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How Fictional Worldbuilding Applies to Building Startup Narratives

startup narratives, trees, forest, fantasy, science fiction, worldbuilding

Last week I spent some time with my friend, who joined me in my recent social experiment, brainstorming and iterating on feedback. Specifically, how I could host better transitions between presentations. She left me with one final resonating note. “Maybe you would’ve liked a creative writing class.”

I’ve never taken any creative writing courses. I thought those courses were designed for aspiring writers. And given my career track, I never gave it a second thought. Well, until now. I recently finished a brilliant fictional masterpiece, Mistborn: The Final Empire written by #1 New York Times bestselling author, Brandon Sanderson. So, that’s where I began my creative journey.

In my homework, I came across his YouTube channel. One of his lectures for his 2020 BYU writing students particularly stood out. In it, he shares his very own Sanderson’s Laws.

The three laws that govern his scope of worldbuilding are as follows:

  1. Your ability to solve problems with magic in a satisfying way is directly proportional to how well the reader understands said magic.
  2. Flaws/limitations are more interesting than powers.
  3. Before adding something new to your magic (setting), see if you can instead expand what you have.

Outside of his own books, Sanderson goes in much more depth, citing examples from Lord of the Rings, Star Wars, and more. So, if you have the time, I highly recommend taking one and one-fifth of an hour to hear his free class. Or if you’re more of a reader, he shares his thesis on his First Law, Second Law, and Third Law on his website.

But for the purpose of this post, the short form of the 3 laws suffices.

The First Law

Your ability to solve problems with magic in a satisfying way is directly proportional to how well the reader understands said magic.

The same is true in the world of entrepreneurship. Your ability to successfully fundraise is directly proportional to how well the investor understands your venture. Or more aptly put, how well you can explain the problem you are trying to solve. This is especially true for the 2 ends of the spectrum: deep tech/frontier tech startups and low-tech, or robust anti-fragile products/business models. Often times, the defensibility of your product comes down to how well people can understand what pain points you’re trying to solve. You may have the best product on the market, but if no one understands why it exists, it’s effectively non-existent.

Though not every investor will agree with me on this, I believe that too many founders jump straight into their product/solution at the beginning of their pitch deck. While it is important for a founder to concisely explain their product, I’m way more fascinated with the problem in the market and ‘why now?’.

You’re telling a story in your pitch. And before you jump into the plot (the product itself), I’d love to learn more about the setting and the characters involved (the underlying assumptions and trends, as well as the team behind the product). As my own NTY investment thesis goes (why Now, why This, why You, although not in that particular order), I’m particularly fascinated about the ‘why now’ and ‘why you’ before the ‘why this’. And if I can’t understand that, then it’s a NTY – or in millennial texting terms, no thank you.

My favorite proxy is if you can explain your product well to either a 7-year old, or someone who knows close to nothing about your industry. Brownie points if they’re excited about it too after your pitch. How contagious is your obsession?

The Second Law

Flaws/limitations are more interesting than powers.

Investors invest in superheroes. The underdogs. The gems still in the rough. And especially now, at the advent of another recession and the COVID crisis, the question is:

  1. How much can you do with what little you have?
  2. And, can you make the aggressive decisions to do so?

I realize that this is no easy ask of entrepreneurs. But when you’re strapped for cash, talent, solid pipelines, are you a hustler or are you not? Can you sell your business regardless? To investors? New team members? Clients/paying users?

On the flip side, sometimes you know what you need to do, but just don’t have the conviction to do so, especially for aggressive decisions. You may not want to lay off your passionate team members. Or, let go of that really great deal of a lease you got last year. You may not want to cut the budget in half. But you need to. If you need to extend what little you have to another 12-18 months, you’ve got to read why you should cut now and not later. Whether we like it or not, we’re heading into some rough patches. So brace yourselves.

But as an investor once said to me:

“Companies are built in the downturns; returns are realized in the upturns.”

The Third Law

Before adding something new to your magic (setting), see if you can instead expand what you have.

