Innovating Leadership:
Co-Creating Our Future

Resources:

Learn more about Celesta Capital, Michael’s venture capital firm, at https://www.celesta.vc/. The TechSurge podcast is online at https://www.techsurgepodcast.com/.

Our host Maureen Metcalf posts a newsletter every week on LinkedIn. You can subscribe here.

Maureen’s latest book is Innovative Leadership & Followership in the Age of AI. You’ll find details about it at https://bit.ly/LeaderInAI, or check out the Kindle version at https://amzn.to/44buVz8. The audiobook version is now available at  https://amzn.to/4dTCleZ.

Her other 10 books are available on Amazon here.

Other episodes you’ll enjoy:

– Mastercard’s Chief Innovation Officer on Fostering a Culture of Innovation with Ken Moore

– Courageous Followership with Ira Chaleff & Neil Grunberg

– Business Disruptions: Are You Disrupting or Being Disrupted? with Mark Kvamme

– How Leaders Thrive through Rapid Change with Chris Nolan & Mike Schindler

Guest(s):

Guest(s) Bio:

Michael Marks is a Founding Managing Partner of Celesta Capital and a host of the TechSurge Podcast. For 40 years, Michael has successfully led and transformed technology companies. Prior to Celesta, Michael was a founding partner of Riverwood Capital, a Menlo Park-based private equity firm, and served as Partner and Senior Advisor at KKR. He spent 13 years as CEO and then chairman of Flex, growing its revenues from $150M to nearly $30B in that time. Michael also served as an Interim CEO at Tesla. Michael served as an Adjunct Professor at Stanford Graduate Business School from 2008 – 2017, and is currently a Board Director for over 20 companies. Michael previously served as a Director for Schlumberger Limited, GoPro, and SanDisk, among others.

Transcript
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Maureen: [00:00:00] This is Innovating Leadership Co-Creating Our Future. I’m your host, Maureen Metcalf, founder and CEO of the Innovative Leadership Institute, where we help leaders be future ready. Helping us in this mission today is Michael Marks a technology investor and operating executive for nearly 40 years.

We’ll be talking about his leadership and management lessons from his storied career and how he successfully grew a global technology business and high performance teams. We’re also going to be talking about the current context of his experience with global logistics. So Michael, thank you so much for being here.

And welcome.

Michael: My pleasure, Maureen. Thanks for having me.

Maureen: President Trump has just rolled back some of the tariffs. Others are continuing . So let’s talk about what you are [00:01:00] seeing now, and if you were back as the CEO of Tesla or as the CEO of Flextronics, or i n a senior role at KKR helping advise your client companies, what would you want them to be thinking about and doing right now?

Michael: It’s a very complicated question, and the good news or bad news is that the answer I’m going to give you is a timeless answer. It’s not depending on, what’s going on today, and it goes like this. Everybody underestimates how interconnected the global supply chains are. So when people talk about separating supply chains, I can tell you unequivocally that that is impossible.

And I’m gonna give you an example , so what you see in the news is people talk about what are the tariffs gonna be like on shoes that are all manufactured in China or things like that. Or apple phones that are manufactured in China. What everybody [00:02:00] underestimates is how complex these supply chains are.

And if you go back to, for example, before World War II or during World War II, everybody, separated the supply chains, you could do that. It is impossible today. Let me give you an example, and I used to teach this at Stanford Business School, and this was one of the examples I used some years back, which is that there was an earthquake in the north part of Japan, I don’t know, this is 15 years ago or whatever, and

you know,

Michael: it took out some factories and stuff like that. And what happened was 90 days later there were no red cars on any parking, on any dealership lots in the world. And that’s because there was a factory in this little town that nobody even knew of that made a chemical that went into.

Auto paint to make the pigment red, and it turns out it was the only supplier in the world. Nobody even knew that they probably didn’t know it themselves. That’s the issue that we’re [00:03:00] facing. So you can talk about what parts go into a phone, but you have to look at what goes into those parts. What are the chemicals, what are the materials, what are the, what are the rare earth minerals?

And it is literally impossible to map a supply chain like that. So we’re having all this conversation at a high level, and it is literally impossible. It’s impossible for China to separate from us. It’s impossible for us to separate from China and so on. So when I listen to all this stuff about tariffs, I’m not saying there’s no value to the concepts for whatever.

