A response from the CEO of CB Insights
Huge thanks to Anand Sanwal for emailing me his views about the power of purpose at CB Insights.
I’ve appended his views at the end of this re-post of “I Love You Too”. You can make your own decision to whether CB Insights indeed have found a higher purpose than profit and whether this higher purpose is foundational to their success.
I love you too!
If you’ve read any of my previous articles (blog page) or been in the audience for one of my keynotes, you’ll know that I regularly argue that purposeful organisations (organisations that have a purpose beyond profit) typically outperform their competitors. So when I come across companies that are profitable because they provide a product or services that benefits society, I want to learn more about what makes them tick. Queue right CB Insights.
What do CB Insights Do?
Their about page answers this beautifully.
Our team comes to work every day to build technology that helps corporations guess less and win more.
We aggregate and analyze massive amounts of data and use machine learning, algorithms and data visualisation to help corporations replace the three Gs (Google searches, gut instinct and guys with MBAs*) so they can answer massive strategic questions using probability not punditry.
Questions Like:
Which disruptive companies should we worry about? Which emerging trends could kill us? What new markets should we enter? What is our competitor’s strategy? Who should we acquire? Who should we invest in? Who is our next customer? Who are the S&P 500 of tomorrow?
Why do I use CB Insights?
A large part of my role is to encourage leadership teams to experiment with the new business models that are better suited to benefiting from the current explosion of new exponential technologies.
This should be incredibly easy, but it’s not. Large successful organisations are like tankers. They find it incredibly hard to make even small changes in direction. In being successful, they have typically become robust by introducing a range of frameworks that are intended to protect their existing businesses. Financial metrics, approval processes, committees, silos, functionalisation and centralisation, are just some examples of how large organisations have tried to protect their franchise. Perfect for a linear world but an impending disaster of titanic proportions when the world is exponential.
Many leadership teams I talk to agree that they need to do more, but they struggle to break free from the corporate constraints to enact the necessary changes. They want to be freed up to experiment and make mistakes from which they can learn and in turn increase their breadth and pace of innovation. Most fail to make and sustain the necessary change as they are subsumed by the corporate antibodies that mistakenly believe that corporate controls and structures are protecting their organisation. They are not. They are in fact suffocating it.
So for most incumbents the threat does not come from technological advancement or the next unicorn start up or even their direct competition. Their biggest threat is their own collective inertia and breaking free of this always needs a fundamental change in the leaderships mindset.
The fastest way to do this, maybe even the only way, is to figuratively shock the leadership team in to action, by creating a very necessary sense of crisis. Without a genuine, gut-wrenchingly strong sense of unease that their organisation has not already missed the boat, it’s unlikely they’ll break from their corporate stasis.
CB Insights is a great way to create that sense of crisis. For example, this is a recent article where they explore why Kroger, one the largest employers in US, are doomed. Funny, provocative, on-point, insightful and if you are in the grocery sector very scary indeed.
Grocery chain discovers internet
A classic CB Insights mailer
Hi there,
In late August, we talked about how the retail industry is asleep at the wheel.
The examples at the time were Footlocker and Hibbett Sports, both of which couldn’t even say that Amazon was a competitor. It was a clear sign of an industry that was about to get Blockbuster’d.
But it’s not limited to apparel and sportswear retailers. Let’s add Kroger now to that list of the delusional.
Kroger has been getting pummelled in the market. It’s trading at close to its 52-week low right now.
Yeah — the stock price chart is not pretty.
But what is slightly more alarming is its strategy (or non-strategy) to get out of the slump. This is where innovation is required.
A piece by Heather Haddon in The WSJ (see The Blurb) discusses how Kroger plans to fight back against Amazon and presumably reinvent itself.
Its strategy to fight back is online ordering and delivery of groceries.
Yup — that’s the plan to fight back against Amazon.
Online ordering. And delivery. Very innovative Kroger. Very.
Meanwhile, Amazon is working on a beehive shaped warehouse that drones fly in & out of, just did its biggest acquisition of a Kroger competitor, is working on augmented reality to make storefronts irrelevant, flying drones that talk, and also the death star.
I imagine Kroger’s cost-cutting initiatives will get going soon to try and keep The Street happy, which means less investment in innovation, and then the downward spiral will accelerate. How does this end well?
Love it!
If you are a senior leader, you have heard of CB Insights but choose not to sign up to their mailer, you could be nuts. You can subscribe using this link.
So, does CB Insights have a purpose beyond profit?
Honestly, I don’t know, but I suspect they may well have.
One tell is from employee feedback. I use Glassdoor quite regularly for research and cannot remember ever having seen such positive employee sentiment. It’s always fun to look at your own organisation on Glassdoor to put these ratings in perspective! If you work for an organisation that is predominantly profit driven, do you get employee reviews like this?
Another tell comes from how radically different their mailers are from other competing organisations. It must have been a brave call to take the decision to write so provocatively. There style will undoubtable offend some (The Kroger leadership team for example) and those they do offend could in many instances be their clients. A final tell comes from the fact they are not only disrupting their industry by being provocative. They are also democratising data by sharing information that was previously difficult to obtain and removing the unnecessarily complex financial jargon to make it understandable and usable. I don’t think a solely profit focused organisation can create such employee goodwill or empower their marketing teams to introduce provocative humour (because of a fear of eroding their brands credibility) and I can’t imagine product and sales teams easily deciding to give up their intellectual property, so more people benefit. Perhaps I’m wrong, but I don’t think so. CB Insights are certainly not cheap if you want direct access to their analytics engine, but none the less I’d be very surprised to learn that they are not working on a higher purpose than simply making money. I love you too! If our still wondering why I titled this piece “I love you too”, then sign up to CB Insights here. if you are reading this and you work at CB Insights I’d love to hear from you to understand whether you have a higher purpose than profit. I love you. Colin If you loved this article, share it with a friend. If you hated it, share it with an enemy. Anand Sanwal, the CEO of CB Insights, responds.. Regarding the idea of having a purpose beyond profit, I do think being a sustainable business that is not reliant on investor largesse is critical. Assuming we do that, we’d like to do two things: Firstly, we want to fundamentally change how corporations make decisions. It should be based on probability and data, not punditry and decibels. Secondly, we want to demonstrate that you can build a company without raising a ton of money, by taking care of clients and the team and having a sense of humor the whole time. Thx again A From what I have seen to date, it very much looks like Anand and his team are well on track to achieving both!!
Col