The Role Mindset Plays in Business Growth and Expansion

Intro (00:09):
Welcome to innovations and breakthroughs with your host Rich Goldstein, talking about the evolutionary, the revolutionary, the inspiration and the perspiration and those aha moments that change everything. And now here’s your host, Rich Goldstein.

Stefan (00:33):
The lower prices I can do. That’s a belief. So the advantage as I started getting inquiries in vantages, that’s one of the ways that I can work with companies, whether it’s about hiring, right. Again, I express some beliefs. I expressed a mental model. Hiring is not about a hiring is not about you don’t need to hire, you need to get work done. You need to change your team. Like that’s a belief about hiring. Whereas a lot of people have just the belief, like I need to get this job done. I need to hire a person to fill this job. It’s like, well, that’s kind of a short-term view of it. And maybe you have some, maybe she just changed the job, right. What you need to do is get work done. So that’s what I mean by a mental model and vantage we’ll work with companies who want to grow like Amazon or innovate like Amazon to apply some of the things that I’ve learned.

Stefan (01:19):
And then I bring in associates and partners, uh, often other ex Amazon people or people that we’ve trained embedded. Uh, so one company I’ve worked with is EMAG in Romania. Romania is, uh, Eastern Europe, uh, is the one of the largest e-commerce if not the largest and most well-known, uh, e-commerce marketplace in, in Eastern Europe, uh, magazine, Amazon of Romania, perhaps, uh, it’s a billion dollar plus marketplace. Um, lot of people don’t have a clear other drag to this castle, like where’s Romania. Um, but, uh, it’s, it’s a, it’s an economy that’s equivalent to Italy or Spain actually growing a little bit faster, uh, than both. Um, it’s an accelerating economy and, uh, uh, I’ve been working with the Meghan, how do they bring more selection and how do they grow the third-party marketplace? Uh, what can they learn from Amazon and, and other leaders so that they’re not only best in class, best in Romania, but best in world.

Stefan (02:13):
And, uh, so we’ve been doing some pilot programs, advanced that’s advantage, uh, project where we’re helping them take a different point of view on some of their business processes to look at constraints. And what constraints are they considering or could they change, could be other components to change business process, to grow like Amazon looking at message flow, looking at policies, uh, goals. But then, uh, we’ve come up with a pilot program that lets out of country sellers, uh, uh, uh, sell and try selling in Romania without shipping pallets and pallets of good their first. So if they have a presence in Germany or Poland, uh, we have a program that, uh, so it could be an American seller. Who’s put some stuff in the Amazon, uh, Europe and their inventory is sitting in Germany or Poland. Great. Uh, we can make it, uh, pretty friction, friction free for you to list your products in Romania on the mag marketplace and see if there’s customer interest for you.

Stefan (03:10):
So you can kind of try before deciding to make a full supply chain into Romanian. Um, and so it was really like, you know, we started from the question we started from mental model. Why do we have to have shipments into remainder to let sellers try to sell here? Uh, could we do a great customer experience, um, with a short enough ship time and that doesn’t have to be weeks, uh, that would allow people to keep their inventory wherever it is in Europe and still let them try to explore the marketplace. So that’s, uh, a recent project that we’ve been working on there at EMAC.

Rich (03:44):
Yeah. And so two things occur to me when I’m hearing you describe that one is, um, that it sounds like, um, advantage is very much focused on mindset like the, that, that, um, you’re acknowledging what a huge role mindset can play in your business, that there can be assumptions that you have about, um, about the business and the way that the business needs to operate. That aren’t necessarily true. Uh, and that if you can challenge those assumptions, you might find an opening for, um, for a whole new business model, or you might find an opening for a new market or just, um, greatest success in marketing and product because, uh, uh, the, the assumption that was assumed to be true, just isn’t true, uh, or

Stefan (04:30):
It’s changed, or it’s not true for the slice, right? So one of the Amazon leadership principles is learning to be curious that you keep validating your beliefs, right? You, you keep it. Yep. We believe it’s true, but we’re going to keep validating it. So when seller fulfilled prime launched at Amazon, um, you know, that, that was a big mindset shift for Amazon. There were senior vice president who had said over my dead body, will I ever have the prime badge on a seller shipped item? Right. And so what we had to look at was, well, if we could unlock that that’s, that would be millions of new products that are now available for prime at Amazon. Look, we had to change the mindset. So then we had to say like, what would we have to believe? Well, we’d have to believe that there are sellers who could ship prime or parts of prime with the same SLA.