And finally consider:

  • Can you reach profitability with what you have without taking additional injections of capital?
  • Can you extend your runway by cutting your budget now?
  • But if you need capital to continue, do you need venture capital funding? I’m of the belief, that 90% of businesses out there aren’t fit for the aggressive venture capital model.

How scrappy are you? How creatively can you find solutions to your most pressing problems? And maybe in that pressure, you may find something that the market has never seen before.

In closing

Like a captivating fantastical story, your startup, your team, your investors, and especially you yourself, need that compelling narrative. The hardest moments in building a business is when there’s no hope in sight – when you’re on the third leg of the race. In times of trial, you need to convince yourself, before you can convince others. To all founders out there, godspeed!

And as Sanderson’s Zeroth Law goes:

Always err on the side of what’s awesome.

If you’re interested in the world of creative writing or drawing parallels where I could not, check out Brandon Sanderson’s completely (and surprisingly) free series of lectures on his YouTube channel.

Photo by Casey Horner on Unsplash

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#unfiltered #11 What I Learned About Building Communities through Social Experiments – Touching Jellyfish, Types of Social Experiments, The Thesis, Psychological Safety and Fairness

jellyfish, social experiment, psychological safety, how to build a community
Are these jellyfish friendly or not? Will they “bite”?

As colorful and as beautiful jellyfish are, we are still scared of the possible danger that each possess. So, most of us only admire them from afar. And for many of us who have seen some, we’ve watched them float gracefully in dark blue aqueous solutions across a sometimes distorted film of glass. These beautiful mysteries of the deep blue.

To Touch the Jellyfish

Much like my fascination every time my parents brought me to the aquarium as a kid, I’ve been fascinated with the people around me. Especially about the thin, sometimes distorted, film between these exceptionally fascinating souls and me. The distortion created as a function of society’s, as well as their own, efforts.

Exactly a year and two months ago, I embarked on a journey to host small-scale social experiments, like:

  • Hidden Questions. A game where no one else knows the question, except for the person answering it. And where the person answering has the choice of sharing the question that inspired the answer or taking it to the grave by taking a shot of hot sauce (about a 700,000 on the Scoville scale, for reference) or a variable number of Beanboozled beans.
  • Brunches with Strangers. Quite literally, Saturday brunches with strangers. Hosting a cast of people from all walks of life. Like founders, street artists, astrophysicists, concept artists, athletes, criminal investigators, filmmakers, college drop-outs, and much more.
  • The Curious Case of Aliases. Where players (strangers to each other) under aliases guess each other’s hobbies, occupations, deepest fears, etc. after only playing in a 30-minute game session. For instance, skribbl.io. Cards Against Humanity. Codenames. And Mafia.
  • And, the most recent addition to my small Rolodex of social experiments, Improv Presentations. A TED talk-like night where people present someone else’s creatively esoteric slide decks, with no context as to what’s in the deck until they’re on “stage”. To the postmortem dismay of my cheeks and core, we saw everything from how to survive a cat-pocalypse to how to master the art of DM’ing using military tactics to how to be a good plant parent.

The Thesis, The Questions

As COVID would have it, the lack of in-person interaction and self-quarantine inspired the last two. Yet, all of which with the same thesis: helping make the world feel a little smaller, a little closer, and a whole lot more interesting. Starting not with the people who bathe in the limelight, but with the people directly around me.

Why is it so hard to be candid with strangers? And sometimes, even harder with family and friends?

Do we need alcohol, drugs, crazy incidents, violence, a lack of sleep, or stress to truly be ourselves?

Though not all-encompassing, people seem to be naturally curious about things, events, status, money, and gossip. Why aren’t people more curious about people – well, as just themselves? Like me, you’ve probably posed and have gotten the question: “How are you?” or “How are you doing?”. And likely, with more times than one is willing to admit, we didn’t really care about what the answer might be. Often times, since we know we’re just going to get a “Good” or “OK” in response.

