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Intention and
Invention
Designing Companies That Create New Industries
Bi! Warner
V2 February 14, 2013
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Foreward
I intend to help people fo!ow their heart.
I believe people are pushed to fo!ow their head.
These two statements encapsulate what drives me these days. I started two companies,
Avid and Wildre. Both had successful outcomes nancially. Avid became a public
company and is the leader in high"end video and lm editing systems today. Wildre
created a telephone"based virtual assistant very similar to Apples Siri. It was sold to
Orange PLC in 2000, netting investors a 4"10x return.
But how the companies turned out from my original intentions is a di#erent story. The
intention behind Avid was I intend to help people tell their story. Avid does this
beautifully and has since it started shipping in 1989.
Wildre captured the technology worlds imagination by making the rst speech"based
electronic assistant, and one with a personality to boot. But as the demos wowed people,
I felt uncomfortable that something was wrong.
A jarring conrmation of this feeling came much later when I mentioned Wildre to
young man, and he said Oh, Wildre. I know that product. When I get Wildre, I hang
up. I asked why, and he provided a zinger. People who use Wildre dont want to talk to
me. They use it to screen calls.
It was true. My unstated intention with Wildre was I intend to help people feel closer
together. And after nine years of e#ort, I had built a product that did the exact
opposite.
I believe I took two di#erent approaches on the two companies. With Avid, I followed
my heart and fullled my intentions. With Wildre, I followed my head and ended up
not fullling my intentions...even doing the opposite.
So today I work with entrepreneurs on a simple concept: That you can indeed follow
your heart as you build your company. And, like Avid, the company will still make perfect
sense to those using their head as they invest. Starting in 2004, I have, over the last eight
years, created and rened a range of techniques for helping entrepreneurs truly turn the
energy that is in them into a company that not only reects their intentions, but causes
those intentions to ow in an ever"growing way.
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On Designing
Companies
Stories and Background
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What Game
Are You
Playing?
Founder Fit vs. Market Fit
Ill start with an old joke. One sh swims by the other and asks
hows the water? The other replies whats water?
I believe the same is true in business. Businesses live in a medium,
but that medium is so taken for granted, and so assumed to be
singular, that the design of companies is remarkably static.
In fact, I believe that most entrepreneurs simply ignore the design
of their company and focus on the design of their product.
They adopt the assumed method of company formation that I call
Market Fit. You create a product that ts a market. You prove
the market exists, you convince investors it exists, you design your
product to the market and then you sell that product to the
market. Your company design? Thats simple. It becomes whatever
it must become to best serve the market you have found.
Voila. Youve left your company design up to the folks who have
the most money $now% to pay for a product that meets a current
need.
But what about entrepreneurs that seek to create products for
which there is no current market? No one is searching Google for
the price for these things. In fact, people either dont think they
need them, or they believe the product is impossible.
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The Wright Brothers
1899: Bicycle Makers Plan Lifto!
I believe the Wright Brothers story provides
excellent information about how to build your
company to t its founders, and then how not to.
While others were seeking to create powered ight
through complex and expensive inventions, the
Wright Brothers created a world for themselves. A
shop with everything they needed. Their own wind
tunnels. And nally, their own private, quiet, windy
beach where they could experiment in peace. $And
in secret.%
The Wright Brothers simply solved each problem
that came up until there were no problems left, and
they were able to y. First as a glider. And then as
powered ight. When they couldnt nd an engine
that performed well enough, they invented their
own.
I submit that from 1899 to 1903, the Wright
Brothers were using a company design technique I
call Founder Fit. They focused on what they
needed to accomplish what they believed was
possible.
The Wright Brothers actions were taken only for
themselves. Not for anyone else. They didnt make
their own wind tunnel to prove ight to data to
others. They made the test equipment to learn what
they needed to learn.
The result is in the history books. They achieved
excellent powered ight before anyone else.
They were ying. Literally. And then they decided
to become a sh. Because after they made the
invention, the felt they needed to become a real
company. And real company in those days was based
on patents. Click here for a quick video showing
what happened.
http://bit.ly/WhatGame
VIDEO
A Brief Story of Changing the World
Click or enter the link below:
1:04
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Patent War
The Wright Brothers were obsessed with patents, and
with the fear that others would steal their ideas. They
refused to show their ying machines publicly until
the patents were set, which furiously increased the
creativity and cleverness of future competitors.
I believe that the patent war represented the Wright
Brothers decent into simple sh, living in the same
old water everyone else did. Two bicycle makers
designed their own world and cracked the hardest
engineering problem of the century and then, with
only fear and an amazing lack of imagination became
ghting sh in a battle that could only kill them.
