This is whatever we managed to get out of Derek’s talk during thenewmedia.asia conference in KL recently. If we have not captured things correctly, we ask to be forgiven or to be corrected. Here are his contact details:
Twitter @Sivers
Who is Derek Sivers? Professional musician who tried to sell a CD via a website called CD Baby in 1997. He has done multiple jobs, so it is not easy to pin point. It was not easy at that time (1997), because none of the infrastructure was already set up – imagine there is no Paypal. Friends sell friends’ CDs and it kept growing. In 10 years, he sold the company for $22 million cash and gave it all to charity. Very straightforward and honest review of his business background- and he claims that it was pure dumb luck.
Why are you doing what you are doing? Derek gives an example of the “why” behind a career, the doctor who does it because his mom died of lung cancer and the other one who does it because of fulfilling his parents’ wishes.
The key takeaway is: Do not pursue something that is not really your calling.
- Money, prestige, fame, leave a legacy or freedom? Use this compass to find your direction.
- If you know, you can focus. Imagine a log under sun- never gets on fire. Imagine a log under magnifying glass, it gets on fire.
The future of new media:
- Every person is entitled to their own opinion – streaming vs buying MP3
- Nobody knows the future – anybody who claims they do, are full of shit “Note from team at YAS: Heart this quote!”
- No business survives past first contact with customers
- CD Baby started as payment processor –> Store (customer feedback) –> Distributor (Itunes Apple)
Revolution: What is a revolution, really?
- Buffett: We don’t swing unless it is clear home run. Do not invest unless it is a clear success
- More likely to be a home run if the business model focuses on one thing
- Went to local record store to ask how to sell CD “You set the selling price, We charge a flat $4 per CD”
- IF not a hit, switch. If people are not loving what you are doing, stop.
- Ultimate music recommendation service: You do not need to wait for 2 years (with developers and designers) – he forgot how to live the real dream – focused on making money. Start Version 0.1 (start small, you do not need to gather $100,000 before you build the application of your dreams)
- An idea (a multiplier) with no execution (has value in money, from $1, to $1,000,000) means nothing
Best things in CD Baby (and why customers loved them) – some unique points:
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- Such a huge deal to people: “They will answer your phone” Answered phone on 2nd ring – 30 customer service, 5 managerial. Total 85 employees
- Amazon set up competition (Amazon Advantage) to do things the same way as CD baby. But they lost because of customer service.
- Personalised email headers
- From CD Baby loves Sara
- Subject: CD Baby loves you!
- Changes on your profile/album/order need pizza delivery to the team (set an amazing culture of humanising the business)
- At the end of every order, Customer comments sent to musicians (where did you hear about the musician, any feedback, etc). Apparently this helped set up a few musicians for some amazing deals.
- At the end of every order, leave special requests with order (including cinnamon gum and squid) – again it humanises the business
- People remember the tiny ways you make them smile, than all the business school stuff
- Stick with the field you really know
- Such a huge deal to people: “They will answer your phone” Answered phone on 2nd ring – 30 customer service, 5 managerial. Total 85 employees
After listening to the entire conference, we felt that this was one of the most genuine, no-agenda speakers on the list. Plus going through Derek’s website was pretty entertaining too. You should check out his blog post on why he gave away $20 million to charity (when he sold his company), well technically delegated it to a trustee board. It was much better when we saw him live in person presenting. He also mentions that people like Buffett might be happy with 100 billion, but he has his comfort zone and he is happier working with a smaller team in a smaller company. We echo that sentiment here, and are hoping to make ripple waves on encouraging Malaysian youth to take small steps to a bigger future at www.livelifelah.com (coming soon)
Thanks Derek!
