Excellent leaders are rare, and some of the very rarest and best are of a specific type: entrepreneurs who start a successful company (a tiny percentage of total entrepreneurs) and who then continue to manage it well as a big, established business (a tiny subset of successful entrepreneurs). How do they do it and what can we learn from them? Consider examples of this rare breed who happen to be in the news:
–Elon Musk’s Tesla yesterday reported a quarterly profit and its highest quarterly sales ever. It’s easy to forget how utterly unlikely and insanely audacious the whole Tesla story is. Entering the capital-intensive auto industry was supposed to be impossible for a startup. Ditto for developing electric motor technology that could challenge mammoth incumbents; ditto for building a 300-acre battery factory. Yet not only has Tesla managed a profit, figures released two weeks ago show that Tesla continues to sell more luxury sedans in America than Mercedes-Benz, BMW, or any other company.
-Uber’s Travis Kalanick keeps thinking way, way beyond disrupting the taxi business. A few days ago his company conducted what it trumpeted as the first revenue-generating delivery by an autonomous truck. It was a well-done publicity stunt, but it called attention to a significant expansion by Uber: launching Uber Freight to disrupt the huge trucking industry. Others have tried and failed in attempting the same thing, but Uber has more capital, more experience, and better technology. We were just getting used to the idea that Kalanick’s grand vision was to revolutionize personal transportation. Actually it’s bigger; we can strike the word “personal.” For Uber, it’s a credible goal.
–Kevin Plank’s Under Armour is struggling, but it’s competing at its industry’s highest level. This former college fullback started a t-shirt business 20 years ago. Now it’s a publicly traded company with over $4 billion of annual revenue. The stock has been sliding the past few days over investor concerns about growth, but Plank reminded CNBC viewers yesterday that Under Armour is still one of the world’s top three sports brands (after Nike and Adidas). Such success against the industry’s biggest competitors is remarkable.
-Netflix’s Reed Hastings has made himself one of Hollywood’s most powerful players but is still thinking about what’s next. He has transformed his business model from DVDs-by-mail to movies-online to original-content-(and TV shows and movies)-online. Only Disney spends more on production. Yet he keeps looking ahead. At a recent conference he speculated that someday people could be entertained by taking a personalized pill that would cause them to hallucinate entertainment. He was kind of kidding, but just kind of. The fact that he had conceived such an idea tells us a lot.
Can we draw lessons from these four? Only cautiously. It seems that they all started with big ideas and have never stopped making them bigger. But a different lesson is more important. None of them were ready to be CEO of a big corporation when they launched their companies. They are successful CEOs because they’ve grown personally and haven’t stopped growing. That’s unusual; most people stop growing early in their careers. While most of us will never be famous CEOs of big global companies, these four are extraordinary in how they’re confronting a personal challenge that faces us all.
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What We’re Reading Today
Mylan execs’ pay unlikely to fall after EpiPen settlement
Heather Bresch‘s company recently agreed to a $465-million settlement of allegations that it overcharged Medicaid for the EpiPen, an amount that’s over twice as much as Mylan’s pretax earnings in the year’s first half. But Mylan bases executive pay on “adjusted diluted” earnings, a measure that excludes litigation settlements. WSJ
Tata Sons refutes write-down allegations
The aftermath of Tata Sons’ abrupt dismissal of former chairman Cyrus Mistry gets odder. A leaked letter from Mistry to the board says Tata Sons businesses may need to write down nearly $18 billion. The company rejects those assertions, calling them “malicious.” Reuters
Tesla’s surprise profit
Elon Musk‘s company hadn’t turned a quarterly profit in three years until yesterday, when Musk announced the company earned $21.9 million in the third quarter. Tesla shipped a record 24,821 vehicles in the quarter. Fortune
The NFL and the Premier League face viewership decline
The world’s two most popular sports leagues have long been considered immune to the viewership declines afflicting other TV programming. But recently their viewership is down by double-digit percentages; primetime NFL games are down as much as 21%. NFL Commissioner Roger Goodell and other sports executives must determine whether the cause is temporary (possibly the presidential race) or something bigger. NYT
Building a Better Leader
How much change should a new CEO impose?
A new boss sparks anxiety throughout the organization. He or she must walk the line between making needed improvements and avoiding “change fatigue” among employees. Harvard Business Review
Doing business in the U.S…
…got harder last year. In the World Bank’s Ease of Doing Business report, the U.S. fell one spot to eighth place; inability to adopt bipartisan reforms is a major reason. Fortune
This election’s divisiveness…
…has spread into the workplace, creating tension between co-workers. Over 50% of HR professionals say they’ve seen more workplace hostility caused by this election than by previous ones. WSJ
Marc Benioff on targets that got away: LinkedIn and Twitter
The Salesforce CEO said he was interested in buying Jack Dorsey‘s Twitter, but his shareholders got wind of the plan and made their opposition clear. He bid for LinkedIn, seeing a good fit with Salesforce’s business model, but Satya Nadella‘s Microsoft bought the company in June. Benioff questioned the legality of Microsoft’s plan to combine LinkedIn’s user data with its own. Fortune
Disney’s renewed interest in Twitter
Twitter’s stock jumped after a report that Bob Iger‘s Disney had renewed its interest in buying the social media firm. It’s unclear how far negotiations have gone, but the two sides have reportedly agreed on a price in the high $20s per share. Twitter could have become more motivated to sell, having announced it would cut 9% of its workforce because of slowing user growth. Business Insider
Qualcomm to buy NXP Semiconductors for $47 billion
The deal, which includes nearly $10 billion in debt, brings Steve Mollenkopf‘s company one of the largest makers of chips for the auto industry, as demand for smartphone chips sags. Qualcomm had stayed out of chip industry’s consolidation until now. Reuters
Up or Out
Shawn Price, a top cloud executive at Oracle, died Tuesday at age 53. Fortune
Fortune Reads and Videos
Snapchat wants to raise $4 billion…
…with an IPO in early 2017. The offering would value the company at $25 billion to $35 billion. Fortune
American Apparel may re-enter bankruptcy
That would be two bankruptcies in less than two years. Fortune
Walmart adds “Holiday Helpers”…
…to improve checkout times at its stores. Clad in yellow vests, they’ll retrieve items shoppers might have forgotten, among other duties. It’s another effort to improve shoppers’ in-store experience. Fortune
Michael Moore’s Trumpland has gone viral…
…with conservatives. A clip from the liberal activist’s new film has been spreading among Donald Trump supporters online, though the segment has been cut to exclude language that Trump supporters might not like. Fortune
Quote of the Day
“It will be beneath the dignity of Tata Sons to engage in a public spat with regard to the several unfounded allegations appearing in his leaked confidential statement…These allegations are not based on facts or the true state of affairs. It is convenient to put selective information in the public domain to defend one’s point of view.” — Tata Sons press release, responding to a leaked letter from recently dismissed chairman Cyrus Mistry to the board outlining potential write-down costs. Reuters