Jun 182014

Democracy in Action

I went to our local high school gym last night to vote for a smallish ($12mm) school bond issue as well as another proposition I didn’t quite understand about paying for fire alarms in the schools. As is always the case in New York, I was somewhere between amused and appalled that the voting machines are pre-war vintage (possibly Civil, definitely WWI).

But this election was a new experience for me. When I finished voting, I ran into a friend of ours who is on the school board, and he suggested I stick around because the polls were closing, and I’d get to hear the results.

This picture is how the results were tabulated. A woman with a whiteboard yelled across the gym to each of three other volunteers, who yelled back the numbers from each of the three machines. Hand tabulation in 2014. I’m glad the vote wasn’t close!


Why exactly are we not all voting on the internet by now?

Apr 052012

A Great American Experience

A Great American Experience

President Obama signed into law today a bill called the JOBS Act.  I haven’t read the full text of the law, but based on abstracts, my opinion of the JOBS Act is that it’s great for the startup community, but even greater for growth companies. I am less familiar with the Crowdsourcing components of the bill, but certainly that will make it easier for pure startups to attract micro capital.

The Sarbanes-Oxley reforms that make it easier and less costly to go through an IPO and be a public company will really enable growth companies like Return Path and many others in the Internet industry to go public a little earlier and with less difficulty. Tapping the public markets like that will enable the thriving Internet sector, which is one of the few truly high-growth segments of the economy, to grow even faster and create even more jobs.

Even better — George, Jack, and I were invited to attend the bill signing ceremony and speech in the Rose Garden at the White House!  Below are three pictures, one of the signing, one of the three of us, and one of me and Scott Dorsey, our friend and CEO of Exact Target, who we ran into there.

It was a great experience for the three of us overall.  Seeing the White House, the President, and a positive product of the legislative process up close and personal was great.  Hearing the President’s speech, which was a complete pep talk about the virtues of entrepreneurship and small businesses as the growth engines of the economy, was very inspirational.  And overall, the whole thing made all three of us so proud of everything that all 300+ of us, and our very strategic and patient investors and Board members, have accomplished at Return Path these past dozen years.  We ARE part of the global growth story.  And we should all be excited about that!

Jan 052012

Book Short: Fixing America

Book Short:  Fixing America

I usually only blog about business books, but since I occasionally comment on politics, I thought I would also post on That Used to be Us:  How America Fell Behind in the World It Invented and How We Can Come Back, by Tom Friedman and Michael Mandelbaum (book, Kindle), which I just finished.

There is much that is good about America.  And yet, there is much that is broken and in need of serious repair.  I wrote about some thought on fixing our political system last year in The Beginnings of a Roadmap to Fix America’s Badly Broken Political System?, but fixing our political system can only do so much.  Tom Friedman, with whom I usually agree a lot, but only in part, nailed it in his latest book.  Instead of blaming one party or the other (he points the finger at both!), he blames our overall system, and our will as a people, for the country’s current problems.

The authors talk about the four challenges facing America today – globalization, the IT revolution, deficits and debt, and rising energy demand and climate change, and about how the interplay of those four challenges are more long term and less obvious than challenges we’ve faced as a country in the past, like World Wars or The Great Depression, or even The Great Recession.  The reason, according to the authors, that we have lost our way a bit in the last 20-40 years, is that we have strayed from the five-point formula that has made us successful for the bulk of our history:

  • Providing excellent public education for more and more Americans
  • Building and continually modernizing our infrastructure
  • Keeping America’s doors to immigration open
  • Government support for basic research and development
  • Implementation of necessary regulations on private economic activity

It’s hard not to be in violent agreement with the book as a normal person with common sense.  Even the last point of the five-point formula, which can rankle those on the right, makes sense when you read the specifics.  And the authors rail against excessive regulation enough in the book to give them credibility on this point.

The authors’ description of the labor market of the future and how we as a country can be competitive in it is quite well thought through.  And they have some other great arguments to make – for example, about how the prior decade of wars was, for the first time in American history, not accompanied by tax increases and non-essential program cuts; or about how we can’t let ourselves be held hostage to AARP and have “funding old age” trump “funding youth” at every turn.

The one thing I disagree with a bit is the authors’ assertion that “we cannot simply cut our way to fiscal sanity.”  I saw a table in the Wall Street Journal the same day I was reading this book that noted the federal budget has grown from $2.6T in 2007 to $3.6T today – 40% in four years!  Sure sounds to me like mostly a spending program, though I do support closing loopholes, eliminating subsidies, and potentially some kind of energy tax for other reasons.

