It’s time to celebrate!
🏆 Mike Beckham with front-row, behind-the-scenes lessons on champion leaders
😍 Connor Rolain shares two examples of how to move beyond transactions
📊 Top five headlines in consumer news with executive summaries and links
Plus, bonus festivities at the end …
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Connor Rolain
HexClad, Head of Growth
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The Slow Death of Transactional Reward Programs
I’m noticing a lot of brands’ reward programs moving away from discount codes and towards unlocking free gifts + exclusive perks that don’t destroy your margin.
Our friends over at Kitsch just launched a new program with Rivo that nails this …
- No mention of discounts
- Tiered free gifts
- Gamified AOV
- Repeat purchases
- Exclusive perks
- Early access to new drops
It protects margin, drives demand, and doesn’t train your customer to wait for a sale.
The more friends someone refers, the better gifts they automatically receive. The results?
A 17% increase in AOV from referred customers and $450K in additional sales during the first 90 days alone.
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Mike Beckham
CEO, Simple Modern
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Three Characteristics of Championship Organizations
The Oklahoma City Thunder are NBA champions!
I have been a fan of the team since it came to Oklahoma City in 2007. My company, Simple Modern, is a corporate partner of the Thunder, and I hold season tickets courtside.
In other words, I’ve been fortunate to have a front-row + behind-the-scenes view of the Thunder’s success.
Here are three characteristics about the organization’s path to greatness that I am applying to my leadership:
- Consistency
- Chemistry + Culture
- Process > Results
1. Consistency
The Thunder organization was born in 2007.
Several key architects of the franchise relocated to Oklahoma City from Seattle. Remarkably, many of these leaders remain part of the organization today.
The most notable is Sam Presti — widely regarded as the best GM in the NBA, potentially the best GM in professional sports.
In a season of remarkable statistics, this is my personal favorite.
Presti won his first title after 18 years on the job.
It marks the first time this has happened in the history of professional sports! A GM has never won their first title more than 14 years after taking the job.
The reason is simple. Professional sports are all about winning today. If you fail to guide your team to a championship relatively quickly, you will be replaced.
Presti experienced tremendous success and equally tremendous disappointment in his tenure. He struck gold by drafting Hall of Famers back to back to back …
- 2007: Durant
- 2008: Westbrook
- 2009: Harden
For all the talent that OKC acquired, it never translated into a championship. Some of this was due to controllable decisions; much of it was the capriciousness of injuries.
A championship trophy was the one accolade that eluded Presti. How did he survive so long without winning a championship?
Presti is employed by an ownership group that …
Understood his greatness even though he had failed to achieve the ultimate goal.
Clay Bennett and the other owners of the Thunder gave him continued support through the disappointment of coming up short year after year. They supported him through a massive rebuild that began in 2020 during COVID.
During those years, Thunder basketball was hard to watch.
It included the most lopsided loss in NBA history and being called “the black eye of the NBA.” The organization suffered through periods of zero ticket revenue due to COVID restrictions and had players with names like Charlie Brown taking the court.
There were some pretty bleak stretches, but the ownership group was willing to trust Presti’s vision for the future.
That belief has now paid off with the youngest championship team of the shot-clock era.
The biggest knock-on effect of turnover is losing institutional knowledge. Because of the consistency in the Thunder’s key leadership roles, they were able to learn from the lessons of the 2010s — transforming failure into an experiential asset.
The adversity and disappointment of coming up short yesterday … built today’s juggernaut.
Champions are rooted in consistency, talented people focusing on the same thing for a long period of time. Consistency certainly doesn’t guarantee great results.
But you can’t hope to build something remarkable without it.
Great leaders gather talented people, then give them the time and opportunity to fully grow into their potential.
2. Chemistry + Culture
This year’s Thunder was known for its group interviews after games. They genuinely enjoyed being around each other and gave off the vibe of a college team with their interactions.
In some ways, this shouldn’t be surprising. Their average age was lower than several NCAA tournament teams.
That chemistry is not a coincidence; the Thunder take an atypical approach to player evaluation.
Every team has scouts who evaluate potential players’ skill set and basketball abilities. The Thunder have a second group that exclusively investigates character and personality. They interview high school girlfriends, teachers, neighbors, friends, and families.
Where most teams conduct surface-level research in this area to unearth red flags, I’ve been told the Thunder use this process to evaluate cultural fit and motivation thoroughly.
The result? A group of players who are remarkably connected. This connection is obvious in post-game interviews.
Fan interest in the NBA often centers on trades: “Will his three-point shooting help our offense go to the next level?”
How a player will impact the culture and locker room is rarely taken into consideration.
The two teams in the Finals this year, the Thunder and Pacers, were both examples of how team success can be more than the sum of individual talent. This level of achievement requires each teammate to sacrifice to help the team be its best.
The same is true when leading a business. Some teams have an abundance of talent.
What keeps them from translating it into results? Dysfunction and poor culture. After studying tens of thousands of businesses, McKinsey concluded that the number one predictor of team success is “trust.”
Great organizations simultaneously filter for exceptional capability and cultural fit.
3. Process > Results
The NBA is known as a “make or miss” league.
Imagine it’s the last 10 seconds of a close game. Your team is down one point. During a timeout, the coach draws up the inbounds play. The timeout ends. Everyone takes their places.
Your team executes each of the cuts and screens perfectly, leading to an open three-pointer from your best shooter in the corner as time expires.
The shot misses. You lose. Game over.
