Marketing

The Formula

Over the years I've read hundreds of business books. I had the good fortune to work in a world-class organization and be mentored by an exceptional man. I've meet and talked to many successful business owners and superstars.

When I break it all down there is a simple formula that works:

talent/expertise + work ethic + great attitude = success

Talent/expertise- become an expert on something by doing (Malcolm Gladwell's data suggests it takes 10,000 hours to master something). Take risks. Make mistakes. If you have been bestowed with God given talents too, even better.

Work Ethic- by the time you get into the work force you have it or you don't. You naturally take on more than you should. You are proactive. You are prepared. You get up early, work late, and never seem to turn it off. And you love it.

Great Attitude- life is too short to work with jerks (even talented ones). People help and gravitate to people they like. They get more opportunities. Doors open easier. Things seem to fall into their lap. People call them lucky.

When these three ingredients come together in an individual, you have something special. Hire them (even if you don't have an open position). Work with them. Work for them. Learn from them.

Darik

Well Done Caine!

Update as of 4-15-12- Caine has raised $117,000 for his scholarship and counting. Fantastic!

2012 Software Company of the Year!

What a fantastic honor, but the best is yet to come! Bravo U Team!

It's a real honor to work with such talented people!

Darik

Good Stuff...

Update- I'm reading Isaacson's book on Jobs. No question he was a driven genius, but I did not fully appreciate what a gigantic ass he was as well. That man had some demons. A must read.

Darik

From Forbes.com 10-5-2011

By Eric Jackson

Three weeks ago, I wrote a post about the top ten lessons Steve Jobs could teach us.

I had a feeling – like I suspect many others – that he only had a few more days with us on this Earth.

He’s irreplaceable. We’ll never see anyone else like him. Edison, Einstein, Henry Ford… he has left an indelible mark on our society in the last 35 years and for many more to come.

Yet, despite his greatness, he also taught us that he’s just a man. He got up every day, like you and me. He kissed his family goodbye and he threw his heart and soul into his work – his passion — just like we can.

We all can be great. If we try, we’ll honor him.

Here are the Top Ten Lessons Steve Jobs taught us:

1. The most enduring innovations marry art and science – Steve has always pointed out that the biggest difference between Apple and all the other computer (and post-PC) companies through history is that Apple always tried to marry art and science. Jobs pointed out the original team working on the Mac had backgrounds in anthropology, art, history, and poetry. That’s always been important in making Apple’s products stand out. It’s the difference between the iPad and every other tablet computer that came before it or since. It is the look and feel of a product. It is its soul. But it is such a difficult thing for computer scientists or engineers to see that importance, so any company must have a leader that sees that importance.

2. To create the future, you can’t do it through focus groups – There is a school of thought in management theory that — if you’re in the consumer-facing space building products and services — you’ve got to listen to your customer. Steve Jobs was one of the first businessmen to say that was a waste of time. The customers today don’t always know what they want, especially if it’s something they’ve never seen, heard, or touched before. When it became clear that Apple would come out with a tablet, many were skeptical. When people heard the name (iPad), it was a joke in the Twitter-sphere for a day. But when people held one, and used it, it became a ‘must have.’ They didn’t know how they’d previously lived without one. It became the fastest growing Apple product in its history. Jobs (and the Apple team) trusted himself more than others. Picasso and great artists have done that for centuries. Jobs was the first in business.

3. Never fear failure – Jobs was fired by the successor he picked. It was one of the most public embarrassments of the last 30 years in business. Yet, he didn’t become a venture capitalist never to be heard from again. He didn’t start a production company and do a lot of lunches. He picked himself up and got back to work following his passion. Eight years ago, he was diagnosed with pancreatic cancer and told he only had a few weeks to live. As Samuel Johnson said, there’s nothing like your impending death to focus the mind. From Jobs’ 2005 Stanford commencement speech:

No one wants to die. Even people who want to go to heaven don’t want to die to get there. And yet death is the destination we all share. No one has ever escaped it. And that is as it should be, because Death is very likely the single best invention of Life. It is Life’s change agent. It clears out the old to make way for the new. Right now the new is you, but someday not too long from now, you will gradually become the old and be cleared away. Sorry to be so dramatic, but it is quite true.

Your time is limited, so don’t waste it living someone else’s life. Don’t be trapped by dogma — which is living with the results of other people’s thinking. Don’t let the noise of others’ opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.

4. You can’t connect the dots forward – only backward – This is another gem from the 2005 Stanford speech. The idea behind the concept is that, as much as we try to plan our lives ahead in advance, there’s always something that’s completely unpredictable about life. What seems like bitter anguish and defeat in the moment — getting dumped by a girlfriend, not getting that job at McKinsey, “wasting” 4 years of your life on a start-up that didn’t pan out as you wanted — can turn out to sow the seeds of your unimaginable success years from now. You can’t be too attached to how you think your life is supposed to work out and instead trust that all the dots will be connected in the future. This is all part of the plan.

Again, you can’t connect the dots looking forward; you can only connect them looking backwards. So you have to trust that the dots will somehow connect in your future. You have to trust in something — your gut, destiny, life, karma, whatever. This approach has never let me down, and it has made all the difference in my life.

5. Listen to that voice in the back of your head that tells you if you’re on the right track or not – Most of us don’t hear a voice inside our heads. We’ve simply decided that we’re going to work in finance or be a doctor because that’s what our parents told us we should do or because we wanted to make a lot of money. When we consciously or unconsciously make that decision, we snuff out that little voice in our head. From then on, most of us put it on automatic pilot. We mail it in. You have met these people. They’re nice people. But they’re not changing the world. Jobs has always been a restless soul. A man in a hurry. A man with a plan. His plan isn’t for everyone. It was his plan. He wanted to build computers. Some people have a voice that tells them to fight for democracy. Some have one that tells them to become an expert in miniature spoons. When Jobs first saw an example of a Graphical User Interface — a GUI — he knew this was the future of computing and that he had to create it. That became the Macintosh. Whatever your voice is telling you, you would be smart to listen to it. Even if it tells you to quit your job, or move to China, or leave your partner.