Stefan (05:18):
Uh, so we went and looked for right customer, right? Vantage is a lot about mindset and that’s probably why we spend the majority of work. But, um, one of the things that I believe as well, mindset mode, uh, is more, is caught than taught, right? Those are your parents out there, you know this with your kids, right? You may try to teach them one thing, but if you don’t do it, they’re going to catch right more is caught than taught. So in our engagements with vantage, we do, we don’t just want to be guys that, Hey, let’s have a good discussion, have a beer. And, and, uh, you know, okay, let’s think differently. We do try to come alongside. So we’ll actually do the analysis with our clients, um, to, to say, what would we believe, or if we do get to, okay, now, what has to be different?

Stefan (06:01):
Um, we like to equip our clients. So we did an it project with EMAG where, um, they had not worked in a particular software technology and they were nervous about going in a direction. We all agreed. It was a better mindset direction, uh, to build, uh, some software in a different way with a different technology. So we put together a team advantage that, uh, not only would do the software, but do it with them, help them hire, uh, help do some teaching along the way of how the software worked. So that when we left, not only did they have the new software, they had the new capability, uh, to run an offer in the software. So we’re, we’re about equipping our clients, both with mindset and the capability to, to achieve the growth, the innovation and growth that they want to do.

Rich (06:48):
Fantastic. And then, so I’d like to just, um, shifted over a little bit. We talked about innovation before, um, and, uh, uh, so I’m curious what role, um, IP has played, um, in, um, um, in a company like Amazon, uh, when they’re innovating products or innovating processes and innovating products. So they’re very innovative product, um, company. I mean, clearly they’ve, um, they’ve, they’ve taken over the world essentially through innovation. Like they innovated in a way, and it just, you know, just a little aside here, I remember, um, like in my mind’s eye, I could see the 60 minutes interview of Jeff Bezos where, um, where he was, where he was asked, well, or the comment was made. Well, put, you know, you realize that in order to be profitable, you need to sell every book in the world. And Jeff Bezos, just like, because he had a big vision, right? He got it.

Stefan (07:46):
He’s had the library of Alexandria idea for a year. So that’s part of, that’s part of what drives Kendall, right? The mission of Kindle is every book ever published in 60 seconds or less make every book ever poet. That’s a great mission, right? It’s not about the device. If you work backwards from the customer and go, who is my customer and what is the need? Not, not, not what’s the product, but what’s the need they have, um, that’s going to lead you to a different place. Uh, so let’s say you got Kindle, right? It’s it’s not Kindles there. I mean, yes, the device is great and loved by us, but it’s, it’s, um, you know, an Amazon’s proud of the device, but, uh, it’s about how do I fulfill that mission of every book ever published 60 seconds? What would I need to do that led to other business decisions? Right? Because Kendall wasn’t, it’s not like apple early days where it’s like, oh, this book is only available on Kindle. Now you want to read it on your phone. Great. Cause it makes it available to you fast. You want to read it in Kindle software, on your laptop. Great. It’ll make an avail too fast. Right. Uh, uh, that idea of meeting the customer need, um, versus focusing on your product or device, uh, that’s very, Amazon worked backwards from what does the customer need and then service it better than anybody else.

Rich (09:01):
Absolutely. And so, again, from that spirit of innovation, it’s like, um, there was a role that IP played in helping the company grow. And so I’m, I’m curious about really like how that, um, how they work together. Like, what did you see with the way in which Amazon prioritized IP and helping to grow the company? Yeah.

