Tuesday, January 24, 2023

A Penny Stock Story That Didnt Get Enough Attention

 Here's a story that always intrigued me that only got a little bit of attention and I'm shocked wasn't replicated in the ICO and Crypto market as preferred equity loans:

Full Story available on Bloomberg or here:

"Actually, it’s a little more complicated than that. What Sason discovered is a way to get shares in desperate and broke companies at big discounts by lending them money. Magna has done deals with at least 80 companies. Of those, the stocks of 71 have gone down since the investment. He can still turn a profit, because the terms of the deals allow him to turn debt into equity at a fixed discount. No matter where the stock is trading, he gets it for less.

relates to This 27-Year-Old Made Millions Riding the Death Spirals of Penny Stocks
Photographer: Ryan Lowry for Bloomberg Businessweek
Magna functions as a pawnshop for penny stocks—shares of obscure ventures that change hands far from the rules of the New York Stock Exchange. His customers have included a would-be Chilean copper miner, an inventor of thought-controlled phones, and at least two executives later busted for fraud. They come to Sason to trade a lot of their stock for a little bit of money. Often they’re aware the deal is likely to be bad for their shareholders.
If the share price goes lower before Magna can unload its investment, the companies have to give up even more stock, all but eliminating the risk for Sason. Critics call it “death-spiral financing” because it drives stocks into the ground. Others in the field say they sometimes make double, triple, or even 10 times their investment in just a few months.
The business is legal, but the loopholes in securities law it exploits are too sketchy for most of the Ivy League types at banks and hedge funds. At least six other lenders of last resort to penny-stock companies have been sued by the Securities and Exchange Commission for breaking the rules around dumping shares or other violations. One was arrested by the FBI. It’s worked out better for Sason, who hasn’t had any issues with the authorities. He’s using death-spiral profits to diversify Magna and turn himself into an entertainment mogul.
 
 
The son of an Israeli immigrant who works as a contractor, Sason grew up in Plainview, a middle-class Long Island suburb about an hour east of Manhattan, in a beige ranch-style house near the Seaford-Oyster Bay Expressway. When he was 10 or 11 he started a rock band called The Descent with some neighborhood kids. They did Blink-182 covers, and he sang and played drums, guitar, and keyboards.
Sason built a recording studio in his parents’ basement and started writing music for the band. The Descent got pretty good. Around sophomore year, someone got their music in front of Trevor Pryce, a 260-pound defensive end for the Denver Broncos who invested in music as a sideline. He flew to Long Island to sign them to his record label—but first he had to sit down with their concerned parents. “I was in the living room with five Jewish families surrounding me asking me about calculus,” he says. “It was hilarious.” Pryce gave Sason and his bandmates $5,000 each, and they started to dress the part of rock stars at school, according to Chris Antonelli, a band member. “We called it Rock Star Fridays,” Antonelli says. “I’d wear my grandmother’s mink coat and sunglasses, and Josh would wear a boa.”
The Descent played showcases for executives from major labels, but the other kids Sason and Antonelli recruited weren’t very good. “They botched it beyond belief,” Pryce says.
“It was a big letdown,” Antonelli says. “There was a lot of anticipation that we were going to be the Next Big Thing, and it didn’t happen.”
Sason enrolled at nearby Hofstra University and lived at home. A second band, Vibes, was less successful, playing its biggest shows at Temple Beth Am in Merrick, N.Y. Bandmate Michael Morgan says Sason was eager for another shot at the big time. “When you’re signed to a record label and you’re in high school, your perception of success has to change,” Morgan says. “You’re like, ‘OK, that’s possible. What else? What’s next?’ ”
Sason got a job making deliveries in his black Mustang for an Asian restaurant, then did filing for the debt-collection firm. Morgan says they worked out together every day at a Jewish community center—where kids now play basketball in the Joshua A. Sason Gymnasium, renamed in 2013 after a donation.
In an entrepreneurship class at Hofstra, where he was a member of the class of 2009, Sason came up with a plan to import sand from Israel and sell it as a collectible called “Sand from the Holy Land.” He liked the 2006 Oprah-endorsed documentary The Secret, based on a self-help book about the power of positive thinking. Another friend says Sason still talks about his belief in the book’s “law of attraction”—how you can achieve anything you want by imagining that it will come true.
The way Sason tells his story, that’s pretty much what happened to him. He says he was on vacation with his family in Puerto Rico when he read The Intelligent Investor, the 1949 book by Benjamin Graham that Warren Buffett cites as an inspiration. “It was pretty much a life-changing moment for me,” Sason says. “I read it once. The second time I read it, I went through and highlighted it. The highlights became a guideline for me to write my own interpretation.”
Sason says he doubled his bar mitzvah money on blue-chip stocks in 2009. “I realized I had maybe a little bit of a knack for how investing works,” he says. He borrowed his mother’s retirement savings, took a “low six-figure” loan from a friend of the family, and started Magna from his bedroom. The business grew, Sason says, as word spread about how Magna could finance small companies.
“It was a gradual and progressive growth,” he said in the January interview. “There wasn’t anything in particular that I would recall from back in the day, to be honest with you.”
 