6. Expect a lot from yourself and others – We have heard stories of Steve Jobs yelling or dressing down staff. He’s a control freak, we’ve heard – a perfectionist. The bottom line is that he is in touch with his passion and that little voice in the back of his head. He gives a damn. He wants the best from himself and everyone who works for him. If they don’t give a damn, he doesn’t want them around. And yet — he keeps attracting amazing talent around him. Why? Because talent gives a damn too. There’s a saying: if you’re a “B” player, you’ll hire “C” players below you because you don’t want them to look smarter than you. If you’re an “A” player, you’ll hire “A+” players below you, because you want the best result.

7. Don’t care about being right. Care about succeeding – Jobs used this line in an interview after he was fired by Apple. If you have to steal others’ great ideas to make yours better, do it. You can’t be married to your vision of how a product is going to work out, such that you forget about current reality. When the Apple III came out, it was hot and warped its motherboard even though Jobs had insisted it would be quiet and sleek. If Jobs had stuck with Lisa, Apple would have never developed the Mac.

8. Find the most talented people to surround yourself with – There is a misconception that Apple is Steve Jobs. Everyone else in the company is a faceless minion working to please the all-seeing and all-knowing Jobs. In reality, Jobs has surrounded himself with talent: Phil Schiller, Jony Ive, Peter Oppenheimer, Tim Cook, the former head of stores Ron Johnson. These are all super-talented people who don’t get the credit they deserve. The fact that Apple’s stock price has been so strong since Jobs left as CEO is a credit to the strength of the team. Jobs has hired bad managerial talent before. John Sculley ended up firing Jobs and — according to Jobs — almost killing the company. Give credit to Jobs for learning from this mistake and realizing that he can’t do anything without great talent around him.

9. Stay hungry, stay foolish - Again from the end of Jobs’ memorable Stanford speech:

When I was young, there was an amazing publication called The Whole Earth Catalog, which was one of the bibles of my generation. It was created by a fellow named Stewart Brand not far from here in Menlo Park, and he brought it to life with his poetic touch. This was in the late 1960′s, before personal computers and desktop publishing, so it was all made with typewriters, scissors, and polaroid cameras. It was sort of like Google in paperback form, 35 years before Google came along: it was idealistic, and overflowing with neat tools and great notions.

Stewart and his team put out several issues of The Whole Earth Catalog, and then when it had run its course, they put out a final issue. It was the mid-1970s, and I was your age. On the back cover of their final issue was a photograph of an early morning country road, the kind you might find yourself hitchhiking on if you were so adventurous. Beneath it were the words: “Stay Hungry. Stay Foolish.” It was their farewell message as they signed off. Stay Hungry. Stay Foolish. And I have always wished that for myself. And now, as you graduate to begin anew, I wish that for you.

Stay Hungry. Stay Foolish.

10. Anything is possible through hard work, determination, and a sense of vision – Although he’s the greatest CEO ever and the father of the modern computer, at the end of the day, Steve Jobs is just a guy. He’s a husband, a father, a friend — like you and me. We can be just as special as he is — if we learn his lessons and start applying them in our lives. When Jobs returned to Apple in the 1990s, it was was weeks away from bankruptcy. It’s now the biggest company in the world. Anything’s possible in life if you continue to follow the simple lessons laid out above.

May you change the world.

The Seven Habits of Spectacularly Unsuccessful Executives

A friend sent me this article on seven habits of spectacularly unsuccessful executives.

I have always found it fascinating to read stories of business failures. They serve as a sobering reminder to stay engaged.

Darik

The truth for anyone who wants to do great things

I Heart Talent

Attracting and retaining talent is no easy task. In fact, it has been the hardest thing I have done as an entrepreneur.

Harder than raising money.

Harder than creating a new product.

Harder than increasing sales.

It doesn't help that I don't know HTML from fortran, or that I can't pontificate the nuisances of Maya versus Max. I'm a simple sales and marketing guy.

What I can tell you is that if you are able to convince a superstar to come join you, they will tell their network that is likely filled with more superstars. Soon, something magical starts to happen and attracting even more talent becomes easier and easier. Products get better and better. Things become more interesting and fun.

We are experiencing that magical moment (that image is our latest piece on digestion). Our content, technology, processes, customer service...the entire organization is doing exceptional things. We have a world-class team.

Exciting times U Team...so honored to work with each of you.

Darik

Thank you for not letting me forget the importance of brand...that even packaging can be elegant...how incredibly hard it is to make something easy to use. RIP.

Never Forget

Do yourself a favor and read these two stories. You may know parts, but the complete stories should be read in full, especially today.

The story Rick Rescorla

"Let's roll"

Darik

This guy does for economics what Understand does for healthcare

Conrad Hilton

Any entrepreneur would be well served to watch this CNBC biography on Conrad Hilton. Certainly an inspiration when things get dark (and there will be moments of darkness).

You had guts Mr. Hilton.

Darik

Company Trademarks Red Soled Shoes

Amazon patents single click check-out and now these guys trademark red soled shoes! Geez, tens of thousands of dollars and I can't get a process patent on an novel approach to patient education. Grrrrr.....

WSJ Article

At least Judge Marrero realized how ridiculous this is and is considering throwing out the trademark altogether.

Darik

Thinkers vs. Doers

You really can't make this stuff up. This logo is from the Smithsonian Institute's blog on innovation, aptly named "The Department of Innovation".

The problem?

The gears would not work and would lock on the first revolution.

Full Article here from American Thinker.

Darik

Work Ethic

We all know the story of the ant and the grasshopper…ant works hard, saves food for winter, lives happily ever after…grasshopper plays, winter comes and the lazy bastard withers away. Good, I’ve never liked grasshopper’s anyway…lazy people even less.