How could this happen?
I believe the answer is simple. People too often play a
game that is assumed, rather than the game they want
to play. I believe this is what happened:
The Wright Brothers played their game and won.
Then they played someone elses game and lost.
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Intention, Invention
and Beliefs
A Framework for Creating Companies That Change the World
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Introduction
Four Concepts Form the Foundation of Your Company
I intend to help people see the simplicity in life. In my work with
entrepreneurs, Ive found that what will become an extremely
complex company can be understood through four simple concepts:
Intention: This is the energy in each of us that drives us to help
others. I believe its not just a general energy, but it manifests itself in
individual intentions, such as the I intend to help people tell their
story intention that drove me on Avid. I believe a single intention
can spawn a company and power its founder for a decade.
Invention: I see inventions as servants to intention. They are way for
ones intentions to take shape in the real world.
Beliefs: Beliefs are the connector between intention and invention.
For example, if you dont believe something is possible, you wont
attempt any invention. Beliefs are extremely powerful in that the
shape the ow of your intention, and they also lead you to invent in
specic ways.
Your People: I believe our insatiable desire to invent comes from our
desire to help others. And our greatest energy comes from our desire
to help people we love. Entrepreneurs often focus on customers ""
people who can pay. I encourage them to focus on the people they
love helping, and design a company centered around that.
Remarkably, it usually turns out that you can help your people and
create a protable, sustainable business with that help at the core.
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Intention
Example
The Declaration of Independence: The
Worlds Most Famous Statement of Intent
The central thesis of my work on designing companies to
t their founders is the idea that ones own source of
energy comes from intention. I believe that intention is a
word for the energy a person has to help others. I also
believe that each invention we make springs from a single
founding intention.
The founding of our country serves as a wonderful example
of intention, invention and beliefs at work. In 1776, the
rebels had a tiny army and no proof that they could ever
win a war against England. Undaunted, they pushed the
belief"to"proof ratio to the maximum and issued the
Declaration of Independence. The intention was to help
people be free to pursue life, liberty and happiness. The
declaration said nothing about the the actual design of the
country that was dreamed of. It was pure intention and
pure belief. And no proof.
In 1787, the Constitution would lay out the basic design
principles of the country, providing an actual framework to
ow the intentions and support the beliefs that were
outlined eleven years before.
...!at "ey are endowed by "ei#
$rea%r wi" certain unalienabl&
'ights, "at among "ese are Life,
(iber) and "e pursuit o*
+appiness.
...,at "ese Uni-d Colonies are,
and of Right ought % be Fre&
and Independent Sta-.
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Invention
Example
The US Constitution: Guiding 240 Years of
Country Design From Just 418 Lines of Text
Brad Feld has written a great book on startups called Do
More Faster. Its a series of essays on how to get more done
with less e#ort. I have two essays in the book, but I wish I
could add a third: Get Less Done with More E#ort.
If the Constitution was to be measured in lines of code, its
truly tiny " just 418 lines. Read the constitution and see the
accounting of the lines here. The US Constitution may be
small, but it was the result of years of enormous e#ort and
thought.
In fact, I would argue that the Constitution achieves the
highest ratio of intention ow to compared to the size of
the invention. I call this ratio intention density . The US
Constitution is the smallest in the world. Its intention is
to provide Life, Liberty and the Pursuit of Happiness.
And arguably, the intention ow it has fostered is the
largest of any country in the world. Hence, it has the
highest intention density of any single invention that I
know of.
At the MITx Awards Ceremony, I gave a 12"minute
keynote speech that explains this in a funny way. Click to
listen
BLOG POST
http://bit.ly/
Constitution418
Our First Social Network:
The US Constitution
http://bit.ly/SocialNetworkSpeech
12:29
KEYNOTE SPEECH
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Belief
Example
Alexander Hamilton
Alexander Hamilton fought in the Battle of Yorktown in
1781 and helped end the Revolutionary War. But his
biggest contribution to our country was in his ability to
change the fundamental political and economic
structure of the country. He is rightly referred to as one
of our Founding Fathers. Here I will use his story to
point out the power of belief, and the role it needs to
play in the design of companies as well as countries.
Bankrupt States
In 1790, most states were essentially bankrupt from the
debts they incurred to ght the War. Hamilton believed
that a strong central government and a modern nancial
system could increase condence in the new country.
The Federal Government Assumes State Debt
Specically, Hamilton convinced Congress to have the
Federal Government assume the debts of the states.
