Well, Bill, just like entrepreneurship is iterative,
you go out into the world, then you're back
to the drawing board-- we're back here with you.
It's nice to be back here, and we're
going to be looking inward in this step-- whereas all
the previous steps, we've been really focused outward,
so it's a change of pace here.
It's great that you mentioned that, because it's
very common to hear entrepreneurs say,
hey, our secret sauce is this-- and investors
ask for what is your secret sauce, what
is your secret sauce?
Let's talk about that.
Well it's important to have "secret sauce", unique selling
proposition, or what we're going to refer to as the core.
But that's not where you start, you
have to start with the customer, and then kind of figure out
what your core is, and why it's relevant to them.
But you do have to have something
that makes you uniquely qualified
to provide the solution to the customer.
Otherwise, you're just creating a market
that someone else will be able to reap the benefits of.
And that's not a very smart move,
because it's very expensive to create a market.
If you create the market, you want
to reap the dividends from spending that investment
to create the market.
Let me play skeptic for a minute.
You advocate focus on the persona--
and if you identify a painful problem
that the persona hasn't solved, why do you
need to care about anything else, such as the core?
Because you don't want to be in a situation
where you incur all this investment of money, time,
effort, intelligence, and then create a market that you turn
around and somebody else owns.
That's not a sustainable business.
You spent money here, but you didn't reap the rewards here.
That's a business that's going to be out of business quickly.
What we need to do is think about
once we create this business, what is it that we can uniquely
do that the customers will want to come to us because we
provide more value to them than anybody else.
Can you give an example of a core at one of your companies.
Sure.
At SensAble, we had this device--
which we were well known for-- which is a phantom.
And it would allow you-- you would hold this,
and you would go in, and you would
have a 3D image in the computer.
And this would allow you to touch it, feel it, change it,
deform it and the like.
So you can edit products that you're creating?
Absolutely.
And to every one it seemed like our core
was this piece of hardware.
However, that, for us, was not the core--
that was kind of one of the outer moats.
At the core is really-- what's at the center--
that one thing that you do that you will protect
above all else, that nobody else could replicate.
That would be the hardest thing.
So if you think of as a castle, there are outlying moats.
And then the one in the middle is the crown jewels.
For us, the hardware was a very imposing moat for people--
but we know that the hardware was something
that could potentially be reverse-engineered.
And so we thought long and hard about-- what
is it that we can do that we can do better than anybody else?
And so the key to us, we realized, was the software.
And not just the software, but the engine within the software
that created the ability to do 3D touch.
That is very, very heavy duty algorithms,
and we were uniquely positioned to do that before anybody else
because you needed to have the hardware first,
and we're the only one that had the hardware.
But someone could catch up with the hardware,
but if we had that the software, we
know where the great people were to write that software,
and we could get miles ahead of other people.
So even when they finally caught up to us,
they broke this outlying moat of the hardware,
they still would just give up when
they saw how far ahead we were on the software.
But what forced you at the time to think
that you need to be thinking about your core?
We had a very clear personal objective--
we wanted to build a great company in a five year time
horizon.
And so we-- I had done a lot of work before this,
and I had been in a company where
we didn't have a strong core and so I was determined
that we would create a market, and then
we would own that market.
And am I my right to infer that once you've
realized that your core is software, not hardware,
you made many of the important decisions
based on that realization of the core?
Absolutely.
We didn't go out and tell the world what it was,
but we spent a lot of time recruiting the best people
at MIT, Stanford, Carnegie Mellon, and Georgia Tech
to be on our team.
We looked at who are the leaders in that
and got them as advisors.
We thought about our incentive structure--
how the company's physical layout was set up
because our core-- we needed to develop
this at very rapid pace.
Because at the end of the day, this
was going to be that thing that would protect us
above all else.
How much of deciding what your core should
be driven by who you are as a person, who you co-founders
are, you as a team-- then by a rational deduction
of what it should be?
You're going to be balancing these two things.
You have to figure out what the customer wants
and what you're good at.
But you also have to figure out what you're passionate about.
Because when you start a company,
you're not doing it for six months, 12 months, 18 months.
You better plan on doing it for six years,
and you better love what you're doing--
because if you don't, you're not going to be really good at it,
and the people around you are going to know it.
And they're not going to be passionate about it.
So your core better be something that you can get excited about,
and you will think kind of competitively-- how do I
defend this?
How do I defend the family jewels?
The crown jewels?
And that's how you need to think about it-- as well as it being
the logical decision that's best for your customers
where you have assets to actually deliver on that core
as well.