If you asked the audience to make a list of things that are sexy, I’d bet you big money that you wouldn’t find garbage on it.

Garbage is not sexy. We flush it down the toilet, put it in the trash can, ship if off to somewhere we don’t have to think about it.

But Tom Szaky, the CEO and founder of TerraCycle, sees waste differently. His first legendary product was a worm-poop fertilizer for plant food, packaged in used beverage bottles. But that was just the beginning for Szaky. He realized that to become truly legendary, he needed to consider a bigger problem: how humans think about waste.

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By seeking to eliminate the very idea of waste, he brought innovation to the historically low-innovation garbage industry. In short, he created a category that didn’t previously exist. Now TerraCycle is a $30 million company and the world is taking notice—huge companies like Waste Management are copying his ideas.

Category designers like TerraCycle always attract competitors, and every successful niche-down attracts imitators. But the competition isn’t a bad thing. It’s actually good (no, a necessary) development—for yourself, your company, and your industry.

Let’s unpack why your business actually thrives on competition.

Competition validates that the problem you solve is important. 

Once you’ve niched down and identified the problem you want to solve, it’s up to the market to tell you whether that problem actually needs solving.

So when competitors emerge, it’s a sign that you’re on the right track. The problem you’re solving is so valuable that other companies want to try to solve it, too.

They want to get in on the action and try to make a killing.

But because you designed the category, every decision your competitors make is based on your original idea and what you’ve already done in the space.

They’re already several steps behind.

When customers begin to say “yes” to your solution, the industry surrounding your niche also affirms the value of your solution by offering their own solutions.

And as a category designer, that’s a sweet place to be in.

Competition allows the market to take off.

All legendary entrepreneurs are also evangelists.

They broadcast their big idea to the world, educating customers on why they need their solution. If the problem they’re confronting is really novel (read: legendary), consumers may not even have considered it a problem.

This is where competition comes in.

When you set out to convert the world to your way of thinking about a new product or service, people will especially take notice when an ecosystem forms around the problem you’re solving.

The more they hear about a problem, the more urgently they need to fix it.

And as competitors enter the market, corporate sponsors may express interest, new avenues for market research will open up, more capital enters your category.

And your customers become evangelists themselves, posting positive reviews of your product and spreading the word about why you’re better than your competitors.

While these loyal customers create trust for your company, the presence of competition allows the market itself to flourish.

Competition teaches you how to direct your business. 

By studying how your competitors are doing things, you can position yourself as not just better than them, but different.

Being different means you don’t have to fight for market share with anyone, always trying to outdo them. You’re not keeping up with the Joneses, you’re in a league of your own.

Competition also opens your eyes to ways you can improve your own offerings.

In Tom’s case, he didn’t want his company to be a one-product wonder. Instead, he wanted the organization to address a much larger category, hence the pivot from worm-poop fertilizer to recycling.

And it was tough: TerraCycle had to close a factory and lay off workers in order to invest in that change. But it takes courage to be legendary.

Now, TerraCycle’s business includes a “sponsored waste” service that helps consumer brand giants like Unilever and Procter & Gamble collect hard-to-recycle packaging and an R&D group dedicated to figuring out how to repurpose stuff that is considered “non-recyclable.” Labels change, and Tom inspired big companies to rethink things that were once considered “nonrecyclable.”

Competition spurs growth in your industry and forces you to be better. After all, you simply can’t be legendary without attracting – and competing with – rivals.

The U.S. is in the middle of a digital transformation. Artificial intelligence and technology breakthroughs are changing our world—for better or worse.

In this fast-paced landscape, some businesses will thrive, and some will fail.

One of the most eye-opening conversations I’ve had on this subject was with billionaire entrepreneur Tom Siebel. In 2006, Tom sold his company, Siebel Systems, to Oracle for just under $6 billion. Today, he’s the founder and CEO of C3.ai, a new software platform focused on digital transformation.

He recently joined me on my Follow Your Different podcast to talk about his book, Digital Transformation, and why it’s more critical than ever before for CEOs and senior leaders to have a detailed understanding of new technology.

Here’s what I learned from Tom about surviving a digital transformation:

Corporate culture should empower employees to grow alongside a digital transformation.

Part of what makes C3.ai – Enterprise AI so successful is its ability to attract and retain high-performing employees.