I’ll save their solution for those who read the book.  It’s not as good as the meat of the book itself, but it’s solid, and it actually mirrors something my dad has been talking about for a while now.  If you care about where we are as a country and how we can do better, read this book!

Jan 032012

Taking Stock

Taking Stock

Every year around this time, I take a few minutes to reflect on how the business is doing, on my goals and development plans, and on what I want to accomplish in the coming year.  Although most of that work is focused on how to move the business forward, I also make sure to take stock of my own career trajectory.  I always ask myself three questions when I do this:

  1. Am I having fun at work?
  2. Am I learning and growing as a professional?
  3. Is my work financially rewarding enough, either in the short term or in the long term?

Of course, I always shoot for 3 YES responses.  Then I know my career is on track.  But as long as I get 2 YESses, then I feel like I’m in good shape, and I know which one to work on in the coming year.  I’m not sure I’ve ever had a situation in the dozen years of running Return Path where I’ve had 0 or 1 YESses.  If I did, I’d probably spend more time thinking about whether I was still in the right job for me.

I think these three questions can work for anyone, not just a CEO.  Hopefully everyone takes the time to take stock like this at least once a year.  It’s healthy for everyone’s career development.

Dec 202011

Transparency Rules

Transparency Rules

I think each and every one of our 13 core values at Return Path is important to our culture and to our success.  And I generally don’t rank them.  But if I did, People First is a leading contender to be at the top of the list. The other leading contender would be this last one in the series:

We believe in being transparent and direct

The big Inc. Magazine story about us last year talked a lot about our commitment to transparency and some of the challenges that come with being transparent and direct with people. I’d like to highlight here some of the benefits of being transparent, and the benefits of being direct (sometimes those two things are the same, sometimes they are different).

Transparency’s benefits are so numerous that it’s hard to pick just one or two themes to write about, but my favorite benefit is empowerment.  Especially in a world where information is increasingly available and free, hoarding it comes at a high cost.

  • If everyone in the company knows that you’re short of plan and disappointed about that, the majority of people will exercise hawkish judgment about expenses.  The opposite is true as well.  If people know you’re running ahead of plan, they will be more willing to take risks and make investments. Without transparency of financials, people are just more in the dark and looking for all answers and judgment to come from above
  • If everyone on your staff understands the process you went through to make a tough call about an element of your strategy, they are not only more likely to understand and support the decision, but they learn from you how to make decisions in the first place
  • If your Board knows you’re having a tough quarter from the get go, they’re not surprised at the quarterly meeting and don’t force you to spend painful and precious minutes in the meeting On the firing line reporting on the details. Instead, they can spend time leading up to the meeting thinking about the details of the problems and how they can help or what insights they can bring to bear

Transparency does have some limits, even today.  There are three main limits we run into. One is compensation — still too touchy and wrapped up in people’s self esteem to post on the wall (though I have heard about a couple companies that do that, believe it or not). Another is terminations. Although you might want to tell the company that you fired Sally because she wasn’t carrying her weight, the long term value you derive from dignity and kindness trump any short term value you might derive from such a statement (plus, people know when Sally isn’t carrying her weight, anyway). The third limit to transparency is around half-baked ideas. Although you might sometimes want to try ideas on for size publicly, you have to be careful not to send people scurrying off in the wrong direction just because you blurted something out in a meeting.

The second half of this value statement is about being direct.  Being direct mostly has benefits in terms of efficiency. You can be direct and still be polite and kind.  But being direct means not beating around the bush, being political, or being conflict avoidant.  It means nipping problems in the bud and saving yourself time or money in the long run.

  • If you are direct with an employee who is not performing well with data to back it up, the employee has a much better shot at improving than if you delegate the feedback to HR, wait for the next annual performance review, or go passive and skip the feedback entirely
  • If you are direct with a boss who you think is treating you unfairly, your odds of fixing the situation go way up
  • If there’s bad news to deliver, be direct about it — look the other person in the eye, deliver the news crisply and succinctly, and as quickly as you can after finding it out or deciding on it yourself

Avoid euphemisms at all cost. Telling someone you “might have to rethink things” is not the same as saying “I will have to fire you if xyz don’t happen in the next 30 days.” Saying “xyz would be good for you to do” is not the same as saying “the way for you to get promoted is to consistently do xyz.”

Being transparent and direct are increasingly table stakes for successful companies full of knowledge workers who want to be empowered and clear on where they stand.

I’ve really enjoyed writing all of these values out in living color. I will do a wrap up post shortly.