Last weekend I was reminded of this parable in the most unusual of places; a hummingbird feeder in my backyard.

Here’s the backdrop- my daughter got the hummingbird feeder for her birthday. A few weeks ago we filled it with red nectar and hung it by a nail on the top of an awning in our backyard. The awning is large and intricate and this specific location was at the end of the structure. The footprint of the nail on the awning is very small.

And within a few days an ant had found the honey hole.

Think about it…an ant would have had to climb up the awning, find the base of this nail. That in and of itself would be difficult. Then he would have to walk out to the tip of the nail and find the ring of the feeder, climb down the ring and onto the feeder and go to the bottom of the feeder and find this little 1 cm hole that the nectar comes out of. With his little mandible full of a pinprick of sugar, he then walks what must be equivalent of miles back to the colony…and repeats the entire process over and over again.

That’s the life of an ant…search, search, search, search, search, search, search, search, search, search, search, search, search, search, and bingo. GUYS, OVER HERE!!!!

It’s a simple reminder on work ethic from an ant in my backyard. And when work ethic meets talent…that’s when magical things happen. I’m seeing that from some people at Understand right now, and what they are indeed doing is amazing.

I’m not moving the feeder and I hope the hummingbirds never come. It’s an ant feeder now that I'm happy to keep full.

Ant, thank you.

Darik

A real gem...

A major thank you to a good friend for turning me on to Radiolab.org.

They are all good, but to get hooked listen to Season 9, Episode 2... Finding Emilie. If that doesn't get you hooked, nothing will.

Darik

Well Done Boston...

Some things just make be well up and cry like baby, like this. A wonderful display of humanity and compassion.

Darik

Understand quote of the day...

"Mac people don't do specs, they do colors." The intra company Mac vs PC war continues...

Darik

4 Hour Work Week, yea right...

I read the book "The 4 Hour Work Week" by Tim Ferriss a while ago and recently discussed it with a friend. We debated the premise and Tim’s suggestions.

After that conversation I felt compelled to state an observation to aspiring entrepreneurs…there is absolutely no substitute for long hours and hard work. I am personally unaware of any successful entrepreneur who has worked anything close to a 4-hour workday, let alone week.

If you believe this is possible, ride your unicorn back to Narnia. It’s not gonna happen. Promise.

“I am only an average person, by George, I work at it harder than the average person.”
- Teddy Roosevelt

Darik

UPDATE- after much thought and introspection, I must correct my above statement. There probably is somebody who started a business and achieved great success working 4 hours a day or less. At some point in history. Somewhere. Maybe.

Life is supposed to go something like this…you are born and have a good 18 years to be silly, and largely make mistakes. You think you will live forever, consequences are abstract and you look back and wonder how you made it through this time virtually unscathed.

You then go to college and/or get a job and enter the “real world”. You work hard, make sacrifices and climb up the proverbial ladder. Somewhere in all this you get married, have kids and hope to make more good decisions than bad. You try and make good financial decisions so you can enjoy your “golden years”. Then you retire.

In your golden years, you take up all those deferred hobbies, go on cruises, spoil your grandkids by letting them stay up late and eat all the candy they want.

But life doesn’t always work that way. I wish you could ask Mike Pierce.

Mike was a friend and occasional mentor at Stryker. He didn’t have an especially profound impact on my life, but he was friendly, knowledgeable and no matter how busy he was he always made time for a young Marketing Associate who had stupid questions. More times than not I found Mike in his office, deep in thought, surrounded by books. I called him The Professor. He was a good man. Mike retired a few years ago.

To say that Mike was a lifer at Stryker, is an understatement. Mike was one of the two key originators of Stryker Endoscopy. He and engineer William Chang, nurtured and grew this division in the early years and I’d be hard pressed to name anyone else that played a greater role in its success, especially in the formative years. Today, Endoscopy has thousands of employees and has sales in excess of 500MM.

I was visiting my old employer yesterday when I learned he had passed away several months ago. Cancer of the adrenal gland. Very rare. Afflicts one person per million.

I’m struck by the injustice and irony of it all. Here was a man who worked hard his whole life, and prepares to ride off into the sunset. We all know stories like this and it certainly gives pause to rethink our life and priorities. It's not fair and I don't understand it.

So with this, I’m not going to work today. I’m going to go do something else. Take a walk. Go to the movies. Or maybe I’ll go to the bookstore and pick out something in honor of The Professor.

Rest in peace Mike.

Darik

Innovation

This is a cool video on how memory sticks are made: Video

All that, and they are able to sell them at $24.95 and make a profit. Amazing. Wish the beginning of that video said Reno, Nevada.

Darik

The Sleeping Giant

Back in late 2009, I was given a unique opportunity to write a chapter for a book that was the idea of best-selling author Ken McElroy on the first year of being an entrepreneur.

Throughout 2010, I watched as my story, along with the stories of 19 other entrepreneurs slowly took shape. In January of this year the book was finally published.

Ken, thank you again for this wonderful opportunity and thank you to the other entrepreneurs whose stories I have read, enjoyed and learned from.

www.thesleepinggiant.com

Darik

December 7, 1941- A day that will live in infamy

Thank you to our Veterans for your continual sacrifice. 69 years...never forget.

Video

Darik

True Story

This is an absolutely awesome story that just happened a few minutes ago. The team has been tasked with taking the quality of our animations to a new level. It's been a massive project, thousands of hours invested and lot's of money spent upgrading our infrastructure.

Yesterday, I got a peak at our new 3D model. Wow. This has truly exceeded my expectations in every way. U-Team, YOU ROCK!!!

In my excitement I forward the attached screen shot to one of my best friends. My email to him said nothing, but just included this image.

Within minutes the phone rang. It was him. I couldn't answer, and he didn't leave a message. A few minutes latter I get this email from him:

Ok, that has to be Tiff. Give her a kiss for me when she wakes up. Call me when this is all good. YO!