Tom attributes much of this success to his company’s focus on continuing education. At C3.ai – Enterprise AI, the corporate culture reinforces the belief that learning is essential to staying relevant in the fast-paced world of AI.

Employees are encouraged to complete a specialty continuing education curriculum in Coursera that focuses on industrial AI technology. When they do, each is given a bonus that varies between $1,500 and $2,500. To date, Tom estimates he’s doled out $1 million in employee payouts.

The real bonus: employees that are better equipped to perform their job, serve customers, and apply their skills to advance their careers.

For Tom, survival comes down to one important principle: “In order to stay on top, you need to be continuously evolving.”

Every company needs to adapt to new tech or face extinction.

Tom sees our digital transformation as the business-world equivalent of evolutionary biology. Fundamentally, it’s the idea that enterprising businesses must find ways to adapt to the storm of new technology in order to survive.

Research shows that since 2000, 52 percent of companies in the Fortune 500 have either gone bankrupt, been acquired, or ceased to exist as a result of disruptive technologies. Today, the collision of the physical and digital worlds has affected every aspect of our society.

Take Amazon. It’s AI-based platform—an elastic cloud business model—has made it a retailing superpower. Last year, more than 8,000 outlets closed in the U.S. as consumers moved to the digital marketplace.

Tom told me that most retail outlets will eventually be replaced by Amazon.

“This is the business equivalent of a meteor hitting the Yucatan and knocking out 86% of the world’s dinosaur population.”

Moving forward, it’s important that both companies and individuals learn to adapt. Some will use technological evolution to thrive in the new economy and survive. Those who stay the same will find themselves becoming increasingly irrelevant—and soon, extinct.

Governments and the private sector need to work together to keep citizens safe.

Some will argue the Industrial Revolution was a positive moment in our nation’s history. It increased the production of food and goods. It provided safer, warmer living conditions. It expanded transportation.

At the same time, there were also significant deleterious events that came out of the Industrial Revolution. We can draw a line between the invention of the steam engine to Marxism, child labor, World War I, and World War II.

Now, consider the post-digital transformation era. Tom sees the same outcome with IoT devices, the computer systems we use to control everything from the flow of capital and transportation to our energy and power grids.

“Together, they dramatically increase the surface area available for cyberattacks,” he told me.

Countries like Russia, Iran, and China are currently investing billions of dollars in AI. Armed with that power, they’re capable of weaponizing those systems in an act of technological warfare. Consider what would happen if one of them shut down a U.S. cities power grid. Millions would lose access to things like food, water, and public safety. It would be like Mad Max meets Peoria.

It’s fucking bullshit that companies like Google won’t sell technology to the government, and instead do business with China. Tom points out that allowing AI to be used for ethically questionable activities is an important consideration business leaders need to be aware of, especially as it relates to our nation’s safety and privacy.

That’s why, at C3.ai – Enterprise AI, Tom is working to bring AI to our commercial and industrial defense and intelligence systems. His hope is that by helping the U.S. government harness this technology, we’ll be better prepared to meet the technological issues of the future.

“To arm ourselves, we need to look at the digital transformation not just as an entrepreneurial opportunity,” he adds, “but also a way to keep us safe while protecting our civil liberties.”

That’s one step in the right direction. The most critical step, however, is the one we all need to take: arming ourselves with the knowledge to survive the digital transformation.

Today, every top-level CEO needs to be technologically savvy. Moving forward, businesses will differentiate themselves by using technology to create new strategies with the disruptive power to wipe out entire markets—or even opposing nations.

As new and emerging technological advancements become a fundamental part of business language, leaders and managers need to be able to leverage these new platforms to gain a competitive advantage, both at home and in the IT war abroad. “Those that don’t develop a working knowledge of new technology will not only become ineffective,” says Tom, “they also won’t be able to function in tomorrow’s business landscape.”

We all have a choice: we can learn the technical language of today and use it to succeed at our jobs while better serving our companies, employees, shareholders, and customers. If we don’t, we’ll become more than obsolete. We’ll become extinct.

To listen to the full podcast click here to Follow Your Different

When in a position of power, there is strength in vulnerability.