 
I still couldn’t understand how a wannabe musician from Long Island had become a millionaire investor virtually overnight. I’d found a 2012 lawsuit in which a financier named Yossef Kahlon accused Sason of copying his business model, but the only thing Sason would say about him is that they hadn’t spoken in years.
There’s little else online about Kahlon, and his number is unlisted. His address is on the lawsuit, though, so I drive to his house in Great Neck, N.Y., a wealthy town on Long Island’s north shore. A white Range Rover is parked in the semicircular driveway outside the brick colonial mansion, which was listed for sale last year for $6.3 million. Dance music thumps from inside. A slim man with gelled black hair and gray stubble answers the door and says Kahlon isn’t home. An e-mail arrives the next day. “My name is Yossi Kahlon,” it says. “I heard you are looking for me.” We arrange to meet at a steakhouse in Manhattan, and at the appointed time, the man with the gelled black hair walks up. It was Kahlon after all. “Nice to meet you again,” he says. Then he pulls out a wad of tens and hundreds to pay for a Tanqueray and tonic and tells the story of how he met and mentored Josh Sason.
relates to This 27-Year-Old Made Millions Riding the Death Spirals of Penny Stocks
Kahlon, 48, is an Israeli immigrant, too. After arriving in Queens in 1989 and driving for a taxi service, he built a small fortune by getting in early on arcade games and financing car dealerships. He hired Sason’s father to work on his house and soon befriended the family, inviting them over for holidays. One Passover, when Josh won the traditional game of hide-the-matzoh, which usually comes with a prize of $1 or $10, Kahlon says he gave the kid $1,000.
Around 2009, Kahlon heard the Sasons were having financial issues. He told the elder Sason he could help. “I said, ‘Bring your son here, I’ll teach him to make money,’ ” says Kahlon, who by then was in the penny-stock business.
The market for penny stocks can be traced back to the scrum of brokers who used to trade shares that weren’t welcome on the New York Stock Exchange. A 1920 article in Munsey’s magazine called them “a close-packed mass of creatures apparently human” and described the auctioning of shares in a puppy.
Penny stocks exist so that, say, an oil wildcatter with a hunch he’s about to drill a gusher can raise the money he needs without the hassle of listing on an exchange. They feed a desire for a hot tip that could double or triple. It’s a disreputable corner of the market. Many listings are bogus. Most are, at best, just a guy with an idea, and often that idea is to raise some money so he can pay himself a fat salary. Other listings are real businesses that have been dropped from the big exchanges because they’re on the verge of failure.
Kahlon paid brokers to scour the market for penny stocks with high trading volume, then call the companies to see if they wanted to issue new stock. These struggling companies can’t sell new shares to the public the usual way, by enlisting a proper investment bank, because it’s too expensive and the offerings too tiny. But they can sell to private investors such as Kahlon. They gave him steep discounts, and he’d sell the shares into the public market right away, often doubling his money as everyone else’s shares were diluted. There are laws against doing this, but Kahlon thought he spotted an exception in Texas. He incorporated his company there, while operating from New York.
Kahlon says he showed Sason how to trade like him—and then cut off contact so that no one could accuse them of conspiring. “I’ll teach you the business, but the minute you open, we can’t talk anymore,” he said to Sason. “I don’t have any friends in this business.” Texas corporate records show Sason incorporated Magna Group in the state in 2010, using the same mail drop as Kahlon.
Once Magna got going, Sason’s younger brother, Ari, dropped out of the University at Buffalo and started working with him in their parents’ home. They pulled a sewing machine table out of the garage and set it up in Sason’s bedroom for Ari. They quickly made enough money to move to a suite at 5 Hanover Square in Manhattan and hired a team of “finders” to identify targets.
“They had at least two guys pretty much cold-calling corporations they would look up on the Internet,” says John Perez, who worked for Magna for a few months in 2012 as a trading assistant. “The other two guys worked on the deals.” One of Sason’s salesmen, Ari Morris, made up the alias “Michael Goldberg” to use for himself on the phone. Magna’s website listed Goldberg as “director of structured investments” in 2012. Clients say he sounded nice.
Magna wasn’t the only group calling. Executives of penny companies say that when their stock has a high trading volume, they get bombarded by young salesmen and washed-up bankers asking if they need cash—and often they say yes.
That activity caught the attention of the SEC. In the summer of 2012, the agency filed separate lawsuits against Kahlon and another penny-stock financier, saying their clever Texas loophole in fact wasn’t. The SEC said Kahlon made $7.7 million buying penny stocks at deep discounts and dumping them on the public. Kahlon says he did nothing wrong; the case is still pending.
Kahlon closed down his fund. He hoped his former student would help with legal costs. Sason didn’t, and Kahlon says he felt slighted—not given enough credit or respect for bringing Sason in on the game. Kahlon sued Sason, alleging that he damaged a relationship with a broker; a judge dismissed the case.
When I ask Sason about Kahlon’s story, he says it isn’t true. “Nobody showed me the business,” he writes in an e-mail. While his family friend’s success inspired him to look into penny stocks, he says Magna’s deals aren’t like Kahlon’s, the shared mail drop was a coincidence, and he never got a $1,000 Passover prize.
None of the SEC actions mentioned Magna, and Sason has never been in trouble with the agency. Almost all of the regulatory filings by Magna’s clients show deals that are more intricately constructed than Kahlon’s.
 