If you want to have some fun, I highly recommend the next time someone asks you that, say “Terrible”. And watch the computer chip in their brain malfunction for a quick second.

What did I learn?

I won’t claim I found the universal truth or a holistic answer to any of those questions I posed above. Because I haven’t. After all, someone I really respect once told me:

“50% of what you know is true. 50% is false. The problem is you don’t know which half is which.”

So, in my life, my goals are two-fold:

  1. Build a system to help me discern my two halves of knowledge.
  2. Expand the total capacity of what I know.

I will share more on this blog as I am able to draw more lines of regression myself.

But in the context of this post, through social experiments, I’ve discovered that people yearn for psychological safety. Not only does Google’s Project Aristotle share its effectiveness in the workplace, it’s equally, if not more true, outside of it as well. The reason that it’s sometimes easier to share your thoughts and struggles with strangers is that strangers often won’t judge you to the same extent as friends and family do. Frankly, they don’t have much context to judge you from – implicitly and explicitly.

People want fairness. Not in the sense of you get 1 cookie, so I should get 1 too. But a fair system to be judged by. That I will get the same benefit of doubt as you will give to anyone and everyone else. When we all get drunk together, we will all be drunk and we will all relieve ourselves of any filters we may previously have. And though everyone’s drunk personality is different, and frankly everyone will still be judged… For that moment, that night, everyone’s on the same playing field.

The Applications

Let’s take most recent experiment with improv presentations as an example. The initial idea was that everyone should present their own slide decks. As serious or as silly as they might be. But some of my friends were hesitant. In their words, they felt they needed to “impress” or “have better public speaking skills”. Some simply said that they didn’t think they’d “be as good as others”.

Before our first “TED Talks@Home”, I shifted it altogether where we’d all be presenting each other’s presentation. All of us would have no context as to what we’re presenting until we get on “stage”. Whether we were experts on a specific topic or in comedy or deck-making, we’re all jumping into a bottomless pool together. After our second virtual improv night, this past weekend, between muted giggles and visual laughs, one of the presenters told me that it wasn’t as bad as she thought it would be, and that she’d want to do it again.

Luckily, it seems more than 60% of my friends, colleagues, and acquaintances come back to participate in more brunches or game sessions or improv nights. 1 in 4 guests have proactively started friendships outside of the experiments. And about 5% have introduced their new friends to their friend circles. A small handful have also been inspired to start their own. So, maybe I’m doing something right.

Building Communities

The same (psychological safety and fair system) holds true for building communities, creating your corporate culture, and finding and keeping your friend group and your significant other. Although in the context of building communities, but applicable elsewhere as well, I forget who told me this once:

“A strong community has both value and values.”

– The person who told me this, please come claim this quote

Value is why people initially come out to join a community and admittedly, reach out to be a friend. Whether it’s because of who you know or what you can offer or how you can help them pass the time, it’s the truth. Values are why they stay. And safety happens to be one of those values.

In closing

As always, my findings aren’t meant to be prescriptive. But merely act as a guide – another tool in your toolkit – so that you are better equipped for future endeavors.

Like with people, when one day I get to touch a jellyfish, I don’t care about being stung. But I do want to know where I can touch where I won’t be stung. And subsequently, where I will touch where I know I will be stung. The difference between going in blind and not is that when I get stung, I am prepared to be.

Photo by Mathilda Khoo on Unsplash

#unfiltered is a series where I share my raw thoughts and unfiltered commentary about anything and everything. It’s not designed to go down smoothly like the best cup of cappuccino you’ve ever had (although here‘s where I found mine), more like the lonely coffee bean still struggling to find its identity (which also may one day find its way into a more thesis-driven blogpost). Who knows? The possibilities are endless.

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Two Ways Investors Measure Founder Coachability

As much as investors love founders with passion (or obsession) and grit, they also want to invest in founders who have the capacity to grow as individuals as much as their startup grows. And that boils down to how curious and open-minded they are. In other words, how coachable are they? In the past 2 weeks, I’ve had the fortuity to talk to 2 brilliant angel investors – each with their own respective formula for measuring founder coachability.