I recently had a jam session with Jerry Colonna on my podcast to discuss positional power in the workplace—more specifically, how to lead properly in a place of professional power. For those that don’t know, Jerry is the founder and CEO of Reboot.IO, a coaching company aiming to “foster a revolution around work because better humans make better leaders.” As noted by WIRED magazine, this guy can make founders cry—for their own good.

His new book, Reboot: Leadership and the Art of Growing Up, is really something—powerful and intimate. It’s not the same, worn-out business leadership narrative that’s been penned time and time again. As a certified professional coach, he believes in the corporate world leaders should take what’s called “a warrior stance.” Displaying a position of stability and strength, but also openness and non-aggression—and never with a “strike-first” attitude.

If anything, he urges every business leader to always remain humble and vulnerable—characteristics you don’t hear to describe people in positions of power very often.

Here’s some of the wisdom he shared:

To put it simply, better human beings make better business leaders.

Before becoming a great CEO, you have to first make sure you’re a great human.

This requires what Jerry calls “radical self-inquiry.” Or, “stripping away the bullshit mask.” Dropping our manufactured personas, and self-defining with complete honesty.

He went on to explain that only once you’re completely comfortable and confident with your true, human self, can you be a great leader. Because true faith in yourself is so much deeper and stronger than false machismo.

This is what it takes to become a Warrior Leader.

And it all comes down to mindset.

In our darkest hours—when our co-founder quits, investors pull funding, we lose our best client, our board fires us—these are the moments when business leadership is defined. In these situations, a true warrior leader does one important, definitive action: acknowledge they created the conditions that led to their misfortune.

Carl Jung, the father of analytical psychology, once said, “Until you make the unconscious conscious, it will direct your life and you will call it fate.” Jerry loves this quote.

We must always recognize that we are complicit in our failures. We influence everything that happens to us, good and bad. People should not be afraid to ask, “In what ways have I been complicit in creating these conditions I say I don’t want?” 

Of course, some of what happens is out of our control. Warrior leaders accept this. Because a warrior leader is confident, secure, has an open heart, and says to the world: “Do what you will with me. Screw you. This is who I am. This is where I stand. I don’t have to be aggressive. I don’t have to attack—but I get to be me. Now, let’s do some great work.”

Positional power isn’t always true power in business leadership—and can be toxic.  

Organizations experience power struggles all the time. I’ve seen this happen firsthand and it is nauseating. People need to grow up.

One of Jerry’s biggest points was how your job title doesn’t matter as much as you think it does. 

In my own professional life, I’ve been in plenty of “powerful positions” where I could hire and fire whoever, and spend a lot of company money on whatever I wanted. But at some point, I realized that unless I had the power to effectively communicate and influence people, I was powerless.

Because true power is in collaboration.

Business leaders who say, “Do this or you’ll be fired” are powerless, really. The greatest power isn’t granted through a position or title. Because a title can be revoked. Bonds with people can’t.

When we lead from a place of love, however, we bring out the best in others. But when leaders just leverage their power and neglect to be truly compassionate, they create toxicity and fear.

Jerry firmly believes those who hold positional power need to be confident and unwavering, but also humble. They need to be willing to share their story—including both successes and failures—to connect with people. Great business leadership creates a safe environment conducive to growth through its own actions.

The first step is committing to a warrior stance: stable and confident, but also respectful, personal, and accessible.

To listen to the full podcast with Jerry, click here to Follow Your Different.

Giant billboards. Direct mail promotions. Glossy print ads.

They’re the oldest marketing strategies in the book. Used for decades, companies simply played the comparison game until someone came out on top.

But the days of traditional marketing are over. Having a winning company isn’t about beating rivals in an old game anymore.

Instead, today’s most legendary entrepreneurs, CEOs, leaders, and marketers are category designers. They’re redefining the game by establishing entirely new market categories, developing them, and executing to position themselves as the leader. Category queens and kings.

In the past decade, the legends of this craft have been able to show the world why their breakthrough innovations matter. They strategically grow their markets by influencing customers to abandon old ideas and products and embrace a new way of doing things.

As an entrepreneur, CEO or CMO, you have to ask yourself: Are you playing someone else’s game? Or do you have the courage to create and design your own market category?

Categories are how we assign value to things.

Have you ever questioned why a flat-screen TV at Costco sells for $150, while a high-end pair of sunglasses is $400?