 
Paul Riss’s deal with Magna in July 2011 was typical. The New York entrepreneur’s company, Pervasip, was developing a communications app to compete with Skype, but it was down to its last $100,000, barely enough to last a month at the rate the company was losing money. When Magna’s “Michael Goldberg” called offering cash, he didn’t even ask to look at the app, Riss says. “All they care about is the liquidity of the stock,” he says. “They want to see how many dollars are trading a month.”
On the surface, the $75,000 loan Magna offered seemed all right. It was in the form of an “8 percent convertible promissory note,” meaning it asked for an 8 percent return and gave Sason the right to convert it into stock. The fine print explained that if Pervasip didn’t pay back the money within six months, the lender could convert at a 45 percent discount to the market price. So, no matter where Pervasip’s stock was trading, the company had to give Magna shares that were worth more than $136,000—an 82 percent return in just six months. Essentially, Magna locked in a fixed return.
The lower the shares went, the more Pervasip had to give up so Magna could get its money. The only risk Magna took is that no one would buy Pervasip’s stock at any price. “Unfortunately, that’s about the only money available,” Riss says.
Pervasip didn’t repay, and gave the discounted shares to Magna in January 2012. Riss says he doesn’t have records that show just how much Magna made. After bouncing up to 3¢ for a bit, Pervasip now trades for nine-thousandths of a penny. Riss says he still gets calls from lenders like Magna offering more money.
An analysis of 80 public filings shows that a company that does a deal with Magna sees its shares plummet 55 percent over the next year, on average. Most never recover and wind up trading for thousandths of a penny or less. Sason says that’s not Magna’s fault.
“I want to help the company, I really do,” he says. “We never, ever make an investment where we knew our activity in the marketplace would potentially decrease the value of the company. There would be no benefit for us.”
 