Formula #1: Assessing Peer Coachability

Last year, I shared a post about the importance of all three levels of mentorship – peer, tactical, and veteran. With the most underappreciated one being peer mentorship. For the sake of this post, let’s call the first angel, Marie. Similarly, Marie finds that peer coachability acts as a useful proxy for founder coachability. And she approaches peer coachability in a very unique way:

What do you and you co-founder(s) fundamentally disagree on?

Following that question, usually 1 of 3 scenarios ensue:

  1. The co-founders can state what they disagree on. And by follow-up question, share how they resolved that disagreement, then how that applies to their framework for resolving future disagreements.
  2. They figure it out on the spot. Better sooner than later.
  3. They say, “Nothing.” And quite possibly, the worst answer they could provide. ‘Cause that means they just don’t understand each other well enough. It’s highly unlikely that given how complex human beings are, that there can be two ambitious individuals who have the exact same outlook on life. Even twins have variations in their perspectives.

Knowing what co-founders disagree on assesses not only how well founders know each other, but also, how they’ve learned from each point of friction. Whether intentionally or not, they become each other’s coaches and push each other forward.

Formula #2: Assessing VC-Founder Coachability

Jerry, on the other hand, tests the waters by offering a controversial opinion about building a business or an insight into the industry, but one he has conviction and experience in. Then, he waits to see how the founder responds. The founder(s) can either:

  1. Disagree, and subsequently walk through where the dissent starts and offer a sequence of data and analyses as to why he/she believes in such a way.
  2. Agree, but still offer how he/she reached the same conclusion.

In either case, Jerry is looking for how mentally acute a founder is and how much room for discussion there is between them. On the other hand, the strike-outs regress to 2 categories:

  1. Disagree, and spend time trying to convince Jerry why he is wrong, rather than working to persuade Jerry to possibly see a bigger picture he might not have considered before. And sometimes, this bigger scope includes a marriage of Jerry and the founder(s) insights.
  2. Agree or disagree, but unfortunately, is unable to substantially back up their claim. Becoming a yes-man/woman in the former, or an argumentative troll in the latter.

The Mentorship Parallel

Unsurprisingly, just like how VCs use these methods to assess founder coachability, I’ve seen mentors use similar methods to assess potential mentees. Many aspiring mentees seek mentorship for its namesake – that metaphoric badge of honor. Not too far from the apple tree when people start a business or come to Silicon Valley to be called a CEO or for their company to be ‘venture-backed’. A category of folks we designate as “wantrapreneurs”.

And unfortunately, many aspiring mentees find bragging rights to be the mentee of [insert accomplished individual’s name]. Yet they don’t actually mean to learn anything meaningful, much less accept constructive criticism. Realistically, no mentor wants to go through that mess. “If you want for my advice, you better take it seriously,” as my first mentor once told me.

In closing

A great VC’s goal is to be the best dollar on your cap table, but they can’t be that Washington if you don’t let them be one. And though it doesn’t call for your investors or board members to micromanage, it does mean you are expected to be candid in both receiving and using (or not using) feedback.

Photo by Xuan Nguyen on Unsplash

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A Telltale Sign for a “VC No”

telltale sign, conviction, leap of faith, how to find a lead investor

Three moons ago, I jumped on a call with a founder who was in the throes of fundraising and had half of his round “committed”. And yes, he used air quotes. So, as any natural inquisitive, I got curious as to what he meant by “committed”. Turns out, he could only get those term sheets if he either found a lead or could raise the other half successfully first. Unfortunately, he’s not the only one out there. These kinds of conversations with investors have been the case, even before COVID. But it’s become more prevalent as many investors are more cautious with their cash. And frankly, a way of de-risking yourself is to not take the risk until someone else does.

I will say there are many funds out there where as part of the fund’s thesis, they just don’t lead rounds. But your first partner… you want them to have conviction.

