Editor’s note: Peter Levine is a partner at Andreessen Horowitz. He has been a lecturer at both MIT and Stanford business schools and was the former CEO of XenSource, which was acquired by Citrix in 2007. Prior to XenSource, Peter was EVP of Strategic and Platform Operations at Veritas Software, where he helped grow the organization from no revenue to more than $1.5 billion, and from 20 employees to over 6,000. Follow him on his blog and on Twitter @Peter_Levine.

As a former CEO and senior executive, there was a time when I did not quite understand the profound impact a CEO has on the culture of a company, even though I always knew culture was important.

The organization reflects the behavior and characteristics of the CEO, and that establishes the culture. Foster an environment of open communication and the organization inherits a culture of open communication. Operationally detailed? The organization becomes operationally detailed. Political? The organization becomes political. Curse a lot? The organization curses. Angry? The organization gets angry. Have a big office? Everyone wants a big office. It doesn’t matter what’s written on a coffee mug or on a “culture” slide, what you do as a CEO, day in and day out, and how you behave will define your company’s culture.

Dysfunction

Despite the best intentions, companies often become culturally dysfunctional. This occurs when leadership has a perception about the culture that conflicts with reality, or leadership behaves differently than what might be written down. 

The organization reflects the behavior and characteristics of the CEO, and that establishes the culture.

One of the most studied examples of cultural dysfunction occurred at Enron, the former energy-trading giant. The CEO (Ken Skilling) and several top executives were arrested for a pattern of deceit, dishonesty and illegal financial practices. They promoted a culture of dishonesty, self-dealing and self-enrichment that destroyed the company. Ironically, the Enron code of ethics outlined four key principles: communication, respect, integrity and excellence… So, yes, culture matters and the CEO defines it.

Cultural dysfunction is not limited to large companies. When I arrived at XenSource, which was a 50-person company, the culture was dysfunctional, despite the fact that the founding team believed the culture to be awesome and supportive of innovation and collaborative thinking. There were two telltale signs: 1) Employees painted a very different cultural view from the founders; and 2) The responses were inconsistent with each another, indicating that the culture was a free-for-all with very little leadership. One clear example of the inconsistency resulted in the organization having two engineering efforts that competed with each other. Here was a company with a supposedly “collaborative, non-political” culture that had engineering teams pitted against each other to see who would win. The competitive activity turned out to be corrosive and undermined the intended culture of the company.

Stemming dysfunction

I often talk about CEO self-awareness as one of the key attributes of corporate success. In the case of XenSource, the leadership espoused and verbalized cultural “intent,” but practiced and allowed something very different in the company. The company almost failed due to a highly dysfunctional culture. Make sure what you believe is what is truly happening in the company. 

Stemming dysfunction requires leadership and taking some simple but important actions: proactively define cultural attributes important to the organization—write them down and let people know what they are, and “walk the talk.” You must practice and exemplify your culture and have a mechanism to review culture deep within the organization. Ask the following questions:

• Is the organization’s culture consistent with the defined attributes?
• Where are the differences?
• What are we doing right or wrong to keep a strong and consistent cultural backbone in the company?

The Cultural Paradox: I can’t change the culture because that’s not part of our culture

Culture is formed — whether intentionally or not — in the early days of a company’s life. Activities and behaviors are repeated and these become the elements that shape the culture of the company. Examples of such early practices might be: 1) The founding team always interviews all new people applying to the company; or 2) a product-oriented focus in everything the company does. The accepted and repeated practices become the culture and define how the company operates.

However, what has worked in the early days might not be as effective as the company grows up. As a result, you might be forced to choose between two conflicting cultural attributes.

Take the attribute “the founding team must always interview new people”—a great cultural practice intended to ensure new employees are a perfect fit. Is there a point where growth is hampered because the company can’t interview fast enough and candidates go elsewhere? What part of the culture do you change? Limit growth or change your hiring practice? Changing either impacts culture.

One of the most difficult aspects for technical founders is hiring outside the comfort zone of the founding team. This is evident when hiring sales, marketing and finance people. A good example of this is how a technical founder might apply engineering hiring techniques to a sales organization, which my partner Ben Horowitz recently blogged about here. The fear here is that bringing on non-technical people will destroy the company culture. Do you put engineers in all the non-engineering functions and continue to only hire technical people, or do you augment the culture and integrate new and different organizations into the company? Here again, sticking to the past practice/culture of only hiring technical people might be counter to building a great finance or sales organization.

