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Evernote CEO Phil Libin got a terrible birthday present for his 42nd birthday: a highly critical review of the popular note-taking service by influential tech blogger Jason Kincaid.

But Libin’s response was a rarity in the Valley these days: it showed a CEO who gets the importance of good PR.

The review, titled Evernote, the bug-ridden elephant, said, “Evernote’s applications are glitchy to the extreme; they often feel as if they’re held together by the engineering equivalent of duct tape” and “the apps are so laden with quirks that I’ve long held a deep-seated fear that perhaps some of my data has not been saved.”

Those are not good thoughts to be associated with service for which keeping important data — forever — is an important brand promise.

Many tech CEOs respond to criticism by saying, in effect: “We’re smarter than you. You can’t understand how brilliant we are. Stop being a hater.” Not Libin. He addressed the issues head-on in a blog entry posted the next day. He acknowledged that there had been challenges:

There comes a time in a booming startup’s life when it’s important to pause for a bit and look in rather than up. When it’s more important to improve existing features than to add new ones. More important to make our existing users happier than to just add more new users. More important to focus on our direction than on our speed. This is just common sense, but startups breathe growth and intentionally slowing down to focus on details and quality doesn’t come naturally to many of us. Despite this, the best product companies in the world have figured out how to make constant quality improvements part of their essential DNA.

He also laid out a plan to address the challenges:

Our new philosophy is to find every spot in our products where we’ve been forced to make a trade-off between doing what’s simple and doing what’s powerful, then rethink it so that the simplest approach is also the most powerful. We know we’ve found a good design for something when that conflict disappears. It feels like magic when that happens, and we’ll have several bits of magic in the coming months.

It was not only brilliant from a PR perspective, but as an Evernote user, it was reassuring to me that the company saw the issues and is working on it. (I’m in the process of reviewing Evernote’s scanner and it also helped alleviate some of my concerns about that product. But I can already tell Libin it won’t be a glowing review.)

CEOs need to learn that criticism has value. Not every critic is a hater. And not everyone is an idiot. Many of them have broad-based experience. Many of them know economics, liability law, public policy and government relations better than a startup CEO.

Uber’s surge pricing policy illustrates my point exactly. Yes, there are economic principles of supply and demand that exist (in theory) in Economics 101. But those are often constrained by the fact that we live in a society with norms. Could you charge $25 a gallon to people buying gas while evacuating an approaching hurricane in New Orleans? Sure, you could. The laws of supply and demand dictate it. But be aware that in some places, it is illegal to do this. Even if it is not illegal, be prepared to be hauled in front of local officials and blackballed by your community.

It’s what I call the difference between short-term capitalism and long-term Capitalism. You have to optimize your strategy for the society we live in, not a theoretical perfect market.

One of my favorite experiences in dealing with a CEO was when I tweeted about confusing pricing on the HotelTonight hotel booking app. When I checked pricing for multiple nights, it showed me the price for the first night. It wasn’t reflective of the average rate for my stay. Because hotel prices can vary widely, showing me a $150 rate for the first night isn’t helpful if the second night is $450. CEO Sam Shank saw my tweet and engaged. We talked through some alternative approaches and HotelTonight soon addressed the issue. We’ve been friends ever since and I frequently give him feedback on the product. (Sam recently talked with Bloomberg West’s Emily Chang about surge pricing.)

Understanding and working with the media is a delicate dance. The message that gets out to the public can be key when your company is facing a crisis. And no matter how hot your company is at the moment, you will eventually find that you need the media’s help to get your message out.

Here’s some advice that I give to startups on PR in general, as well as crisis PR:

  • If there is an error in a story about you or your company, reach out to the reporter first. Most people are trying to do a good job. If they made a legitimate mistake they will try to fix it. In an era where many execs and VCs have more followers than media outlets that write about them, it can be tempting to use social media to directly make your claim about being misquoted. While that may satisfy your fans and be gratifying, those aren’t the people you need to convince. A correction or clarification is a lot more credible if it is posted by the media outlet.
  • Even if you’re smarter than everyone else (or you think you are), expounding on theory rarely plays well — either to the media or to the public. If your product is so complex that people can’t understand it, the smarter play is to create a product that people can understand. Mocking your users may be gratifying in the short term, but it’s not a winning long term strategy.
  • Involve your PR team in major pricing and strategic decisions. An experienced PR team can help you understand the likely media reaction, the likely public reaction and how you can mitigate those. In fact, when I design products, one of the first things I do is create a list of things that might blow up and what the PR impact might be. And then I work to make the product better so that those issues don’t arise. PR shouldn’t be a bolt on; they should be helping you craft the messaging while the product is being built. Obviously this doesn’t work for super early stage startups, but once you’re a $500 million company, you can and should afford this.
  • Build relationships with the reporters who cover your specific beat. If you’re focused on payments, find the people who cover payments and reach out to them. You don’t need a PR firm for this. A note or a tweet from a CEO can get the job done. It’s tempting for inexperienced entrepreneurs to go looking for the big names. You’re a lot more likely to be successful reaching out to people most knowledgeable about (and interested in) the space. There is also a lot of cross-pollination of ideas among reporters, so a small effort can go a long way.
  • As your company matures, reporters will have greater expectations. A two-person company that has just raised a seed round will get a lot more slack than a $2 billion company serving millions of users.
  • If there is a major crisis, hire a crisis PR firm to work with your executive team. Crisis PR is very different from the day-to-day pitching of reporters.
  • Never, ever lie. This means that you should be completely upfront with your PR team as well. Great PR people know that they should never to lie to reporters. If you lie or mislead your PR team, they won’t be able to do the best job of representing the message you want to get out.

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