When you step back and consider the options, it’s laughable. Why is a TV—an advanced piece of technology that can talk to satellites in space—less than a piece of plastic a fraction of the size?

Both of these products are examples of a category—the human filing system that allows us to relate goods and assign value.

And that $400 price tag is all thanks to category designers.

That’s their job. They’re the ones strategically positioning products for success. It makes sense that when you design a category around things people care about, you’ll automatically create value while increasing the speed with which customers respond. You become more strategic, you make your company more important, and you change the way people think about you.

If you do this well, you can make people believe a pair of sunglasses is more valuable than a complex piece of electronics. When you do, you’re also considered a pioneer. You’re a visionary entrepreneur that’s breaking—and taking—new ground.

The category makes the brand.

As human beings, we put the category first and the brand second. If we like the category, we’ll be interested in the brand.

Categories build a filing system to create a priority network of brands we “must-have, have and aren’t interested in.” For example, if I like a muscle car like the Ford Mustang then I’m not excited about a Chrysler minivan. And I would even go so far as to assert that categories can make your career as an entrepreneur.

Why? Because companies and brands only matter if they rule their category.

Dentists are a good example. If you’re driving around and you notice a sign for a dentist, the vast majority say, “Dentist,” and below it, “Sally Smith, DDS.” It’s understood that the profession is more important than the person. So they put the category first and their name second because dentists know that categories will make their personal brand stronger.

Likewise, as entirely new categories emerge, they have the potential to drive fresh labels into the spotlight. Take the craft beer explosion on the West Coast. Over the last decade, we’ve seen the rise of the India Pale Ale (IPA). Today, it feels as though a craft brewery opens every 15 seconds, and everyone sells multiple IPAs.That’s because so many people like the category—or IPA—so it suggests if a new brewery has a few, they’ll also like their brand. It’s category first, brand second.

Most entrepreneurs are intuitive about this and understand that category drives interest. So it’s not uncommon to see craft brewery billboards in Southern California that say, “Craft Beer,” followed by the brand name.

Even though I can see all this, it still blows me away that a pair of high-end sunglasses can cost $400 when a flat-screen TV is $150. But it’s just further proof that category design is the new marketing tool.

There’s no such thing as a legendary company in a terrible category.

Companies that want to do notorious shit don’t focus on incremental objectives. They’re set on changing the world at an exponential level. These are the companies that shape our lives and, frankly, they design a different future for all of us.

A great example is Dell computers. In the late ’80s and early ’90s, Dell was famous for designing a new category—selling computers directly to consumers when competitors like IBM and Compaq were selling their products through distribution channels. As the personal computer was establishing itself, Dell came in, changed the game, and became the biggest player in the market.

Then the Internet became significant, and Dell was a pioneer in that space, as well. They designed the category by selling desktops, servers, and laptops that allowed you to access the World Wide Web from anywhere.

Back then, Dell had one of the most powerful labels in technology, but now their brand is boring. And while it’s a $90-billion company that’s run well and creates a number of amazing products, none of that matters. They aren’t creating—or attempting to dominate—any of today’s new technology categories.

They’re simply a great company with great products that nobody cares about.

The most exciting companies are creating entirely new categories in business. They’re solving problems we didn’t even know we had until they came along.

If your brand has a lackluster category, it isn’t going to be memorable and you’re not going to matter tomorrow. Harsh, but it’s true. So it’s up to you to become the category designer for your market. When you do, you just might become a future pioneer of the startup world.

To listen to the full podcast, click here for more from Lochhead On Marketing.

By Christopher Lochhead

It can be terrifying to start a business.

Between finding customers, figuring out your core offering, and projecting revenue, you face a lot of uncertainty as an entrepreneur. And that’s before you’ve even gone to market.

To be truly legendary, however, you need the courage to be different than everyone else.

Rejecting the pack mentality takes guts. And not everyone is able to identify a problem that no one’s ever thought of before, let alone believe in themselves to solve it, and why their solution matters, with every fiber of their being.

But that’s where category design comes in. Once you “niche down” by identifying where you can be different, you’re not competing with other companies in your industry. Instead, you’re making your own category.

We’ve already explored legendary entrepreneurs who’ve nailed category design and expertly executed their magic triangles, so this is all about YOU.

Here’s how you can make your business massively successful by niching down.

Building a legendary business means having the courage to step forward into the coming “niche-nado.”

