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Creating Corporate Culture – John Assaraf Interview – Part 5

By At Work, Business Philosophy, Company Culture, Entrepreneur Insights, Speaking, Start-Ups, TakeLessons.com, Videos No Comments

Part 5 in the video series. Subscribe for email alerts when more videos are posted.

More from this series:

Creating Corporate Culture – Part 1

Creating Corporate Culture – Part 2

Creating Corporate Culture – Part 3

Creating Corporate Culture – Part 4

John Assaraf sat down with Steven Cox, CEO of TakeLessons.com, to discuss what it means to create and maintain a thriving corporate culture. In this interview, Cox defines corporate culture, outlines steps entrepreneurs can take to define their company’s culture and shows how a strong culture can translate into other great gains for any organization.

Assaraf: So let’s get into how you designed culture, because you’ve taken the time in your old offices, in your spectacular new office and I’ve seen your growth over the last year and a half two years. You did this by design. You didn’t do this by luck. You said this is who I am, this is what I stand for. You had your initial core employees who you brought on board and most of them are still with you.

Cox: That’s correct.

A: You’ve built a 300 person company now and growing at lightening speed. How did you design this?

C: First of all, I’d like to show you another chart here. This is our revenue growth. Without any numbers attached to it, you can see that that’s exactly the kind of growth that companies like to see. When I say what I am about to tell you, I do attribute our growth to culture. Good strategy, smart people, it’s a must, but how we got those people on the bus is absolutely key to what we do.

First of all, just a little background on what we do. In essence, we’re America’s largest music lesson company. We give music lessons, and these are personal one on one lessons, in a customer’s home or at a studio in 3,000 cities across the US. When we first started, we started with the idea, how do we revolutionize services on the web? We wanted to do something that was powerful. We wanted to do something that truly made a difference from a technical perspective and use technology to drive services on to the web. I wasn’t 22 anymore; I was now in my 30’s and being a student of yours and Brian Tracey and those sorts of people it was very important to me that not only do I build a company but that I make a difference along the way.

So when we first started off, it was from design, like you mentioned. We said, we are going to make sure and focus on as Jim Collins says, getting the right people on the bus. We looked and we looked and I brought a second person on board. His name is Chuck and he shared the same sort of values. That was six or seven years ago and Chuck is still with me today. I found Drew and Chris and they’re both still with me today. We talked to so many people and said, do you share the same value and core system that we have? We purposely designed a company in such a way that longterm you could take me out, you could take Chuck out, any of the cofounders, and the company would keep humming along, growing like crazy based on the value system, not necessarily based on a single individual.

A: And he will share the value system with you today so you understand this.

C: Yes.

A: Just so you know, we’re learning a ton from Steven and his team to bring these types of designs to Praxis Now also. So as Steven says he may have learned some stuff from me and Bryan and other individuals, we’re learning from him and we’re sharing back and forth all the time. One of the things that Steven does phenomenally well is personal and professional growth on a constant basis, CANI, constant and never ending improvement. He’s always willing to give and always willing to learn. So, I’ll let you keep going.

C: I’d like to show you a couple more slides to build credibility to show what the company is doing and to show our growth. These are our active paying customers that are growing. We have service providers, these are teachers, that actually give the lessons and you can see that this chart mimics the growth, which is what we want to see, even in the recession. So what I’d like to do is talk a little bit about what culture meant to us and how we went about defining our core values. Culture is a combination of the language we use within the company and the symbols, stories that we have, how we work amongst each other, how we work amongst our suppliers and our service providers as well, as well as how we make decisions as to what’s right and what’s wrong for the company.

About 5 to 6 years ago I was reading a book by Jim Collins, Good to Great, and if you haven’t read the book I highly recommend it. It’s an incredible book written by an exceptional author. Basically, he says the way that you get to a vision is you have to be very, very clear on what things you value and what is your key reason for being in business, the core purpose. And that is something that does not change. That is something that is core to what you do. Then you marry that with what we call the envisioned future and that is, you look long term. He calls it BHAG’s, if you’re familiar with that.

A: Big Hairy Audacious Goals

C: Right. These are things that if you were actually to tell them to people in the general public, this is where I want to go as a company, they’d kinda look at you like you’re crazy, like your head’s popped off. The typical response is, “you’ll never do that.” And that means you’ve got a perfect BHAG.

Part 5 in the video series. Subscribe for email alerts when more videos are posted.

