When I speak to classes at UC Berkeley and Stanford, most of the questions center on career advice:
What should I do? Should I get my masters now or later? Should I join a start-up, start a company, or join a more established firm?

My answer: It is too risky not to take a risk.

That’s right. Doing the “safe” thing is the riskiest thing you can do in today’s environment.

What’s “safe”?
Joining Google, HP, McKinsey. Huh? That’s right … joining one of these firms is way too risky.

What’s better?
Joining a start-up or starting your own company. It is counter-intuitive, but it is actually far less risky to take a risk. Of course, that assumes you live in a place like Silicon Valley and not in a place like Germany.

Let me explain and compare to opportunities:

Let’s say you’re a newly minted Harvard MBA with an engineering background and you get a sought-after product management job at a large tech company at $105,000. You’ve got a few stock options and a potential bonus. Sounds low-risk right? Wrong.

Another job offer is a newly funded start-up. 18 people. Has 18 months of cash to burn. Seems to have a good plan and good potential. You get a product management offer for $80K and lots of options. Seems risky? Wrong again.

The big company is the wrong move because your up-side is capped and your downside is roughly the same as the start-up. The down-side at the start-up is it goes under and you’re out of a job. The downside at a large company is they do another re-org and you’re out of a job. Of course, the bigger downside is that they never do a re-org and you actually keep your job at big bertha for the next ten years. What then? Maybe you’ve worked your way to a VP and have to deal with bureaucracy and in-fighting … and you cannot understand how your SVP still has a job because he’s so incompetent.

Let’s a assume you do lose your job (the downside in each scenario). Guess what? Who cares? You can always get a job. I repeat, you can always get a job. Of course, this assumes you live in a place where failure is embraced (Silicon Valley) and not in a location where failures are shunned (Germany). In Germany the bankruptcy court might go after you personally. In Silicon Valley, if a large company offers you a job today … they’ll likely offer you that same job two years from now … even after a failed start-up.

Now to the start-up … we’ve already discussed that your downside is low (basically it is earning $25K less a year and a slightly higher possibility of being out of a job earlier). But your upside is outstanding. And not just financial upside, but the learning, the dynamism, the fun, and the opportunity to help change the world. Put it this way — joining a start-up (loss of $25K/year) is much less risky than getting an MBA (loss of $150K/year) and both have similar upside.

Some people say that working at a big company is like investing in a bond that gives you a guaranteed 4%/year while working at a start-up is like investing in a high-beta hedge fund. That’s not a good analogy. Because your downside is capped at a start-up. It is like investing in a hedge-fund where the upside is limitless but the downside is capped at 2%/year — wouldn’t you take that option over investing in the guaranteed 4%? Of course, you’d take it any day.

The real problem is that finding a job a cool start-up (or founding your own company) is hard work. It takes a lot of time and effort. Finding a big-company job is easy. But the job market is changing fast. Vertical job search engines like SimplyHired (www.simplehired.com), referral rewards systems like karmaONE (www.karmaOne.org), and candidate centric sites like The Ladders (www.theladders.com) and WooMeNow (www.wooMeNow.com) are changing the way people find jobs and how companies find people.

Summation: it is far more risky not to take a risk.

Superficial people are low value-add. They tend to be takers more then givers and seem to follow the latest trend more than an internal compass.

Three of the things that superficial people use to make judgments about other people:
cars, watches, and shoes

That’s right. They tend to look at the car you drive, the watch you wear, and shoes you walk in. This is especially true for men.

So if you drive a $100K red sports car, wear a $4000 watch and $700 shoes, you’ll likely be targeted by superficial people. If you are the exact same person, but drive a $20K car with a $20 watch and $100 shoes, you will likely not be targeted by superficial people.

So … what is it worth to you to not be on the superficial hit-list??

What’s with the huge email attachments???

I mean … come on …

I’m in a cab to the airport and I’m downloading my emails … laptop hooked up to my mobile phone … at 145 Kbps … and it turns out that a business colleague sent me a 5 MB attachment …
Jeeez … I finally download the attachment and excitedly opened it and … guess what? … it was not worthy of being 5MB. It was not even worthy of being an attachment at all. It was a really bad marketing brochure.

Which led me to the latest Summation Law:
The value of an email attachment is inversely proportional to its size.