Sent from my iPhone

He thought my wife had been taken to the hospital and I had taken a picture of her going into surgery! Honest to God! I called him and he was all panicked. He even refused to believe me at first that this was our new 3D model!

This is the ultimate compliment. I'm just going to float around the office for the next few days!

Darik

"Simplicity is the ultimate sophistication"- Leonardo Di Vinci

Simplicity sells

Darik

Szakara: Graphic Designer, Humanitarian...

A special thank you to the our graphical sensei, Joey Szakara, for the kick-ass new web site he did for the Boys & Girls Club and to Mike, Jim, Chris and the rest of the folks at the Boys & Girls Club for the amazing meal. A carving station, bread pudding, grilled asparagus...really? We're not worthy, we're not worthy...thanks everyone!

You can check out their new site here: Boys & Girls Club

Nice work Joey!

Darik

The REAL Silver Bullet

With all due respect to my technology colleagues, the endless articles about Twitter, physician blogs, Facebook and other social media are putting me to sleep. Yes, a well-designed web site with good content is a necessity and driving people to your site (and through your doors) is a must. I’ve built a business helping doctors do exactly that!

But let’s stop looking for the technological silver bullet and get back to the human element of building a practice.

A friend of mine recently moved to town (we will call her Cindy) and asked me for a recommendation for someone to do a mommy makeover. I suggested a surgeon in town who I know well and trust. He is talented and has a good reputation. I know several people who have had excellent results from him.

Cindy scheduled an appointment, introductions were made and questions answered. Several weeks later we went to Cindy’s house for a BBQ and I asked if she had made a decision. She had, but it was with another surgeon in town.

The surgeon was female.

“Darik, I just felt more comfortable with her. She has kids too and understands what I want. I know you really like your friend, but I just connected with her. She spent a lot of time talking to me. She’s wonderful!”

I know my doctor friend and I am certain he did not rush her. But there is no doubt in my mind that the female physician was able to identify with Cindy on a different level. Cindy didn’t feel rushed. Cindy didn’t feel awkward or out of place. This physician was able to communicate and empathize on a totally different level.

Blame it on God or Darwin or whomever you chose, but males and females are wired differently. Let me be clear that I am not making any claims that one sex is more or less qualified than the other or that empathy is a substitute for skill. What I am saying is that women are generally known to be better communicators and more empathetic than men, and studies from UCSF and Northeastern University show evidence that this is true for doctors as well.

Disagree to the peril of your practice, but I believe that tapping into this strength can make a female physicians practice even stronger OR if you are a male recognizing this need, and working to fill it will make your practice better and your patients more loyal. And to be fair, there are plenty of male physicians who are excellent at communication and empathy and female physicians who are not. But by and large, female physicians come to the table better equipped in this area.

Comfort

My father recently had complications from a total knee replacement. He was readmitted for a serious infection. I got in my car and drove 5 hours to be with family who had been waiting for word from the doctor after his revision surgery. The call or visit never came. No one ate or slept well that night. It was not until mid afternoon the following day that the doctor gave us an update.

When he did give us the update, he was stoic and lacked emotion. I want the facts and respect honesty. My mother and father however, needed comfort and reassurance that things would be okay and that he had and would continue to do all that he could. Had he simply taken my mom’s hand or put his arm around her, she would have breathed a huge sigh of relief. That never happened and it was a missed opportunity to connect with our family. You can’t miss these opportunities when you are in the elective surgery business.

Communication

“I’m a highly trained surgeon, not Oprah!” Okay, simmer down. I’m sure God himself has touched your hands, and your eye for aesthetics is second only to Michelangelo. But guess what? If you can’t communicate well with patients or the perception is that you are short on time, they will likely look elsewhere.

Spend time getting honest feedback from office staff, loved ones, and former patients. This self-assessment could prove invaluable in identifying weakness in communication and helping you develop a plan to better manage that. If you are fundamentally weak in communication skills, surround yourself with a staff that is strong in this area. Use tools or aids that help you better communicate complex topics to patients and their families. Have coordinators create a patient workflow that ensures effective education and gives patients an opportunity to ask questions and alleviate fear.

Empathy

The biggest fear for Cindy was that something would happen to her during surgery and she wouldn’t be able to take care of her kids. That was it. The female surgeon was easily able to zero in on this fear, talk about it, and give her the reassurance she needed to do the surgery. I have witnessed enough doctor-patient interaction to say that women physicians are generally more adept at this, which can be a significant advantage. In Cindy’s case, it was the main reason she made her decision.

Emotions are not something you can easily change or learn, but recognizing the role they play in a consultation is a first step. Be real. Be engaged. Remember the significant fears, real or imagined, that patients have that are preventing them from making a decision.

Comfort, communication, empathy…simple, fundamental things that will do far more to increase bookings than putting your practice on Facebook. And you can tweet me on that.

RIP John Wooden

A great man. Rest in peace Mr. Wooden.

Wooden Poem

Wooden Bio

Darik

Dude, where's my prototype?

This belongs in the annals of great business mistakes:

Apple engineer leaves prototype of new iPhone at a bar.

UPDATE APRIL 20: Apple asks for their phone back

UPDATE APRIL 20: Engineer named

UPDATE APRIL 26: Police Raid (Wow...this seems overkill. I think this is a bad PR move by Apple).

Darik

A Wake-Up Call

The moment of clarity came at a trade show while I strolled around the exhibit hall looking at all the medical device companies that had had animations done to showcase their new products.

That’s a pretty good animation, and we didn’t do it. Hmm, there is another animation that we didn’t do. Wait a minute; there is another fricken animation, THAT ISN’T OURS. WTF, ANOTHER ANIMATION THAT WE DIDN’T DO!!!

For the next week I literally had sleepless nights. New competitors and lost opportunities…we needed to step up our efforts, now.