I’m not gonna wade into the politics of it. But what I am saying is if we have a global tariff war, a trade war, it will still be impossible to separate the supply chains, and we will only see those things roll out over time. It’s just too complex to map.

Maureen: 35 years ago I worked for Unisys and the Buy American Act was in place then, [00:04:00]and I was in a contracts role and we were supposed to designate, which were buy American products and we really had to go back to where do you count the process? Is it manufactured? Is it assembled? Which parts go back and forth five or six times across borders. So where did they originate? And to your point it, it becomes an exercise that doesn’t have much value.

Michael: Well, look, Maureen, you can see it in autos right now. I mean, people can’t figure out what’s going on in an auto.

How much content is coming in the United States and how much is like you just pointed out, is shipped back and forth across borders. These things are really complex and they do not lend themselves to the simple kind of political statements.

Maureen: One of my clients runs a chemical company .

They’re in the US but also UK, Singapore, and India. How do you even navigate something that [00:05:00] is this uncertain?

Michael: I don’t have a good answer. It’s just not possible.

No good answers.

Maureen: Looking for the silver bullets.

Michael: Yeah. Good luck.

Maureen: So if you were running one of these companies and there is no good answer, what do you do?

Michael: I don’t really know. T here’s not a simple answer to that. It depends on what kinds of companies. It depends on what the alternatives are. I can tell you that it takes 10 years to build an auto plant I’D states. So it’s not like all of a sudden everybody’s gonna go, Hey, I have an idea. Let’s just go build a plant down the street.

One of the statistics that I am very familiar with and like to talk about is that in the United States today, there are 600,000 unfilled manufacturing jobs, 600,000 unfilled manufacturing jobs today, and half of those are unskilled. Where’s the labor going to come from for all this bring back manufacturing in the United States?

We can’t even fill the jobs we have now. It’s [00:06:00] ridiculous.

Maureen: And the new plants are gonna be more technologically advanced, less labor and frankly, by the time they get here, we’ll be in a different political administration, ,

Michael: right? So nobody’s gonna make the decisions to , make tens of billions of dollars of investments in the United States under this environment.

So we’re just gonna be a lot of noise for a long time. Too bad.

Maureen: We’ve just talked about supply chain . It seems appropriate then to raise the question of innovation that in some ways we will innovate out of the challenges we have or innovate forward to reduce some of them. So can you tell our listeners a little bit about your point of view on innovation versus execution?

Michael: I can , I get asked this question a lot and of course. They’re not mutually exclusive. In fact, you have to have both. I do find an awful lot of question like, okay, how much do I spend? For example, [00:07:00] today everybody’s talking about artificial intelligence. How much do I use AI and the things that we’re doing versus not?

And of course everybody’s trying to figure it out. Companies that don’t innovate die. It’s only a matter of time and all you have to do is look around. Look at the stocks that nifty 50 from 50, 60 years ago.

know,

Michael: There’s like three of them left on the, on the top companies that on Wall Street.

And it’s because companies, if they don’t change, they die. One of the saddest examples is what’s happened to Intel. You know, one of the most powerful companies you know of, of a generation ago, and they didn’t innovate. They focused on execution, they focused on their customers, they focused on all the things that, that it seems like are the right things to do.

But what happened was people innovated around them, AMD and Nvidia and Deep Seek and all these different, changes to the world. The good news is, is my partner Lip-Bu Tan is now the CEO there and he understands these things and hopefully can right the ship. [00:08:00] But that’s an example of a company and there are many, many companies.

 Look at retail. Look what happened when Amazon came in and you could get on your telephone or on your computer and you could have a delivery done the next day. I mean, Amazon changed the whole retail landscape, right? And now they’re changing it again by deliveries. I mean, I’m amazed by this, , you can get on your computer or your phone three o’clock in the afternoon and order something and it’s on your doorstep first thing in the morning the next day. And now , the people who haven’t done that are having to really work to catch up. And the good ones are catching up, but a lot of them are falling by the wayside. All companies have to execute.

If you don’t execute, you also die. But that’s obvious, right? And so when people talk about do you execute or you innovate. Execute is table stakes. Innovation is what’s required to, to change your business and stay modern and stay focused. And there’s always changes. Right now it’s AI, but there was dot-com and there was, software as a service and you name these [00:09:00] innovations and they become, ubiquitous in the landscape.