Stefan (09:21):
Yeah. Amazon starts with just like good gardening. Amazon starts with soil. It’s a, it’s an environment that supports, you know, and there’s lots of Geoff quotes or which could just be Amazon quotes. Um, it’s okay to fail that we learned, the only failure is failure to learn. Like we’re willing to be misunderstood for a long time. You know, we’ll let things play out for a while. So that’s good environment. Um, you know, we want to be curious, you know, how this workout be customer focused, uh, think big, like all these, the leadership principles of Amazon, like what’s the culture we want to have as a company. And how does that work into the rewards of people? What are your performance goals, et cetera. Um, that creates a nice garden compost and as good environment, uh, for innovation to occur. But then, uh, you want to pay attention to what’s going on, market positioning, et cetera.

Stefan (10:10):
And at some point early in my time at Amazon, um, you know, so maybe it’s kind of like late, right around 2010, 2007, Amazon noticed that they had less patents than maybe some of their competitors. And that’s a, that’s a, that’s a risk game. Uh it’s, it’s less about, Hey, we want to go Sue other people, our patents like, oh, we’re we potentially be exposed to be sued. Um, so it was a short term initiative. It’s really helped because it trained a lot of employees. I never thought about getting a patent. It wasn’t something like, oh, I should go get a patent. Um, but Amazon said, Hey, we want you to, uh, think about when you’re inventing, what becomes, how does the adventure come and asset for Amazon? So I appointed her to like, get these blurs over my shoulder. Uh, Amazon started a process that, Hey, we’re gonna reward all employees, get a nice little plastic trophy. If you get a patent submission and a blue one, if you get a patent, um, uh, patent accepted. So somehow I got 11 patents out of this deal. What we, what I started doing with my teams and project is in the project kickoff meeting. We started going, what’s potentially patentable, uh, in how we build this or, uh, what we build. And many of my patents are actually around algorithms. It’s not like I invented, you know, some games with patents are crazy. Uh, you know, a, a dirigible that’s going to launch drones. And, uh, but

Rich (11:33):
The one click right

Stefan (11:35):
Here with the longtime defensible patent. But, uh, and obviously it was, I didn’t go Sue people for one click. It’s like, really, it was maybe it was a patent office mistake in early days, but, but nature to Amazon wasn’t sued over one-click, um, position them in a way. So we had a great environment for innovation. IP started changing how I ran my projects with my teams at the kickoff meeting we’d started going. And that would force us to think about what are different ways we could do this? How could, what is the core problem? How are other people solving it and how could we solve it better? Right. It made us think differently going what’s the potential for a patent here. Uh, and then we would fire those off even before the project started, uh, to the patent team because, uh, we’d been trained that that was an easier way to get patents.

Stefan (12:27):
If there, if you know, don’t go research, everything, don’t go, uh, get started on a prototype, uh, actually start, you know, just let us see early days. Uh, and then, you know, uh, it, it also made a great cross-functional with teams because, um, like most of the co named people on my team or on my patents were not on my team. We would come together for an ad hoc project, people with the same interest or the same idea. Um, and so it created, it reinforced a good environment for innovation because we looked across departments like, huh, I wonder if we could do this, who should I talk to pay? Let’s just grab a beer and pizza session, you know, at the end of the day with these three people, let’s brainstorm it, write it up cement from the patent office. Um, because we thought like that, you know, I’ve got a, you know, a couple of stories that you and I talked about previously about app actually applying that, uh, in a couple of ways, um, uh, within, within Amazon.

Rich (13:28):
Yeah, absolutely. Um, so I mean, when you had told me about, um, had to do with, um, with, um, artificial intelligence related to prime day. Yeah.

Stefan (13:39):
Uh, you know, as Amazon made a move into data science and really pushing machine learning and going fast, uh, that also became an approach, you know, some of my patents around algorithms, um, I’m not actually sure from patent to this one, but it was definitely, or what patents would they have gotten, but it was definitely intellectual property. We may not have gotten the patent because we just moved so fast to build it. The first prime day, I had a bit of at Amazon, a bit of a garage sale, uh, reputation, right? Those are some of the news articles like Amazon’s garage sale in July, uh, which really Amazon was trying to kind of build the same kind of event as singles day, uh, in, in China. So it’s not the reputation Amazon wanted. So, uh, that first prime day, we couldn’t really tell we’re going out to recruit deals.