Just like, no diet is going to stop me from having my mint chocolate chip with Girl Scout Thin Mints, served on a sugar cone. I’m salivating just thinking about it, as the heat wave is about to hit the Bay. An investor who has conviction will not let smaller discrepancies, including, but not limited to:

  • Crowded cap table,
  • No CTO,
  • College/high school dropout,
  • Lower than expected MRR or ARR,
  • No ex-[insert big tech company] team members,
  • Or, no senior/experienced team members,

… stop them from opening their checkbook. And just like I’ll find ways to hedge my diet outlier, through exercise or eating more veggies, an investor will find ways to hedge their bets, through their network (hiring, advisors, co-investors, downstream investors), resources, and experience.

So, what is that telltale sign of a lack of conviction?

I will preface by first saying, that the more you put yourself in front of investors, the more you’ll be able to develop an intuition of who’s likely to be onboard and who’s likely not to. For example, taking longer than 24 hours to respond to your thank you/next steps email after that pitch meeting. Or, on the other end, calling someone “you have to meet” mid-meeting and putting you on the line.

It seems obvious in retrospect, but once upon a time, when I was fundraising, I just didn’t let myself believe it was true. That investors just won’t have conviction when they ask:

Who else is interested?

A close cousin includes “Who else have you talked to?” (And what did they say?). If their decision is contingent – either consciously or subconsciously – with benchmarking their decision on who else is going to participate (or lead), you’re not talking to a lead (investor). And that initial hesitation, if allowed manifest further, won’t do you much good in the longer run, especially when things get bumpy for the company. Robert De Niro once said, in the 1998 Ronin film,

“Whenever there is any doubt, there is no doubt.”

You want investors who have conviction in your business – in you. Who’ll believe in you through thick and thin. After all, it’s a long-term marriage. Admittedly, it takes time and diligence to understand what kind of investor they are.

In closing

Like all matters, there are always other confounding and hidden variables. And though no “sign” is your silver bullet for understanding an investor’s conviction. Hopefully, this is another tool you can use from your multi-faceted toolkit.

From spending time with some of the smartest folks on both sides of the table and from personal observations, even if it’s anecdotal, the sample size should be significant enough to put weight behind the hypothesis. And, if I ever find myself wanting to ask that question, I aim to be candid, and tell founders that I’m not interested.

Photo by Manuel Meurisse on Unsplash

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#unfiltered #10 Idea Journals – How to Start, Prompts that Stretch your Parameters, The “Right” Setting, Embracing Imperfection

idea-journaling, sunrise, sunset

Three weeks ago, in the prelude to this post, I mentioned the art of ideating and how I personally pursue the expansion of my creative horizons. Though I have or had other systems in place (i.e. whiteboard in the shower, pen in pocket everywhere I go, meditation), idea-journaling has been, by far, the most impactful in stretching my creative muscle.

When you start:

  • Dedicate your time to doing it daily, with no cheat days. Set aside ten minutes each day to do so.
  • Invest in a journal you love. Don’t skimp. I fell in love with the Moleskine sketchbook at first sight. Though I have graduated to the Leuchtturm1917 sketchbook now. For me, investing in a higher end journal made me more inclined to journal daily – not wanting my Hamiltons go to waste.
  • Don’t worry about completeness or complexity. A journal entry can be 1 sentence or 5 pages or even a drawing. Regardless, dedicate a minimum of 1 page to each entry, even if you only fill it in with 1 sentence.

Explore different mediums of thought. Here are some of the prompts I started with:

  • Write a short story.
  • Draw a picture.
  • Design a logo.
  • Compose a tune.
  • Jot down a recipe you think could work. And after, how would you plate this dish?
  • Create a new language.
  • Write a poem in that new language (or language that’s not your native tongue).
  • What stood out to you today?
  • Write out a conversation you would have with your role model, a celebrity, your boss, your friend. Or even what your follow-up conversation would look like with someone you talked to today?
  • How would you resolve a problem that’s plaguing you now?
  • If you could change or add one fundamental universal law, what would you change and why?
  • And, if you’re still stuck without a prompt, what should be the question or prompt you ideate with today?

