We recently made an investment in Atlanta tech startup TranscriptsHQ. The founder, Eugene Yukin is one of the most passionate entrepreneurs I’ve met in a long time and I’m already enjoying working with him. Having a background as a reporter who was constantly purchasing transcripts for audio files, phone calls, and videos, Eugene believes that transcripts and summaries can be purchased a better way. The service is super simple and very affordable. They still use humans to power the transcription which allows them to do summaries and notes– along with great quality. Since I love the service, and since I have tons of traffic to this site for the Simon Sinek Ted Talk “Start with Why,” I thought it appropriate to provide a transcript of that popular video here.
Videos through blogs are great, but personally, I prefer to just read. I like going at my own pace (faster than the video) and having the option to skim, highlight, copy, paste and more. With all that background, here is the transcript of Simon Sinek’s TED talk, mandatory content for every startup entrepreneur in Atlanta and the Atlanta Tech Village.
We assume that we know why we do what we do, but then how do you explain when things don’t go as we assume. Or better, how do you explain when others are able to achieve things that seem to defy all the assumptions. For example, why is Apple so innovative year after year after year? They are more innovative than all their competition and yet, they are just a computer company. They are just like everyone else. They have the same access to the same talent, the same agencies, the same consultants and the same media. Why is it that they seem to have something different? Why is that Martin Luther King led the Civil Rights Movement? He wasn’t the only man who suffered in pre civil rights America and he certainly wasn’t the only great orator of the day. Why him? And why is it that the Wright brothers were able to figure out control powered manned flight when there were certainly other teams who were better qualified and funded, and they didn’t achieve powered manned flight. The Wright brothers beat them to it. There’s something else at play here.
About three and a half years ago, I made a discovery and this discovery profoundly changed my view on how I thought the world worked and it even profoundly changed the way in which I operate in it. As it turns out there’s a pattern. All the great and inspiring leaders and organizations in the world, whether it’s Apple or Martin Luther King or the Wright brothers – they all think, act, and communicate the exact same way and it’s the complete opposite to everyone else. All I did was codify it. It’s probably the world’s simplest idea and I call it the Golden Circle. Why? How? What?
This little idea explains why some organizations and some leaders are able to inspire where others are not. Let me define the terms very quickly.
Every single person and organization in the planet knows what they do 100%. Some know how they do it, whether you call it your differentiating proposition or proprietary process or USP. But very very few people and organizations know why they do what they do. And by why I don’t mean to make a profit – that’s a result. It’s always a result. By why I mean, what’s your purpose? What’s your cause? What’s your belief? Why does your organization exist?
As a result, the way we think, the way we act, the way we communicate is from the outside in. It’s obvious; we go from the clearest thing to the fuzziest thing. But the inspired leaders and organizations, regardless of their size or industry, all think, act, and communicate from the inside out. Let me give you an example.
I use Apple because they are easy to understand and everybody gets it. If Apple were like everyone else, a marketing message from them may sound like this: We make great computers. They are beautifully designed, simple to use, and user friendly. Want to buy one?
And that’s how most of us communicate. That’s how most marketing and sales are done and that’s how most of us communicate interpersonally. We say what we do, we say how we are different or how we are better, and we expect some sort of behavior – a purchase or vote or something like that. “Here’s our new law firm. We have the best lawyers with the biggest clients. We always perform for our clients – do business with us.” “Here’s our new car – it gets great gas mileage, it has leather seats – buy our car.” But this is uninspiring.
Here’s how Apple actually communicates – Everything we do we believe in challenging the status quo, we believe in thinking differently. The way we challenge the status quo is by making our products beautifully designed, simple to use, and user friendly. We just happen to make great computers. Want to buy one?
Totally different, right? You’re ready to buy a computer from me. All I did was reverse the order of the information. People don’t buy what you do, people buy why you do it. This explains why every single person in this room is perfectly comfortable buying a computer from Apple. But we are also perfectly comfortable buying an MP3 player from Apple, or a phone from Apple or a DVR from Apple. But as I said before, Apple is just a computer company. There’s nothing that distinguishes them structurally from any of their competitors. Their competitors are all equally qualified to make all of these products. In fact they tried. A few years ago Gateway came out with flat screen TVs. They are imminently qualified to make flat screen TVs, they have been making flat screen monitors for years. Nobody bought one.
Dell came out with MP3 players and PDAs and they make great quality products and they can make perfectly well designed products and nobody bought one. In fact, talking about it now we can’t even imagine buying an MP3 player from Dell. Why would you buy an MP3 player from a computer company? But we do it everyday. People don’t buy what you do, they buy why you do it.