And if you’re not adapting to them, adopting them, you’re getting in trouble for sure.

Maureen: We both agree that AI is significant. Do you have any thoughts on how, again, leaders proceed ? We hear scope, it’s gonna be the biggest change of our careers. I talk about it like a large change management experience.

 We have to implement and transform our organizations smartly, depending on where we are in the hype cycle and how it supports our business . What are your thoughts on how do we go forward looking at and scoping our AI investments?

Michael: Look, it’s a, it’s the subject of the day and everybody’s talking about it.

 You use the right word when you say, where are we in the hype cycle? ’cause we are way in the hype cycle. , clearly AI is gonna change the way we work [00:10:00] is gonna change the landscape. But there’s so much hype. And I’m gonna give you a perfect example and that is drug development.

There are so many companies out raising money, AI can develop drugs. And the reality is AI can’t develop drugs. And one of our companies, Prellis, the CEO knows quite a bit about this. We did our own podcast on the subject, and what he always says is, if AI can develop drugs, where are they? There is not one drug out there that has been developed by AI, the reality is you have to start with a molecule.

You can improve it, but you can’t create it from scratch. A really good example of this is a concept that you can train AI to speak English and to make sentences and to write articles and all that kind of stuff. You cannot have AI invent the Russian language if it doesn’t have samples to work from.

So I look at all of this stuff. I’ll give you another really good example. Just read an article recently [00:11:00] about, Apple and Google both announced and Amazon announced, big AI upgrades to their products, to Alexa, to their phones. And guess what? They haven’t done it yet. They’re already a year behind.

And so everybody, your listeners and everybody in the world needs to take a deep breath and think that AI matters. It’s important, you should learn about it, you should try it. You should find uses for it in your businesses and in your daily life. But let’s not lose sight of the fact that these things evolve over a much longer period of time than the hype machine would suggest.

And the Hype Machine is based on people creating values so that they can get investors. , the reason you know Amazon talks about upgrading Alexa is because they don’t want people to not use Alexa. So you can understand these things, but these changes take more time than people would have you believe.

Maureen: For the companies you are investing in, what do you wanna ensure that they’re attending to in the AI space?

Michael: [00:12:00] Well, it’s different for different companies of course, ’cause we have many companies that are actually in the AI space. For example, one of my favorites, White Rabbit, which is using artificial intelligence to read mammograms.

This company’s aI is eight years in the making. It wasn’t just invented , last year. , with Llama and these things. We have many companies. We have another company, Percipient, which is using AI to, to analyze images from drones and satellites and cameras to find the bad guys.

Also, eight years in the making. Artificial intelligence is not new. And so for many of our companies, they’re just using the new tools to create new products, and that’s valuable in terms of day-to-day management. You know, you can use AI now to make your plane reservations, so go do that.

I mean, go be efficient. You can use AI to do, a lot of back, back office tools and these are very simple and straightforward and you should use ’em. It’s like. , back when the PC was invented, [00:13:00] you wanted to use it. ’cause here’s a new tool and this is a new tool, so we have to find ways to use it.

Maureen: You’ve had a very successful career. You’ve been CEO .

You’ve been in the VC space and you teach at Stanford. What differentiates you? If you think back to your fresh outta college, you’re surrounded by other. Young men, fresh outta college. What made you different than those other young men and women that were your peers?

Michael: Well, I’ll answer that in a slightly different way than the way you asked it, and I’ll answer it in the way of what I think makes for the most successful executives, and I’m clear on this subject, and that is curiosity. So I happen to be very curious and I have lots of people that I work with and I’m around who are very curious what, what matters about curiosity.

It goes back to your question about innovation and how you need, [00:14:00] how you use new tools. People who are curious are always looking around, what is that? What is that? Over there? , gosh, I didn’t realize that there was something that I could do with AI, for example, or reading the newspaper.

And today it’s not the newspaper, but it’s, online. But it doesn’t matter. I tell the students, when I was a student at Harvard Business School back in the seventies, one of my professors the first day of school said, you’re in business school now. You need to get a subscription to the Wall Street Journal.

And I did, and I’ve still read it as much as I can, every day for 40 years. Now, I tell my students the same thing, if you are not. Curious. You’re not paying attention to what’s around you. How will you adapt? How will you react to competition? How will you come up with a new idea that somebody else isn’t using that will allow you to make your company, bigger and more advanced?