Stefan (14:20):
Can’t really tell the sellers and vendors what the deals, what the event is. Um, you can’t really tell them how much we just want your biggest deepest discounts. Um, so it was a really a pull approach. Uh, and I was given the challenge of, Hey, it’s January, we’re going to do prime day again. Uh, I want you to go build a workflow that recruits the deals we have for prime day and year round, but let’s start with prime day, um, and, and into account, uh, what we know versus what our sellers and vendors know, right. We know what ourselves vendors carry. We know what customer interests, we have more signals and customer interest on it. We also know a little bit more about price elasticity because we’ve been watching, we were tracking kind of how price less us two works. So aren’t, we better positioned to recommend, uh, to, to, uh, sellers and vendors, the products they should put on, on promotion with the best potential for customers to buy them, um, the actual level of, uh, price discount we recommend them to take.

Stefan (15:26):
So we built a workflow and AI algorithms to, uh, to do that, uh, for prime day two. And that’s continued to be involved from day three. Um, I think we did a few patents submissions on that, but really was the IP part of it was what should the algorithms be? How do we test it fast? How do we take in our best human signals, uh, to turn that into a unique workflow, um, that’s powered by, uh, key intellectual property from different places across the company. Right? I was talking for price elasticity. I was talking to, uh, the, the leader of the pricing team for customer interest. I was talking to my predecessor on the detail page team, um, and then pulling that together to make a workflow and to make an algorithm and a structured process that what we ended up doing, we had an embed, we got better news articles that have the second prime day.

Rich (16:20):
Amazing. And then overall, like kind of what Amazon did was they position themselves as a leader in the patent space, too. They started that, they realized that benchmarking themselves against other companies that had larger patent portfolios led to them just wanting to be a leader. And that’s kind of what they did is they, they, um, they grew their portfolio to, to, uh, not be behind, but to be in the lead. Yeah, for sure. Moving it to the present day then, like, so now with Foundry, um, what role does IP? So with Foundry, you acquiring brands, brands who have either done a little bit of work on IP or a lot of work with, um, protecting their IP or somewhere in between. Now, what role is IP playing in, um, in vetting these brands for acquisition and, and kind of what should, um, should brands know about IP to position themselves for sale? Uh, you know, as, as we

Stefan (17:25):
Evaluate founder, founders and brands to acquire, um, you know, part of what we like is w we’re going to be fairly selective in what we acquire, uh, and, um, uh, but we want to serve all of them, even if it’s just, Hey, we’ve reviewed your brand and here’s some feedback, uh, it’s not necessarily a fit for us, or we’re not even sure it’s a time for you to sell it. Maybe this is the wrong exit window. Um, you know, you might the strategy actual Y and exit later, um, after you complete it, IP is part of that due diligence. When we’re looking at products, a, a founder as said, we’re looking at a couple of things we’re looking at, uh, what’s the current risk too. Yeah. I love it. When people complain about Amazon using data, uh, to copy a seller stuff, because I’m like sellers do that all day, right?

Stefan (18:14):
Every seller I know, uh, always pays attention to their competitors. They pay attention to top selling products. So how well positioned with IP, uh, is your product, uh, against, uh, being copied, uh, because the better position you are, whether it’s Amazon brand registry, whether it’s patents, uh, the better position you are to protect yourself with some moats, you can’t avoid copycats, but you can help slow them down, or you can help, um, get them off the platform, right? If you’re well protected, um, you have in the U S anyway, uh, uh, you have redress options, uh, and you have options even where Amazon can take someone out if you you’re well enough protected. So when we look at, we may look at, you know, have they had patent submissions, have they evaluated patents? Um, do they have their designs? Well-documented do they have the inputs that are there to, in order to file for a patent?