Power is like cottage cheese — it has an expiration date. Integrity is like a Twinkie — if you maintain your consistency it can last forever. Do you want to be a Twinkie or cottage cheese?

You ever think about happiness? I guess this is a subject that dominates many people’s thinking but it generally did not enter my mind much in the past. But I started thinking about happiness more because of an extraordinary woman I met in South Africa a few months ago.

I was walking through the outskirts of Soweto … through a shanty-town … when I met a nice woman. Even though she had a few teeth missing, she had a big smile and was very welcoming. She invited us into her home … this was a tiny one-room 100 sq foot tin home with a tin roof … and the first thing I noticed was that it was … immaculate. Absolutely immaculate …

And she was proud of her home.

And she showed me the two beds in her home. Beds were small … tiny … she shared one bed with her daughter and her two sons (both teenagers) shared the other. But she was bragging to me about her home.

Her block (with about 45 other tin homes) just went from just one porta potty to three porta potties. And their block just got a tap for water (they used to have to walk three blocks for water but now their entire block can share one tap). Progress … and she was happy.

And she was happy with what she had … it was not that she was living in ignorance. From her home you could see the highway where all these Mercedes Benzes were cruising … and just 10 miles away in Johannesburg are some of the richest homes in world … and just 2 miles away (a nice walk) are the really nice areas of Soweto with Nelson Mandela and Bishop Tutu have homes …

But she was still very happy.

So … I thought to myself … I can never complain. We are the Blessed Class.

But more than that … I decided right there and then that I would only associate with other people that are happy. So I have a new rule:

If you are unhappy you better have a good excuse for being unhappy.

That’s right. If your mom dies … you should be unhappy for a time. If you got dumped from a long relationship … shed some tears. You got fired from your dream job? Yes, you too can be unhappy for a limited time.

But …

But … if the waiter serves you a side of French fries instead of the mashed potatoes you ordered … you can’t get unhappy. If a friend shows up late to dinner … you’re still happy. The cable company double-bills you for your pay-per-view movie … yup, still happy. If you’re a little hungry, a little cold, your shoes gave you a blister, your favorite TV show got cancelled, the Yankees lose a game, someone spills red wine on your new shirt … you’re happy …

As I wrote last year, for us, the blessed class, it is essentially immoral for us to be unhappy…

There are two types of people in this world:

1. People who respond quickly to evites — replying with a “yes/no/maybe” immediately
2. People who keep checking the evite daily … weighing their options … mulling it over … and finally deciding to never respond

Ever send out an evite? As the sender, you can see when someone looks at the evite. Sometimes I’ll see that someone looked at an evite multiple times but still not respond. What gives?

There is such a thing as evite etiquette. If someone is kind enough to send you an invite to their birthday party, a gallery opening they are having, etc. you should be kind enough to respond right away with a “yes”, a “no”, or at least a “maybe”. If you are truly not sure or have trouble making decisions then reply with a “maybe”. That’s much better than the I-looked-at-the-evite-but-will-pretend-that-i-never-saw-it routine ….

David Teten posts a very interesting tidbit about Gender Differences in Spoken and Written Communication. Much of which isn’t too surprising and confirms common stereo types (men are longer-winded and use more profanity, women tend to be more polite, etc.) … but it is interesting to see data bacj it up. Worth taking a look at…

I think everyone should strive to have two years of liquid assets to cover expenses. That’s not possible for most Americans, but it is something you should strive for. It will give you a ton of flexibility and keep you ethical.

The goal:  To have enough cash in the bank that you could, without changing your lifestyle one iota, live on your cash for up to two years.

Why a strategic cash reserve is important
Just like the United States government keeps a strategic oil reserve, you should keep a strategic cash reserve. Maybe you cannot do two years — than start off with what you can put away and grow it from there. This reserve is not for a rainy day or for just a random emergency — you should try to keep other funds for that — this fund is for if you are out of work (or want to go without pay to start a business).

This fund gives you flexibility of not taking the first job you are offered. But more importantly, this fund will keep you ethical.

Keep you ethical? What do I mean?

I believe that most of the corporate scandals are due to the fact that people live beyond their means and most people will cheat, lie, and steal (or do whatever it takes) to maintain their current lifestyle. My theory on Enron, Worldcom, etc. it that the executives were over-extended and once things started taking a turn for the worse they started cooking the books because they couldn’t bear to lose their perks (their club memberships, their chauffeurs, etc.). Most people do not want to eliminate luxuries — people do not want to take a step backward in life.