Sep 092011

9/11’s 10th

9/11’s 10th

I wasn’t yet writing this blog on 9/11 (no one was writing blogs yet), and if I had had one, I’m not sure what I would have written.  The neighborhood immediately surrounding the World Trade Center had been my home for more than seven years before the twin towers fell, and it continued to be my home for more than seven years after they fell.  That same neighborhood was Return Path‘s home for its first 18 months or so, across two different offices.  Like all Americans, the attack felt personal.  Like all New Yorkers, it was in our face.  But it hit home in a different way for those of us who lived and worked in Lower Manhattan.

For the seven years after the attacks, I stopped by Ground Zero on the morning of 9/11 to reflect and memorialize the event.  I won’t be doing that this year — between living outside the city, the kids, and the likely overwhelming crowds, it doesn’t make sense.  So this post will have to suffice as this year’s reflection on the 10th anniversary of that awful day.

My memories from that day and the weeks that followed are a little jumbled now, as memories often are.  The things I remember most vividly, both personal and professional, are:

  • The smell and the smoke.  Up until the New Year, over 3 months after the attacks, a plume of smoke was rising from Ground Zero, and the air had a putrid smell of burning everything — building materials, fuel, fragments of life
  • I had left the city that morning to drive to a meeting in Danbury, Connecticut at Pittney-Bowes with our then head of sales, Dave Paulus.  We both received calls on our cell phones at the same instant from Mariquita and Pam telling us to turn on the news, that a plane had crashed into the World Trade Center.  For a while, everyone assumed it was an accident.  We continued with our meeting, although it kept getting interrupted with more bad news coming in via our senior contact’s assistant, until she wheeled a TV into the conference room so we could watch for ourselves
  • I couldn’t get back into the city that night, so Dave and I crashed at my Grandma Hazel’s house in Westchester.  When I finally did get home, Mariquita and I met up and stayed with our friends Christine and Andrew on the upper west side and listened all night to the fighter planes cruising up and down the Hudson River, sentries on patrol
  • When we finally could go back to our apartment, we had to go on foot from Canal Street south, and we had to show proof of residence (in our case, a copy of our lease) to get past the military guards.  With no traffic allowed and no subways running in Lower Manhattan for a week or two, the streets had an eerie emptiness about them.  The prevalence of national guardsmen and NYPD patrols toting machine guns made it feel like a war zone
  • At work, where the Internet 1.0 meltdown was still in process, we were in the middle of negotiating a life-saving financing and acquisition of Veripost with Eric Kirby and George.  We hit the pause button on everything, but we picked back up and dusted ourselves off within a day and got those deals done within a few weeks and saved the company
  • We had one junior employee in our New York office who got into his car on the afternoon of 9/11, drove to New Hampshire, and never contacted us again.  Just completely blew a fuse and dropped out.  It wasn’t until we tracked down his parents a few days later that we even knew he was safe and sound
  • I was fortunate not to lose anyone close in the attacks, but my friend Morten lost over a dozen close friends who were all traders from his town in New Jersey.  He attended every single funeral.  How he got through that (and how others got through their many losses) remains beyond my comprehension, even today

The only thing I have really blogged about over the years related to 9/11 was my post Morning in Tribeca in 2004 when the skeleton of WTC7, the first rebuilt building, was going up.  Now that the Freedom Tower is rising, it finally feels like the Ground Zero site has great forward momentum and will in fact be fully renewed in a few years once the bulk of this construction is done and the tenants have moved in.  That will be a great day for New York, and for America.

Filed under: Current Affairs, Politics, Return Path


May 022011



Once I stripped out the spam and the person:person emails from my inbox this morning, here were the five subject lines I was left with:

  • Wall Street Journal:  Osama Bin Laden is Dead
  • [eCommerce company]:  Final Hours to Shop Our Private Sale!
  • Wall Street Journal:  Bin Laden Was Killed in Abbottabad, Pakistan Official Says
  • [Travel site]:  Last minute deals from NYC and more!
  • Wall Street Journal:  Osama Bin Laden Buried at Sea
  • Return Path (yes, my own company):  Why Whitelisting is Important to Your Email Marketing Mix

The cynic in me says “wow, nice timing on the email marketing.”  I am guessing the attention and click-through on anything other than today’s big news will be greatly diminished.

But the realist in me says there’s no way anyone in a marketing department can figure out how to optimize around headlines delivered during a 24-hour global news cycle.

Does anyone have a theory about how to think about this?  Is it even a problem?

Apr 142011

BookShort: Vive La Difference

Book Short:  Vive La Difference

Brain Sex, by Anne Moir and David Jessell, was a fascinating read that I finished recently.  I will caveat this post up front that the book was published in 1989, so one thing I’m not sure of is whether there’s been more recent research that contradicts any of the book’s conclusions.  I will also caveat that this is a complex topic with many different schools of thought based on varying research, and this book short should serve as a starting point for a dialog, not an end point.

