7 Types of Leaders based on Vision, Execution, and Empathy

This article is written by Erik van Mechelen, based on the Octalysis framework by Yu-kai Chou and lessons from Octalysis Prime, a mentorship journey with Yu-kai Chou.

So you want to be an effective leader. Maybe even a great one. It is a good thought, a great feeling.

As a leader, you have the chance to inspire, direct, and support people to team and individual accomplishments, to make society and the world better through those people.

These statements might feel to you too grandiose. But we know from Core Drive 1: Epic Meaning & Calling, that having a Why will drive you to become a stronger leader.

This article will briefly touch on how to learn and train yourself to be an OP leader, the convergence of a leader with Vision, Execution, and Empathy.

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Black Hat Motivation within Fundraising (Gamification)

Fundraising GamificationBlack Hat Motivation within Fundraising (Gamification)

(Below is a snippet of Gamification Book: Actionable Gamification – Beyond Points, Badges, and Leaderboards. Please subscribe to the mailing list on the right to order the book when it launches. This post may be moved into a Premium Area after a certain period of time).

In the realm of fundraising, I regularly get approached by startup entrepreneurs who are looking for some support to help them navigate fundraising from angel investors as well as venture capitalists (I also get approached by many investors, but on an entirely different set of motivational challenges – mostly White Hat).

The thing about investors is that they are generally motivated by the forces of greed and fear. The force of greed – the intense desire to make a billion dollars (Core Drives 2 and 4); the force of fear – the apprehension of losing all their money (Core Drive 8).

At the beginning, the entrepreneur may promote many great attributes about the company, appealing to the investor’s sense of Core Drive 1, 2, 4 and even 5 if there is a good social proof. (Here you see the value of remembering the numbers for each Core Drive. Don’t worry if you don’t remember these numbers now, but just take note that they are mostly on the White Hat side of things.) The investor starts to show a lot of excitement, and the entrepreneur feels like the deal is sealed.

However, as the investor gets closer and closer to writing a check, the fear of losing all their money begins to preoccupy them, which is driven by Core Drive 8: Loss & Avoidance. They start to ask for more metrics, traction, and further social proof. Often, six months go by, and still no funding is committed.

From my personal experience, investors generally only close deals quickly when they are *convinced* that they will lose the deal if they don’t commit. If an entrepreneur *convincingly* tells the investor that a lot of people are already in on the deal, and if the investor does not act this week the round will be full, only then will they finally react. Black Hat creates urgency and closes deals.

When I was trying to raise $600,000 for my gamification startup straight out of college, I found the experience to be extremely difficult and sobering. We were a very young team, and this “gamification” thing seemed like a half-baked crazy idea.

After struggling for awhile to raise a modest amount of money to keep our small team afloat, we were finally able to secure $650,000 from three investors. At that point, I wrote an email to all our potential investors, who for over a year continually “wanted to see more” and “weren’t sure about this gamification thing.” I simply told them, “We are going to close the round, but thank you for your continuous (and non-existent) support!”

At this point, many of these investors who didn’t want to commit for an entire year suddenly responded with passion, enthusiasm, and even anger. “Yu-kai. I thought we agreed that I could invest this much money in your company. Why are you telling me that you are closing the round without me?” I was thinking, “Well, you kind of had an entire year to do that…” but they oddly made it seem like I was burning bridges if I didn’t take their money.

As a result, we tried to cap the round at $800,000 instead of $600,000, and we couldn’t do it. We tried to cap it at $900,000 and couldn’t. We tried to cap it at $1,000,000 and we still couldn’t. Finally, I capped the round at $1,050,000, while rejecting some investor money, just to show that we were serious about the cap. (I’ve also heard this same experience retold many times by other entrepreneurs.)

This illustrates the irrational power of Core Drive 6: Scarcity & Impatience as well as Core Drive 8: Loss & Avoidance (while also serving as a fine example of the limits of White Hat motivation). All these “potential investors” clearly liked what I was doing. They were encouraged whenever I gave them good news. They saw that it could potentially make the world a better place. But they didn’t acted until they saw that the deal was being taken away from them. With White Hat motivation alone, people will always be intending, but never actually doing.

