Tag: questions

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Before the Close – How to Increase the Chance of Raising Capital

A number of founders ask me for fundraising advice. While they come in different magnitudes, one of the common themes is: “I’ve had many investor meetings, but I still can’t get a term sheet. What am I doing wrong? What do I need to do or to say to get a yes?”

To preface, I don’t have the one-size-fit-all solution. Neither do I think there is a one-size-fit-all solution. Each investor is looking for something different. And while theses often rhyme, the “A-ha!” moment for each investor is a culmination of their own professional and life experiences. This anecdote is, by no means, prescriptive, but another perspective that may help you when fundraising, if you’re not getting the results you want. This won’t help you cheat the system. If you still have a shoddy product or an unambitious team, you’re still probably not going to get any external capital.

One thing I learned when I was on the operating side of the table is: When you want money, ask for advice. When you want advice, ask for money. It’s, admittedly, a slightly roundabout way to get:

  1. Investor interest,
  2. And reference points for milestones to hit.

But it’s worked for me. Why? Because you’re fighting in a highly-competitive, heavily-saturated market of attention – investor attention. This method merely helps you increase the potential surface area of interaction and visibility, to give you time in front of an investor to prove yourself.

Investors are expected to jump into a long term marriage with founders, while, for the most part, only given a small cross-section in your founding journey to evaluate you. It’s as if you chose to marry someone for life you’ve only met 60-90 days ago. While angels and some people have the courage and the conviction to do that, most investors like to err on the side of caution. Contrary to popular belief, venture capitalists are extremely risk-averse. They look for risk-adjusted bets. And if you can prove to them – either through traction or an earned secret – that you’re not just a rounding error, you’ll make their lives a lot easier.

So, let me elaborate.

When you want money, ask for advice.

As you’re growing your business and you want to show you are, ask investors for advice. Tell them. “So I’ve been growing at X% MoM, and I’ve gotten to Y # of users. I’m thinking about pursuing this Z as my next priority. And this is how I plan to A/B test it. What do you think?”

And if you keep these investors in the loop the entire time and ask and follow-up on their advice, at some point, they’d think and ask, “Damn, this is an epic business. Will you just take my money?”

So, what are good numbers?

The Rule of 40 is a rough rule of thumb many investors use for consumer tech markets. Month-over-month growth rate plus profit should be greater than or equal to 40. So you can be growing 50% MoM, but burning money with -10% profit, aka costs are greater than your revenue. Or you can be growing 30% MoM, but gaining 10% profit every month. And if you’ve got 10s of 1000s of users, you’re on solid ground. Better yet, one of the biggest expenses is increasing server capacity costs.

For more reference points on ideal consumer startup numbers, check out this blog post I wrote last year.

For enterprise/B2B SaaS, somewhere along the lines of 10-15% MoM growth. With at least 1 key customer logo. And 5 publicly referenceable customers.

Of course, the Rule of 40 did not age well for certain industries in 2020.

When you want advice, ask for money.

When you ask for money most of the time, investors, partners, and potential customers will say no, especially if you’re super early on and don’t have a background or track record as an entrepreneur. So when they do say no, I like to ask them one of my favorite questions: “What do I need to bring you for you to unconditionally say yes?” Then, they’ll tell me what they want to see out of our product or our business. These, especially if they’re reinforced independently across multiple different individuals in your ecosystem, should be your North Star metrics. And when you do put their advice to action, be sure to follow up with the results to their implemented advice.

  1. You either do what they recommended. And show them what happened. And what’s next.
  2. Or you don’t do what they recommended. But show that you heavily considered their recommendation. What you did instead. Why you chose to do what you did instead. And what’s next.

To take it one step further, once I ask the above question to have a reference point for growth trajectory, I ask: “Who is the smartest person(s) known to achieve X (or in Y)?” with X being the answer you got via the previous question. And Y being the industry you’re tackling.

For instance, I’d recommend:

Then, go to that person or those people and say, “Hey Jennifer, [investor name] said if there’s one person I had to talk to about X, I have to talk to you.” Feel free to use my cold email “template” as reference, if you’re unsure of what else to say.