So I was lucky. I think I was born curious. I don’t think there’s something you just decide about. But I ran a global [00:15:00] company and I was always reading what’s going on in Brazil, what’s going on in Europe? Why are they doing things differently from the way we do it? And if I hadn’t been able to do that and adapt to all this new information, I would never have been able to manage Flextronics into the size of a company that we became.

Maureen: Some of our listeners probably don’t know the Flextronics story, so can you give us a little bit of insight into what you grew it from and what were your biggest enablers?

Michael: Sure. In fact, it touches on, on all these things we’ve already talked about, so I’d be happy to do that. So I had worked at Flextronics, in 1990.

It was not a very well run company for a variety of reasons. I left and went on to do some other things. The company got in financial trouble and shut down their US operations and had just an Asian operation and, long story short, the banks decided to pull the plug and wanted to raise eight and a half million dollars, which is what they were owed.

[00:16:00] And so I put together a group of investors and I was fortunate to have met them along. The way Sequoia Capital and Kinder Perkins and NEA, the major venture firms in this area. And we put eight and a half million dollars together and bought 55% of the company. So it was a $15 million valuation in 1993.

So we had 90 million of revenue. We were profitable little company only factories in Hong Kong Singapore, and in a little town in China. And over the next 13 years, my management team and I built it into a $25 billion company with 300,000 employees, factories in 26 countries and 15,000 suppliers.

And we are obviously proud of that. When I started, we were 22nd in the industry by revenue. And when I retired at the age of 55, by the way, we were number two. So we went from 2022 to two, and we did that. [00:17:00] We didn’t change, those other companies mostly survived. We acquired a couple of them, but when I started it was a cheap hands business that’s in quotes, cheap hands.

And what that means is that people outsource labor. Hewlett Packard would have a little assembly facility down the street because , there was lower cost labor, less sophisticated labor than they were used to when I left. We designed their products, we manufactured them, we handled the logistics, we took their orders.

We would take the orders, build them, ship them to the customer, and then tell. Hewlett Packard that we’d just shipped a product and they owed us money for it. It became a very sophisticated business, and we did that by having our eyes open to, okay, what are the customers doing? What could we do better for the customers?

Right now, all we do is do labor. We’re cheap hands. That’s not an interesting business that’s not exciting or higher margin. What if we started buying the materials and then [00:18:00] we started buying the materials? What if we started to design the products? What if we warehouse the products for them?

What if we did everything for them? And as we did that and got bigger and bigger, we got better at that than any of our customers. And today. Almost nobody does their own manufacturing, like everything’s outsourced. But when I started, everybody had their own factories. And so what we did was we said, let’s get better at it than them.

You asked the question about execution. We out executed them because it’s what mattered to us every day, whereas they had customers and products and marketing and branding and distribution, blah blah. We didn’t have any of that, so we out executed them, but we also out innovated them. So not only did we execute, but we went and said, how can we do this better?

What tools can we find? One of the things, for example, we did, one of my proudest moments was the day we launched a new Xbox, the Microsoft Xbox. We launched it in three continents on the same day, north America, [00:19:00] Asia. Europe and we had factories, so we had to set up the manufacturing and the supply chains and all of that.

And on the same day, we launched the production of a product around the world that was innovative. That was not something that anybody had ever done on their own. So combination of execution, combination of innovation, and we had a fantastic culture. We were able to develop a system where everybody just loved working at the company and wanted to come to work every day and make things just a little bit better.

So that was a real ride.

Maureen: how did you build that culture? Because we often hear that culture is the secret sauce

Michael: well, I can speak to this I think pretty well, and I hope your audience will get a kick outta some of the things that I have to say.

First of all, there are many different kinds of cultures and in my experience, different cultures work so long as everybody in the business buys into that culture. So let me give [00:20:00] you an example. One culture, which was ours at Flextronics, is where the CEO wants to be surrounded by other people who know more than the CEO knows, and you give them the rope to go run their part of the business and then they hire other people and they hire people like that. And as long as everybody fits that, the culture works great. Now, I’ve also seen the exact opposite work incredibly well, which is where the CEO likes to tell everybody what to do, and that works equally well as long as that person is surrounded by people who wanna be told what to do.

And so. You have to have internally consistent cultures, but they can be very different. Where people fail in creating cultures is that they don’t weed out the people who don’t fit. And when companies get big, it’s really hard to keep a culture intact. One of the techniques I used at [00:21:00] Flextronics was I wrote a little blurb irregularly.