Steering change

Existing culture can get in the way of future growth and company leadership must steer the transition. Changes to practices and culture should be done by first asking why something is done a certain way and what’s the intended outcome. Preserving the intended outcome should trump the practice. 

A strong culture is the backbone of any organization, and the CEO is the standard-bearer and the agent of change.

Let’s go back to the example, “the founding team shall interview all new applicants.” The intended outcome is to make sure that all new employees are of the acceptable caliber and intelligence, and understand the culture and origins of the organization. The problem is the system does not scale, particularly as candidates are hired around the world and at a pace that far outstrips the capacity for the founders to handle.

A change to the practice might be to empower key employee “ambassadors” who act as a proxy for the founding team. Alternatively, maybe just one of the founders meets all new candidates as opposed to all founders meeting all candidates. If part of the intended outcome is for a candidate to meet the founders and get a feel for the company, then have all new employees meet the founders at a lunch or dinner after they join the company. Developing a strong and scalable interview process and on-boarding/mentoring system will ensure that the intended culture is preserved while steering change from an operational perspective.

Managing culture

The concept of managing culture may seem a bit heavy-handed, particularly in tech companies that pride themselves on being free from overbearing rules and bureaucracy. However, not managing culture can be likened to not managing growth, or not managing expenses, or simply not managing and certainly not leading…

Remember:

1. Self-awareness. If you can’t accept self-awareness, you should not be CEO.
2. What are you trying to accomplish? What’s the end game?
3. Translate energy to the areas you are least comfortable understanding.

A strong culture is the backbone of any organization and the CEO is the standard bearer and the agent of change. In a recent Fast Company article, GitHub Co-founder and CEO Tom Preston-Werner shares his perspective on how he and his cofounders have thought about and managed the company culture from 10 people to 160. Regardless of age, background and experience, culture is something that evolves with the CEO and the process of creating a great culture requires leadership to routinely and consistently assess and exemplify the core values of the organization.

Article courtesy of TechCrunch

Ringadoc has a pretty big vision: To be the “frontline of primary care,” to let anyone and everyone pay a flat fee to instantly talk to a real doctor at any hour of the day. In pursuit of perfecting on-demand medicine, the startup announced today that it has raised $1.2 million in follow-on seed financing, led by Founders Fund’s seed vehicle, FF Angel. The round follows the $750K the startup raised last June from Founders Fund, bringing its total to just under $2 million.

Ringadoc Founder Jordan Michaels tells us that, initially, the company set out on a straightforward trajectory — providing on-demand service for people to reach a doctor at any time — however, they soon learned that this was something that doctors themselves wanted to give to their own patients. So, the Ringadoc team decided to build it. And, after an extended private beta trial, the team is launching Ringadoc Exchange this afternoon to let doctors triage their own calls from their iPhone or Android.

The new Exchange platform enables doctors to more easily follow up with their patients, removing the need to continue paying for an expensive operator-based answering service. According to Michaels, the service is free for three months and then costs $50/month thereafter. Eventually, Ringadoc wants to allow doctors to charge patients for the calls or take calls from outside their own patient pool as well, features that will be coming their way in the next quarter. Michaels says that they want to allow doctors to get paid for some calls they’re doing with their own patients and offer a “premium” level of service and availability to their existing patients for a fee.

The goal, while it may seem pedestrian, is an important one. Waiting in line at the doctor’s office, or waiting by the phone for your doctor to return a phone call about a diagnosis or an appointment, can be extremely frustrating. Ringadoc wants to give doctors the ability to respond more efficiently to their patients — whenever and however they want — in turn, ending the cycle of unreturned calls, and relieving pissed off patients and overworked staffers.

“Patients are always going to call doctors on their own schedule,” says Joshua Kreiss, a neurologist in Menlo Park, CA. “Ringadoc allows me to quickly triage and follow up as appropriate, giving me enhanced control of a very important part of my practice. It’s a win/win for me and the patients.”

Today, Ringadoc covers more than 500,000 patients in over 20 states in the U.S. through its platform — a number the team hopes to expand upon with its new round of seed financing. Traditionally, doctors have had to deal with 1970s-style technology to handle after-hours calls from patients. But the penetration of mobile technology has changed our everyday behavior to the point where we now expect the same ease of access and availability from our doctors. Ringadoc wants to prove to the medical community that adapting to this on-demand world can actually make their lives easier, rather than the alternative.