If you use this tactic again and again, eventually you’ll build a family of unofficial (maybe even official) mentors and advisors, even if you never explicitly call them that. Not necessarily asking for money all the time. But asking for money might help you ignite the spark for this positive feedback loop.

In closing

When I was on the operating side, a brilliant founder with 2 multi-million dollar exits once told me: “Always be selling. Always be fundraising. And always be hiring.”

I didn’t really get it then. In fact, I didn’t get it the entire time I was on the other side of the table. What do you mean “Always be fundraising”? Should I just be asking for money all the time? What about the business?

It wasn’t until I made my way into VC at SkyDeck that I realized the depth of his words. Keep people you eventually want to fundraise from and hire in the loop about what you’re building. Keep them excited. Build a relationship beyond something transactional. Build a friendship.

Jeff Bezos put it best when he said:

“If everything you do needs to work on a three-year time horizon, then you’re competing against a lot of people. But if you’re willing to invest on a seven-year time horizon, you’re now competing against a fraction of those people, because very few companies are willing to do that.

“At Amazon we like things to work in five to seven years. We’re willing to plant seeds, let them grow and we’re very stubborn. We say we’re stubborn on vision and flexible on details.”

Photo by Frame Harirak on Unsplash

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Fantastic Unicorns and Where to Find Them

As a venture scout and as someone who loves helping pre-seed/seed startups before they get to the A, I get asked this one question more often than I expect. “David, do you think this is a good idea?” Most of the time, admittedly, I don’t know. Why? I’m not the core user. I wouldn’t count myself as an early adopter who could become a power user, outside of pure curiosity. I’m not their customer. To quote Michael Seibel of Y Combinator,

… “customers are the gatekeepers of the startups world.” Then comes the question, if customers are the gatekeepers to the venture world, how do you know if you’re on to something if you’re any one of the below:

  • Pre-product,
  • Pre-traction,
  • And/or pre-revenue?

This blog post isn’t designed to be the crystal ball to all your problems. I have to disappoint. I’m a Muggle without the power of Divination. But instead, let me share 3 mental models that might help a budding founder find idea-market fit. Let’s call it a tracker’s kit that may increase your chances at finding a unicorn.

  1. Frustration
  2. The highly fragmented industry with low NPS
  3. Right on non-consensus
Continue reading “Fantastic Unicorns and Where to Find Them”
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#unfiltered #31 The Art of Running into Walls – How to Confront Fear and Fear-Setting

Last night, I happened to re-stumble across a sentence in my collection of quotes that caught my eye.

“The greatest pleasure in life is doing what people say you cannot do.”

– Walter Bagehot
Journalist, businessman, essayist

The founder story

I’ve had this long-standing belief – which if you’re a regular reader of this blog, you’re no stranger to – that founders need to have a personal vendetta when building a business. They must have something to prove or someone they’d want to prove to. Building a business is finding where selfishness meets selflessness. In fact, I’d argue that’s true in every ideal professional career.

The path of entrepreneurship is one where resilience is the floor, not the ceiling. While I understand, it is not the only career path that carries this trait, it is the one I am most familiar with. And having asked 31 people, 18 of which are or have been entrepreneurs, I’ve learned that everyone, despite their job title or background, can be scared in the face of obstacles. Everyone feels fear, myself included. The question is what do we do next, after the feeling of fear enters our heart and mind.

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Myths around Startups and Business Ideas

In a number of recent conversations with friends outside of venture and “aspiring entrepreneurs”, a couple myths, which I’m going to loosely define here as popular beliefs held by many people, were brought to my attention. 4 in particular.

  1. If I have a great idea and build it, it’ll sell itself.
  2. That idea/startup is over-hyped.
  3. The startup/venture capital landscape is over-saturated.
  4. If it doesn’t make sense to me, it’s not a good idea.

Quite fortuitously, a question on Quora also inspired this post and discussion.

If I have a great idea and build it, it’ll sell itself.