The issue on improving the quality of our content had been lingering with me for a while. More frequently I was finding medical content that was really great done by other companies, only to find myself making excuses for Understand…oh, well that is blah, blah excuse, blah, blah, excuse…

I am surprised at how easily I fell into the “business as usual” trap (thankfully it was short lived). In retrospect, I think it happens something like this…”Hey, we have great growth in a poor economy, wow, we rock. Let’s keep doing it this way!“ coupled with working in the business and not on the business.

As a starting point, a line was drawn in the sand. No new content would be created using our old processes and tools. We had to rethink how we create content. Nothing was off limits. Processes were reevaluated and changed (still are), money was spent (a lot), and new talent was hired (still looking for more).

The end result is world-class animation, a better user experience, and better educated patients.

What to expect from Understand in the coming months-

-A new approach to content development resulting in higher quality content, better story telling, and vastly improved 3D animation. This includes our existing animations, which are undergoing a complete revamp as well as new libraries and custom projects.

-Significant improvements to the user interface within our customer account section. Setting up and managing an account should be simple and intuitive like the iPad, which ships with no instructions.

-More flexibility in how patients view content. You want full screen? Ok. You want to remove the text? Cool. You want continuous play? You can do that too.

-More platforms to view our content-mobile, iPhone, iPad, waiting rooms…yes.

Energized,

Darik

Piracy Protection 3.0

After months of stealth development, I am pleased to announce the latest copy protection initiative from the tech team at Understand.com.

http://www.youtube.com/watch?v=up863eQKGUI

What the critics are saying:

“A viral masterpiece filled with shameful guilt.”
J. Szakara, Nevada

“Starts out slow, but by the end I had my Visa out and was making good for that rouge copy of Qbert.”
E. Zerrenner, Michigan

“I asked the development team to think out of the box for copy protection and they give me this. Wow. These guys rule.”
C. Miller, New York

“It’s like a deep moat with a dragon. A very mean dragon.”

D. Davis, Fresno

New Gov’t Report Demonstrates Superiority of Private Sector in Controlling Health Costs

This is the first paragraph of an article written by Morgen Richmond- The Centers for Medicare & Medicaid Services (CMS) released their annual report this week on total healthcare spending in the U.S. for 2008. To the limited extent that this release was even reported, the headline was that the growth in healthcare spending “slowed” from the prior year. From a growth rate of 6% in 2007 to only 4.4% in 2008. This in fact represented the lowest rate of growth since the CMS first started reporting this data in 1960. Given all the hyperbole about exploding healthcare costs this past year, this would seem to be wonderfully good news, worthy of national media attention. Might the cost curve be bending down (gasp) without government intervention? … Big Gov

Rely on Entrepreneurs, Not Bureaucrats

More good stuff from Steve Forbes: http://www.forbes.com/global/2009/1214/opinions-steve-forbes-fact-and-comment.html

Darik

"A Tax on Advertising- Plain and Simple"

Thank you to Jim Davidson for his excellent article on an amendment lurking in the healthcare reform bill that disallows pharmaceutical companies from deducting advertising expenses as well as the expense of sales personal, marketing seminars, and most if not all other related marketing expenses.

http://www.dtcperspectives.com/content/editor/files/Dec2009/EyeontheHill-ATaxonAdvertising.pdf

While this may sound like a reasonable way to cut drug costs (First Amendment aside) to people unfamiliar with the debate, Jim has written a good article as to why this is not the case.

Darik

UPDATE:

Here is another article for people who think DTC is evil...
http://www.dtcperspectives.com/content/editor/files/Dec2009/PerspectivesEditorial-TheAssaultThatHasNoEnd.pdf

TECHNOLOGY ROCKS

Here I sit in the Sao Paulo airport, waiting to go home. I have been here for 5 hours. I’m bored.

I have caught up on my e-mail. I have eaten. I have checked my fantasy football score. I have lamented the loss of my beloved Fresno State Bulldogs. I finished my new book “Outliers” and have perused four other books on my Kindle. I have counted my mosquito bites.

And then it hits me. I am in frickening Sao Paulo! I am 6,534 miles from home.

I watched Fresno State play Nevada from my COMPUTER, LIVE last night. I CALLED my wife from my COMPUTER to check-in on my daughter who was in the hospital. She took a picture of her to make me feel better and e-mailed it to me while we were on the phone. I got it SECONDS LATER. On my way here the plane had WIFI. I could have checked my e-mail while traveling at 500 MPH @ 35,000 feet FOR FREE. I can choose from TENS OF THOUSANDS of books from my Kindle and download them instantly.

I mean really, WHAT AN EXCITING TIME WE LIVE IN (ok, no more caps to illustrate my excitement)! Opportunity. Innovation. Convenience.

Sometimes the most mundane of days can fill up your tank when you take a moment to look around.

Off to terminal 2…

Darik

Capitalism- The World's Greatest Success Story

From my picture on this blog, it is easy to see where I stand on economics. Frankly, I never envisioned a time when I would feel compelled to defend the merits of capitalism. There is simply no other “ism” that has improved peoples standard of living or quality of life more than capitalism. Ever. And it's not even close.

Yet today there are movies being made against it and huge sectors of private industry being gobbled up by the government to “save it”. Capitalism doesn’t need saving. In fact, when free markets have problems, it is government that has caused them as detailed by Steve Forbes in this excellent article: http://www.forbes.com/forbes/2009/1019/opinions-steve-forbes-capitalism-true-love-story.html

One of my favorite interviews on capitalism comes from Milton Freidman, economist and American intellectual in this interview: http://www.youtube.com/watch?v=RWsx1X8PV_A

While I find myself dancing on the political tightrope again, the real purpose of this post is to remind people that entrepreneurs will get us out of this mess as they always do. They will create new products, fill needs, and hire people. Government doesn’t need new legislation, spend trillions of our dollars, or play favoritism with silly programs like “Cash for Clunkers”

I’ll close with this paragraph from the article by Steve Forbes on a specific example that illustrates the point well;

“When there is a need, entrepreneurs--appearing seemingly out of nowhere--will step in to fill it.
As one of the literally millions of examples, take what happened in the 1980s, after budget cuts forced the U.S. Coast Guard to scale back on some of its services. The Coast Guard could no longer provide nonemergency marine assistance to recreational boaters. Almost immediately, small entrepreneurs took up the slack. In Southold, N.Y. Captain Joseph J. Frohnhoefer Jr. founded Sea Tow Services International Inc., a AAA-like organization for boaters. His small business grew from a single vessel into a thriving franchise network with 108 locations throughout the U.S., Australia, Europe and the Caribbean.”