Stefan (19:08):
Are they prepared to get a patent? Um, and, and so we look at how well positioned they are to, uh, protect their IP, uh, and what their risk is, um, for IP infringement, from others that feeds into our diligence, uh, or diligence. And then within our own company, Foundry, uh, you know, we’re taking the same way that I built at Amazon, uh, and, and our team, you know, our, our team moves building technology and our core platforms or technology and data platforms. That’s a differentiator we’re going to have with, with brand aggregator companies. Um, you know, I built things like selling coach at Amazon or other automated pricing tools or automated workflow tools. I know how to optimize conversion from the detail page cause we built some of those algorithms. Um, we want to be able to scale with software versus people, and we want to help these brands accelerate their growth, right?

Stefan (19:58):
We want founder to be the best place for an earn-out. Uh, if you’re looking at your risk of, uh, or your, your potential for a big, uh, for earnout as part of your, uh, acquisition price, you know, our software and our IP or software and processes, um, in a district team’s experience, uh, are going to help reinforce that, right. We want to grow, grow the brands that we bought. And so the, the algorithms and the, uh, process that we put in place, our Foundry IP that, uh, we’re starting from day one to go, how do we scale and how do we build effectiveness?

Rich (20:35):
Yeah, absolutely. And so you’re, um, it’s kind of like what you’re doing or, or the lens through which you’re looking at, the brands that are requiring, um, also applies at home for how you’re operating the company. And you’re, you’re, you’re booking to innovate processes that would help to grow those brands and then to make them exclusive, to make them proprietary, to help, um, um, make it be the calling card that sets you apart and differentiates you. And then at the same time, something that is exclusive to you, what proprietary.

Stefan (21:09):
Absolutely. Yeah. One thing Amazon does, it’s kind of a trifecta, which has mentioned, they also find ways for other people to use some of their, they externalized, but black box some of their stuff. Right. So whenever we built internal tools at Amazon, we also always, we evaluated the IP, but we also evaluated the opportunity to externalize that service via AWS. Right. Uh, so some of Amazon’s AB testing capabilities you can do through seller central. Uh we’re they’re not showing you all the sausage making, or they’re not showing you the IP, but they’re giving you an opportunity to use it through a service. Um, so when you’re talking about use at home, I thought thrown at me because, you know, I have seven kids, I got a scale here.

Rich (21:51):
We’re trying to scale a family. Yes. You you’ve scaled successfully. I was fantastic.

Stefan (21:57):
So yeah, we have, we’ve got to buy nine airplane tickets to travel somewhere. That’s the easy part. How do we handle ground transportation?

Rich (22:03):
Yeah. The hard part is getting nine seats together.

Stefan (22:07):
So the funny part there is, I’m also when we travel, sometimes I’m looking at, uh, uh, apps like Turo, which do car sharing, or I’m looking at band bus rentals, uh,

Rich (22:19):
Looking to run like a 16 passenger van. Yeah, yeah.

Stefan (22:22):
In Hawaii, it’s surfing vans. And then, uh, you know, big cities, the two rents band buses,

Rich (22:30):
Is it just the Ford passenger van? They’re like, well, what can we get? You

Stefan (22:34):
Know, we drive a sprinter. So we’re, we’re, we’re big fans.

Rich (22:37):
Yeah. I love sprinters myself. I mean, what was that vehicle? So, um, well this is really awesome. Um, and uh, if people want to learn more about you again, touch with you, how do they go about doing so,

Stefan (22:51):
Um, you know, super easy to contact on LinkedIn, Stephanie at LinkedIn or my company again is vantage. So our website is vantage leader.com. Um, so I’m stephan@vantageleader.com.

Rich (23:04):
Awesome. I appreciate that. I appreciate you taking the time to, uh, to share some of your background, share some of your insights and also the exciting things that you’re up to these days. So just thanks so much for being on the program and, um, and sharing

Speaker 4 (23:17):
All of that. Thank you, rich. I love helping people

Stefan (23:19):
Innovate and I’m super glad for your podcast giving people inspiration.

Outro (23:29):
Thanks for listening to innovations and breakthroughs with your host, rich Goldstein. Be sure to click, subscribe, check us out on the web@innovationsandbreakthroughs.com and we’ll see you next time.