Unfortunately, most times, it won’t. As Reid Hoffman puts it: “A good product with great distribution will almost always beat a great product with poor distribution.” As a founder, you have to think like a salesperson (for enterprise/B2B businesses) or a marketer (for consumer/B2C businesses). People have to know about what you’re building. ’Cause frankly you could build the world’s best time machine in your basement, but if no one knows, it’s just a time machine in your basement. Probably a great story to tell for Hollywood one day (even then you still need people to find out), but not for a business.

That idea/startup is over-hyped.

I’ll be honest. This really isn’t a myth, more of a common saying.

Maybe so, at the cross-section in time in which you’re looking at it. But if you rewind a couple months or a year or 2 years ago, they were under-hyped. In fact, there’s a good chance no one cared. While everyone has a different technical definition of over- and under-hyped, by the numbers, time will tell if it’ll be a sustainable business or not. If it’s keeping north of 40% retention even 6 months after the hype, we’re in for a breadwinner.

Take Zoom, for example. Pre-COVID, if you asked any rational tech investor, “would you invest in Slack or Zoom?” Most would say Slack. Zoom existed, but many weren’t extremely bullish on it. Today, well, that may be a different story. As of this morning (Oct. 12, 2020), while I’m editing this post before the market opens, the stock price of Zoom is $492 (and same change). Approximately 343% higher than it was on March 17th, the first day of the Bay Area shelter-in-place. And, right now, the price of Slack is $31. Approximately 56% up from the beginning of quarantine.

Neither are startups anymore, but the analogy holds. Also, a lesson that predictions, even by experts, can be wrong.

The startup/venture capital landscape is over-saturated.

“There’s too much money being invested (wasted) on startups.”

From the outside, it may very well look that way. Every day, every week we see this startup gets funded for $X million or that startup gets funded for $YY million. According to the National Venture Capital Association (NVCA), $133 billion were invested into startups last year. Yet, it pales in comparison to the capital that’s traded in the public markets.

VC funds see thousands of startup pitches a year. Per partner (most funds 2–3 partners), they each invest in 3–5 per year (aka about once per quarter). Meaning >99% of startups that a single VC sees are not getting funded by them. That doesn’t mean 99% never get funded, but it’s just to illustrate that proportionally, capital isn’t being spent willy-nilly.

If we look at it from a macro-economic perspective, if we are reaching saturation in the startup market, we should be getting closer to perfect competition. And in a perfectly competitive market, profit margins are zero. The thing is profits aren’t nearing zero in the startup/venture capital market. In fact, though the median fund isn’t returning much on invested capital. A good fund is returning 3–5x. A great one >5x. And well, if you were in Chris Sacca’s first fund, which included Uber, Twitter, and more, 250x MOIC. That’s $250 returned on every $1 invested.

If it doesn’t make sense to me, it’s not a good idea.

Finding Product-Market Fit and “Idea-Market Fit”

Revolutionary ideas aren’t meant to conform. If an idea is truly ground-breaking, people have yet to be conditioned to think that a startup idea is great or not. As Andy Rachleff, co-founder of Wealthfront and Benchmark Capital, puts it: “you want to be right on the non-consensus.” Think Uber and Airbnb in 2008. If you asked me to jump in a stranger’s car to go somewhere then, I would have thought you were crazy. Same with living in a stranger’s home. I write more about being right on the non-consensus here and in this blog post.

Frankly, you may not be the target market. You’re not the customer that startup is serving. The constant reminder we, on the venture capital side of the table, have is to stop thinking that we are the core user for a product. Most products are not made for us. Equally, when a founder comes to us pre-traction and asks us “Is this a good idea?”, most of the time I don’t know. The numbers (will) prove if it’s a good idea or not. Unless I am their target audience, I don’t have a lot to weigh in on. I can only check, from least important to most important:

  1. How big is the market + growth rate
  2. Does the founder(s) have a unique insight into the industry that all the other players are overlooking or underestimating or don’t know at all? And will this insight keep incumbents at bay at least until this startup reaches product-market fit?
  3. How obsessed about the problem space is the founder/team, which is a proxy for grit and resilience in the longer run? And obsession is an early sign of (1) their current level of domain expertise/navigating the “idea maze”, and (2) and their potential to gain more expertise. If we take the equation for a line, y = mx + b. As early-stage investors, we invest in “m’s” not “b’s”.