Darik

UPDATE 10/29: Taxpayers paid $24,000 per car for the Clash for Clunkers program- http://money.cnn.com/2009/10/28/autos/clunkers_analysis/index.htm

A Refreshing Conference

I was reminded today of the Blind Melon music video No Rain. For those of you who don’t know the video this tap dancing little girl dressed in a bumble bee outfit desperately tries to find a group she can identify with.

http://www.youtube.com/watch?v=dYlAwvz8uwc

So what does this have to do with Understand and online patient education you ask?

For the first time I am at a conference where I do not have to politely disagree with Susan the practice manager who believes that a piece of paper with medical jargon and a scribbled drawing from the doctor is all the practice needs for patient education. I don’t have to convince Dr. Fantasy that he does in fact need a web site because many of his patients are doing research on him and checking his qualifications online.

To be fair, many doctors and practice managers get it, especially in elective markets like plastic surgery. Those practices and hospitals that have not embraced technology will begin to find themselves at such a severe disadvantage that it will have a significant impact on productivity and patient care. Practice web sites, online patient education and EMR's will soon be as common as telephones and computers are today.

But this conference is far ahead of others focusing on Health 2.0 topics like the impact of social media (Facebook, Twitter, blogs…) on healthcare, using web-based tools to improve health outcomes and compliance, studies outlining the technological sophistication of patients, how best to communicate with patients online…interesting stuff when you live in my world.

Even though Understand has been doing this for six years, we are still in the infancy of online patient education. Our products have morphed from “you can have it in any color as long as it is black” into personalized patient experiences customized by the doctor with extensive metric tracking. In this otherwise bleak economy, I am grateful to be in an industry that continues to grow, innovate, and provide essential services that doctors and patients need.

So I find myself sitting in my hotel room and my head spinning with new ideas. This will not be conducive to a good nights sleep! Maybe I’ll watch the Blind Melon video again. Darik

A Doctors Warning

This is an insightful article from an orthopedic surgeon on healthcare refrom: http://www.washingtonpost.com/wp-dyn/content/article/2009/08/19/AR2009081903189.html

Darik

Not good...

This is not good news for entrepreneurs, the economy or our country.

http://online.wsj.com/article_email/SB10001424052970204313604574328621808977640-lMyQjAxMDA5MDAwNzEwNDcyWj.html#articleTabs%3Darticle

UPDATE 8-23-09

Here is additional insight from Steve Forbes on the topic of regulating and increasing taxes on VC's: http://www.forbes.com/forbes/2009/0907/opinions-steve-forbes-retarding-recovery.html


Darik

The truth will set you free...

Now that we have had time to read the proposed health care reform bill, this is what we learn (thank you Alan Caruba for putting this list together):

• Page 22: Mandates audits of all employers that self-insure!
• Page 29: Admission: your health care will be rationed!
• Page 30: A government committee will decide what treatments and benefits you get (and, unlike an insurer, there will be no appeals process).
• Page 42: The “Health Choices Commissioner” will decide health benefits for you. You will have no choice. None.
• Page 50: All non-US citizens, illegal or not, will be provided with free healthcare services.
• Page 58: Every person will be issued a National ID Healthcard.
• Page 59: The federal government will have direct, real-time access to all individual bank accounts for electronic funds transfer.
• Page 65: Taxpayers will subsidize all union retiree and community organizer health plans.
• Page 72: All private healthcare plans must conform to government rules to participate in a Healthcare Exchange.
• Page 84: All private healthcare plans must participate in the Healthcare Exchange (i.e., total government control of private plans)
• Page 95: The Government will pay ACORN and Americorps to sign up individuals for Government-run Health Care plan.
• Page 102: Those eligible for Medicaid will be automatically enrolled: you have no choice in the matter.
• Page 124: No company can sue the government for price-fixing. No“judicial review” is permitted against the government monopoly. Putsimply, private insurers will be crushed.
• Page 127: The AMA sold doctors out: the government will set wages.
• Page 145: An employer MUST auto-enroll employees into the government-run public plan. No alternatives.
• Page 126: Employers MUST pay healthcare bills for part-time employees AND their families.
• Page 149: Any employer with a payroll of $400K or more, who does not offer the public option, pays an 8% tax on payroll
• Page 150: Any employer with a payroll of $250K-400K or more, who does not offer the public option, pays a 2 to 6% tax on payroll
• Page 167: Any individual who doesnt’ have acceptable healthcare (according to the government) will be taxed 2.5% of income.
• Page 195: Officers and employees of Government Healthcare Bureaucracy will have access to ALL American financial and personal records.
• Page 203: “The tax imposed under this section shall not be treated as a tax.” Yes, it really says that.
• Page 239: Bill will reduce physician services for Medicaid. Seniors and the poor most affected.
• Page 241: Doctors: no matter what speciality you have, you’ll all be paid the same (thanks, AMA!)
• Page 253: Government sets value of doctors’ time, their professional judgment, etc.
• Page 265: Government mandates and controls productivity for private healthcare industries.
• Page 268: Government regulates rental and purchase of power-driven wheelchairs.
• Page 272: Cancer patients: welcome to the wonderful world of rationing!
• Page 280: Hospitals will be penalized for what the government deems preventable re-admissions.
• Page 298: Doctors: if you treat a patient during an initial admission that results in a readmission, you will be penalized by the government.
• Page 317: Doctors: you are now prohibited for owning and investing in healthcare companies!
• Page 318: Prohibition on hospital expansion. Hospitals cannot expand without government approval.
• Page 321: Hospital expansion hinges on “community” input: in otherwords, yet another payoff for ACORN.
• Page 335: Government mandates establishment of outcome-based measures: i.e., rationing.
• Page 341: Government has authority to disqualify Medicare Advantage Plans, HMOs, etc.
• Page 354: Government will restrict enrollment of SPECIAL NEEDS individuals.
• Page 379: More bureaucracy: Telehealth Advisory Committee (healthcare byphone).
• Page 425: Government will instruct and consult regarding living wills, durable powers of attorney, etc. Mandatory. Appears to lock in estatetaxes ahead of time.
• Page 425: Goverment provides approved list of end-of-life resources, guiding you in death.
• Page 427: Government mandates program that orders end-of-life treatment; government dictates how your life ends.
• Page 429: Advance Care Planning Consult will be used to dictate treatment as patient’s health deteriorates. This can include an ORDER for end-of-life plans. An ORDER from the GOVERNMENT.
• Page 430: Government will decide what level of treatments you may have at end-of-life.
• Page 489: Government will cover marriage and family therapy. Government intervenes in your marriage.
• Page 494: Government will cover mental health services: defining, creating and rationing those services.