The app allows doctors to control and handle patient calls on their own schedule right from their smart phone, responding to patients directly rather than requiring them to go through an operator. The app, along with the platform itself, was built with the support of Practice Fusion — the well-funded startup which offers a free, web-based Electronic Medical Records system that includes charting, ePrescribing, billing, support and scheduling for doctors and patients. Practice Fusion founder and CEO Ryan Howard currently serves on the startup’s board of directors and was one of its first investors.

With its new funding in tow, Ringadoc plans to develop the ability for doctors to provide cross-coverage care and premium access to paying patients, while moving to uncover ways for medical practices to access alternative revenue streams.

The app is currently available on the App Store and Google Play. For more on Ringadoc, check out Josh’s in-depth coverage here.

Article courtesy of TechCrunch

Billtrust, a company that provides a SaaS to manage online billing for companies, is merging with Best Practice Systems, another provider of electronic billing solutions. The financial terms of the agreement were not disclosed.

As we wrote two months ago, BillTrust just raised $25 million from Bain Capital Ventures to acquire new companies in 2011. Billtrust, which was founded eleven years ago, powers electronic billing and payments for consumer and business billing services across North America.

The company, which builds and hosts billing solutions, offers business to business services as well as business to consumer services. For example, a number of newspaper groups use Billtrust to power online billing for subscriptions. BillTrust’s revenues have grown tenfold over a five-year period.

The acquisition by Best Practice Systems is partly to expand BillTrust’s client base, and also to add additional technologies. Best Practice Systems has a foothold in the insurance and healthcare industries as a business to consumer offering for bill payment online. The company also offers mobile billing and payments to clients.

Article courtesy of TechCrunch

Target today made a huge move to counteract the practice of “showrooming,” the term that refers to how consumers are using retail brick-and-mortar stores to go hands-on with items, which they then order online for less – often from competitors like Walmart and Amazon. The company announced that it is now extending its holiday price matching policy year-round, in order to match those prices offered by online retailers like Amazon and Walmart.com, as well as BestBuy.com and Toysrus.com (including Babiesrus.com).

The deal also includes Target.com, just in case Target’s own online property ends up competing with its retail stores on price. The price match is only being offered for up to seven days following the purchase, and as before, the policy includes print ads from other local retailers, too.

It’s hard to say whether or not the move will have the desired impact. Target was price-matching online retailers over the holidays (Nov. 1 – Dec. 16), but December sales were still flat, year-over-year. In Target’s last earnings call, CEO Gregg Steinhafel told analysts that Target stores didn’t see a lot of price match activity. Still, given this new policy, the company is essentially acknowledging that competition from e-commerce sites is affecting its bottom line. Otherwise, why bother?

Price-matching can be a dangerous game, too, as Toys”R”Us and Best Buy found out, recently issuing complaints to the attorneys general in over half a dozen states, saying that Walmart’s ads were misleading. Best Buy specifically cited an iPhone 5 price match, saying it lost $65,000 on the day of a Walmart Facebook promotion, because it had to match the chain’s $150 price, despite the fact that iPhones were out of stock in many places.

Showrooming remains a concerning trend for the retail industry, as more users than ever shop on web and mobile. In mid-2012, comScore released a U.S. “state of the internet” report, which found that 35 percent of users were engaging in showrooming, leading them to buy online for a discount. The most popular categories included the obvious bigger ticket items, like electronics, but more concerning for brick-and-mortars, customers were also showrooming apparel and accessories. That latter category was traditionally safe from the practice, as consumers bought offline due to the need to try things on for fit. No-hassle returns from online competitors have clearly had an impact in terms of turning consumers’ homes into dressing rooms.

72 percent said their number one reason for showrooming was looking for a better deal. Forty-five percent said they were also interested in seeing the item in person. Twenty-four percent bought online because offline inventory was out of stock, comScore had reported. A separate report from IDC found that showrooming was most popular on weekends, with the actual showrooming taking place on Saturdays, while retail app use surged on Sundays, as the results of those price matching efforts paid off.