In closing

While I know not everyone echoes these thoughts, hopefully, this post can provide more context to some of the entrepreneurial motions we’re seeing today. Of course, take it all with a grain of salt. I’m an optimist by nature and by function of my job. Just as a VC I respect told me when I first started 4 years back,

“If you’re going to pursue a career in venture, by nature of the job, you have to be an optimist.”

Happened to also be one of the VCs who shared his thoughts for my little research project on inspiration and frustration last week.

Photo by K. Mitch Hodge on Unsplash

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#unfiltered #30 Inspiration and Frustration – The Honest Answers From Some of the Most Resilient People Going through a World of Uncertainty

A few weeks ago, around the time I published Am I At My Best Right Now?, I started noticing more and more that my friends, colleagues, and people that I’ve met since were going through tough times. Two lost a family member. Some were laid off. Two were forced to leave this land I call home. Four broke up. Three burned out. Countless more told me they were stressed and/or depressed, and didn’t know how to escape this limbo. After I published that post, another handful of people also reached out and courageously shared the troubles they are going through now. How it’s been so hard to share with others. And yesterday, while editing this blog post, I found out that one of my high school friends had passed.

Inspiration and Frustration

During this time, I had a thought: Frustration is the absence of inspiration. There were many times in my own life when I was beating myself up because I couldn’t think of a solution. And a small percent of those times, I didn’t even bother to think of a solution since I was so engrossed in my frustration with myself.

In these unprecedented times and inspired by the conversations around me, I decided to show that we’re not alone. So, I asked people who I deeply respect and who could shed light as to what it means to be human. I asked just two questions, but they were only allowed to answer one of them:

  1. What is the one thing that inspires you so much that it makes everything else in life much easier to bear?
  2. What is stressing/frustrating you so much right now that it seems to invalidate everything else you’re doing?

In turn, they responded via email, text, or on a phone call. Of the 49 I asked, so far, 31 responded with their answers. 4 politely turned me down due to their busy schedules. Another one turned me down because she didn’t feel like she could offer value in her answer.

26 responded with what inspires them. 5 with what frustrates them. All of whom I know has been through adversity and back.

Admittedly, the hardest part about this study was how I was going to organize all these responses. Unlike the one about time allocation I did over a month ago, where I knew exactly how to organize the data before I even got all the responses, this one, I really didn’t know how to best illustrate the candor everyone shared. In fact, I would be doing a disservice to them, if reduced their honesty and courage to be vulnerable to mere numbers. So, in the end, below, I let everyone speak for themselves. Sometimes, simplicity is the best.

Thank you to everyone who contributed to making this blog post happen, including Brad Feld, Mars Aguirre, Shayan Mehdi, Thomas Owen, Chris Lyons, Mark Leon, Jamarr Lampart, Christen Nino De Guzman, Louis Q Tran, Sam Marelich, Dr. Kris Marsh, Quincy Huynh, DJ Welch, Jimmy Yue, and many, many more heroes who helped me and the world around us behind the curtains.

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The Biases Entrepreneurs can Carry

backlit beach clouds dark

Last week, I started building a Quora presence. Admittedly, I’ve been a long-time lurker, and only recent answer-er on the platform. Partly to practice sharing thoughts. Partly to answer more specific queries. And partly to have fun. Yes, fun.

It just so happened that I came across a curious question then.

As an entrepreneur, have you found that the cognitive biases (i.e., systematic deviations from rationality that affect human decision-making) described in this article affect the decisions you make for your business?

The question cited this article. And the article itself detailed on 3 of the many cognitive biases entrepreneurs (well, people in general) come across.

  • Confirmation bias – anything we see or hear that supports our own beliefs reinforces our beliefs, whereas the opposite sparks disagreement
  • Sunk cost fallacy – our tendency to continue to hold onto hope for bad investments
  • And, overconfidence – overestimating yourself and underestimating everyone else.

My answer

Simply, yes.