A link to more articles from Alan Caruba can be found here: http://www.chronwatch-america.com/authors/34/Alan-Caruba

Darik

Slow Down on Health Care Reform

HR 101- the work place is not the place to discuss politics or religion. But when politicians propose to change the face of the industry you do business in, you have an obligation to speak up. It is in this light that I comment on health care reform and what I see as a monumental mistake without proper due diligence and on the backs of small business and high income earners.

What is the role of government? My expectations are simple. In the most basic sense I expect it to:
-Provide security and defense
-Create and maintain infrastructure
-Manage and enforce laws
-Provide a baseline of education for citizens

As proven time and time again, government doesn’t do even these basic things very well. The examples of government waste are so common they are as cliché as the $640 toilet seat: More examples here: http://www.heritage.org/Research/Budget/wm839-list.cfm.

With this abysmal track record, our government wants to take over healthcare.

What evidence has the government given us that they can manage, let alone successfully reform our healthcare system? What evidence do we have that what it will be shaped into will be better than what we have today? Is it the role of government to provide healthcare for all? Why not also provide universal food? Universal housing? Universal transportation? You can extend this argument into absurdity. Where do we draw the line?

These are the same folks who passed an $800 billion stimulus bill without one person actually reading it! http://www.cnsnews.com/Public/content/article.aspx?RsrcID=43478)
Can you imagine employing a person who signs contracts without reading them? It comes as no suprise that given the time to read and understand the stimulus bill it is full of pork, waste, and questionable earmarks. Examples here: http://online.wsj.com/article/SB123310466514522309.html

In only 6 months I have watched the government take control of the automotive, finance, and insurance industries under the pretense of “too big to fail”. Trillions have been committed to save questionable businesses that have made bad decisions. Our elected officials are putting a suffocating amount of debt on we the people for generations to come (http://www.politico.com/news/stories/0709/25164.html) without proper due diligence or an exit strategy.

Most Americans are distracted and are simply trying to survive in this economy and have little capacity to digest the ramifications of nationalized healthcare. Washington has proven that if you create legislation fast enough and push it hard enough you can pass almost anything. "Never let a good crisis go to waste." is turning out to be fact, and not tongue-in-cheek.

Most good things are imperfect and can be improved upon. The current U.S. healthcare system is no exception. Despite the criticism our system receives, no other country has produced more advancements in medicine or improved peoples quality of life more than the United States. Examples here: http://www.ncpa.org/pub/ba649

Before we drastically alter healthcare, we need to have careful analysis and thoughtful debate from people far outside the beltway.

Darik

Don't Lie, Cheat or Steal

My first boss told me I could take risks and make mistakes but if I were to lie, cheat or steal I would be fired. Simple and solid advice for a young man out of college (thanks Tim).

This litmus test has served me well, and while some may argue that it is as obvious as looking both ways before you cross the street, I offer you some examples from today’s news:

Plastic Surgery Device Company Settles Case of Reviews It Faked
http://www.oag.state.ny.us/media_center/2009/july/july14b_09.html

Madoff starts 150-year sentence at NC prison
http://news.yahoo.com/s/ap/20090715/ap_on_re_us/us_madoff_behind_bars_7

Mortgage fraud is expected to escalate
http://www.lasvegassun.com/news/2009/jul/17/mortgage-fraud-expected-escalate

Banned NY clinic owner faces new $47M fraud charge
http://www.newsday.com/news/local/newyork/ny-nyclinic0717,0,1524749.story

Stanford’s $7 Billion Fraud Trial Delayed
http://www.bloomberg.com/apps/news?pid=20601103&sid=aW537JwPznUk

My advice to entrepreneurs:

-Tell the truth
-Do background checks on all employees and contractors
-Trust but verify

Darik

Props for Reno

Much to my wife's disdain, I love the Comedy Central show Reno 911. If you haven’t seen it, let's just say Lieutenant Dangle and crew don't always portray our beloved city in the best light.

So it's nice to see Reno getting some well deserved props: http://finance.yahoo.com/news/Next-Generation-Consulting-prnews-15500060.html?.v=1

Next Generation Consulting of Madison, Wis., has named Reno as one of the hot "Next Cities" for young professionals to live and work. Reno ranks 17th among mid-sized cities based on factors such as living costs, wages and after-hours activities. I do find it a little suspect that their home town of Madison was ranked number 1, but we will give them the benefit of the doubt.

And for all you business owners and entrepreneurs across the border dealing with high taxes and cost of doing business in California, Reno has 300+ days of sunshine, world-class skiing, minimal traffic, affordable housing, a river that runs through our downtown, and no state income tax.