I wrote it. People used to always ask us, somebody wrote them for me, but I wrote them and it was called The View from Here, by the way, not the view from the top, the view from here. And then I would write about things that I’d seen, like I’d go off to visit a factory in Hungary and I would see something that they had done that, that I wanted to.

Acknowledge and want everybody to think about it in their own businesses. So I’d write a view from here saying, I just came from this factory, in Hungary, and there was a problem with logistics and the guys rented a plane to go get the parts to bring it in. This is a true story, to make sure that the customer, got their product on time.

And I published that in every language. Eventually I started doing video views from here so that I could tell what was happening in the public markets, how people reacted to our quarterly statements, and we translated that into all the languages that people were, so everybody was hearing [00:22:00] a consistent story about the company, what we thought was important.

I’ll give you a cute little story ’cause it’s one of the things that happens when companies get big and you can’t manage them very well. And one of the things that happens is. In a big company, if you fire somebody, it’s not uncommon for them to show up someplace else in the business, right? Because somebody goes, oh, you lost your job.

I have a job over here. And so they’ll, they do that. So I once was talking to Howard Stringer who is the CEO of Sony, and this is my, one of my favorite stories. And I’ve told it a lot of times ’cause humor works extremely well in getting messages across. And I said, so how’s it been like running Sony?

He goes, he’s telling me how. Bureaucratic. It was, this is many, many years ago, so this is not a statement about how Sony is today, but he said, I fired the guy who was running Canada.

And then six months later I was in India and the guy was running India. And I said, so did you fire him again? And he said, no, I was afraid he’d show up someplace he could hurt me. [00:23:00] I love that story anyhow cultures are difficult to manage, especially as companies get large.

Maureen: Did you have a specific goal for your culture?

Michael: The View from Here was just a way of communicating , I mean, there were 300,000 people in 26 countries, and so I wanted everybody to know. What I thought was important in the company, that was just one technique.

There are many techniques, you have various meetings that you hold and all this kind of stuff, but that was one easy way of everybody in the company hearing from me about the things that I thought was important so I could reinforce parts of the culture that I wanted. That’s one technique among many.

But I will say that. Because in our company, the culture was to go figure out how to make things happen and not wait to be told what to do when we would hire people. Who wanted to be told what to do, they would wander around going, what am I supposed to do? [00:24:00] And people would tell them, you’re supposed to figure out what you’re supposed to do.

And ultimately we had a company across town in the Bay Area where it came from a, a company where the culture was, where everybody was told what to do and I had to put out an edict. No longer to ever hire anybody from that company because it was obvious they just couldn’t fit into our culture. So look, it’s lots of tricks, Maureen.

Lots of techniques and tricks and people have different ones. I, mine isn’t the only way to be successful, but that’s how I did it.

Maureen: There are probably some consistent themes, whether you choose to be an empowering leader or a directive leader. The building blocks underneath are likely similar.

That’s right.

Michael: There’s an old saying, I like to say is that nines higher tens and sevens, higher sixes, so I always wanted to get rid of the sevens and higher nines or tens.

Maureen: So what was one of your biggest challenges? [00:25:00] Hopefully you didn’t fire anyone from one region and have them show up in another.

Michael: Oh, I’m sure it happened, but I, not that you know of. Not that I know of.

Maureen: So what is a challenge? What worked, what didn’t work? How do I continually evolve?

What does that look like for you and what was one of your more interesting learning opportunities?

Michael: . Look, I evolve like everybody else. There’s new experiences, new tools. I still am very curious. I’m always trying to learn about things.

Right now, I’m doing a lot of investing in the biomedical space, which is something I don’t know much about, but I’m fascinated by it. And

know,

Michael: I’m always asking questions, how does this work? How does that work? So that’s just an interesting thing. One of the things that. That appears to have separated me from a lot of people is that I’m very transparent and very truthful.

And what I mean by that is I tell people what I think. I’m not afraid of rejection. I like [00:26:00]ideas. I like a good interchange of ideas, and I’ll always say what I think, but I’m always prepared to change my mind if I hear something that’s better than mine, and apparently. That’s a rarer trait than I imagined because it’s mine.