In fact, not just entrepreneurs, but most people are affected by the mentioned cognitive biases – confirmation bias, sunk cost fallacy/loss aversion, and overconfidence. It’s just that many people aren’t aware they have them, which can be detrimental to business, relationships, mental health, and more. I think the article even ranks the 3 from least noticeable to most noticeable from a self-assessment point of view. I’ll give an example of each – all of which I’ve seen before:

Confirmation bias – Stanford engineers are smart. → I will continue hiring Stanford engineers. The flip side is that you’ll be looking less into other populations of engineers who could also be amazing, like folks who are underrepresented and underestimated. Therefore, creating this self-perpetuating loop.

Sunk cost fallacy – I’ve hired this VP Sales that came highly recommended from multiple sources. But over the course of 6 months, I realized that this VP (1) couldn’t meet, much less beat, quota each quarter, and (2) has been unable to hire other great candidates to fulfill quota each quarter. But she will change. She’ll get better. She’ll grow into the role. While it’s okay to hire for passion, make sure candidates have at least a baseline of skills required for the role. And in a VP hire, a good proportion of the job description is hiring. The sunk cost here is the VP hire. While I don’t have to fire her, unless she’s really not doing her job at all, I need to find someone to top her who can perform in the role as fast as possible.

Overconfidence – My product is amazing; all of our competitors’ products suck. I’ve seen this way too often when founders pitch their startup. And while it’s great to be confident in your own product/team/yourself, it should never eclipse your perspective to value the work and commitment and results of others. A question I love asking founders who say “my product is amazing, everyone else is bad” is: What are your competitors doing right? If you were them, what would you say about your own product?

In closing

While these 3 are only a few among the myriad that plague our cognition (i.e. left digit bias, hindsight bias, anchoring bias, fundamental attribution error, etc.), hopefully, this post will shed a little light into the world of our own psychology. Sometimes before we can fix something, we have to first be aware of it.

Photo by Pixabay on Pexels.com

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A Startup Hiring Philosophy

There’s a saying in venture that: “A-players hire A-players; B-players hire C-players.” Your ability to grow a business is often closely correlated with your ability to attract and acquire talent. But what does it mean to attract and hire world-class talent? Especially for functions you, as a founder, yourself may not be an expert in.

“A-players hire A-players;
B-players hire C-players.”

How does a first-time founder how to vet a seasoned sales executive? Or on the flip side, how does a non-technical founder learn to differentiate a good AI engineer from a great AI engineer?

While even the best founders, leaders, and managers make hiring mistakes, hopefully this post can act as a reference point as to what to look for. And while I have yet to master the craft, I’ll borrow 5 lessons from some of the best that has served as a guiding principle for me and for some of the founders I’ve worked with.

5 Lessons from 4 of the Greatest

  1. Hire passion; train skill.
  2. Desire/obsession > passion.
    • And, the ephemeral nature of passion.
  3. Hire VPs who can hire.
  4. Attract and hire intentionally.
    • On building trust.
    • On scaling yourself.
  5. To hire your best complements, ask people in your network 2 questions.
    • Who to ask? And what’s next?
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#unfiltered #27 The Impetus of My Social Experiments – Higher Research and the Application to Startups

bunny, egg, curiosity, curious, social experiments

People seem to love origin stories – both in theatre and in life.

“How did it all start?”

“How did you get into this career?”

Or…

“How did you meet your wife/husband?”

And well, I can’t say I’m one to push back on that.

There’s something truly magical about “Once upon a time…”. And I’m no stranger to fairy tales. Growing up, I was largely influenced by older female cousins and family friends. As soon as our parents left to their wine-sipping adult gossip around a table of blackjack, my cousins and older female friends would drag us to watch their favorite Disney movies on the VCR, namely princess movies. I’m not exaggerating when I say I’ve seen Beauty and the Beast more than 100 times or Cinderella more than 50 times. In fact, my friends in elementary school would talk about their favorite movies – Transformers, LEGO Bionicles, Peter Pan, and Tarzan. Yet, mine was Disney’s 1998 Mulan.

And they all started with “Once upon a time…”

So, it was no surprise when friends, colleagues, and then strangers started asking me:

“How/when/why did you start hosting social experiments?”