According to Target’s website, the price match may be requested at Guest Services prior to a purchase with proof of current lower price, or by bringing in your original Target store receipt and proof of the current lower price. The policy is effective as of now.

Article courtesy of TechCrunch

A newly signed California law forbids employers and universities from asking employees and applicants for their social media passwords. The law was hastily developed in response to a string of reports last Spring of employers coercing applicants to “voluntarily” allow businesses to snoop through their Facebook accounts as part of the interviewing process. The United States House of Representatives failed in an attempt to ratify a Federal ban, paving the way for states to take up the responsibility.

Universities and scholarships were also found with sophisticated procedures around monitoring current athletes and student applicants. The University of North Carolina handbook for sports explained,”Each team must identify at least one coach or administrator who is responsible for having access to and regularly monitoring the content of team members’ social networking sites and postings.”

Facebook responded to the media frenzy by reminding schools, governments, and businesses that giving away passwords was expressly forbidden by their security rules.

Hoping to help Facebook end the practice, the bill will go into effect January 1st.

[Via Reuters]

Article courtesy of TechCrunch

The new iPad launches in China this Friday, July 20th. Big crowds are expected. But Apple is using a reservation lottery service to allow buyers to essentially reserve their place in line now. Interested buyers simply need to go to this page, select a version of the iPad and provide their government ID. After that, a lottery-like system will notify the lucky few.

But this isn’t just about reducing the size of the crowds and improving customer satisfaction. Apple is using this system to fight scalpers and scammers.

In the past scalpers would try to turn a profit by getting in line early, buying an iDevice and then reselling the product at a higher cost to someone in line. Of course Apple frowns upon this practice. Not only is it a bit unsavory, there’s a high chance that buyers can be scammed with a fake iPad- it’s happened before. Unscrupulous dealers are also known to try to scoop up as many units as possible and then resell them at a higher cost.

As M.I.C. Gadgets reminds, Apple previously used this same lottery system for the iPhone’s Hong Kong launch. Apparently it worked to some degree of satisfaction. It’s nigh impossible to stop all the scammers, but this system seems fair enough to the early adopters while providing enough protection against the baddies.

Good luck! May all the odds ever be in your favor.

Article courtesy of TechCrunch

The modern man is clearly embarrassed by tablet computers. It’s a common trend to disguise the slate computing device as a book. I guess it affords owners an air of class and sophistication as it appears they’re toting around a well-loved tome rather than a dull, lifeless computer. Twelve South has taken this practice to the extreme with redesigned iPad and iPhone cases.

The BookBook is one of the finest iPad cases ever tested by TechCrunch. The construction and materials are top-notch. And thanks to a zipper and relatively thick sides, it wraps the device in a fair amount of protection, too. It feels fantastic in the hand. The vintage-looking leather adds a good amount of character and seems to age well. Inside, the iPad is secured with a leather sleeve that also features a kickstand that props up the device at a 30 degree angle.

The iPhone case isn’t as impressive, though. It uses the same overall design but this doesn’t seem to translate well to the smaller form factor. The material is equally nice and the iPhone version sports an ID window and credit card slots on the backside of the front cover. But the BookBook for iPhone lacks any sort of closure mechanism (like a zipper or snap), leaving the opposing side to essentially flap open willy-nilly. This is made worse by the fact that in order to talk on the phone with the case, users have to fold the front cover behind the phone, warping this side of the flap.

The cases are a bit pricey at $79 and $59 for the iPad and redesigned iPad and iPhone cases.”>iPhone versions, respectively. That’s par for the course though. The other options from DODOcase, Pad and Quill and XHiBT are priced similarly but the BookBook actually features a bit more protection. Plus, it feels better in the hand than the other cases I’ve tried. I hesitate to recommend the iPhone version for the reasons outlined above but the BookBook for iPad is fantastic.

Click to view slideshow.

Article courtesy of TechCrunch

Late last week, one Justin Watt discovered something suspicious going on with the wi-fi at his hotel, the Times Square Marriott. Not content to charge him hundreds for the room and $16.95 for internet access, it appeared that the service provider was using JavaScript injection to serve banner ads on every website guests visited.

The story spread like wildfire for obvious reasons, and at last Marriott has responded, saying the problem has been remedied and won’t happen again.

