A-squared team. A great company can only be built by a great team. In all my companies, we recruit talents with an A in their craft and an A in teamwork. These two A’s compounds their impact. A player also brings other A’s while B players will tolerate C players who would be damaging to any company.
As part of my series about the “How To Take Your Company From Good To Great”, I had the pleasure of interviewing Jack Jia.
As a 4-time serial entrepreneur, Jack Jia is currently a founder and CEO of Musely, a telemedicine technology leader providing medical treatments for skin conditions & skincare. Jack Jia has been an investor for GSR Ventures, TSVC, WIN, Rally and others, with a focus on internet, mobile, and software investments — a dozen of his early bets have become unicorns with a combined value exceeding 100 billion dollars. Prior to GSR, Jack was the founder and CEO of Baynote, a leading recommendation software company. Before founding Baynote, Jack was the founding CTO at Interwoven, a leading software company that pioneered content management space and led the company to a successful IPO valued at 7 billion dollars.
Thank you so much for joining us in this interview series! Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?
There is a constant debate in Silicon Valley if entrepreneurship is by nature or nurture. For me, it is 80% nature and 20% environment or nurture. When I was an 8-year-old boy in China, I read an article about Silicon Valley engineers building technology and transforming the world. I told myself that I needed to go to Silicon Valley and become an entrepreneur. At that time, China was in the middle of the Culture Revolution — poor, and empty of any technology or innovation.
It took another 21 years for me to start my first company in Silicon Valley. I went NYU for my Ph.D. first but immediately realized that was not my dream — neither the work nor the place. I quickly traded my Ph.D. work with a master’s degree and drove across the country to my mecca valley.
Silicon Valley was and still is the heaven for entrepreneurs. It is the 20% nurture needed for anyone with a destiny to build something from the ground up. My first company, V-Max America, was to take the Micron Computer from a remote town in Idaho to mainstream China. That was what the market offered me to do in the early ’90s. When the internet came a few years later, my playground got a whole lot bigger. For 25 years, it has been a dream to reality, a hundred times over.
Can you tell us a story about the hard times that you faced when you first started your journey? Did you ever consider giving up? Where did you get the drive to continue even though things were so hard?
Moments of Despair: the hardest times of my journey. And it’s safe to say, the hardest for almost all entrepreneurs, is at the beginning (typically year 1–3) of every new company started — in my case, four of them. The hardest times are the giant emotional ups & downs that hit you weekly, daily, and sometimes, hourly. On Sunday, I could feel so pumped that my solution could solve world hunger, but by Monday, I could be so lost and in despair…
Initially, I didn’t understand this emotion. I thought it could be due to lack of financial security. Interestingly, the same loss and despair came back in every startup I led, even after I was financially settled for several generations over ☺
I eventually realized that the act of entrepreneurship is INHUMANE! Humans are pack animals. 2020 has proven that social distancing torments us to our very core. Entrepreneurship requires us to leave our pack/village/big company, and venture out to a journey on our own, and alone! If we were to do this back in the ancient days on the plains of Africa, we would almost face certain death, taken out by lions or wilderness, the moment we left our pack.
The ability to recognize and overcome the Moments of Despair is, to me, the untold secret to success. Without them, entrepreneurs may not work as hard, or as fast, to find solutions. The journey of a successful startup is a zig-zag pathway, full of dead ends and impasses. Without the founding team to work in an overdrive mode — day or night, awake or asleep — we simply cannot build a business from an idea.
So, mental and physical fitness is a prerequisite of being an entrepreneur. Eat & exercise well so your brain can take the emotional rollercoaster of a startup journey. Regardless of your initial startup idea, success is all about “iterate fast & fail faster”. That’s how to overcome the impasses. I was so busy and occupied that I didn’t even have time to consider giving up.
The Moments of Despair can scare us to death, but they are very energy to fuel the flywheel needed for a successful venture!
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘takeaways’ you learned from that?
In the early days of Musely, we built our app with a few thousand skincare “Tips”. We didn’t know how to promote our app downloads to women. So, we hired an expert — a creative director in app advertising in San Francisco — to help us. In the next a few weeks, he created a bunch of “funny” ads on Facebook: curious women with questions over their heads illustrating the notion of tips. When that failed, he switched the women’s faces with all kinds of handsome or funny men. 10,000 dollars and one month later, we realized that we committed a cardinal sin: startups are built by the founders and founding team. No professionals or experts can help you to build one. They may enhance our offer or solution, but the core and the insights have to come from our own DIY!
What do you think makes your company stand out? Can you share a story?
We offer prescription skincare medications while the entire skincare industry is built on marketing and selling a jar of cream with 99% water and 1% scent. We offer science over scent.
For example, one of the most popular ingredients in skincare in the last a few years is this magical ‘Hyaluronic Acid’, with thousands of articles and brands touting its fountain of youth attribute… But the reality is far from magic: Hyaluronic Acid is nothing but a moisturizer base. It has zero impact to our skin, other than being a moisturizer. In fact, it is classified as an INACTIVE ingredient that can hold water.