Why? By exploring different avenues of creative output, you give your mind more degrees of freedom to think. Expand your parameters. That’s why multi-linguists are able to host such a vast vernacular bandwidth.

The Setting

Just like the process of idea-journaling, the setting in which you do so is equally as important. Why? You ideate best in a positive or neutral environment, when you won’t tie down emotions and biases to the environment you’re journaling in. Find your sweet spot, and make it a routine. When and where do you find yourself to be the most relaxed and/or the most creative?

For me, although I don’t shy away from ideating throughout the day, I find my mind the most expansive: (1) right after I work out, and (2) right after a good hot shower. And though rare, if the above two don’t work, I take at least a 20-minute walk, tuning into either a podcast episode I’ve heard before or a non-lyrical playlist.

Once I find peace in the preamble of my ideation “ritual”, then I settle down in a place where I feel comfortable and at home. Before the crisis, my go-to spot in the city was Sightglass Coffee on 7th. Now it’s in my backyard garden. With good lighting and a cup of chamomile or green tea.

Embracing Imperfection

My idea journals are a sanctuary for me to be imperfect. And arguably, its is where I found myself to be the most courageous. I didn’t have to cower in fear of judgment and biases from other eyes. And I can be unapologetically myself. Over the past 2 years, I’ve been lucky for that same courage to have bled outside of the book-bound acid-free pages.

If I can quote a line from the prologue of Bob Iger‘s brilliantly wicked book, The Ride of a Lifetime…

“True innovation occurs only when people have courage[…] Fear of failure destroys creativity.”

Give yourself room to fail. You’re not going to like every single one of your ideas. In fact, if you’re like me, you might end up hating 4 out of 5 ideas you have when you first start off. But keep at it. Make it a habit. And one day, you’ll notice the distribution of good-to-bad ideas shift in your favor.

If you’re anything like me, when I get stuck, take some time to look up at the jewel-studded indigo canopy above. As your mind hops between one twinkle to the next, you might pick something up in the traversal.

As you make it a habit…

Although an unintentional upside when I embarked on this journey, the endeavor is truly meditative, perpetuating a positive feedback loop of euphoria. And over time, you’ll find yourself concepting more robust and intricate ideas. Hopefully, unbounded by your situational constraints. The sky’s the limit!

Photo by Leon Biss on Unsplash

#unfiltered is a series where I share my raw thoughts and unfiltered commentary about anything and everything. It’s not designed to go down smoothly like the best cup of cappuccino you’ve ever had (although here‘s where I found mine), more like the lonely coffee bean still struggling to find its identity (which also may one day find its way into a more thesis-driven blogpost). Who knows? The possibilities are endless.

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Finding the Sweet Spot – Iterating What and How You Measure Product Metrics

iterating product metrics, measure, measuring tape

Many founders I meet focus on, and rightly so, optimizing their core metrics – a set of units that surprisingly don’t change after its initial inception. But metrics and the way you measure them should undergo constant iteration. Metrics are a way to measure and test your assumptions. 9/10 assumptions, if not all, are honed through the process of iteration. And by transitive property, the metrics we measure, but more importantly, the way we measure them, is subject to no less.

Though I’m not as heavily involved on the operating side as I used to be, although I try to, the bug that inspires me to build never left. So, let’s take it from the perspective of a project a couple friends and I have been working on – hosting events that stretch people’s parameters of ‘possible’. Given our mission, everything we do is to help actuate that. One such metric that admittedly had 2 degrees of freedom from our mission was our NPS score.

The “NPS”

“How likely would you recommend a friend to come to the last event you joined us in?” Measured on a 1-10 scale, we ended up seeing a vast majority, unsurprisingly in hindsight, pick 7 (>85%). A few 9’s, and a negligible amount of 5s, 6s, and 8s. 7 acted as the happy medium for our attendees, all friends, to tell us: “We don’t know how we feel about your event, but we don’t want to offend you as friends.”