You can ensure you never have that temptation. You can save before you take on a new expense. Let’s say you want to join a gym and it costs $100 per month. Treat that as a liability that you will have to incur for at least two years — and make sure you have an extra $2400 ($100 times 24 months) in your "life emergency account" before incuring that liability. Now this does not mean that you can go ramp-ape on one-time-purchases either (as you do not want to get too used to being on the charity circuit even though each gift is a one-time purchase).

Though most people can’t have a two-year of cash reserve, it is a goal worth striving for and it is my definition of financial success. I know this sounds crazy, but i know many people making over $150K/year that have less then $10K in their account and they are still paying off their credit card debt…

After just celebrating Christmas and Hanukkah, I have been thinking a lot about religion….

In the U.S., parents generally no longer determine a child’s profession, whom they marry, where they live, what they study, who their friends are, etc. … but parents still determine their child’s religion — arguable one of the most important aspects of someone’s life and soul. why?

there are many great religions out there — why are most people’s religion chosen by one’s parents?

and though some religions simultaneous act as cultures — like the Jewish culture — culture is much different then religion. culture is much more about your background and where your ancestors came from — and one should celebrate that. but religion is much more about who *you* are.

Now many people change their religion or convert to a new religion then their parents — but they are a very small minority. The biggest predictor of a person’s religion is what their parents’ religion is (and the only time people tend to change their religion is right before marriage). That’s not as true in profession, field of study, favorite hobbies, favorite authors, or even political party.

Why? Why don’t people choose a religion for themselves?

Ahhhh … New Year’s Resolutions … i actually am a big fan of them yes, i don’t kid around — i set goals for each year and then i check up on the goals every quarter and track how i am doing against these goals.

some are business goals (like revenues for my company, Stonebrick). some are more personal goals.

this year, one of my most innovative resolutions is to limit small talk and concentrate on big talk?  how, you ask?   i have no idea how i’m actually going to be able to move the average cocktail conversation to big talk … but i am going to try.   i imagine i’ll piss off a few people in the process … but no pain, no gain.

i came away thinking that we spend too much of our time on small talk.  especially people that spend most of their professional time selling (like myself).  instead of asking someone i just met "where do you live?" or "where did you grow up?" or "what do you do?" i might to try to stir the pot a little …

check back with me next quarter and i’ll let you know if this little experiment is successful …

Peter Hirshberg writes a great piece on Young People, Overwhelmed by Friends, Turns to Friendinis.

snip:

“We’ve had lo-cal cola, lo-cal chips, and now comes lo-cal friendships,” says Terence Loughton of Cambridge University.

are we ready for friends-lite? because of technology we are adding more “friends” then ever before. but is this just a rehashing of the old debate on friends vs acquaintances?

As the new year approaches, I find it is helpful to write down one’s rules for living. I have done this for the last few years and find it is help. Published below are some of my (non-personal) rules.   I would also be very interested in hearing your rules — feel free to email them to me.

– don’t waste your talents. If you are blessed, help others.

– if you are reading this, chances are that your life is better than at least 90% of the people on earth. Always remember that. Use your talents and wealth to make the world better for the other 90%.

– always be adamant about learning. Time is not on your side. Listen to books on tape. Read the paper every day. Incorporate learning into your daily routine

– force yourself to read at least 10 pages of a book every day. A real book (with at least 150 pages) — not a periodical.

– go out of your way to help people. Always be the first to proactively volunteer to drive a friend to the airport or help her move. Always try to connect people to one another if they can mutually benefit.

– don’t complain … ever. Don’t sweat the little things …

– don’t hang out with people that complain

– fire people that complain

– never, ever be unethical. Follow the ten commandments to a tee. In the rare case that you tell a lie, make sure you force yourself to feel bad about it.

– always be on time and respect other people’s time

– always have something to read

– fix little problems right away

– always carry a pen

– "the perfect is the enemy of the good". There are things that need to be done right and there are things you need to do right now.

– "one does not discover new lands without consenting to lose sight of the shore for a very long time" – Andre Gide

– "the worst thing you can do for those you love is the things they could do and should do for themselves." – Abraham Lincoln

– "you miss 100% of the shots you don’t take" – Wayne Gretzky