Musely stands out by debunking the misinformation of the entire skincare industry, and by offering scientifically proven medications to slow down and even reverse our biological clock on aging and other skin conditions.
Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?
Exercise, exercise and more exercise! When our brain is in the overdrive mode (required by the startup thinking), it burns our blood into brain waste, therefore the feeling of “burn out”. The only few ways to get rid of these byproducts is to increase blood circulation and clean them out.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?
Many mentors helped me along the way. My NYU professors allow me to finish early and gave me three years back for my entrepreneurial journey. Several angel investors offered me more than money, but their collective wisdom on how their companies succeeded. There are hundreds of ways to fail a startup, but only a few ways to succeed. A few other Silicon Valley heroes inspired me a lot: Steve Jobs’ relentless pursue to perfection; Elon Mask’s ability to build giant businesses as an outsider — he was no car expert, rocket scientist, earth driller, or payment guru, but he became a better one via DIY.
I am extremely grateful to our current investors who have the infinite patience to allow us to pivot three times in three years before we took off.
Ok thank you for all that. Now let’s shift to the main focus of this interview. The title of this series is “How to take your company from good to great”. Let’s start with defining our terms. How would you define a “good” company, what does that look like? How would you define a “great” company, what does that look like?
A good company improves the state of art, while a great company disrupts it. Ford was a great company in the early 1900s when it not only produced cars cheaply (using assembly line) and with a style (black Model T), but also disrupted transportation from horse cartridges and trains, as a result of the mass-produced cars. But Ford has not been a great company for a long time. It is merely a good company producing slightly improved cars each year.
Tesla, however, is a great company today, or the Ford of the 21st century. It transformed the automotive industry into a software and battery business instead of the traditional car/engine/transmission/mechanical business. That is why it is worth more than the entire carcompanies combined while only producing 1% of the total cars today.
Based on your experience and success, what are the five most important things one should know in order to lead a company from Good to Great? Please share a story or an example for each.
In order to be great, one must have and maintain the ability to innovate and reinvent itself. That is easy to say but extremely hard to do. 5 things that separate great from good:
- A small band of innovators (including the CEO) on the top. Research has shown that 99% of the tech companies will lose its edge being a great company when their founders are gone. When my own company Interwoven hired a CEO who was not an innovator, even I, as the founding CTO, couldn’t steer the company to the next level of greatness.
- Iterate and fail fast. No matter how smart our team is, we will fail 10–100 times more than we succeed. We encourage experiments and therefore failures, as long as we measure the outcomes, recognize the failures, control the damages, and start new tests. Iteration is the only way to greatness! Recognizing the difference between sausage making and sausage is a key.
- Don’t build consensus and the ability to welcome many “no”s. If innovation is understood and corralled by the whole company, it is either too late or too easy for it to be impactful. In all the companies I started, I typically collect feedback from dozens of potential customers or experts. If I get all “yes” on my idea, it would be a red flag. I want to hear more “no” than “yes”. And, I want to hear why they say “no”. If my potential solutions can overcome their “no”, I may have found a breakthrough.
- A-squared team. A great company can only be built by a great team. In all my companies, we recruit talents with an A in their craft and an A in teamwork. These two A’s compounds their impact. A player also brings other A’s while B players will tolerate C players who would be damaging to any company.
- Empowerment is not one of the five keys. Innovation by definition is an act of a small minority who sees the future before the whole population. If Steve Jobs had empowered the entire 50,000 Apple employees to decide what to build when he came back in the late ’90s, we’d never have seen Mac, iPhone, iPad… Instead, empowerment will lead to mediocracy.
Extensive research suggests that “purpose driven businesses” are more successful in many areas. Can you help articulate for our readers a few reasons why a business should consider becoming a purpose driven business, or consider having a social impact angle?
Innovations and disruptions require a huge amount of mental energy from our team. Treating our work merely as a job won’t cut it. Musely happens to provide affordable skincare medications to millions of women who suffer from terrible skin conditions like Melasma on their face and body, or aging skin on their face or neck. When we received countless feedback as the medication being the “godsend” and “holy grail” solutions to improving confidence and quality of life, we knew that we needed to embrace the social impact. Our patients’ life-changing experiences are profound. So is the thrill felt by our team to be part of a bigger purpose and mission than merely producing beauty products. Our mission has become bigger: to democratize the knowledge and access of skincare that works to everyone instead of the few elites.
Most businesses can find deep connections to society with their products or services.
What would you advise to a business leader who initially went through years of successive growth, but has now reached a standstill. From your experience do you have any general advice about how to boost growth and “restart their engines”?
It all starts from the team on the top. Do you have innovators or entrepreneur types in your executive team? Ideally, the CEO should be the Innovator in Chief. Iterate, iterate, and iterate, and be patient on the experiments. Sooner or later, you will find that new growth. It took us three years and three pivots to find it. A company that I invested early in called Goat (now a unicorn) took five pivots before finding the billion-dollar opportunity to transact second hand designer shoes online.
