Once upon a time in the early 1980s, a lower-Manhattan comedian decided not to play by the rules of the uptown clubs in order to make a name for himself.

Back then, only a handful of serious comedy clubs existed, and all of them operated with the same mindset: Motivate comedians with fear and cut anyone who didn't deliver a five-star routine every single performance.

Bill Grundfest refused to accept those terms. So, in 1982, he opened his own club, The Comedy Cellar. Thirty-six years later, it's one of the oldest venues of its kind left standing. Meanwhile, Grundfest has showcased everyone from Jon Stewart to Ray Romano, worked on shows like Mad About You, and won a Golden Globe in the process.

"I did not expect to outlive all the incumbent clubs," he said with a laugh when we spoke.

So how did he? Grundfest attributes his success to a few key strategies that are not what you'd expect to hear in a story about clawing your way to the top. And happily, those reasons are as applicable to sales and marketing departments in 2017 as they have been to Grundfest over the last few decades. Here's how you can apply Grundfest's rules to your own business.

1. Develop a "ruthless devotion to kindness."

This is top of the list for Grundfest, despite how counterintuitive it sounds. He explains that this strategy came about in response to the way uptown clubs operated, where the attitude towards comedians was, "We're doing you a favor by giving you this performance spot."

In contrast, The Comedy Cellar decided that if you give people more money and a little respect, your return on investment will be enormous. The venue has always paid comedians above-average fees for performances and striven to create a place for these artists they wouldn't be able to find elsewhere. For example, rather than discounting a couple menu items for performers and calling that generosity, The Comedy Cellar keeps a "comedians only" table. That small gesture makes performers feel valued and gives them a chance to socialize with others in the industry. The result for Grundfest and Co. was a constantly rotating cast of top-quality performers, many of whom remain dedicated patrons of the venue today.

Most businesses today operate more like those uptown clubs Grundfest rejected a few decades ago. "I don't care how many gyms they give you," he said. "[Most companies] are leveraging fear."

How can you change that? Start by winning the loyalty of both employees and customers by showing them how valuable they are to you. "You can't buy that kind of evangelism with marketing," says Grundfest.

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2. Give people what they don't deserve.

Grundfest is pretty well known at this point for hosting many now-famous comedians long before they made it to SNL or Comedy Central. Turns out, they weren't all comic geniuses at the start.

When we talked, Grundfest explained how Jon Stewart "bombed for six months" when he first started performing at The Comedy Cellar. When asked by his colleagues why he kept asking Stewart back, Grundfest's response was, "Once in awhile, we have to give someone better spots than they deserve, and they have to grow into those spots." Stewart's comedic talent may have needed a bit more developing, and Grundfest saw enough unique talent to foster that growth.

In other words, you have to give people a chance to fail if you want them to reach any point of real innovation. This is a pretty common mantra in the age of "lean startups" and "continuous delivery," but Grundfest eschews such jargon in favor of a much more practical approach: support people until they prove they can't do it. And supporting means not just talking about your "culture of innovation" but actually following through on your words and providing employees with spots they may not yet deserve.

3. Cultivate a clear brand, then stick to it.

Grundfest is especially interested in the importance of comedians developing their own "brand" and continuing to refine it. He cites the comedian's routine of "record it, listen to it, edit it" when A/B testing jokes. Startups should be continually operate in that cycle of doing, testing, and redoing, regardless of whether your industry is entertainment or server architecture.

You also need to channel your focus into those things that actually make sense for the brand. Ray Romano might have loved his fax machine joke, but the world knew him as "stand up dad and husband," and that's ultimately what moved him into the world of sitcoms. Ditto for Roseanne ("stand up domestic goddess"), Rodney Dangerfield ("I get no respect"), and Woody Allen ("intellectual New York Jew").

"What business are you really in?" Grundfest asks, adding that if it takes someone more than a sentence to answer that question, they don't actually know their own business.

What about the public's perception of you? In comedy, says Grundfest, "You're getting customer feedback in real time. And the feedback is public. And the feedback is brutal." You also have to be willing to take it in order to progress as a comedian.

It doesn't sound far off from the world of fast-paced startups subject to 24/7 scrutiny from the Internet, where you have to be willing to withstand and grow from all manner of tweets, comments, and reviews in order to survive. Right now, your business-to-business brand is as alive as any performer onstage. That means Grundfest's decades-old approach to an onstage art form might just be the most relevant business tool available.

Published on: Aug 8, 2017