 
Sason bought his penthouse in Tribeca for $4.2 million in January 2013. At some point he upgraded from the Mustang to a $200,000 two-door Mercedes-Benz, his high school buddy Antonelli says. He started hanging out at Lavo, a bottle-service club in midtown Manhattan popular with celebrities. “He’s there like Thursday, Friday, Saturday, Sunday,” says Antonelli, “holding court with all the beautiful waitresses.”
Magna’s biggest score came in 2013, when it helped a Greek shipping company called Newlead avoid bankruptcy. The shipper, which once owned 15 tankers and container ships, was down to four vessels. It had enough cash to cover about a month of operating losses.
The deal had a twist. Instead of giving Newlead a loan, Magna paid some of Newlead’s lenders for the right to collect its old debts. After Magna sued Newlead to collect, the two companies quickly filed a settlement where Newlead agreed to give Magna discounted stock that it could sell right away. A New York state judge signed off on the arrangement.
Sason said in an affidavit filed in the case that Magna, together with an unnamed partner, paid off $45 million of debt and received stock that it sold for $62 million—a $17 million profit before expenses.
relates to This 27-Year-Old Made Millions Riding the Death Spirals of Penny Stocks
Photographer: Ryan Lowry for Bloomberg Businessweek
The financing technique is legal as long as the debts that are being paid off are real and the financier doesn’t kick any of the money from the stock sale back to the company, according to Mark Lefkowitz, another penny-stock financier who pleaded guilty in 2012 to breaking those rules. “The bottom line is, it’s supposed to be used for bona fide conversions of debt to equity,” says Lefkowitz, who’s cooperating with the FBI. He cut an interview off quickly, saying he was due to be sentenced soon and needed to check with his FBI handler before talking.
The financing may have saved Newlead as a company—it avoided bankruptcy and bought new tankers—but it ruined it as a stock. The company has been so thoroughly pillaged that if you’d bought $3 million of shares in March 2013, just before Magna invested, you’d be left with a dime. Adjusted for reverse splits, the shares trade for 20 billionths of a penny—$0.0000000002. Newlead did not respond to a request for comment.
It’s hard to say exactly how much Magna has profited since 2010. Sason says Magna has done $200 million of deals, confirming calculations from clients’ regulatory filings, though some were with partners. He says the majority of the company’s equity is his, with the rest owned by his employees.
Rivals in the business say that penny-stock financiers typically demand at least a 50 percent return, a figure supported by SEC findings. Sason says he can count the deals that backfired “on one hand.” By any reasonable estimate, his returns would top almost any hedge fund. “The returns are healthy,” he says. “We’re not getting into any business or any strategy not to be profitable.”
Since the Newlead score, Magna has been diversifying. Sason started a “ventures” division, which invested in PledgeMusic, a London-based website that lets musicians sell albums they’re working on in advance, and Mainz, a sort of high-end receptionist outsourcing company. He hired a former executive at Madonna’s record label to help him run his entertainment division."

Friday, December 2, 2022

Jack Dorsey Email leak

 interesting to see emails and passwords that one uses. such as an @0.Pizza email address.

Monday, November 28, 2022

Empowering Others to do their best work

Insight 1 of 4 with Tiziana Casciaro

Award-Winning Organizational Behaviorist & University of Toronto Professor

 

 We equate authority and power, but they’re not one and the same. Some people wield a lot of power even though their title may not suggest it. This is because power comes from control over the resources that people value and that they need and want. As the boss, you have resources that people want, and you control them: a promotion, a budget, an attractive project. But there will be people who have other resources that you might need. It could be information, or a network, and, without knowledge of them, you as leader are going to be cut out of a very important resource. That makes you dependent on them. We tend to personalize power, but nothing is further from the truth: power is always situated in a relationship. It’s all relative, and it shifts over time.