With this move, and with his other nancial innovations,
our country went from a lose confederation of mostly
bankrupt states, to an emerging power. And yet, nothing
much had changed immediately. Only the structures for
the future.
The Belief"to"Proof Ratio
People love to see proof. But proof is a form of burden,
much like carrying weight. People also have an amazing
ability to believe in the future with little and sometimes
no proof. Hamilton, in his ve years as Secretary of the
Treasury dramatically increased belief in the countrys
future, while letting the proof wait. Much like the
thrust"to"weight ratio in an airplane, when you can
operate with more belief and less proof, you climb faster.
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Your
People
Example
Google Helps Their People For Free
When Sergei Brin $left% and Larry Page $right% started
Google in 1998, Alta Vista was already a leading search
engine. Soon it was using the accepted method of
monetization in those days "" it had become a portal.
Remember the phrase sticky eyeballs? The idea was that
people would come for search, and stay for all the other
links, which would yield advertising dollars.
Page and Brin had a di#erent idea. How about making
search incredibly fast and simple? You come, you search,
you leave. They loved their people " the searchers "" and
they vowed to serve them, and never take from them. No
monetization.
Steven Levys book In the Plex outlines what happened.
Usage exploded, even while Brin and Page were at Stanford.
VCs invested due to the growth, but still asked for proof of
how Google could make money. Brin and Page just pressed
on with helping people search.
Eventually they found the answer that helped their
searchers and at the same time brought in revenue. It was
called AdWords. Carefully designed so any ads were useful
to searchers instead of annoying, Google made an
incredibly protable company that only helped searchers
and never took anything from them. No sticky eyeballs.
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Intention Flow
The Essential Flow of Energy that Creates Great Companies
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Intention
Flow
Helping People as the
Core of Any Great Company
In this diagram, the orange lines show intention ow from the
intention, through beliefs, through the invention and on to the
people being helped. The small circle with the little i is a single
intention of a single person. For example, for me on Avid it was
I intend to help people tell their story.
I call this a timeless intention, because like the Declaration of
Independence, it says nothing about how to fulll the intention,
and it is a simple human truth.
The Avid Media Composer was my invention, and it made all
video and sound digital and instantly accessible. My people were
editors who used the Avid to tell their story.
It is remarkably easy to take an entrepreneur who knows who
they want to help, and get them to block their own intentions
because they believe that focusing on the ow of money and on
current customers is the only way to design their product and
$often by default% their company.
And it is also true that it is remarkably easy to get entrepreneurs
to do what comes naturally to them "" to invent for their people
and to create products the ow their own intentions .
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Do Less
Slower
More Thinking. Less Doing. High Intention
Density Yields More Results
Much of the time I spend with entrepreneurs is to get them
to change their work habits. Much like the sh story earlier,
where the game is assumed, I nd that entrepreneurs need
constant reinforcement that they are doing the right thing.
And working hard and getting a lot done seem to be the
default behaviors that everyone agrees is the sign of a great
entrepreneur.
Not me. The Founding Fathers took 116 days to come up
with their tiny 418 lines. A rate of 3.6 lines per day. I believe
that great work comes from little bursts of doing, and lots of
time thinking.
I believe that the entrepreneurs rst task is to understand
their own intentions and beliefs, and then encode these into
the sma!est inventions they can.
I believe entrepreneurs need to start by believing that they
have something important to give to their people, and they
dont need proof in order to start and to accelerate. They
dont need validation, and they often dont even need money
to start.
To put it in terms of two ratios, I believe entrepreneurs need
a very high belief"to"proof ratio, and then they should make
the smallest inventions that create the highest intention
ow possible $high intention density.%
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CoFlow
Creating an Additive World
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Addition is
Better
Sound Waves Meet the Venn Diagram
The concept of CoFlow is based on what we already know from
nature. We know that great things in nature are additive.
When you listen to the sounds of the forest, you hear them all.
The birds singing, the rustling leaves, the wind "" all those
sounds add up to what you hear.
In fact, the idea that anything acts in a subtractive way in
nature is hard to imagine.
But once we start to use our heads, we can imagine lots of ways
where subtraction is key. The Venn Diagram illustrates. You
take three independent items, and begin to realize how small
the overlap is. Strangely, we see that small overlapping part as
the most valuable.
But in nature, things just add up. More sounds makes a richer
sound. More avors make a richer meal. More types and colors
of light make a more beautiful scene. Nothing subtracts from
anything else.