More from this series:

Creating Corporate Culture – Part 1

Creating Corporate Culture – Part 2

Creating Corporate Culture – Part 3

Creating Corporate Culture – Part 4

 

 

Creating Corporate Culture – John Assaraf Interview – Part IV

By Business Philosophy, Company Culture, Entrepreneur Insights, Speaking, Videos No Comments

 

Part 4 in the video series. Subscribe for email alerts when more videos are posted.

More from this series:

Creating Corporate Culture – Part 1

Creating Corporate Culture – Part 2

Creating Corporate Culture – Part 3

John Assaraf sat down with Steven Cox, CEO of TakeLessons.com, to discuss what it means to create and maintain a thriving corporate culture. In this interview, Cox defines corporate culture, outlines steps entrepreneurs can take to define their company’s culture and shows how a strong culture can translate into other great gains for any organization.

Assaraf: As Steven was talking, I was thinking of Barbra Streisand’s song, “People who need people are the luckiest people in the world.”

Cox: John’s been taking voice lessons with us.

A: No I  have not! I’m just trying to make you laugh a little bit. So let me ask you all a question so we can get a little feedback loop going. Do you all agree that it’s all about people, it’s all about making a difference? Making a profit is good, but the number one focus is creating a culture and company with people who love and value what you value as well.
Kristen, what’s some feedback from our group here?

Kristen: They’re all agreeing with what you said. Business should be more about the people. We don’t have any questions as of yet. I assume we’ll get some.
Great, let’s keep going.

C: Sometimes I’m asked, this seems like a lot of soft, feel-good stuff, how do you balance the necessity to produce profit with focusing on people and producing a culture that people want to be a part of. I’m a finance guy by trade and that’s what I studied in school so I want to give you some data, not from me, it’s actually from people a lot smarter than me, that backs up what we’re talking about and what we’re saying here.

Two professors from a little university called Harvard, which you’ve probably heard of, have completed an 11 year study on the effects of how people are using culture within public companies. These aren’t private companies; you can actually get results and know what the financials and what the revenue growth of these corporations are. They divided companies into a weak culture group, where the value of culture has not been emphasized whatsoever, it’s kind of just roughshod, do whatever you want. Then there’s a strong culture, and there’s four main divisions along the way. So they took a look at the bottom percentage with a weak culture and then they looked at companies with a strong emphasis on culture. They were completely blown away by the differences between those types of corporations. The companies with a strong emphasis on culture had expanded their workforce by fivefold of the people with weak culture. More important, or just as important, the revenue growth was exponential and the stock price was 900%. It’s unbelievable. And yes, there are other factors probably associated with this, but this is a data point that without a doubt makes a huge, huge difference.

The bottom line is that if you can get the alignment of your people with your mission and your vision and your values, you create a force, a force that’s unstoppable because you’re all marching in the same direction. Whether that is two people, four people, 400, 4,000, the rules are still consistent. Culture helps everyone get on the same page and march in the same direction.

Another study, there’s a group called Dennison Consulting, they’re based out of Canada as well as in Switzerland, and they’ve also completed many many studies on this and they look at financial data. Companies that have focused more on their culture and developing out with clear indicators of what we stand for versus companies that have no indications of these, and this isn’t just something they hang on a wall and say “these are our corporate values”. Enron had those. This is something where they went in and studied and queried the employees and said, does this corporation live the value system that they say? For those that do, the return on assets is unbelievable compared to the bottom group. The sales growth, again, is unbelievable. These are absolute key factors in what drives a company. It’s undeniable. We’ve experienced that just in our own business as well.

More from this series:

Creating Corporate Culture – Praxis Now Interview Part 1

Creating Corporate Culture – Praxis Now Interview Part 2

Creating Corporate Culture – Praxis Now Interview Part 3

Creating Corporate Culture – John Assaraf Interview – Part 3

By Business Philosophy, Company Culture, Entrepreneur Insights, Speaking, Videos 2 Comments

 

Part III in the series: Subscribe for email updates when more videos are posted.

More from this series:

Creating Corporate Culture – Praxis Now Interview Part 1

Creating Corporate Culture – Praxis Now Interview Part 2

John Assaraf sat down with Steven Cox, CEO of TakeLessons.com, to discuss what it means to create and maintain a thriving corporate culture. In this interview, Cox defines corporate culture, outlines steps entrepreneurs can take to define their company’s culture and shows how a strong culture can translate into other great gains for any organization.

