Over a year ago, I wrote a post titled Business Development in a Web 2.0 World. I wrote about the importance of relationships in today’s business dealings. I wrote:

To get, one must give, and trust that the gift is compelling enough to have the other give in return.

(I’ve always wanted to quote myself. Talk about an ego boost!)

Now, its a year later. The work we have done at Lijit has really begun to pay off. Since I started in the end of 2007, we have seen our pageviews grow 30x (11mm per month to 325mm per month) and our user base grow 11x (1,000 – 11,000). Clearly, our approach to business development has worked.

But, this past weekend at Gnomedex, I began to rethink my philosophy.

If you approach relationships as “give with the hope of getting something in return,” by definition, you are creating unidirectional value relationships.

A good illustration of this is the classic/stereotypical dating situation: Man takes woman out to a meal and a movie. He expects she will return a little loving. Who has the power in the relationship? Clearly, not the man.

Look at traditional sales relationships. Same story.

The majority of business dealings are created with the intent of forming a unidirectional value relationship. To be clear, while there is always some value passed back and forth, this is more an exploration of mutually equal value and sharing of power.

Which brings us to the concept of a bidirectional value relationship. Value is mutual. Power is shared.

In my personal life, I tend to be more like my original concept: “To get, one must give, and trust that the gift is compelling enough to have the other give in return.”

Which makes me more interested in women that have such needs that within the relationship, I can provide more than I get in return. This creates an imbalance in mutual value and power, often leaving me in a less than ideal situation. While I was assuming that I was keeping control, and therefore the balance of power in a relationship, the truth was that I was giving away both.

In business relationships, if you miscalculate and the value you provide is not compelling enough, or the other party is uninterested in providing equal value in return, the relationship ends up being unequal and creates the reality of a difficult ending.

Think of it this way. There are two parties, and between the two parties there is a bucket sitting on a level. Neither party can take the bucket, but each party can fill the bucket. If one party fills the bucket, but the other doesnt, the bucket tips. If one party takes too much out of the bucket, the bucket tips. There has to be equality.

Does this mean that relationships are not the focus of business development 2.0? Actually quite the opposite. Relationships are the centerpiece, but successful relationships are bidirectionally valuable.

How does Freemium work in all of this?

The general idea is that if a user likes a product, they will be willing to pay more to use it. Or, for some cases, free accounts can be used for lead generation. But, if the relationship with the user is unidirectional (you give away too much; the paid services are not compelling; you attract the wrong kind of user), then the model fails.

When building a strong, lasting relationship, its important to determine what equal value entails (For example: you put Lijit search on your blog and allow us to share in the revenue generated, and in return we will monetize an under-monetized section of your blog and give your readers a superior search service) and ensure it is understood by both parties.

Relationships should be evaluated on the ability of both parties to provide value. A true relationship, business or otherwise, is predicated on the fact that power, and therefore control, is shared by both parties. When that is out of sync, the relationship has no chance of becoming long-term. In fact, there is no relationship at all.

There is simply an agreement between two parties, that usually occurs after a series of negotiations focused obtaining the highest potential value for each individual party.

Building bidirectional value relationships takes time and trust. It takes a willingness to be vulnerable and a clarity of requirements. Such relationships take learning whats important to each party, and being brutal if those requirements are not met.

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Yesterday I was on a call with a potential business partner for Lijit. With me on the call was one of our product people.

We were going down a specific path with this partner, who on the call threw us a bit of a monkey wrench. It happens. Its the internet.

Our product guy sends out an email after the call that basically indicates that the project is now dead. At the same time, I draft an email to the business partner about ways that we can potentially still work together even with the major change to the business strategy.

So who was right? The product guy for answering the question “Can it be done?” or me for answering the question “How can it be done?”

The truth is we both are correct. It needs to be determined if there is a solution to the problem, but also a need to understand the brain damage that solution might cause.

Organizations that understand this fundamental reality (product cares about the feasibility of projects, while business development cares about the potential of projects) create a positive work environment where idea flourish and projects actually complete.

Right around when I first started at Lijit, Todd Vernon wrote a post about the roles of a CTO and a VP of Engineering. Initially, I was taken aback by this section:

Another way to look at it, the CXO team should all be thinking of the next way to upset the world.  The VP’s and their Directors should be huddling on how to deliver the crazy ass stuff the CXO team is thinking of.  Of course, everyone wears a little of both hats, but in my mind that’s the focus.

After all, I had just come off of selling my company, and saw myself as someone who’s purpose in life was to “think of the next way to upset the world.” Yet, I was taking on the VP of Business Development role, which was a “by design” decision. (My focus was on learning more about how a venture backed company worked and surrounding myself with experienced rock stars like Lijit’s board and management team.)

But the question that loomed was could I do what I do best in a role that is defined by “the delivering crazy ass stuff the CXO team is thinking of”? Isnt that the role of the product team? Frankly, I was worried.

And for a year, that worry never completely subsided. Dont get me wrong, we landed big publishers, launched strong product upgrades and created great partnerships. Dont believe me? We are currently approximately 50%-ish ahead on our goals (which were scary high to start with). Clearly, we are doing something right.