That said, the book was a very interesting read about how our brains develop (a lot happens in utero), and about how men’s and women’s brains are hard wired differently as a result.  Here are a few excerpts from the book that pretty much sum it up (more on the applied side than the theoretical):

  • Men tend to be preoccupied with things, theories, and power…women tend to be more concerned with people, morality, and relationships
  • Women continue to perceive the world in interpersonal terms and personalize the objective world in a way men do not.  Notwithstanding occupational achievements, they tend to esteem themselves only insofar as they are esteemed by those they love and respect.  By contrast, the bias of the adult male brain expresses itself in high motivation, competition, single-mindedness, risk-taking, aggression, preoccupation with dominance, hierarchy, and the politics of power, the constant measurement and competition of success itself, the paramountcy of winning
  • Women will be more sensitive than men to sound, smell, taste, and touch.  Women pick up nuances of voice and music more readily, and girls acquire the skills of language, fluency, and memory earlier than boys.  Females are more sensitive to the social and personal context, are more adept at tuning to peripheral information contained in expression and gesture, and process sensory and verbal information faster.  They are less rule-bound than men
  • Men are better at the kills that require spatial ability.  They are more aggressive, competitive, and self-assertive.  They need the hierarchy and the rules, for without them they would be unable to tell if they were top or not – and that is of vital importance to most men

As I said up front, this book, and by extension this post, runs the risk of overgeneralizing a complex question.  There are clearly many women who are more competitive than men and outpace them at jobs requiring spatial skills, and men who are language rock stars and quite perceptive.

But what I found most interesting as a conclusion from the book is the notion that there are elements of our brains are hard wired differently, usually along gender lines as a result of hormones developed and present when we are in utero.  The authors’ conclusion — and one that I share as it’s applied to life in general and the workplace in particular — is that people should “celebrate the difference” and learn how to harness its power rather than ignore or fight it.

Thanks to David Sieh, our VP Engineering, for giving me this book.

Mar 102011

The Beginnings of a Roadmap to Fix America’s Badly Broken Political System?

The Beginnings of a Roadmap to Fix America’s Badly Broken Political System?

UPDATE:  This week’s Economist (March 17) has a great special report on the future of the state that you can download here, entitled”Taming Leviathan:  The state almost everywhere is big, inefficient and broke. It needn’t be,” which has many rich examples, from California to China, and espouses a bunch of these ideas.

I usually try to keep politics away from this blog, but sometimes I can’t help myself.  I’m so disgusted with the dysfunction in Washington (and Albany…and Sacramento…and…) these days, that I’ve spent more spare cycles than usual thinking about the symptoms, their root causes, and potential solutions.  A typical entrepreneur’s approach, I guess.  So here’s my initial cut at a few solutions.

I’m sure it’s incomplete, and it’s possibly overly simplistic.  While I think it’s a pretty pragmatic and non-partisan approach, I’m guessing people will have visceral political opinions about it.  Here are five things I’d like to see that I think will start us on the road to repair:

  • Nonpartisan redistricting: All districts at all levels of government should be drawn by nonpartisan commissions.  There is no reason to create “safe” seats and uncompetitive elections that drive candidates to extreme positions in order to win primaries.  All of that is undemocratic.  I hope California’s proposition that creates this kind of solution works and is copied.
  • Public finance of campaigns: This will have to come with a constitutional amendment limiting free speech when it comes to political campaigns, but we should be prepared as a society to limit freedom in that one narrow way in order to remove money from politics.  This topic just keeps coming up, from both the left and the right (think about the examples of Wall Street donations impacting financial reform on one side and public sector union political contributions impacting negotiations with states and cities on the other).
  • Presidential line-item veto: Its constitutionality may be in question, but this would give the President a more granular form of one check-and-balance he already has and could greatly help reduce wasteful spending as well as simplify legislation (more on that in a minute).
  • Auto-expiration of tax/spend bills: I found the debate over the expiration or extension of the “Bush tax cuts” to be enlightening.  Maybe some class of tax/spend bills — those over a certain dollar figure, those that create entitlements, though that involve government subsidies to industry — should be forced to be renewed every 5 or 10 years instead of being “evergreen” so that the debate can reoccur in light of changes in circumstance.  How many other things are “on the books” in ways that don’t make sense in today’s world?
  • Simplicity of legislation: The health care reform bill was 1,990 pages long according to the pdf I just downloaded, and few if any in Congress actually read the whole thing.  They even admitted it AT THE TIME.  Is this a smart way to govern?  Whether voluntarily or via constitutional amendment, Congress should consider only passing single-issue bills and maybe even limiting the size of any given piece of legislation to something that at least THEY THEMSELVES ARE ABLE TO READ.