Power is not a zero sum game. We tend to think that if we share some of our power, we’re automatically going to lose power. That’s not how it works. The asymmetrical power that exists because of an imbalance—whether in relation to your employees or suppliers, or, for a country, between the people that have the most and those who have the least—is detrimental to the system in the long run.

A leader in an organization will be personally better off when they allow others to also exercise some power over them. By sharing power with others, they will give them the tools to do their best work. In the long run, you will benefit as well, as opposed to feeling attached to your own power and wanting to control the behavior of others. Giving

Wednesday, November 23, 2022

Columbia Law School Advice on Negotiating and More

Wanted to notate and save this advice on negotiating and leadership from Alexandra Carter

World-Renowned Negotiation Trainer for the United Nations and Director of Mediation Clinic at Columbia Law School
 


 The best leaders ask themselves the right questions to cultivate self-awareness. Questions help you define the problem to be solved, uncover your needs, and grapple with your emotions so that they don't come back to bite you in the room. Feelings help you explore prior successes, and also to create an action plan. Questions are a very powerful tool in a negotiation and especially useful for an expert audience. When you raise the right questions, you're going to get the information you need, and it will give you a target to aim at. If you don't ask questions, you are aiming in the dark.
 
Always start a negotiation by defining the right problem. Many people start their negotiations in the wrong place, by tossing out solutions. Start with, "What's the problem I'm trying to solve?" I was recently counseling a really promising start-up company. They'd had two rounds of financing, and they were getting ready for their next one. COVID hits, a segment of their business disappears, and, all of a sudden, they say, "Alex, we're going to reach out to every distributor we've talked to in the last two years." And I was like, "Whoa. Whoa. Whoa. What is the problem we are trying to solve here?" Depending on that answer, I'm going to counsel you differently. If you told me you wanted geographic distribution and just had to hit big everywhere, okay, maybe do a blitz, but even then, I would still question it. If you told me you needed to achieve the best product velocity in your key markets, then you’d need a totally different strategy.

One of the questions that I think is especially useful is: "How have I handled this successfully in the past?" Asking yourself about a prior success is indispensable before you negotiate with somebody else. If you go into a negotiation with somebody else having just thought about a prior success, you are likely to perform better, because you have primed your mind for creativity, expansion, flexibility, and the ability to think on the spot. The second reason is because the question acts as a data generator. If you think about a prior success and you write down in detail the strategies you used, you're going to find at least a couple that apply to your current situation. Even in a novel situation, you have been through things before, and you can find strategies to help you in your current situation.
 

Monday, August 8, 2022

Maximize your mindset with these tips

 

  1. How can you better adopt a “systems” mindset to maximize your creative output while minimizing your time and effort?
    Self-improvement and personal development are about improving your memory, mind, thinking, and decisions. There’s nothing wrong with that, but I want to produce better results over time. I want to achieve bigger goals while working less and putting in less effort; that’s leverage. When I think about the long-term vision of my life, I’m tired of trying to become this superhuman optimized machine-like entity.

    Instead, I want to create systems. And so your job is not to do the work; your job is to create the systems that do the work. It’s a decoupling of the value you’re creating from the hours you’re putting into your business and career. It’s such a subtle but huge shift; that’s what a second brain is. It’s a system; it’s a point of leverage for you to create, be more productive, and make more creative outputs, decisions, and experiences without having to just pour in more and more of your own time and effort.
     
  2. How can you create a second brain to better unlock your creative potential?
    A second brain is a system of personal knowledge management. It’s not as simple as downloading an app; you need three things to build a second brain: the tool, the behavior, and the mindset. 
     
    • The Tool: The best tool is the simple notes app you likely already have on your digital devices. The power of note-taking comes in its informality. How many great ideas come from a whiteboard session, all these scribbles and crazy diagrams, and suddenly something emerges. Creativity cannot be rigid and precise; it needs to be messy and somewhat chaotic. We can have that kind of messiness and chaos while also benefiting from the incredible capabilities of technology if we get those ideas and capture them digitally. 
       
