People get paid less than their employers' "reservation price" (the most they would ever pay), and more than their "marginal product" (the least they would ever work for). Your actual pay on that spectrum is based on your bargaining power, relative to your employer.Say your services to your company are worth $1000 a day. Under the gun, he would pay you that if he had no other choice. Say you would work for $100 a day if you had no other options. That's your range.Say you're new and independent and unknown, and your boss is Google. Google has more bargaining power, because they can just wait an...

Anyone seeking to succeed in investment banking in China should live by one rule alone: it’s not who you know, but how well you know them. In China, more than any other country where I’ve worked, the professional is also the personal. Comradeship, if not friendship, is always a necessary precondition to doing business together. If you haven’t shared a meal – and more importantly, shared a few hundred laughs – you will never share a business deal. Competence, experience, education and reputation all matter, of course. But, they all play supporting roles.The st...

We've been experimenting with app prices for quite some time and again and again we've noticed a funny effect:No matter what price we choose, we always make the same revenue.I attached two charts to illustrate that. I recently lowered the price of the iPad app (http://bit.ly/92xWv1) from 5 to 1 Dollars. At first the sales spike, then they even out to previous levels. Meaning: By cutting the price by factor 5, I am selling exactly 5 x more apps. Then we lowered the price of iA Writer for Mac (http://bit.ly/jfsHdZ) from 10 to 5 Dollars. And the exact same thing happened. There was a short i...

Most people take “Build something people want” to mean “Pick a problem to solve and solve it well.” This is not sufficient to build a world changing company.“Why now?” is the question entrepreneurs really need to answer. “Why now” encompasses two important and closely related concepts:Why have previous attempts at this idea failed?What enabling factors have emerged that enable you to succeed today?The world is full of smart people who have the same ideaThere are a lot of smart people out there. At least five of them have already tried to solve th...

You might not know it, but a key cog in the global innovation machine is hiding in plain sight in the world's largest democracyReutersFor many firms, developing new products for consumers around the world is the most visible manifestation of innovation - the "real deal." But many people still see India as a place where other people's ideas are made or executed and not where innovation begins. (After all, you don't hear about an Indian equivalent to Google, iPod or Viagra.) Bu they're wrong. In more than 600 captive research and development (R&D) centers across India today, corporations are...

What is the dirtiest word in business? Chances are that the word ‘outsourcing’ comes to mind. Many Americans despise it, many business owners shy away from it and many entrepreneurs depend on it. Regardless of what side of the issue you are on, it is important to know that it exists and will continue to exist. Why? Because there are a lot of things to love about outsourcing.As a business owner and tech entrepreneur who exists in a hyper-competitive market, I have used outsourcing to accomplish a variety of tasks. Whether it is data entry, design, research or basic programming, the...

Years ago, rumors used to circulate about Microsoft interviews.  They were the hot, new company that everyone wanted to work.  With envy came the urban myths.  These rumors have since been transfered to Google, and will surely be transfered to some new company in due time.Bloggers – always desperate for links and traffic – have capitalized on this, with scary articles about their “nightmare interview” and “crazy questions“.  Let’s just stop this right now, shall we?Google’s interview process is really no different from its...