Technology allows us to reach huge, global audiences, and the tools at our disposal will only increase in the months and years ahead.

Podcasts, video-streaming platforms, and newsletter-distribution services are a few technologies that make it possible, nay easier than ever before, to become a personal enterprise by selling your expertise at scale.

You can hit the big time without needing the support of a massive organization or administrative network. In other words, you can niche down.

Remember when small companies actually knew their customers and tailored things to their exact needs? Kevin Maney, the co-author of my book Play Bigger, foresees artificial intelligence facilitating a closer relationship between entrepreneurs and customers.

Once you have a tighter bond with your clients, you can understand and better anticipate their specific needs.

An example of this concept in practice is Stratechery, a media and consulting newsletter that offers daily and weekly analysis of technology giants like Apple, Google, and Microsoft. Created by former marketing and strategy executive Ben Thompson, Stratechery isn’t trying to beat all the sites hawking tech news. Instead of chasing clicks or scoops, Ben decided to appeal to a narrow audience that he intimately understands: industry insiders.

Today, his newsletter is a Silicon Valley must-read in certain executive and investor circles, and he counts subscribers in 30 countries.

Technology enables you to build your personal enterprise and share your expertise with a much larger, yet more niche (read: interested) audience than ever before.

Embark on a journey of self-discovery.

Being legendary isn’t something that happens by accident. You have to make a choice to be legendary.

NBA basketball legend Bill Walton explains this mindset simply and perfectly: “I wanted to great.” And Bill is one of the happiest people I know. In one of his podcast episodes on my show, he told me that his decision to be excellent brought a majestic calmness to his life.

Rather than waiting around for opportunities, you have to have a goal and a plan to achieve it.

Learning about yourself is the first step to figuring out how you can use your unique talents and skills to be legendary, how you can find your niche. By increasing your self-awareness, you’ll be better able to examine the accepted norms and practices of a given industry, and then blaze a trail that verges away from the road well-traveled.

Here are some questions to serve as guideposts for your journey:

• Is the industry you’re seeking to address dominated by companies that are complacent?
• Is the category you’d like to occupy growing or shrinking?
• What do people think about the problem you’d like to address?
• How might new technologies affect your category?

Avoid the very real struggles facing your competitors.

People often have a hard time starting something new.

But the important thing to remember is once you get an idea for how you can niche down, don’t worry about now knowing how to do it.

Instead, just dive in and forge your own path.

Jordan Harbinger, the lawyer turned podcast pioneer, started his show “The Art of Charm” on a whim 11 years ago. He didn’t even have any production experience, but this didn’t matter.

Back then, there were only 800 or so podcasts (rather than ~500,000 we have now). There wasn’t much competition for ear time. Jordan had plenty of room to experiment, and his unique hosting style developed—and resonated with listeners. Rather than approach interviews with a long script of prepared questions or treat guests as his friend, he cast himself in the role of audience advocate.

And that became his differentiator.

So he ditched his day job in law to dedicate himself to defining the self-help category. Today, “The Art of Charm” is widely recognized as one of the first podcasts to build a mass audience, and he has his own eponymous show.

Don’t laugh at me here, but being different is what makes a difference. By being a category designer and niching down, you can achieve a deep-rooted satisfaction knowing that you brought something altogether new to the world.

Fast-forward, and after all this awesomeness happened for Jordan, he and his business partners had a falling out, which meant the Art of Charm was no more. All of a sudden, he had no podcast and no business.

But in less than a year, he created the Jordan Harbinger Show, and now he’s more successful than ever. And he won best of 2018 by Apple podcast, with one of the most popular podcasts— surpassing even his old podcast.

How?

He had established himself so powerfully as a category king in his niche that when his show got taken away from him, and his brand got taken away from him, he was able to reinvent himself again, and in less than a year, be one of the top podcasts on Apple—and build a business today that is even stronger than it was before. In a year, he was able to build a more popular and recognized presence than what he had done in the 11 years prior.

This is yet another powerful example of what can happen when you establish yourself by owning your own niche. You can have everything taken away from you, and then bam, you can come back even more powerful. Because when the niche wants you, and the category wants you, they must have you.

For more legendary stories from legendary leaders, listen to the Follow Your Different podcast.

Note: This post first appeared on Minutes Magazine.

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