Darik

Impressive

Last Wednesday I was a judge for the Tri-State Donald Reynolds Cup (http://www.dwrgovernorscup.org/). This competition includes the top business plans from college students from Arkansas, Oklahoma and Nevada all competing for $100,000 in prize money.

Enter Drew Cleaver and his team from John Brown University in Arkansas. When I first read the business plan I had a smile from ear to ear. His idea is the proverbial “better mousetrap” and the story that goes along with it is exactly what makes this country great. It is simple, ingenious, and will no doubt make Drew a lot of money.

Drew was frustrated with the lack of vertical space in his dorm room closet. So he thought, tinkered and came up with a better clothes hanger that gives you 25% more vertical space for clothes. In 2006 he submitted a patent application and in 2008 he was granted a patent (on his first attempt nonetheless).

Drew is currently in talks with several major manufacturers and distributers including Wal-Mart. Drew won the competition and I have no doubt that we will all see his “Higher Hangers” in stores soon. Bravo Drew. http://www.higherhangers.com/

Next, enter Ben Casnocha. Friday morning a friend invited me to the monthly WIN breakfast in Reno. This month the guest speaker was Ben, a successful businessman, author (My Start-Up Life) and speaker. PoliticsOnline named him one of the "25 most influential people in the world of internet and politics". BusinessWeek recently named Ben "one of America's top young entrepreneurs."

Ben is 21.

It was with curiosity and furrowed brow that I prepared to listened to Ben. I came ready to roll my eyes. “Tell me something interesting you snot nosed kid.”…and he nailed it. Articulate, thoughtful, provocative… I am bewildered at how someone can become so wise and interesting at 21. I don’t know what the future holds for Ben, but it will be glorious. Bravo Ben. http://www.casnocha.com/

Darik

Please fasten your seat belts...

I have included an insightful article about change from author Jim Collins (Good to Great, Built to Last)- thank you Joe. The article makes several good points, but my key take-away is that we have to redefine “normal”. Turbulence is the new normal, and has been for most of human history. The last 50 years, even with 9-11 and the dot com crash have been an anomaly in that economic growth and overall stability have been the norm. Those companies who remain adaptable and get on with business will prosper.

http://money.cnn.com/2009/01/15/news/companies/Jim_Collins_Crisis.fortune/index.htm

Another interesting comment I heard someone mention on CNBC was that “flat is the new growth”. That mentality runs counter to every fiber of my being. You are expanding, or you are retracting. Retract too much, and you will go the way of the Dodo bird. It can be very appealing to dismiss away poor decisions, poor marketing plans, and poor sales growth to the turbulent economic conditions we are in. This is a convenient excuse readily accepted by others, daily. Stop it. Things are going to remain turbulent. It is what it is. Take ownership of your decisions and results. If they aren’t working, fix them. Adapt. I can assure you there is a competitor out there who will figure it out.

Darik

RIP AOL

Yes, after 14 years I am ending my AOL account. As the CEO of a technology company I have finally realized that this subscription is "affecting my reputation as a dude". As a courtesy, I cc'd my AOL contact list my Understand e-mail address.

Here are some of the best responses:

-Welcome to the 90's (and a half dozen welcome to the 21st Century)
-Hey, there is a great new service where you can buy groceries online called Webvan.
-Dude...AOL, seriously.
-It took you 14 years to figure out AOL sucks?
-I didn't even know you had an AOL account. HAHAHAHAHA you are an IDIOT.

While this may very well be warranted, I would like to think that it demonstrates my loyalty and the special relationship I have had with Steve Case.

Darik

Fun

Great time yesterday at our company event. The afternoon started with an intercompany wiffelball game where the mighty Hedgehogs defeated the Vipers scoring some ungodly high number. Vipers head coach Eric Zerrenner had little to say at the end of the game except the bat not being regulation size and weight and something about a rematch on the ice.

We then made our way to the Ace’s home opener. Wow. What a great ballpark and overall experience. Reno has a real hit on their hands. Sorry, couldn’t help myself.

We then made our way down the street to a bar. I want to thank my lovely wife for putting my name in to sing karaoke. And while I love Charlie Daniels, I didn’t realize how quickly the words to The Devil Went Down to Georgia come up on a teleprompter. My apologies to everyone in the bar.

Darik

Downtown Reno Renaissance

With bad news pouring out of every media orifice, I need to highlight some really great things that are happening in downtown Reno.

The new office has exceeded the entire team’s expectations. Thank you to our new landlords Alex and Marion of AMH Properties (http://www.amhprop.com/) who have over delivered in every respect. It’s nice to finally have an office that matches the quality of the team. The vibe here energizes me every time I come in the door.

Economic stimulus…we have already had several people move downtown with more on the way. Understanders are eating, drinking, biking, and shopping downtown everyday. Last week Don Massie even kayaked to work in 30 degree weather.

The Montage (http://www.themontagereno.com/) opened it doors and is selling brand new condos that are absolutely gorgeous. Fernando Leal has single-handedly made the biggest improvement to downtown in years. He had the vision, guts and tenacity to make this project happen. Bravo Fernando. My hat is off to you.

West Street Market (http://www.cityofreno.com/Index.aspx?page=1517) is now open with artists, food, music and drink. This is a great addition to the city.

And finally, the Reno Aces (http://web.minorleaguebaseball.com/index.jsp?sid=t2310) have their home opener tomorrow in a brand new ball park. The game is sold out and the city is abuzz. Understand is the proud owner of season tickets and we will be closing down a little early tomorrow for a mystery event and to attend the game. May the dogs be warm and the beer cold.

Darik

Understanding Angels

If you are trying to start a business and are new to the world of raising funds, here is a great article by Paul Graham for new angel investors that should give you excellent insight into their world.

http://www.paulgraham.com/angelinvesting.html

Darik