Generating new business, increasing your profits, or at least maintaining your financial stability can be challenging during good times, even more so during turbulent times. Can you share some of the strategies you use to keep forging ahead and not lose growth traction during a difficult economy?
An innovative business requires non-conventional executions. Yes, Musely raised $40M in venture funding when we had momentum. But for several years, we didn’t waste them when we were looking for the ultimate business model. In fact, we challenged the norm of business operations by spending 5 to 50x less. We used Craigslist to find our offices at 5x below the business rental market price. We used home furniture for our office, giving us another 10x cost advantage and consumer appeal. So, when the real business opportunity came, we had all the financial power to support it.
One of our company culture principles says: don’t do things just out of box; think as if there is no box!
In your experience, which aspect of running a company tends to be most underestimated? Can you explain or give an example?
The seemingly boring process of iterations. There is no magic in running a great business. It took Steve Jobs one year and 300+ daily iterations to develop and test the concept of the Apple Store so the store was far better than anything we had ever seen when it finally came out. I’d argue that any executive could have done that if he or she had Jobs’ patience and sense of perfection.
As you know, “conversion” means to convert a visit into a sale. In your experience what are the best strategies a business should use to increase conversion rates?
The same boring word of “iteration” is the strategy. We try our best to keep things simple. We test every assumption or design. Internally, we use the term “half-asleep” to judge if our UI/UX is simple enough for consumer to use in a half-asleep mode.
Of course, the main way to increase conversion rates is to create a trusted and beloved brand. Can you share a few ways that a business can earn a reputation as a trusted and beloved brand?
A trusted brand is the ultimate goal. But when a brand is new, like Musely, we have to deploy other techniques to earn a consumer’s trust. It starts with our internal culture. One of two company personas is “Sage” — we provide real science and result-based medications. We develop our medications based on large amount of medical research, dermatologists’ clinical experiences and our own testing before any of our solutions is offered to the customers.
With our rigorous scientific approach, the efficacy of our treatments became unparalleled, when 95% of the patients failed dozens of times in the past. Then, the word of mouth started to happen. The snowball of trust naturally formed. Our marketing strategy became obvious: make sure we capture and preserve these tens of thousands of unsolicited reviews, before and after photos, videos, etc. Many of them came from influencers and celebrities, also unsolicited without pay or sponsorship.
The true authenticity of the impact we made to our patients has become the cornerstone of our brand. Musely has started to become a trusted and beloved brand among millions of women with the skin conditions we treat.
Great customer service and great customer experience are essential to build a beloved brand and essential to be successful in general. In your experience what are a few of the most important things a business leader should know in order to create a Wow! Customer Experience?
The first sentence of our company culture is to “delight our customers”, not just to please them. To delight requires perfection in many fronts, from truly impactful products, to customer experiences, to services. “Meet the expectation” is not good enough to delight our customers. We must beat the expectations. We have done a great job in our medication development. We are still iterating on how to make our customer services equally delightful. We measure, deploy and remeasure solutions weekly on everything we do.
What are your thoughts about how a company should be engaged on Social Media? For example, the advisory firm EisnerAmper conducted 6 yearly surveys of United States corporate boards, and directors reported that one of their most pressing concerns was reputational risk as a result of social media. Do you share this concern? We’d love to hear your thoughts about this.
Social media is a double-edged sword. It certainly can propel a business to glory at a much lower cost. Modern brands can be built as result of social media being available.
But a brand’s social media has to be managed, much like all social media networks. Even Facebook or Twitter themselves have to be moderated. Those who engage with your brand’s social media tend to be the 1% louder crowd, while 99% of your customers might be silent. They are also not trained media professionals either, to report facts and emotions. So, you must have a team of social moderators to guide your social media presence. You also need to deploy a strategy to represent the voice of the 99% silent majority, while curbing the potential bad actors that want to damage your brand on purpose.
What are the most common mistakes you have seen CEOs & founders make when they start a business? What can be done to avoid those errors?
- Going after a small market.
- Settling on B team.
- Not iterating long enough to see the real opportunity.
- Not realizing the mental challenge of being alone in the journey.
Thank you for all of that. We are nearly done. You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
My biggest concern is also the biggest thing I’d like to offer. Technology has transformed almost everything in our life, creating tech billionaires everywhere. But technology is also threatening the livelihood of almost all professions. My biggest fear of all is that it will destroy humanity, not in a way to kill us, but in the form of lack of job opportunities for humans in almost every profession.
So, my movement, ironically as a capitalist, is to offer a universal income to the entire population if their profession is wiped out, or they choose or are unable to work. Without that level of stability, our country and world will suffer, more than we have seen in the last four years, in the not-too-far future.
How can our readers further follow you online?
This was very inspiring. Thank you so much for the time you spent with this!