These things should do a lot to ease legislative gridlock, relieve bitter partisan rancor, and remove some of the silly parliamentary manoeuvrings that plague our government today.  Whether or not they can systematically deal with elected officials’ unwillingness to tackle hard problems and penchant for personal deal-making and runaway deficit spending is another question.

My personal belief is that country could stand some form of a new Constitutional Convention to critically review our society and its governance after almost 250 years.  I love our Constitution and think it was wisely laid out as the foundation for what has become one of the world’s greatest and most enduring nations…but that doesn’t mean that the Founders, who lived in a very, very different time, had perfect vision for all eternity.

Jan 032011

Macroeconomics for Startups

Macroeconomics for Startups

I’m not an economist.  I don’t play one on TV.  In fact, I only took one Econ class at Princeton (taught by Ben Bernanke, no less), and I barely passed it.  In any case, while I’m not an economist, I do read The Economist, religiously at that, and I’ve been reading so much about macroeconomic policies and news the past 18 months that I feel like I finally have a decent rudimentary grip on the subject.  But still, the subject doesn’t always translate as well to the average entrepreneur as microeconomics does – most business people have good intuitive understandings of supply, demand, and pricing.  But who knows what monetary policy is and why they should care?

So here’s my quick & dirty cut at Macroeconomics for Startups.  What do some of the buzzwords you read about in the news mean to you?

· Productivity Gains – This is something frequently cited as critical to developed economies like ours in the US.  Here’s my basic example over the past 10 years.  When I left my job at MovieFone in 1999, there were approximately eight administrative assistants in a company of 200 people – one for each senior person.  Today, Return Path has less than one administrative assistant in a company of the same size.  We all have access to more tools to self-manage productivity than we used to.  Cloud computing is another great example here of how companies are doing more with less. We have tons of software applications we use at Return Path, none of which require internal system administration, from Salesforce.com for CRM to Intacct for accounting. Ten years ago, each would have required dedicated hardware and operational maintenance.

· Fiscal Policy vs. Monetary Policy –  Fiscal Policy is manipulating the economy through government taxing and spending.  Monetary Policy is manipulating the economy by controlling interest rates and money supply.  For a small company that has revenue and accounts receivable, you probably are more inclined to Monetary Policy as it has more to do with your ability to access debt capital from banks through credit lines.  But if you’re in an industry where government grants or support is critical, Fiscal Policy can mean more to you in the short run.  Of course, if you’re losing money as many startups are, business tax credits and the like aren’t so relevant.

· Inflation – As my high school econ teacher defined it, “too many dollars chasing too few goods.”  Inflation may seem like a neutral thing for a business – your costs may be going up, but your revenue should be going up as well, right?  And we can inflate our way out of debt by simply devaluing our currency, right?  The main problem with inflation is that too much of it discourages investment and savings, which has negative long term consequences.  To you, rapid inflation would mean that the money you raise today is worth a lot less in a year or two.  That said, inflation is certainly better than Deflation, which can paralyze an economy.  Think about it like this – if you’re in a deflationary environment, why would you spend money today if you think prices will be lower tomorrow?

· Strong Dollar, Weak Dollar – Sounds like one of those things that’s politically explosive…of course we all want a strong dollar, right?  Why have a mental image of Uncle Sam that’s anything other than muscular?  And yes, it’s a lot more fun to travel to Europe when a latte costs you $4, not $8.  But the reality is that a strong dollar doesn’t necessarily serve all our interests well.  For a startup, sure, you can buy an offshore development team in India for less money than a development team in Silicon Valley, and for a more established company it makes it much cheaper to try and expand to Europe and Asia.  But an artificially strong dollar means that few people outside the US can afford to buy your product or service.  This is related to…

· Trade Surplus/Deficit and Exchange Rates – The net of a given country’s exports minus imports, and how much one currency is worth in terms of the other.  There’s been much talk lately about whether and how much China is manipulating its currency and holding it down, and if so, what impact that has on the global economy.  Why should you care?  If China is articifically keeping the value of the yuan down, it just means that the Chinese people can’t afford to buy as much stuff from other countries – and that other countries have an artificial incentive to buy things from China.  If the Chinese government allowed the yuan to appreciate more, the exchange rate vs. the dollar would rise, and your product or service would find itself with a lot more likely buyers in the sea of 1.3B people that is China.

I’m sure there are other terms of note and startup applications, but these are a handful that leap to mind.