    • The Behavior: The four-part framework is called code. C-O-D-E stands for capture, organize, distill, and express. Think of it as a production line you adopt as a part of your daily routine. Four things have to happen:
      • Capture: It has to be saved digitally somewhere that you can access
      • Organize: It has to be organized to know what's important, what's not, or what's important in a given situation. 
      • Distill: It has to be boiled down to the essence
      • Express: This is communication. It's to express yourself, your ideas, tell your story, share your message, and make an impact. 
         
    • The Mindset: People must put aside the note-taking they learned in school and consider note-taking as a companion to their ongoing learning. There’s a big return on investment here: the notes you take can become part of your lifelong learning of projects and goals. Your second brain is like the map of everything you’re undergoing on your journey that you might want to reference in the future, which is a much more long-term perspective.
       
  3. How can you better filter what you capture and what you leave behind to maximize saving only the most transformative insights?
    The best filter requires a simple adjustment toward what is surprising and what resonates with you. You can’t use too much energy or intellectual effort at the capture stage because not much value is created there. Instead, the value is created when you organize, distill, and express. You need capture to be so low effort and frictionless that it is much more effective over the long term to use emotions like surprise or resonance to decide what to keep.

    I see how people read and highlight. They’re highlighting every remotely good idea, stuff they already know and agree with. Instead, save very sparingly. Only keep the highlights that blow your mind—the ones that are so surprising they make you stop and sit back, almost like you’re in shock. 

    Your second brain is like a CliffsNotes, a portable collection you have of the key points to remind you that they exist and what they are. Once you’ve retrieved it, you can spend all the time you want going back and finding all the details, but the key is finding that genuinely moving piece of information and capturing it effortlessly.
     
  4. How can you implement the PARA framework to supercharge organizing your digital life?
    CODE is how to take action and move information from input to output. PARA is how you store things. It’s the organizational hierarchy, but the key is instead of a vast system, like a library with categories and subcategories, there are only four categories:

    P - Projects which are currently active
    A - Areas of ongoing responsibilities in your work and life 
    R - Resources that you’re collecting
    A - Archives are everything from the past that is no longer active

    It’s a simple hierarchy. There’s a project folder and then a folder for each project. There are two levels. You can’t go down more than two levels. You can start this in 60 seconds. Go into your notes app, or whatever program you’re using, and create one folder for each active project you’re working on. This exercise is really powerful. People are like, “What’s the big deal? I know what I’m working on.” I would suggest you don’t. You have projects in the back of your mind and projects on the back burner; you have projects that you’re working on actively that you haven’t even identified as a project. Making a project list is one of the most powerful exercises to organize your digital life.
     
  5. How can you leverage the “just in time” approach to maximize executing successful projects?
    A question a lot of people have is when do you do your organizing? You’ve captured all these notes. Do you sit down once a day, once a week, or once a month? 

    My approach to executing projects is called “just in time”. I have no regular cadence because the ideal time to sit down and organize your notes is not on any schedule. It’s the moment you decide to start a project. Think about it. If you’re coming out of a meeting with your boss, they’ve said, “okay, it’s time to redesign the website. This is a top priority project”. The minute that project comes into existence, suddenly, you know what you’re trying to do. Suddenly you have goals, constraints, and you know what the competing priorities are. Five minutes earlier, when that project was not started, what basis would you even organize your notes? According to what?

Wednesday, August 3, 2022

4 actionable takeaways and advice for August 2022

 4 Actionable Takeaways

Take 60 seconds to answer one or more of the following questions -- we also highly encourage you to try this with colleagues and/or loved ones! 
​​​​​​
  1. How can you reframe your thinking about the future of geopolitics and strategic competition to maximize the good you can do?
    Whether citizens of different countries, business leaders, or policymakers, we often hear a lot of fatalism in discussions of where the world is going. We hear that competition that leads to conflict and strategic frictions between countries is inevitable. We see that our geopolitical environment is becoming more turbulent but it’s important, as individuals, that we remember our agency and that the world's fate is not just about these abstract structural forces. The structural forces we talk about are ultimately driven by people. The decisions we make determine the decisions that nations make and, therefore, the trajectory of the world.