So I don’t know. It seems like that. Why doesn’t everybody do that? But I always had people coming back and saying, I came to hear you ’cause I know you’ll tell me the truth. And most people won’t, especially in the investing business by the way, in the investing business. Nobody wants to say, I don’t like the idea, because they’re afraid that might turn out to be successful and they might be interested in the future.

They say, we. We don’t have any money or people make a bunch of excuses and I say, look, I don’t like the idea, here’s why. But you ask the question about. A tough situation I was in and I had one may, maybe one of the toughest I can remember, but we were a public company and it was in 2000 and if, 2000 March, April of 2000 is when NASDAQ hit its peak and it dropped 80% and our stock dropped from 24 to two.

And it was a [00:27:00] very tough time in the business. We had a customer who was a big customer. Who shall remain nameless, but a big publicly traded company. , when I talked earlier, Maureen, one of the things we did for our customers is we monitored and oftentimes took their orders directly.

And this company had given us, big volume orders for the quarter. And it was obvious that the, it was obvious that the orders weren’t coming in. And so at the end of the first month of the quarter, I went to the senior VP of Operations and said, you need to cancel. You need to reduce your orders ’cause your orders are not coming in.

And his response was, we’re not cutting our orders. We always make our numbers. It’s oftentimes backend loaded in the quarter, which is true, but we’re not gonna cut our orders at the end of the second month. It was even worse. I went into that same executive and said, look, I can see that the orders are not coming [00:28:00] in.

We have to change. We have to reduce these orders. We’re gonna have a real problem. And he said, same answer. Stick with the orders we’ve given you. We will deliver them. And at the end of the quarter, they missed horribly and we were stuck with hundreds of millions of dollars of inventory. And I went to the to him and said, you have to pay us.

We’re not in the business of holding this kind of inventory. And his response was, no, you have to eat this. We are partners, quote unquote, we are partners and we expect you to eat these costs. Meanwhile, we’re a public company. And I said, that’s unconscionable.

I actually told you in advance twice to cut your orders and you didn’t, and now you expect me to hold onto it and we’re not going to. And he said, [00:29:00] if you don’t, we will pull all of our business from you. And this was $800 million of business. Okay, so now I’m in a crack. Yeah. Obviously talk to my board about it.

Called around other companies to see if this customer was treating them the same way, which they were, and in the end I said, pay us. And they paid us and they took away all of our business. We’re a public company, and I went to Wall Street in our public announcement, told him what happened very clearly, and I said, we have to stand for something.

We’re not in the business. We don’t have the kind of margins where our customers can put us in this position, so we’re gonna miss our numbers pretty badly. And I got asked about this every quarterly earnings for about three years, which is how long it took us to get out of it. And I’ve never been sorry for a day.

I think I took the exact right [00:30:00] position. I think they were unconscionable, they were bully. And I just said no. And then I wrote it into a case for Stanford Business School.

Maureen: Does the case give the company name?

Michael: Not in the case,

Maureen: no.

Michael: I actually used three. It’s a, it’s actually a case I wrote on business ethics and I used three companies. They were all major companies. We didn’t name them in the case, but when I teach it I say who the companies were.

Yeah,

Maureen: You just talked about bullying. It’s an interesting time where we are seeing more bullying. Yes. And that’s. Causing companies to face significant financial challenges right now, like you are talking about where you may lose significant revenue and potentially go out of business.

Michael: That’s right. It’s terrible. Maureen, look. I sympathize with all the companies who go through what they’re going through now or at any [00:31:00] periods of time.

Where there are geopolitical issues or there are, financial issues. Look, , our stock at Flextronics went from $24 to $2.

We were afraid we were going out of business. This was in, in, the summer of 2000, but. Fortunately we survived it. But companies go out of business and when they do, I hope that the people learn their lessons and rise again in some other business, which happens very frequently. Often they do, especially here in Silicon Valley.

If you don’t have a couple of failures on your resume, you’re probably not that good.

Maureen: It also doesn’t feel good when it’s happening. No, it doesn’t. what do you want our listeners to walk away with? You’re working with people from Stanford Business School all the way through large scale CEOs.

 You’ve talked about curiosity. You’ve talked about balancing innovation and execution. Is there a thing that you really want to encourage people at this point in history.

Michael: [00:32:00] Yes. Thank you for that. That’s a big opportunity for me. I will say the following, having been around, and I’m a technology investor, as an operating executive, but I’ve been, investing now for the last 20 years.

