (University of Michigan, Northwestern, Ohio State University), and startups.  And that means we don’t need to travel across the country to find startups that are driving the next wave of innovation.  We can find it in our own backyards by visiting and partnering with Startup Accelerators like The Brandery in Cincinnati, Tech Incubators like 1871 in Chicago, or Venture Capitalists like Drive Capital in Columbus.  We just have to raise our hands and get involved as marketers.

Finally, part of the inspiration in writing this post was the announcement today that my friend and mentor Wendy Lea is going to be moving to the Midwest (Cincinnati in particular) to take the role of CEO for Cintrifuse.  Wendy is one of the most respected leaders in the Startup community and her belief in the potential of our region is further proof of the Entrepreneurial Renaissance that is underway.

Marc Andreesen’s 7 Traits To Reinventing Industries

Marc Andreesen recently provided his take on the news industry and the opportunities to reinvent the business. But one of the most interesting parts of the post was the very end when Marc outlined the 7 traits that any successful business needs to reinvent industries. The following is an exert that deserved to be shared word for word:

The good news is those that would survive and thrive are in control of their own destiny. The challenges and opportunities…can be rethought, addressed, and fixed. It’s similar to what any successful business goes through. The guidelines and the characteristics for winning are the same. It requires the following:

Vision: The difference between vision and hallucination is others can see vision. It is critical to articulate a bright future with clarity that everyone can see.

Scrappiness: Tough challenges call for resourcefulness and pragmatism. You need to stay close to the ground, wallowing in every detail and all over any opportunity that arises.

Experimentation: You may not have all the right answers up front, but running many experiments changes the battle for the right way forward from arguments to tests. You get data, which leads to correctness and ultimately finding the right answers.

Adaptability: Ask yourself, would you rather be right or successful? That needs to be top of mind at all times because times change and we change. You want strong views weakly held.

Focus: Once you gain clarity from experiments and adaptation, then it’s time to focus on a small number of ultra-clear goals. When those are defined then it’s all-hands-on-deck.

Deferral of gratification: You need the stomach (and resources!) to reject near-term rewards for enduring success.

An entrepreneurial mindset: This is true both for new companies and existing companies. It’s a bit of a mantra. We own the company. We make the business. We control our future. It’s on us.

Business Is About Motion

One of my favorite books of 2012 was Get Lucky: How to Put Planned Serendipity to Work for You and Your Business, which was written by the co-founders of Get Satisfaction.  Get Lucky shows businesses how to succeed by fostering the conditions for serendipity to occur early and often.  One of the principles in the book is “Motion”, the skill of putting yourself in unfamiliar situations, but within familiar environments, in order to engage with previously unfamiliar people and ideas that are connected to your job, your projects, or your interests.

Motion is the reason that I’m traveling this week to Las Vegas and the Consumer Electronic Show or what most people know as CES.  Throughout the year, there are handful of events in the digital industry like CES and SXSW where people and companies come together.  The power of these events is the very planned serendipity that is talked about in Get Lucky.  When I’m attending one of these events, I intentionally structure each and every day that I’m there.  That structure revolves around catching up with old friends and colleagues,  attending parties / mixers where key industry players will be, and leaving a little time for the unknown.   For CES 2013, that means my week has things like:

  • Dinner with a good friend (and former P&G colleague) who recently moved into a senior marketing leadership role
  • Attending Twitter’s Annual CES party at the Cosmopolitan
  • Giving a Lightning Talk at the Tech Cocktail / Vegas Tech event for the Las Vegas Downtown Project
  • Lots of coffee meetings that are a mixer of catching up with friends and meeting new people

The pre-planning takes a decent amount of work, but the payoff is tremendous.

I personally think that too many people take a “wait and see” approach to industry events.  In their eyes, just attending the event is sufficient.  As a result, they end having a few fun days away from the office, but they spend the whole time with the people who they came with.  What they miss is the Motion, putting themselves into those unfamiliar situations to engage with previously unfamiliar people.  They miss the chance to bring a little luck to their business.  And I can’t think of a better town for luck than Las Vegas.

The Value of Wearing Two Hats

Every day in business, I wear two hats (metaphorically of course).  The first hat is in the agency world as the Chief Marketing Officer at Rockfish.  The second hat is in the start-up investor world, both as the co-founder of The Brandery and as a partner at Brand Ventures.  While these two professions have more differences than similarities, I know I am better at both jobs because of the other.

On the agency side, each day is spent uncovering the marketing and business pain points of our clients.  These pain points create opportunities which start up companies can capitalize on by providing the solution.  As an investor, I often have one of the first opportunities to evaluate the start-ups that are looking to provide that solution.  Well before they hit the pages of Mashable or the New York Times, many of these start-ups are pitching investors.  In the investment world, venture firms often talk about “proprietary deal flow” where they get a first look at investment opportunities.  In much the same way, being involved directly in the start-up investment space gives Rockfish proprietary deal flow to bring digital innovation to our clients.

Being a practitioner in the world of marketing helps me be a subject matter expert when it comes to brand marketing.  In turn, I become more valuable as an investor because of the subject matter expertise I can bring to start-ups.  And ultimately, the value comes full circle as I can better help the digital innovation strategy of my clients to identify opportunities.

Wearing two hats in your professional life definitely requires double the work.  But at the same time, the return you get for both jobs clearly proves the old saying of “one plus one equals three.”

Brands As API [presentation]

One of our key partners for both Rockfish and The Brandery is Miami University’s Interactive Media Studies Program.   They are really teaching the next generation of business leaders to combine business and technology in their approach to brand building.  Along those very lines, the program recently presented “Brand As API”, a conceptual framework for understanding new opportunities in branding. This model was unveiled at SXSW Interactive in March 2012 and the presentation is embedded below.

Brand As API – SXSW 2012 Presentation