    It’s important to push back against the sense of fatalism. As a community and as individuals, we need to know we can make a difference, we need to know we have the power to reclaim that sense of agency and say, how can we make this world better?
     
  2. How can you leverage the concepts of the great power competition and transatlantic challenges to make better decisions for your business, community, and life?
    You need to understand two big buckets if you want to learn more about the world and make better decisions for your business, community, and life.

    The first bucket is the notion of a great power competition which affects politics, business, and our day-to-day lives. It focuses on the United States, China, and Russia- three nuclear-armed powers possessing substantial economies. The United States and China alone account for over 40% of the world’s economy, and have different visions geopolitically and strategically for the world. Whatever your station in life, whatever your vocation, you must focus on what the United States and China are doing.

    At the end of the Cold War, the United States had a particular vision for how it wanted the world to evolve. There was triumphalism in US policymaking and an underestimation that other countries could become more powerful, have different ideologies, and the ability and willingness to push back. We’re seeing this with Russia's invasion of Ukraine. And so, the competitive dynamics between these three great powers concern anyone because they affect geopolitics, which means they affect business.

    The second bucket is what I call transnational challenges—climate change, pandemic disease, macroeconomic stability, energy insecurity, and so on. One of the concerns is that if these three powers allow their competitive dynamics to dominate their relationships, they not only think about cooperation on those transnational challenges as a fool’s errand, but they think cooperation is a demonstration of strategic weakness.

    Suppose national-level governments are increasingly preoccupied with competitive dynamics and unwilling to cooperate, but these challenges are only growing in severity and complexity. Is there a role other actors and communities play in pushing the ball forward and thinking more creatively about diplomacy? There’s a real challenge, but I also believe there’s a real opportunity for communities to move the needle and think creatively about diplomacy going forward.
     
  3. How can you further overcome the challenges preventing you from becoming a deeply engaged citizen?
    There are three things to focus on to diminish the feelings of isolation and remain a deeply engaged citizen:
     
    • Remember that most trends are going in the right direction: The rate of extreme poverty and child malnutrition is much lower today than it was several decades ago, and life expectancy is much higher. In many ways, the world is safer, more prosperous, and healthier than it was a few decades ago. 
       
    • Restore the sense of community: People feel much more anonymous than they did two years ago. Individuals worldwide report dramatically higher rates of isolation, loneliness, and disconnection. When we have a community, we restore that sense of togetherness and that we’re not fighting the good fight alone.
       
    • Consume more positive news: Axios published an article about how news consumption has declined tremendously. People feel the news is grim. How do we push back on that narrative? The media plays an important role in amplifying good news, spotlighting good trends, and showcasing individuals making a difference. There’s a website called Good News Network, which shares the good news stories you don’t hear about. We need more of those websites. We need to raise those voices and profiles to have a more objective lens.
       
  4. How can you focus on what you do best, and doing it better, to project quiet confidence to your allies and partners?
    Complacency isn’t good for long-term competitiveness or business leaders, but alarmism and consternation aren’t good either. Instead, focus on doing what you do best and doing it better. You want to look inward and say, “How can we become a more dynamic version of our best selves?” Let’s focus on what the power of our example looks like in practice. How can you recommit to renewal at home and abroad and articulate a positive, affirmative forward-looking vision that speaks to your aspirations more than your anxieties? 

    When you can do that, you’ll be able to mobilize the public. People are more excited when you tell them, “Here’s what we are going to do,” as opposed to just what we’re going to oppose. At a time of intense and growing political polarization, we need a shared project that can galvanize the American people to help them transcend their divisions and project quiet confidence to our allies and partners. 
     