We then made a slight tweak, hoping to push them to take a more binary stance. The question stayed the same, but this time, we didn’t allow them to pick 7. In forcing them to pick 8 (a little better than average) and 6 (a little worse than average), we ended up finding all the answers shift to 6s and 8s and nothing else. Even the ones that previously picked 9s regressed to 8s. And the ones who picked 5s picked 6s. Effectively, we created a yes/no question with just this small tweak.

There’s 3 fallacies with this:

  1. Numbers are arbitrary. An 8 for you, may not be an 8 for me. Unless we create a consolidated rubric that everyone follows when answering this question, we’re always going to variability in semi-random expectations.
  2. It’s a lagging indicator. There’s no predictive value in measuring this. By the time they answer this question, they’d already have made their decision. Though the post-mortem is useful, the feedback cycle between events was too long. So, we had to start looking into iterating the event live, or while it was happening.
  3. Answers weren’t completely honest. All the attendees were our friends. So their answers are in part, a reflection of the event, but also in part, to help us ‘save face’.

In studying essentialism, Stoicism, and Rahul Vohra‘s Superhuman, we found a solution that draws on the emotional spectrum that answered 1 and 3 rather well. Instead of phrasing our questions as “How much do you value this opportunity?”, we instead phrased them as “How much would you sacrifice to obtain this opportunity?” Humans are innately loss-averse. Losing your iPhone will affect you more negatively and for longer, than if you won a $1000 lottery.

So, our question transformed into: “How distraught would you be if we no longer invited you to a future event?”, paired with the answers “Very”, “Somewhat”, and “Not at all”. Although I’m shy to say we got completely honest answers, the answers in which we did give allowed for them to follow-up and supplement why they felt that way, without us prompting them.

The only ‘unaddressed’ fallacy by this question – point #2 – was resolved by putting other methods in place to measure attention spans during the event, like the number of times people checked their phone per half hour or the number of unique people who were left alone for longer than a minute per half hour (excluding bio breaks).

Feedback

“How can we improve our event?” We received mostly logistical answers. Most of which we had already noticed either during the event or in our own post-mortem.

In rephrasing to, “How can we help you fall in love with our events?”, we helped our attendees focus on 2 things: (1) more creative responses and (2) deep frustrations that ‘singlehandedly’ broke their experience at the event.

And to prioritize the different facets of feedback, we based it off the answers from the questions:

  • “What was your favorite element of the event?”
  • And, “How distraught would you be if we no longer invited you to a future event?”

For the attendees who were excited about elements closely aligned with our mission, we put them higher on the list. There were many attendees who enjoyed our event for the food or the venue, though pertinent to the event’s success, fell short of our ultimate mission. That said, once in a while, there’s gold in the feedback from the latter cohort.

On the flip side, it may seem intuitive to prioritize the feedback of those who were “Very distraught” or “Not at all”. But they exist on two extremes of the spectrum. One, stalwart champions of our events. The other, emotionally detached from the success of our events. In my opinion, neither cohort see our product truly for both its pros and cons, but rather over-index on either the pros or the cons, respectively. On a slight tangent, this is very similar to how I prioritize which restaurants to go to or which books to read. So, we find ourselves prioritizing the feedback of the group that lie on the tipping point before they “fall in love” with our events.

Unscalability and Scalability

We did all of our feedback sessions in-person. No Survey Monkey. No Google Forms, Qualtrics, or Typeform. Why?

  1. We could react to nuances in their answers, ask follow-up questions, and dig deeper.
  2. We wanted to make sure our attendees felt that their feedback was valued, inspired by Google’s Project Aristotle.
  3. And, in order to get a 100% response rate.