It’s a real joy to be an investor, particularly in early stage companies because there’s just so much excitement. Let’s just take a little trip down memory lane of the venture capital industry. It started, in the seventies and eighties. just in a small group of companies from, silicon, it’s called Silicon Valley for a reason.

Michael: Started with Fairchild and National Semiconductor, and then Intel was created. And here’s this group of hardware investors, up and down the valley here. And look at the revolutions that came from that, from PCs to networks, to workstations to cell phones, to, memory changes, storage, all these things, fantastic stuff but pretty narrow if you think about it as a kind of technology.

Well then everybody went off for the last 20 years, and we [00:33:00] only do software. We only do software. We only do software. Everybody overpaid for the same deals and all that stuff. And we could get into why everybody just wanted to do software. They thought it was more. Capital efficient, which it is not, but then something dramatic happened and that is Nvidia became the most powerful company, the most valuable company, and one of the most powerful companies in the world.

My friend Jensen Wang and my friend Haan at Broadcom and Qualcomm, and all of a sudden people are looking at their portfolios going. We don’t have any hardware in here. And so all of a sudden we became the cool kids again. ’cause we’ve just been doing hardware all this time. We do some AI stuff as we talked about but the broader point is this.

Right now, technology is everywhere. This is the most exciting time in the history of the world to be an entrepreneur because you don’t have to be somebody who knows about semiconductors. You don’t have to be somebody who knows about software. Now you have this explosion in the medical world, all these new [00:34:00] medical diagnostics, like using artificial intelligence to read mammograms or creating a handheld molecular sensing device to allow you to pick up Avian Flu, which is one of our companies, Alveo. You have all kinds of things happening in the medical arena. You have all kinds of innovation in the way services are delivered much more efficiently. We just talked about getting, packages developed your, delivered to your front door in less than 24 hours.

You have incredible evolutions in the way people share their homes, the way they share their cars, right. So you have financial services now, you have buy now, pay later. Everywhere you look there are innovative things happening.

And so if I were giving any advice to the entrepreneurs out there, if I’m giving advice to the entrepreneurs, no better time in history to be an entrepreneur than today. If I’m giving advice to [00:35:00] investors like. No better time in the history of the world to be an investor in technology and innovation.

It’s like how can we not go to work every day with a giant smile on their face, which is what happens to me every single day.

Maureen: Thank you so much. I’m gonna summarize some of what I heard, and I’m gonna start with ethics and your example of, I think your wording was if you don’t stand for something, you don’t stand for anything.

 The example you gave was so palpable that you were willing to face Wall Street, potentially lose your job and potentially have a significantly adverse impact on stock and the company’s future. We all can talk about ethics, but again, until you take a stand for something, it’s just words.

Second was balancing innovation and execution. Again, lots of people have good ideas. Everyone wants to write a [00:36:00] book or do a thing, but the number of people who actually execute effectively is significantly smaller. And the ability to both innovate and execute concurrently and consistently is also kind of the secret sauce.

And then the third one was the idea of curiosity. And I love the point that I’m curious. I ask questions, and when someone comes up with better ideas, I change my point of view. And if you’re curious and learning, you’re changing, especially now, you can’t live in this time without evolving your point of view.

Michael: That’s right.

Maureen: And that allows your company to evolve and thrive.

Michael: That’s right. And look, there’s conflicting points of view all the time. That’s what makes life interesting.

Maureen: It is also what differentiates us and our organizations, the courage to say, [00:37:00] that’s what we thought yesterday and we’ve learned something new today.

Michael: That’s right.

Maureen: thank you so much. How would people learn about you, Michael, follow your blogs or whatever you are publishing.

Michael: Thanks for asking that. Our firm is Celesta. You can reach me at Marks, MAR ks@celesta.vc. I answer all of my emails. We have a Deep Tech podcast, which is very highly rated, which I’m very pleased about.

It’s called Tech Surge. We cover lots of different topics, some fascinating stuff. So that’s another place you can learn about us.

Maureen: Thank you so much Michael, and thank you to our listeners for joining us today on Innovating Leadership co-Creating our Future. Are you interested in elevating the quality of your leadership?

The Innovative Leadership Institute offers best in class leadership development, executive advising and organization transformation services. Send me a note at. inquiries@innovativeleadership.com, the [00:38:00] world’s most successful leaders are created here.