Tuesday, July 26, 2022

5 Actionable Takeaways from Mark Moses

 5 Actionable Takeaways

Take 60 seconds to answer one or more of the following questions -- we also highly encourage you to try this with colleagues and/or loved ones! 
  1. How can you better turn your most critical business goals into reality?
    There are two key questions to ensure you are turning your business goals into reality:
     
    • Where do you want to get to, and what are the measurable, repeatable, daily activities that will get you there? 
      First, you need to get clear on what success looks like for you. I’ve spoken to many executive-level groups, and when I ask what success looks like three years from now, most don’t know. Getting what you want is about having the discipline to follow a cadence. Imagine you determine what you want and develop your big, hairy, audacious goal. You’ve got your vision statement, mission, and core values. The next step is to determine what you need to do annually, quarterly, monthly, weekly, and daily to achieve your desired outcomes. Most importantly, you need to determine and track what are the most critical daily, repeatable, measurable activities that will enable you to get there. For revenue growth, it could be a certain number of new events, that get you a certain number of new prospects, which result in a certain growth level. It is critical to have your eye on the key leading indicators that you can influence daily to ensure you get to your lagging indicators. 
       
    • Who are the people you need to achieve what you want?
      Because most people don’t know what they want three years from now, they rely mostly on their current organizational structure; it’s a significant weakness for many firms. Look at your team—how would you answer the question, would you enthusiastically rehire them again today? In some cases, the answer is no, so the more challenging question is, would you enthusiastically rehire them today to help you achieve what you want three years from now? If the answer is still no, it comes back to you as a leader. Do you have the courage to search properly and find the people to drive the outcomes that you want?
       
  2. How can you fully leverage your leading indicators to better plan for times of adversity?
    Hopefully, your business won’t be affected by the coming recession, but there’s nothing wrong with future planning. It’s good to know the issues in your business that are leading indicators, the impact of those leading indicators, and what decisions you would make to change their outcome. 

    I like to look at 13 months because that gives you a year over year compared to that one month, but you can also do it quarterly. For example, imagine revenue is down, and you have slight gross margin erosion month over month. What if you can see over the last five months that the average time to close a sale has increased by a few days? Is that negative? Are your customers affected? Are your clients having problems? 

    At baseline, we do nothing. At a 5% increase in margin erosion, we take action. More than that, we take aggressive action, and we do something meaningful. At each stage, it’s worth asking why would I not do that anyway, even without the margin erosion? And if I would make those changes when the bad stuff happens, why would I not make them now? What would the impact be if I did?  All these questions lead you to be better prepared for when adversity does hit. 
     
  3. How can you ask better questions in your leadership meeting to maximize alignment in your organization?
    Alignment comes back to a disciplined process that starts with the annual leadership meeting. Each team member prepares the following: What went right this past year? What went wrong? What did we learn this past year? How did we do on our goals compared to how we said we would do? How did we do on the measurable activities we said would drive the outcome that we wanted?

    This is critical because often, things misfire on buy-in and alignment. People might have different visions, or our assumptions are wrong. Let’s say we achieved 80% of the activities but only 60% of the result. We might have chosen the wrong actions, or we didn’t pick enough of them. I like to ask, what will it take to guarantee we achieve the outcome? Once a year, it’s worth asking the question, if we were to start our business all over again, what are we doing today that we would not do in our new company? 
     
  4. How can you use the sensitivity analysis tool to identify the two most important levers in your business?
    When using the sensitivity analysis tool, you pick two essential levers in your business and create a simple two-dimensional graph, and the impact on EBITDA is in the center. That’s the number to focus on. You can see on one end EBITDA is high, and on the other end, it’s low. It’s a very disciplined way to look at your business. I suggest every company take their most essential levers and plot them against each other on the grid. This simple exercise shows you what moves the needle for your business and what you can do more of and less of, depending on your desired outcome.
     
  5. How can you better evaluate which executive coach is right for you to unlock your full potential?
    A good coach is three things. First, they’re part coach; a coach is somebody who can ask great questions and guide you to the answer. They also have a lot of industry experience, so they’ll wear the consultant hat. And at times, they are business therapists helping clients navigate between the courage and fear to act.

    Coaches often get fired because the client’s perception of the value they’re providing isn’t there. You don’t need a friend or therapist. You’re looking for somebody who can help you achieve what you really want a year and three years from now. Think through if you believe they can help you do that and how they are going to help you do it.
 
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