Cox: A lot of times what we hear is talk about, how do we go about designing culture? I want to walk you through it a little bit. This is an interesting concept that came over me about two or three months ago when I was looking at it. Today, a lot of culture has been created by actually caring about people. If you take a look at what’s happened in corporate America… Where I come from, we have about 300, 350 employees within the organization, about 100 here based in San Diego. Our big focus is on the people. That is the core of what we do. There is a fundamental change that I think is happening today in corporate America and I want to walk you through to how we got here.

Assaraf: Absolutely. Probably 75% of the people watching have a small business and the rest want to be entrepreneurs so this is critical stuff for you to know, because not knowing this is detrimental to your growth and to having people who are champions of your cause and your values. This is brilliant, brilliant stuff. Trust me on that one.

C: Back in the ‘80’s, we all are familiar with the movie Wall Street, and the line, “Greed is good”. That’s a certain type of culture, but basically what happened is no matter if you have a giant company or you are a five man or two man operation, the idea was just get as greedy as you can. We saw it happen in the stock market with irrational exuberance but what comes up must come down. Then everyone started feeding into the internet craze. Things were going nuts. People thought they could make money by doing nothing and raise funding like crazy. And you were in that phase as well.

A: But we have a real business!

C: And that’s the key. Folks focused not necessarily on building a real business. What they focused on was developing sock puppets, like Pets.com. What happened at that point, is people became emotionally bankrupt. Corporations, businesses in general became bankrupt. You had everything from MCI Worldcom to Enron that not only stole from investors, but they stole from their own people. These sorts of things left companies emotionally bankrupt and people got a really nasty taste of business; if you’re in “business”, you’re a bad dude. That was a horrible thing that happened. Tack along with that the perils of 9/11 and now you have corporations that starting waking up, saying wait a second, this is not the type of company that we want to run. And  you had folks who were 16, 18, 20, 25 years old then, who looked at this and said, I don’t want to run a company like that. I want to build a company that’s focused on people, that’s focused on making a difference, that is focused on making a lot of money as well as making a difference. You can do both. At first this seemed antithetical, but the idea that corporations make a difference that’s focused on not just you making money, but it’s also, what can you contribute. Very simply, even what you’re doing right here, right now. We were talking a little bit earlier, it’s not only do I want to run a business, but you want to contribute to people’s lives.

A: That’s one of my highest values.

C: We see that sea change happening. What will happen, and why it’s important for your business, as your business continues to grow, I believe over the next ten, fifteen years this new generation of people who are currently in high school and college, they’re going to get out of high school and college and they’re going to look for a great company to work for. The greed, the old way of doing business is going to go out of style. They are going to be looking for people who run companies that focus on people and that actually add value to people’s lives. That’s why it’s directly applicable to every single person in the audience today. Understand as you grow your business, the next generation of people coming up will be looking at you as leaders and saying, do I want to work for this person or not? Do I want to build a business with this person? Do they share the same values as me?

More from this series:

Creating Corporate Culture – Praxis Now Interview Part 1

Creating Corporate Culture – Praxis Now Interview Part 2

Creating Corporate Culture – John Assaraf Interview – Part 2

By Business Philosophy, Company Culture, Speaking, Videos No Comments

 

Part II in the video series:

More from this series: Creating Corporate Culture – Praxis Now Interview Part 1

John Assaraf sat down with Steven Cox, CEO of TakeLessons.com, to discuss what it means to create and maintain a thriving corporate culture. In this interview, Cox defines corporate culture, outlines steps entrepreneurs can take to define their company’s culture and shows how a strong culture can translate into other great gains for any organization.

Assaraf: So let me ask you a question. When you talk about values that “I” have or values that “we” have, as the CEO of a one person company or five or ten, and I know you started off small, bootstrapping your business and I want to talk about that as well today, this is a great entrepreneur to listen to, when you talk about your values, you’re really not talking about what you think your client’s values are or what kind of values you should have in order to appeal to people. You’re really talking about what do you believe at the core of your being. Is that accurate?