I believe that we invest a fortune to teach our students the
benets of subtraction. The benets of understanding the small
commonality rather than the sum of the parts. I believe we
teach people to create companies that focus on what is shared
between the founders, rather than what is the sum of the
founders and beyond.
Ive created a company design concept I call CoFlow. It is
simply a way to add up all the intention ows from all the
founders. It may be simple, but the results are profound.
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Companies as
Feedback Systems
Negative Feedback O#ers Stability. Positive Feedback Creates
Explosive Growth
Classical feedback theory says you need negative feedback to make a stable circuit.
Negative feedback keeps things from growing out of bounds of the amplier.
But with a company, you want just the opposite. You want positive feedback. You
want something that makes a company grow in an explosive way. Explosions are
unstable. Negative feedback stops them. Positive feedback helps cause them.
Facebook only started in 2005. Now it has over one billion users. I believe that the
only way this could happen is through an explosive mechanism. Same with Twitter.
But how do you create a system that reinforces its own growth? The answer is
something I call the Founding Intention.
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The Founding
Intention
A Single Intention, From a Single Founder Forms
the Core of the Company
In the work I do with companies, one of my least favorite words
is we. Ask a founder whats important to them, and they will
often answer We think...
Usually, we means theyve gone through the Venn diagram
process and theyre talking about whats left after all that
subtraction.
I nd it takes work just to convince entrepreneurs that the best
way to build a company is to understand each person as their
true selves "" their intentions, their beliefs, their inventions and
the people they want to help.
Once we do this work, we nd the intentions of each founder,
and begin the process of designing and additive system that
creates something much bigger, rather than much smaller, than
the sum of the parts.
Nature has the concept of a central pathway as a core for
growth. Take a tree for example. It is built around its ability to
ow nutrients up to its leaves. More light moves more nutrients
up the core and creates more growth. A positive feedback
system. But the core is the ow pathway in the trunk. Its not
the leaves.
For companies, I believe a similar concept is the idea of the
founding intention, which comes from a single founder.
For example, I believe Larry Page provided the founding
intention of Google.
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Center Flow
The Core Flow to the Company's People
The founding intention becomes what I call the center
ow of the company. The founder who provides this is the
center ow founder.
This center ow and the people who receive its help
provide a crucial feedback mechanism for the company.
Other founders are free to create their own inventions and
help their own people. I call these ows coows.
The great thing about center ow and coow is that they
are additive. But one simple rule makes them add up in an
explosive, exciting, and rewarding way.
Rule: Every CoFlow Must Add To the
Center Flow
This rule seems deceptively simple, but its e#ect is large.
The Google example illustrates. Page and Brin refused to
do any monetization until they knew it was good for
$Larrys% people. They didnt use my terms, but they used
the method. They created a true coow with Ad Words. It
helped a new group directly "" advertisers. But it also
helped searchers in giving them a new way to nd things
they might want to buy.
This rule will often disallow things that on the surface
seem ne. A new tool to bring in a new type of user. Does
it add to our founding intention? If not, then dont do it.
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CoFlow
Additive Flows that A! Increase the Center
Flow
In the coow model, each founder has complete freedom to
create their own inventions and help their own people. They
only have to do it in a way that increases the center ow.
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Bill Warner
Background and Story
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Bill Warner
Background
Im an entrepreneur, and I get some of it from my
Dad who owned an aluminum extrusion factory, and
my Mom who was a real estate agent and public
speaker.
Ive loved photography since I was six, and ying
since I was 12, when my Dad learned to y. In 1970 he
bought a Beechcraft Bonanza A36. I was in love.
I solod when I was sixteen. I did my 100"mile cross
country at sixteen also. My Mom had to drive me to
the airport since the driving age was 17. After my solo
round trip from Morristown, NJ to Lancaster, PA, she
had to pick me up.
I got my license at 17 and my instrument rating at 18.
I logged about 300 hours by the time I was in college
at Washington University. I got hurt in an accident
there, and my spinal cord injury made it hard $not
impossible% to y. My love of ying remained, but my
time in the left seat was mostly over.
I had rehabilitation at NYU medical center. One of
my roommates, Tom Wade was a quadriplegic. I
ended up making a remote control system for him,
and that launched me into electronics.
I went to MIT, graduated and worked at
Computervision, Lexidata, and Apollo. In 1987 I was
fed up with how hard it was to edit videos, and I
started Avid Technology, Inc.
In 1991, restless to start my second company and
nding Avid too big at 100 people, I started Wildre.
Lots more information on my LinkedIn page.
Bi! solod at 16in his ying days
http://www.linkedin.com/in/billwarner