The goal is not to do business with everybody who needs what you have. The goal is to do business with people who believe what you believe. Here’s the best part. None of what I’m telling you is my opinion. It’s all grounded in the tenants of biology. Not psychology – biology.
If you look at a cross section of the human brain, looking from the top down, what you see is that the human brain is actually broken into three major components that correlate perfectly with the Golden Circle. Our newest brain – our homosapien brain, our neocortex corresponds with the “what” level. The neocortex is responsible for all of our rational and analytical thought and language.
The middle two sections make up our limbic brains and our limbic brain is responsible for all of our feelings, like trust and loyalty. It’s also responsible for all human behavior and decision making, and it has no capacity for language. In other words, when we communicate from the outside in then yes, people can understand vast amount of complicated information like features, benefits, facts, and figures, just doesn’t drive behavior. When we communicate from the inside out, we are talking directly to the part of the brain that controls behavior and then we allow people to rationalize it with the tangible things we say and do. This is where gut decisions come from.
You know, sometimes, you can give somebody all the facts and figures and they say, “I know what all the facts and details are but it just doesn’t feel right.” Why do we use that verb? It doesn’t feel right. Because the part of the brain that controls the decision-making, doesn’t control language and the best we can muster up is, “I don’t know, it just doesn’t feel right.”
Or sometimes you say you’re leading with your heart or you’re leading with your soul. Well, I hate to break it to you, those aren’t other body parts controlling your behavior, that’s all happening here in your limbic brain. The part of the brain that controls decision-making and not language. But if you don’t know why you do what you do and people respond to why you do what you do, then how will you ever get someone to vote for you, buy something from you, or more importantly be loyal and want to be a part of what it is that you do. Again, the goal is not just to sell to people who need what you have, the goal is to sell to people who believe what you believe. The goal is not just to hire people who need a job, it is to hire people who believe what you believe.
I always say that if you hire people just because they can do a job, they will work for your money. But if you hire people who believe what you believe, they will work for you with blood, sweat, and tears. And nowhere else is there a better example of this than with the Wright brothers.
Most people don’t know about Samuel Pierpont Langley and back in the early 20th century, the pursuit of powered manned flight was like the dotcom of the day. Everybody was trying it. Samuel Pierpont Langley had what we assume to be the recipe for success. I mean, even now when we ask, “Why did your product or company fail?” People always give you the same permutations of the same three things. Undercapitalized, the wrong people, bad market conditions. It’s always the same three things. So let’s explore that. Samuel Pierpont Langley was given $50,000 by the War Department to figure out this flying machine. Money was no problem. He held a seat at Harvard and worked at the Smithsonian and was extremely well connected. He knew all the big minds of the day. He hired the best minds money could find and the market conditions were fantastic. The New York Times followed him around everywhere and everyone was rooting for Langley. Then how come we have never heard of Samuel Pierpont Langley? A few hundred miles away in Dayton, Ohio lived Orville and Wilbur Wright. They had none of what we consider to be the recipe for success.
They had no money, they paid for their dream with the proceeds from their bicycle shop. Not a single person on the Wright brothers’ team had a college education. Not even Orville or Wilbur. And the New York Times followed them around nowhere. The difference was that Orville and Wilbur were driven by a cause, a purpose, a belief. They believed that if they could figure out this flying machine, it will change the course of the world.
Samuel Pierpont Langley was different. He wanted to be rich and he wanted to be famous. He was in pursuit of the result, he was in pursuit of the riches and lo and behold look what happened. The people who believed in the Wright brothers’ dream worked with them with blood, sweat, and tears. The others just worked for the paycheck. And they tell stories about how every time the Wright brothers’ went out, they would have to take five sets of parts because that’s how many times they would crash before they came in for supper. And eventually on December 17, 1903 the Wright brothers took flight and no one was there to even experience it. We found out about it a few days later.
And further proof that Langley was motivated by the wrong thing – the day the Wright brothers took flight, he quit. He could have said, “That’s an amazing discovery guys and I will improve upon your technology.” But he didn’t. He wasn’t first, he didn’t get rich, he didn’t get famous, so he quit. People don’t buy what you do, they buy why you do it. And if you talk about what you believe, you will attract those who believe what you believe. Well, why is important to attract those who believe what you believe?