Cox: Absolutely. So many people, I’ve talked to other entrepreneurs and they think, well, I’ve got to design my company based on what values my customer has. We actually take the opposite approach to that. The values that you have as a person, they’re you. That’s who you are; they’re the core. Those values should be authentic, absolutely authentic to who you are and they should be what drives the company. What’s right in my company may not be what’s right in your company. What’s most important is that there is no one right culture. We’ll get into that a little bit more. But the whole idea is that culture is about authenticity. Some people value “the customer is always right”, and if you honestly believe that, you have got to live that day in and day out. One of our values is Constant and Never-ending Improvement and we’ll walk through examples of some of these from our own corporate culture and how we came up with these. That simply means for us, in all situations, where we are today cannot be where we are tomorrow. It’s a personal belief that I’ve held since listening to Brian Tracey when I was 18 growing up, driving in my little Mazda, but those sorts of things are what really carry us. It’s the things that do not change. There are so many things that happen in business, so many ups, so many downs, so many pitfalls, and you have to have a belief system and a value system so no matter what happens, even if it’s to the detriment of the company, you will not change. One of the questions that we ask in an interview, for anyone in the company, is what are values within the company that if the company does not exemplify them, you would not want to be a part of it? That gives a really good insight. We were interviewing a candidate yesterday for a VP position and he said they have to have absolute respect, up and down, for all people within the organization. That was critical to him. Knowing those values for yourself allows you to see if that person is vibing with you and would vibe within the organization, and if you’re seeking a job it allows you to know if that company would vibe with you as well.

A: So this is the core. Who are you? What do you stand for? What don’t you stand for or won’t stand for? That’s really how you develop the nucleus of what you stand for in yourself and that’s how you build from you to the next employee to the next employee to the next employee.

C: Something that I say, and this goes back to being authentic, I’m sure we’ve all heard of Lady Gaga and Adele. They have two very different types of modes of communication. Which one is right? The answer is both. And they’re right because they’re being authentic to who they are. It’s the same thing in culture. As long as you’re authentic, you will go farther than anything made up based on what the customer wants to hear or based on what you think is hot in the industry. So many people, especially back in the internet days, they made those mistakes and they tried to build companies based on a fleeting level of success. They tried to base companies on what could be done to gain funding, kind of massage these sites, with no true basis for why they want to be in business. I think that was to the detriment of a lot of companies back then.

A: I would agree with you. And you know what’s interesting? Adele just won a whole slew of awards recently at the Grammys. Her career is taking off and she stayed true to her culture and if  you don’t know Lady Gaga, she’s making $30 million a year just off of her Twitter account. I think last year she made upwards of $80 million in revenue. That’s a perfect example of individuals who are true to their values that are making a ton of impact and making a ton of money as well.

More from this series:

Creating Corporate Culture – Praxis Now Interview Part 1

Creating Corporate Culture – John Assaraf Interview – Part 1

By Business Philosophy, Company Culture, Speaking, Videos 2 Comments

 

Part I of the series. Subscribe now for updates when the other videos are posted.

John Assaraf sat down with Steven Cox, CEO of TakeLessons.com, to discuss what it means to create and maintain a thriving corporate culture. In this interview, Cox defines corporate culture, outlines steps entrepreneurs can take to define their company’s culture and shows how a strong culture can translate into other great gains for any organization.

Assaraf: Hi everyone, this is John Assaraf, CEO of Praxis Now and with me is a very dear friend of mine Steven Cox and Steven is part of my mastermind group and I’m part of his mastermind group. He’s the CEO of TakeLessons.com which is a company that is serving tens of thousands of idividuals who want to take guitar lessons and really want to find the right teacher online. Prior to this venture, he worked with CollegeClub.com which was a 1990’s company, a very very early social network, before social networks even existed, so if you want to know where social networks may have started, College Club is one of the companys. Steven has got an amazing company that’s venture capital funded. He has got an amazing culture with the people that he has hired, with the people that he works with as far as vendors and the way that they do things. He’s an amazing entrepreneur that’s had some great successes and he’s masterful at creating cultures and teams that drive insane revenues and amazing, fanatical client experiences. What I’d like to do today is really get into Steven’s head on your behalf. It doesn’t matter if  you have an idea or if you have ten or twenty or fifty employees, what you’re about to learn is why it is imperative for you to understand the vital importance of creating a culture that starts with you and continues with every single employee you’ve got. I’m also going to ask Steven a whole bunch of questions about raising money and his entreprenuer skills, but we’re going to focus specifically on building a culture and then we’ll take it from there. We’ve got 90 minutes together. We’re also going to give you a chance about every 15 to 20 minutes to ask questions and Steven might even ask you questions as well, like, do you play a musical instrument? Do your kids play? Steven, thank you so much.

Cox: Thanks for having me. I appreciate it.