The next day on ESPN, we hear Stephen Smith screaming about how your best shooter doesn’t have the “Clutch Gene” and how he “shrank from the moment.”
Because the shot didn’t go in, we selectively remember all the other key shots that player missed. We lament with our friends about our coach’s rotation decisions. We second-guess the choices we made in last summer’s draft when we passed up on a sharpshooter for some needed big man depth.
In our culture, we use results as the lens to interpret our experiences. Is any of that true?
Against that natural temptation, I’ve really enjoyed listening to the Thunder post-game press conferences.
Most athletes say little of substance after a performance. This team has been full of thoughtful commentary …
After wins and losses.
In the second round of the playoffs, the Thunder had a chance to finish a series with the Denver Nuggets in Game Six.
Jalen Williams, the Thunder’s all-star forward, had a terrible game. He scored only six points on 3-16 shooting and missed several layups en route to a disappointing Thunder loss.
After the game, Jalen explained that when he evaluated his performance, he focused on his “process.”
How did he feel about the quality of shots that he took and the decisions that led him to take those shots? He felt like he had made good decisions; the shots just hadn’t gone in.
From that point on, most of the shots did go in. Jalen’s shooting percentage skyrocketed, culminating in a 40-point masterpiece in Game Five of the Finals.
“That will be the first clip on his hall of fame highlight reel,” one podcaster declared.
Just as remarkable, when the Thunder suffered an 18-point defeat in Game Six of the Finals, he had the worst plus-minus of any Thunder player. In fact, he had the worst plus-minus of any player in a finals game in history.
Post-game, he was quick to point out that results can fluctuate dramatically from one game to the next.
So you have to focus on the process.
That means not getting too high when things go well and not getting overly discouraged when the outcome disappoints.
It takes a lot of mental strength to separate process from results.
We have all experienced that sometimes a flawed process can produce great results, just like a great process can sometimes lead to disappointing outcomes.
Exceptional organizations develop the mental strength to evaluate performance through the lens of process.
How did you execute on the things you could control?
As a leader, this is particularly difficult. We are judged by our results. Still, the best way to develop the people in our organization is to train them to be process-oriented.
Conclusion
The Thunder are based in one of the three smallest markets in the NBA. They have no obvious natural advantages over their rivals from bigger markets.
Yet, they have produced a remarkable outcome.
It is proof that consistency, chemistry + culture, and elevating process over results can dramatically impact the trajectory of any organization.
“You’re Losing $20 Million a Year & Don’t Know Your LTV?”
Using Spending Power to Plan and Spend Smarter with Steve Rekuc + AI Ads & PDPs
Curated by the editor of CPG Wire, this week’s five biggest headlines in consumer news.
1. TSG Consumer Partners Backs DUDE Wipes: Business Wire
DUDE Wipes, the viral, fast-growing flushable wipes brand, scored a strategic growth investment from TSG Consumer Partners. Founded in 2011 by lifelong friends Sean Riley, Jeff Klimkowski, and Ryan Meegan, annual sales went from $42M in 2020 to nearly $220M in 2024.
The co-founders will retain significant ownership stakes and continue to run day-to-day operations. The biggest winner in all of this? Probably Mark Cuban.
2. Aria Growth Partners Secures $152M: Axios
Consumer-focused growth equity firm Aria Growth Partners raised $152M for its second fund — twice the size of its original.
Trevor Nelson and Jackie Dunklau co-founded the growth equity firm in 2020 and will continue to lead it. The firm’s recent successes include Hero Cosmetics, acquired for $630M in 2022, and LesserEvil Snacks, acquired for $750M earlier this year.
3. Momofuku Grabs Funding: Twitter
Momofuku Goods, the consumer products division of popular restaurant group Momofuku, raised $27.6M from undisclosed investors. The brand has been on a heater since being spun out as an independent company in 2019.
Sales surpassed $50M in 2023; last year, it grew to $67.5M. Momofuku Goods is also assembling a team of A-players with former Zevia CEO Paddy Spence now at the helm.
4. Bloom Hits Major Milestone: Instagram
Bloom co-founder & CEO Greg LaVecchia shared an impressive company milestone. Since launching last summer, the sparkling energy drink range has sold over 35 million cans. Next up, Bloom is taking on the modern soda category. Its better-for-you soda lineup will launch exclusively at Walmart this week.
5. VO/D Grabs $5M From KarpReilly: Twitter
VO/D, a venture studio specializing in creator-led consumer brands, closed a $5M funding round led by KarpReilly. A number of individual investors like Saquon Barkley, Chris Paul, Odell Beckham, and AJ Patel also participated in the round.
Best known for co-creating 1UP Candy, the fast-growing candy brand co-founded by YouTuber Brian “FaZe Rug” Awadis. VO/D is taking on the supplements category with three new brands.
BONUS: Celebrations
Today marks the 52nd issue of the Operators Newsletter — that’s right, it’s our one-year anniversary!
The customary gift? Paper.
So, yes, I am fully expecting you to write back with a love letter about how much we mean to you.
“But Aaron, did you get me anything?”
Of course, I did. It’s not paper.
But it will make you more paper.
We finally have all the recordings + resources from the Operators Assemble event. Over five hours of content from +20 speakers along with their decks and tools.
You can unlock them here 🎁
With thanks and anticipation,
Aaron Orendorff 🤓 Executive Editor
PS (Disclaimer): Special thanks to Rivo for sponsoring today’s newsletter.