Something called the law of diffusion of innovation. And if you don’t know the law, then you definitely know the terminology. The first two and half percent of our population are our innovators. The next 13.5 percent of our population are our early adopters, the next 34% are your early majority, the late majority, and your laggards. The only reason these people buy touchtone phones is because you can’t buy rotary phones anymore. We all sit at various places at various times on this scale but what the law of diffusion of innovation tells us is that if you want mass market success or mass market acceptance of an idea, you cannot have it until you achieve this tipping point between 15 and 18 percent market penetration and then the system tips.
I love asking businesses what’s your conversion on new business and they love to tell you proudly, “Oh, it’s about ten percent.” Well you can trip over ten percent of the customers. We all have ten percent who just “get it”. That’s how we describe them. That’s like that gut feeling. “Oh, they just get it.” The problem is how do you find the ones who just get it before you are doing business with them versus the ones who don’t get it. So, it’s this here, this little gap that you have to close as Geoffrey Moore calls it, “Closing the Chasm.” You see, the early majority will not try something until someone else has tried it first and these guys, the innovators and the early adopters, they are comfortable making those gut decisions. They are more comfortable making those intuitive decisions that are driven by what they believe about the world and not just what product is available. These are the people who stood in line for six hours to buy an iPhone when they first came out. When you could have just walked into a store the next week and bought one off the shelf. These are the people who spent $40,000 on flat screen TVs when they first came out even though the technology was substandard. And by the way, they didn’t do it because the technology was so great. They did it for themselves, it’s because they wanted to be first. People don’t buy what you do, they buy why you do it and what you do simply proves what you believe. In fact, people will do the things that prove what they believe. The reason the person bought the iPhone in the first six hours was because of what they believed about the world and how they wanted everybody to see them. They were first.
So let me give you a famous example – a famous failure and a famous success of the law of diffusion of innovation. First the famous failure. It’s a commercial example. As we said before a second ago, the recipe for success is money, and the right people and the right marketing conditions, and you should have success then. Look at TIVO. From the time TIVO came out about eight or nine years ago to this current day, they are the single, highest quality product on the market. Hands down there is no dispute. They are extremely well funded, market conditions were fantastic. I mean we used TIVO as a word, “I love TIVO stuff on my piece of junk Time Warner DVR all the time.” But TIVO is a commercial failure, they never made money. And when they went IPO their stock was about $30 or $40 dollars and then plummeted and it’s never traded above $10. In fact, I don’t think it’s traded above $6 except a couple of little spikes. Because you see, when TIVO launched their product, they told us all what they had. They said, “We have a product that pauses live TV, skips commercials, rewinds live TV and memorizes your viewing habits without you even asking.” And the cynical majority said, “We don’t believe you. We don’t need it. We don’t like it. You’re scaring us.” What if they had said, “If you are the kind of person who likes to have total control over every aspect of your life, boy do we have a product for you. It pauses live TV, skips commercials, memorizes your viewing habits etc.” People don’t buy what you do, they buy why you do it and what you do simply serves as the proof of what you believe.
Now let me give you a successful example of the law of diffusion of innovation. In the summer of 1963, 250,000 people showed up on the Mall of Washington, DC. to hear Dr. King speak. They sent out no invitations and there was no website to check the date. How do you do that? Well, Dr. King wasn’t the only man in America who was a great orator. He wasn’t the only man in America who suffered in pre civil rights America. In fact some of his ideas were bad but he had a gift. He didn’t go around telling people what needed to change in America. He went around and told people what he believed. “I believe, I believe, I believe,” he told people. And people who believed what he believed took his cause and made it their own and they told people. And some of those people created structures to get the word out to even more people. And lo and behold, 250,000 people showed up on the right day, at the right time to hear him speak. How many of them showed up for him? Zero. They showed up for themselves. It’s what they believed about America that got them to travel in a bus for eight hours to stand in the sun in Washington in the middle of August. It’s what they believed. And it wasn’t about black versus white. Twenty five percent of the audience was white.
Dr. King believed that there were two types of laws in this world: those that are made by a higher authority and those that are made by man and not until all the laws that are made by man are consistent with the laws that are made by a higher authority will we live in a just world. It just so happens that the Civil Rights Movement was the perfect thing to help him bring his cause to life. We follow him not for him, but for ourselves. And by the way, he gave the I Have a Dream speech not the I Have a Plan speech. Listen to politicians now with their comprehensive 12 point plans, they don’t inspire anybody. Because there are leaders and then there are those who lead. Leaders hold a position of power or authority but those who lead inspire us, whether they are individuals or organizations, we follow those who lead not because we have to but because we want to. We follow those who lead, not for them but for ourselves. And it’s those who start with “why?” that have the ability to inspire those around them or find others who inspire them. Thank you.
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