Assaraf: So let’s get right into it. Is there anything I missed about your bio or the things that our friends all over the world need to know about that I may have missed?

Cox: No, I think you pretty much hit it dead on. I’ve just been an internet geek so that’s pretty much what I’ve been doing since 1996. It’s all I know. A lot of people are good at many things; I’m good at one thing.

A: The other thing that I failed to mention is that Steven just did an amazing deal with Best Buy so now Best Buy is offering not only to sell people guitars, but when they do, they offer Steven’s company’s lessons to the person who buys a guitar. It’s a major, major, major deal. So Steven, let’s talk about, what is culture and let’s get into why it’s so important. What I ask each one of you to do by the way is don’t write all of this stuff down because you’re going to have access to these slides. Listen to Steven and write your own notes down and then come back to these slides later on if you want to have the actual slides themselves. That’s one of the benefits of being a client of mine. So what is culture?

C: A lot of folks when we first start talking about culture, it seems like this feel-good type thing that’s permeated over the last couple of years, and a lot of folks don’t understand what it is or how it engenders across the whole organization. So I liken it to a very simple concept. The culture of your company is really the personality traits of your company. It’s really based on the values that you have as an individual and as a collective group of people, the beliefs that they have and the behaviors that we do. All of those beliefs we have and behaviors we do end up driving the actions within the company and that really makes up the company, how decisions are made based on the beliefs that we form. All that comes back to the values that we have; that’s the key to this whole thing: setting up the values and making sure they permeate the whole organization.

What Do Your Employees Say When Leaving?

By At Work, Company Culture No Comments

As a CEO, one of my biggest jobs is to oversee a culture that represents our core values of resepect, perseverance, an ownership mentality, constant and never-ending improvement, and building things we're proud of. I believe it's the duty of corporations to be more than just a profit machine. I think they owe it to their team to build an ecosystem where the employees can build friendships and skills that last a lifetime.

I teach my team that the company will always continue to evolve, and people will come and go. But while a team member is here, we want to see them learn, grown, become better, make friends, hit goals, and become an all around better human being. And if we can build a culture like that, everyone that comes into the company will leave more confident and empowered than when they came in.

I also believe that the younger generation will seek out companies that share this viewpoint. They have seen the downfall of CEO's and companies – from Enron, to MCI, to the 2008 bank collapse. And this has been reflected in society with the Occupy movements. Future talent expects more out of their companies than what the old guard is ready to give. Thus, the best future talent will be attracted not just to the companies that pay the highest, but to the companies that pay well AND share the same belief systems as the people they wish to attract.

I love seeing one of our team members spreading their wings. While I'm not thrilled they are leaving the company, I'm always happy to see them chasing their dreams, knowing that TakeLessons helped them along the way.

One of our members, August Mao, is leaving tomorrow to pursue an acting career in LA. We wish him the best and hope he gives us a shout out on the Red Carpet one day.

We encourage team members to write their own goodbye. Here's what August had to say. I think it speaks to the type of culture I want to have and reinforces our belief that companies should be a place where people can flourish.

281242_10150236335772828_4849087_nMy Dear TakeLessons Family,

I cannot believe that the day has finally come for me to part ways with all of you. These past ten months have truly been an incredibly eye-opening experience for me. There is something extremely special about this place, something that I will remember to take with me as I embark onto the next chapter in my life.

Working here at Takelessons and meeting each and every single one of you has gifted me with new perspectives. In more ways than one, you have all given me hope. As I venture out into this world, I am hopeful that I will encounter others who are equally as genuine and kind as all of you. I am hopeful that there will be others out there who share the same positive energy and constant optimism that all of you possess. In the future, I hope to again find myself within a community where individuals treat one another with the highest levels of respect, where the importance of friendship and comradery trumps that of the more superficial things in life. I sincerely hope to find another family like you.

I have learned that life will not always be kind to us, and that it certainly will not always go in the direction that we have planned it to. Wherever I end up, there will surely be more obstacles – ones that will be both emotionally and physically challenging. And yet, it gives me confidence to know that somewhere on this big blue earth, I will always have a group of phenomenally wonderful individuals to come back to. From the very bottom of my heart, I want to thank each and every single one of you for all that you have done for me. Thank you for making me into a better person.

Please don’t hesitate to contact me if there is ever anything I can do to help. I look forward to keeping in touch with all of you and will make sure to keep you updated on my journey!

Much Love,

August