In an emailed statement, they write:

As soon as we learned of the situation, we launched an investigation into the matter. Preliminary findings revealed that, unbeknownst to the hotel, the Internet service provider (ISP) was utilizing functionality that allowed advertising to be pushed to the end user. The ISP has assured the hotel that this functionality has now been disabled.

While this is a common marketing practice with many Internet service providers, Marriott does not condone this practice. At no time was data security ever at risk.

We will continue to look into this matter and find opportunities to remind our hotels of Marriott’s high-speed Internet policies.

The company that apparently provides the wi-fi service, RG Nets Inc., has not made any statement. Their fate as the provider of this Marriott’s (and presumably others’) wi-fi is unknown.

Let this be a lesson to us all, though: this kind of behavior should not be tolerated, but it is up to savvy users like Justin not only to notice, but to care and investigate and follow through. Minor but real liberties like this will probably only increase in frequency, so be on the lookout and if you see something suspicious like this, tell an Internet.

Article courtesy of TechCrunch

While plenty of platforms can go viral with consumers, VC idol Peter Thiel said today that he’s impressed by platforms adding legions of small businesses. Speaking at the healthtech conference hosted by electronic medical record platform Practice Fusion, Thiel explained “High paid sales people can get big companies, mass marketing can get consumers, but it’s difficult to get small businesses”. If you see a platform managing to sign lots of small businesses, it could be a winner. Investors take note.

Thiel continued that in addition to being hard to reach, small businesses have historically been resistant to change. To convince them, a product must be “a quantum step better” than their existing solution. He cited Intuit’s QuickBooks and PayPal for eBay sellers as examples of companies able to provide that drastic upgrade, and that subsequently succeeded.

In terms of areas where there’s potential to make those quantum steps, Thiel said “there are tremendous problems to solve in the developed world” specifically in healthtech. He followed that “the single lowest hanging fruit in the US” is in process automation.”The first step in automation is getting everything on a single platform. Practice Fusion has the potential to be the platform company in the electronic record space, and that’s going to be an unbelievably important place to be.”

Thiel is a top investor in Practice Fusion, which now hosts 25 million EMRs, more than any other company in the U.S. It followed his model, growing from 70,000 health care providers in April, to 100,000 in September, to 130,000 now. Part of his due diligence on Practice Fusion? “I talked to my doctor. He said ‘this represents a key improvement.’”

Article courtesy of TechCrunch

Movie trailers are among the most popular videos on YouTube. A typical movie trailer gets millions of views, but how many of those views are natural and who many are pushed as paid-for ads? Yes, movie trailers are all ads in a sense. But people seek them out just like any other 2-minute video. That is not what I am talking about.

The same movie trailers are also promoted through various means and shown as prerolls before other videos or via paid links and those views can also count towards the total. For instance, this trailer for the new Conan The Barbarian movie has been watched nearly 5.5 million times. If you click on the statistics right next to that number, you will see that 4.98 million of those views come from ads (see also below).

This is not an isolated incident. The trailer for Rise of the Planet of The Apes shows 7 million views, but nearly 5.8 million of those ad views. In this case, the statistics are hidden, but I got my hands on them (see second image below). Same for this X-Men trailer: 2 million out of 2.4 million views are ads (although this one is literally a 15-second teaser, not a full two-minute trailer like the other ones I’ve cited).

Not all ads count towards a view, but many do: Promoted Videos, skippable TrueView ads, homepage ads or search ads that drive traffic to the video page.

I find this practice to be surprising, so I asked YouTube for an explanation. A spokesperson wrote me the following in an email:

When it comes to paid advertising, view count of a video increases only when it’s clear that a viewer has made a choice to watch a video. For example, a viewer might make that intention known by clicking to watch a Promoted Video, opting-in to watch a TrueView in-stream ad, or playing a YouTube video embedded in a homepage ad.

To be clear, with standard in-stream ads where a viewer has no choice in its selection, we do not increase the videos view count.

Not every pre-roll ad counts towards a view, but all of those skippable, opt-in TrueView ads do count, and from the looks of things people are watching a lot of those. Some YouTube purists are up in arms about this practice. One commenter asks, “Remember when you could watch a video without having to sit through a commercial?”

There is nothing wrong with movie studios using their trailers as ads. After all, they are trailers (i.e., ads for movies). But when people search for videos, they tend to click on the ones with the most views. Apparently, those views can be bought.

Article courtesy of TechCrunch