Because of our successes, I never bought into the need for a dedicated product team. I didnt want a group who primary function was to tell me no. Who’s role was to determine FEASIBILITY not POSSIBILITY. To ask “Can it be done?” Not “HOW can it be done?”

Then we hired Greg Keller. Greg is a seasoned product manager and a solid blogger. He rides a bike (ok, he is a cyclist), but most importantly, understands the proper intersection of product and business development.

Over the past several weeks, the product team has expanded (and contracted a bit) to take ownership of our three products: The website (and search results), the widget and our ad network. In each case, the product path has become more clear, the important (and missing) elements have come to light, and the spots where I can make the most impact for Lijit.

What this has taught me is that if I were to build a company, I would look past the current constructs of position titles to understanding the true functions:

CEO – final decision maker; vision builder (“What do we want to be?”)

Operations – operationally focused; makes the business run (“How can we make that a reality?”)

BD – Lives outside reality, thinks about what is possible. (“What is possible?”)

Product – Lives in feasibility; thinks about how to make things reality (“What is feasible?”)

Engineering – Focused on making. They are the builders. (“Can we do it?”)

(Yes, I dont talk about sales. Sales is a very mechanical function, even though it is very necessary).

Can a small company share these responsibilities? Yes.

But, damn, its nice to have area experts.

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I dunno. I havent had it yet.

Its 1:30am as I sit in my hotel room. I should have been asleep hours ago, as I have three meetings tomorrow (well four). At 8am I have a phone call,  I need drive down from San Francisco to San Mateo to meet with Apture (I mention them only because they are now installed on my blog, and I think they are pretty interesting) by 10am, and then back to San Francisco for 1pm meeting. Not to mention the the dinner I am pretty excited about with Foodzie.

But this isnt a complaint post.

Earlier tonight I was watching Glee on the new Hulu desktop app. There was a point in the show where one teacher shows the Glee Club teacher a video of him performing in 1993.

“That was the greatest time of my life.”

Which got me thinking. What was my greatest time?

No answer found itself to the front of my brain, and it dawned on me.

I havent had a greatest time in my life…yet.

At first, this realization was followed by disappointment. Has it really been 37 years without a greatest moment? Does it mean my life has been boring and without merit?

But, quickly it hit me. I derive my drive from an intense desire to HAVE a greatest moment. I am comforted by knowing that my greatest moment is still out there.

Then I started to apply the concept to the friends around me. People that I am humbled to know:

Brad Feld: A very successful venture capitalist, what excites Brad about being an investor is helping people build the next big thing. Does he think every investment he (or Foundry Group) makes is in the next big thing? No, but watch where (and in whom) Brad invests his time…its a great indicator of what (and whom) he is excited about.

Frankly by definition being an investor is the belief that the greatest moment is still to be…

Gary Vaynerchuk: Gary wants to buy the New York Jets. Gary is going to be a dad soon. Gary, our generation’s Tony Robbins, is driven by passion and the desire to win. Ask Gary if he has had the greatest moment in his life, and he is liable to punch you in the mouth and yell “I want to own the NY Jets, dummy.”

Jason Fried: I met Jason at the BigOmaha conference after several failed attempted by Jeffrey Kalmikoff to connect us, and was literally awed by Jason’s mix of focus and adjustment when we talked about business ideas. He has a clear vision as to what works and how it works, but he is also quick to absorb data and guidance and apply it to his vision. I would almost be willing to bet dinner in Chicago that if you asked Jason what his greatest moment in life was, he wouldnt name it quickly. Im sure he is proud of 37signals and the work they have done, but I am also sure that he believes that 37signals will be a footnote to whatever he accomplishes in his life.

Jeffrey Kalmikoff: While I refuse to take free tshirts from Threadless, Jeffrey is still my friend. Did you know that Jeffrey used to be a pretty decent DJ? Or that he and Jake Nickell have spoken to MIT and Stanford and were on the cover of INC magazine? Probably not. Because those are things on the path to whatever it is that Jeffrey will one day achieve.

The list goes on and on.

What is it then? People that are focused on the future are more likely to be successful? That people who have had a “greatest moment” are doomed to look at the past?

Not sure thats it.

People who have had a greatest moment spend most of their lives trying to recreate that moment.

Their very motivation centers on the concept of re-experiencing that wonderful moment in time.  Therefore, failure hurts, because you have known true success.

On the other hand, people that have not had their greatest moment yet, are waiting for that moment.

Their motivation is focused on creating that moment. Knowing that the moment will come (and fear that it may never). Therefore failure is part of the process, because we have never known real success.

Maybe I am rambling because its now 2:30am and I can barely keep my eyes open, but chew on this:

If I have had my greatest moment, then I know the parameters that that moment exists in. Therefore, my drive is limited by that scope. I am comfortable working a job, or limiting what I think I can achieve, because I know that my success must occur in a similar way to how it did in the past.

But what if I add a bit of hope to my beliefs?

In hoping that the greatest moment in my life is yet to come, the scope of where my greatest moment lives becomes infinite. I become ok with change and error. I stop questioning my ability to achieve and I focus on what the success should be, because I have no idea where, when or how my success will manifest in the future; I just know it will.

My greatest moment in my life is coming and it will be amazing.

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