Nation Building – How to Build a Company

At SURGE, our companies are 3 weeks into the program. I have been using an analogy for years that seems to connect regarding the key stages of company development. Here it goes…

There are 4 key stages that are critical to building a dominant nation state and these apply to you:

1. Define your Border
2. Protect your Borders
3. Diplomacy
4. Wage War

Step 1: Define your Borders

A country comes together when like-minded people believe in a common and strong purpose. Why would anyone move to your country until you have a purpose? Or why would anyone sign the Magna Carta to challenge the King? You must define who you are (your core purpose, your core values, your business model canvas, your culture and rules) before anyone is willing to pickup and move. And people move for PURPOSE. A core purpose is a 100-year vision that does NOT change. What is your purpose for being a country? It all starts with you: what are you passionate about? What are you talented at delivering that solves a customer need? And it must be unique from everyone else. Or why would someone move to your land? Do you have natural resources (oil, mining), skilled labor, or other assets like a port? If yes, are customers willing to pay for it at the quantity necessary to survive. No undue tax burdens here…(we are for-profit!). Ask yourself these questions amongst your team, are they the same?

Step 2: Protect Your Borders

Now that you have defined your borders, how are you going to protect them? There is an interesting book called, Why Nations Fail, by Acemoglu and Robinson. The authors suggest that prosperity is produced by innovation and investment. To promote a nation to focus on these two key attributes, a government has to become accountable and responsive to citizens (employees) and the great mass of people (other stakeholders). The book discusses Korea. Despite Korea being a homogeneous nation, the people of North Korea are amongst the poorest on earth while the people in South Korea are amongst the richest (and many can play a damn good game of golf…kudos). In essence, how will you become accountable and responsive?

Let me offer a suggestion. Make sure your entire team is on the exact same page. Here are a few questions you can ask your team. Answer: You all need to be consistent.

• Can most of your team recite the same elevator pitch?
• Can most of your team clearly articulate the company’s competitive advantage?
• Does the entire leadership team agree with the company strategy?
• Does the company values performance from employees above all else?

Step 3: Diplomacy

How are you going to protect your country externally and create an opportunity to trade to gain value from other countries? Look at key agreements in the world like Nato (for military protection), NAFTA (free trade between Mexico, Canada and the US) and the Euro (Europe’s common currency to make trade more efficient). While at Dell, Google, a young company that was known to very few at the time, approached us to distribute their search engine on our desktops. We decided to do this giving google a significant increase in access to customers. Ask yourself, what other help, collaborators, should we enlist to help us and how do we motivate them?

“Theologian John Drescher tells the story about a corn farmer who won blue ribbons for his corn year after year. Yet each year, he shared his best seed corn with all of his neighbors. ‘How do you expect to continue to win blue ribbons,’ someone questioned him, ‘if you give your best seed corn to others?’ ‘You don’t understand said the farmer. ‘If the wind carries the pollen from field to field. If I am to have the best corn, I must see to it that all my neighbors also have the best corn. If they produce poor corn, it will pollinate mine and pull my quality down.” – Dan Miller.

My point, you cannot build a country without partners to trade and help protect from the outside. In my experience as a CMO, the most under focused and utilized strategy of companies (the 4th of the 5 C’s of Marketing: Collaborators) is their failure to acknowledge strategic partnerships that help them scale, grow and deliver on customer promises. What key agreements and partnerships do you need to be successful? Do you need to get your goods from the Pacific to the Atlantic and it takes too much time to sail around Cape Horn? Who is your Panama Canal? Did you know that there are major real estate transactions taking place in the Port of Houston and billions in upgrades because the Panama Canal is being widened to double capacity? Houston is becoming a critical port to serve the middle continental US but this was not economically efficient without the Canal change which is scheduled to be completed in 2014. Keep your eyes open.

4. Wage War

This is where most of us as an entrepreneur and startup want to start. If you have a strong definition of your borders, you are able to defend your borders, and have partners willing to come to your aid, you are now ready to attack and be disruptive. This final step will be discussed in more detail on another note… Mañana!