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#unfiltered #25 Meeting the Curiously Passionate and the Passionately Curious – The Why and The Where

travel, meeting people, rabbi sacks

“It’s the people not like us who make us grow.”

– Rabbi Lord Jonathan Sacks on The Tim Ferriss Show Ep. #455

I recently tuned into, at the time of writing this post, Tim Ferriss’ third most recent podcast episode, interviewing Rabbi Sacks. Although I’m a regular listener to the show, I wasn’t expecting much. I neither have a history of being religious nor spiritual – merely peripheral curiosity. Yet, I don’t hesitate for one second to say: It is, by far, one of the most insightful and enlightening podcast episodes I’ve heard in 2020. So, if you have a spare 1.5 hours, I highly recommend it, especially if you’re looking for a perspective shift on:

  • Leadership,
  • Seeking peer approval,
  • What a single cold “call”/visit could get you,
  • And the need for “cultural climate change” in the understanding between the balance of “I” and “we”.

And Rabbi Sacks masterfully weaves these concepts together. While my reaction will never do his insights justice, two other thoughts, each paired with their own story, I had to double click on:

“Good leaders create followers, great leaders create leaders.”

“What happens when you’re in a situation in which you have done something that has generated widespread disapproval? How do you deal with that?

“Win the respect of the people you respect.”

And I digress.

The Bubble

I’ve lived my entire life so far in the Bay Area, barring a few vacations and excursions here and there. I was born here. I went through 12 years of grade school here. 13 if you count kindergarten. And though I had the option of leaving the Bay for college, I ended up choosing a school here as well. Truth be told, I might as well have “Made in the Bay” stamped on my forehead.

I live in a bubble. But I know I breathe in one. Not just geographically, but educationally, racially, sexually, socioeconomically, and so on.

Being a shy introvert pre-adulthood didn’t help with broadening my perspective on life either. I still remember the days in high school when I dreaded the teacher calling on me. Clammy palms, cold sweat, rigid spine. I would never vocally question disagreement. Equally, I would rather be a people pleaser than cause what I deemed to be unnecessary friction. I was a seafood hors d’ouevres of perturbation.

So, by inspiration from a mentor, I took actionable steps to conquer my own demons. Meet one new person you’re extremely excited to meet every single week for a year.

While I still carry the artifacts of myself yesterday, learning to balance myself between the person I thought and think I needed to become and the person I was, I began my journey 6 years ago.

The Pop in the Bubble

I’d be fronting if I said I wasn’t scared shitless when I began. Though I don’t think everyone in the world has this dilemma, I’m confident I am not alone. I had and have all these scenarios playing in my head. A bunch of ‘what-ifs’. What if they think I’m too nosy? What if they don’t have time to respond? Or what if they hate me for bothering them?

They say it gets better over time. And they’re not wrong. But I still have that lingering, gnawing feeling whenever I click send or put myself out there. While, over the years, the fears never fully dissipated, I’ve learned to tango with discomfort. In the words of my mentor who inspired my journey:

“You’re never as good as they say you are, but you’re also not as bad as they say you are. And hell, you can’t even be bad if they don’t even know who you are.”

… which I believe he drew inspiration from Lou Holtz. Shortly after, I clicked the “Send” button at the bottom of my first ‘curiosity’ email. After all, like he said, what’s the worst that can happen? Getting ignored. And as such, I would be no better nor worse off than I was and am in that cross section in time. With that assurance, it eventually led me to find my cold email “template” and hosting social experiments, like Brunches with Strangers.

The Where

Over the past few weeks, a few new people asked me: “Where do you find these people to reach out to?” Although it’s not the first and I assume certainly not the last, I thought I’d share in the form of this post as a possible inspiration for how we can grow, if I were to paraphrase Rabbi Sacks.

While I don’t characterize myself as a voracious reader, I allot time every day and have found many of my Senseis in the form of literature and discourse – online and offline, printed and taped, and in-person and remote. Including:

  • Books
  • Online articles/press releases
  • Newsletters
  • YouTube videos
  • Movies
  • Podcasts
  • Webinars/fireside chats
  • Textbooks
  • And, other people

One level deeper

To look beyond my own horizon, I tune into Pocket‘s Discover tab, or a platform I’ve recently fallen in love with, Readocracy. You can check out what online reading I’ve been up to lately on my Readocracy profile. And I can’t wait, when I can start tracking the books I read and the podcasts I listen to on there. I’m also fortunate enough to have friends who read, write, listen, and socialize with different social and professional circles than I do and am in. And as I meet more people, the spectrum of topics and interests snowball upon each other, as we help each other see new perspectives – some of which we never thought were possible.