For the curious, eventually my startup launched RewardMe, a product that gamified the offline commerce experience. RewardMe was performing eleven times better than the numbers our closest competitors published. (Sorry – since these companies are still in existence, I won’t cite sources here in respect to their current success.) Towards the end of my time there, we even closed a $1.5 million sales deal with a national chain.

Startups are risky, and the unfortunate thing is, just having a stunning product doesn’t mean a company will be successful. A few years after RewardMe’s launch, we hit a combination of personnel, funding, and legal issues. I stepped down as the CEO, and eventually the company folded. If only I had my Octalysis knowledge back then, many things would likely be different, which is why I am hoping my readers learn these elements on motivation before they run into issues in their own companies.

Fortunately, by stepping down as the CEO of RewardMe, it freed up a lot of my time to further study gamification, human-focused design, and develop the Octalysis Framework.

Today, even though my Octalysis Group organization is becoming busier and busier, I’m a lot happier than when I was running a technology startup. That’s because I am now mostly motivated by White Hat Core Drives, as opposed to the Black Hat Core Drives of constantly counting our runway before dying.

The Mysterious Case of the Startup CEO

What the **** is our CEO doing???

In the past 6 years of being an entrepreneur, I’ve had many small, private conversations with Startup CEOs, and I noticed a pretty interesting but common trend.  I initially thought this was more of a unique experience of my own and very few people had the same issue, but I started to see the same thing among technical and non-technical CEOs alike. I then realize it’s something that may be worth sharing about.

Often times, when I ask these startup CEOs about their roles in the company, they would sheepishly say, “Yea…so I’m the ‘CEO’ of the company….whatever that really means…” I’ve been in that mentality myself. It’s hard to explain what you do as a startup CEO, as everything seems pretty vague and does not sound like it tangibly makes the business more value. The only clear task that people actually credit their CEOs is “fundraising”.

But these CEOs unanimously say they work crazy hours. So what are they doing anyway with these hours? It’s somewhat of a mystery.

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The First 90 Days of Being an Entrepreneur

 

In most people’s minds, the hardest part about being an entrepreneur is starting. That’s actually not true. Starting is the easiest part and it just requires you to get off your butt and start doing things. You only think it’s the hardest part because that’s the part YOU are stuck on.

For that reason, here’s a little guide to help you get over that “but I don’t know how to start!” hurdle, so you will have no excuse not knowing how to start your company.

Days 1-5: Decide to be an Entrepreneur and learn as much as you can about it

This is the day that you finally decide to take that leap of faith and begin a real life. Some people start this day by being laid off, but hopefully you came to this conclusion on your own terms.

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Want a Real Life? Be an Entrepreneur

 

Living the life of an entrepreneur is tough. You work your butt off and get paid almost nothing for years, and the chances are you will fail at the end. Living the entrepreneurial life is definitely not the “easy” life.

However, in my opinion, it is the most fulfilling one.

I believe that being an entrepreneur is the best way to make sure you live a life of passion and adventure – a life that leaves you a legacy and stories to tell your grand kids.

The corporate life story

Lets look at a regular corporate life person. This person graduates from college, finds a job, gets married, possibly gets an advanced degree, has kids, advances in her job, gets old, and then there’s goodbye. That just sounds very unfulfilling to me, especially when you are working at a job you hate like most people are.

Sure, some people love their jobs, and I’m all for that, but most people settle for a job that they don’t like just because they are afraid of change and and slowly wait for their midlife crisis.

That’s when they buy their fast car.

Even for those of you who say you love your jobs, if you suddenly had $10M in your bank account, how many of you will choose to quit your job this week?

Yes, you might say that this question is unfair as you could say that about anything. However, I can tell you as a sure fact that lots of successful entrepreneurs who HAVE over $10 Million in their bank accounts keep going back to the torturous startup life because it is just too exciting and addicting to stay away from!

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