Admittedly, where I find who to reach out to is, by no means, special or esoteric. In topics, I look into ones I’m genuinely interested in, in that moment and predictably beyond, even if it’s only a month or two, as promiscuous as I might be for many. In my short phases of promiscuity, I nevertheless take deep dives. Deep, yet often, not long. At the same time, I have a small handful of evergreen interests, like:

  • The art and science of building relationships,
  • The art of creating irreplaceable memories,
  • Psychology and mental models,
  • Swimming and intense athleticism,
  • Art as a multi-faceted definition,
  • Startups,
  • Technology and what lies at its frontier,
  • The final frontier – outer space and its cosmological inhabitants,
  • And the future.

In people, I look for two things:

  1. Inflection points in their life. Oxymorons/ironies. Overt and covert contradictions.
    • If I were to make assumptions given their initial attributes (i.e. education, age, gender, geography, career, life choices/circumstances, etc.), would I have been able to predict where they are now?
    • Of course, in making these assumptions, it is also my responsibility to be aware and to tread carefully where I should. Unfortunately, ignorance is not an excuse. If I’m unsure, I err on the side of caution.
  2. Deep intellectual curiosity and passion. Whom I call the passionately curious and the curiously passionate.

In closing

While I’m prone to talking too much at times, during these moments, it is my duty and the highest form of respect I can offer, to listen. If I were to take it from a selfish note, I learn so much more when I listen. And in actively listening, and actively checking my biases, to respond with thoughtful questions.

So, I’ll close on more thing Rabbi Sacks said in his recent interview with Tim Ferriss:

“Safe space means that courteous discipline of respectful listening.”

Photo by Mantas Hesthaven on Unsplash

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On Scale – Lessons on Culture, Hiring, Operating, and Growth

flower, scale

One of my favorite thought exercises to do when I meet with founders who have reached the A- and B-stages (or beyond) is:

“What will his/her company look like if he/she is no longer there?”

The Preface

While the question looks like one that’s designed to replace the founder(s), my intention is everything but that. Rather, I ask myself that because I want to put perspective as to how the founder(s) have empowered their team to do more than they could independently. Where the collective whole is greater than the sum of its parts. Have the founders built something that is greater than themselves? And is each team member self-motivated to pursue the mission and vision?

It reminds me of the story of a NASA janitor’s reply when President Kennedy asked: “Hi, I’m Jack Kennedy. What are you doing?”

“Well, Mr. President,” the janitor responded, “I’m helping put a man on the moon.”

From the astronaut who was to go into space to the janitor cleaning the halls of NASAs space center, each and every one had the same fulfilling purpose that they were doing something greater than themselves.

And if the CEO is able to do that, their potential to inspire even more and build a greater company is in sight. Can he/she scale him/herself? And in doing so, scale the company past product-market fit (PMF)?

For the purpose of this post, I’ll take scale from a culture, hiring, operating, and product perspective, though there are much more than just the above when it comes to scale. Answering the questions, as a founder:

  • How do you expand your audience?
  • How do you build a team to do so?
  • And, how do you scale yourself?

And to do so, I’ll borrow the insights of 10 people who have more miles on their odometer than I do.

While many of these lessons are applicable even in the later stages of growth, I want to preface that these insights are largely for founders just starting to scale. When you’ve just gone from zero to one, and are now beginning to look towards infinity.

The TL;DR

  1. Build a (controversial) shocking culture.
  2. Hire intentionally.
  3. Retaining talent requires trust.
  4. Build and follow an operating philosophy.
    • Create, hold, and share excitement.
    • Align calendars.
  5. Upgrade adjacent users as your next beachhead.
  6. Capture adoption by changing only 1 variable per user segment.
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