We got exactly what we expected. After our post-mortem, as well as during the preparation for our next event, I would DM/call/catch up with our previous attendees and tell them which feedback we used and how much we appreciated them helping us grow. For the feedback we didn’t use, I would break down what our rationale was for opting for a different direction, but at the same time, how their feedback helped evolve the discourse around our strategic direction. Though their advice was on the back burner now, I’ll be the first to let them know when we implement some element of it.

The flip side of this is that it looks extremely unscalable. You’re half-right. Our goal isn’t to scale now, as we’re still searching for product-market fit. But as you might notice, there are elements of this strategy that can scale really well.

In closing

Of course, our whole endeavor is on hold during this social distancing time, but the excitement in finding new and better ways to measure my assumptions never ceases. So, in the interim, I’ve personally carried some of these interactions online, in hopes of discovering something about virtual conversations.

Photo by Jennifer Burk on Unsplash

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Cold Emails – Addressing Elephants and Rock Hyraxes

cold email, elephant

Amidst this unpredictable pandemic, where people are sheltering in place and social distancing themselves. We’ve reached a new inflection point in the curve of virtualizing our worlds. And it just so happens that this is one of the best times to reach out via cold email.

I want to preface by saying this practice has largely worked for me when I reach out. But is neither representative of the population nor guarantees a reply.

The Lesser-known Rock Hyrax in the Room

When reaching out via cold email, the first thing I do is to address the elephant in the room. Outside of the “why are you reaching out to me” question that everyone has, the second most pertinent question, consciously or subconsciously, often is “how long will this take?” – the rock hyrax in the room.

Fun fact: Apparently, the rock hyrax is the elephant’s closest cousin. Frankly, I didn’t know that until I began writing this piece.

Most people who’ve spent some time honing their skills for cold emailing can answer the first question rather well. But, many miss the second.

Close cousins include:

  1. What does the time commitment look like to respond to the email? To address the ask meaningfully? What is my opportunity cost?
  2. How long will this relationship like?
  3. Can I get along with this person?
  4. Will this be an extension of work?

The most important frame of mind is to be honest. If it’s a sales call, it’s a sales call, not “expanding my network.” If you think it’s going to take half an hour to chat, say it. Don’t be nebulous. Set expectations and be forthcoming and candid from the get-go.

“So… why are you reaching out to me?”

And, I’ll leave no stone unturned. If you know the receiving end is busy, also address why they are the best candidate to answer your ask. Be specific. Whether you’re trying to close the first few clients in your pipeline or reaching out to learn, consider the answers to these questions:

  1. How did you find them?
  2. What about them makes you insatiably curious to reach out?
  3. Why they’re the best fit? What’s in it for them? What’s in it for you? (Note I ask “What’s in it for them” before I ask “What’s in it for you”)
  4. Have you spent time doing diligence? On the person? Industry? Topic?
  5. (Optional) Are there inflection points in their life/career/public presence that are unrelated to your ask, but you find oddly fascinating? Pick 1-2.
    1. Note: You should be approaching this question from a point of admiration, fascination, and/or genuine curiosity. If you have any malicious intent, don’t bother.

It just so happens that the same holds for rekindling old flames. Although it’s, by no means, a replacement for social interaction, hopefully it’ll keep the pan hot, when you do sautée after we start mingling at dinner parties again.

Photo by Geran de Klerk on Unsplash

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Self-Assessment (VC Scout) circa April 2020

vc scout reflection
Photo by Marc-Olivier Jodoin on Unsplash

This year in my resolution, I aim to be more vulnerable by “opening up about the potholes ahead, not just the ones in the rearview mirror”, to quote Jeff Wald. So I’m going to take a step closer to doing so.

Yesterday, my buddy asked me a question that didn’t sit well with me. Not because he was rude, nor because he meant to offend me. In fact, for all intensive purposes, it was entirely innocuous. But it was a question that got me to really question my beliefs and do an impromptu performance review of myself. He asked:

“Out of all the startups you’ve met with and had the chance to source, how many do you regret passing on? Which one or two stands out to you the most?”

I paused for a second. But when words arose to my mouth, my reply was simple. “I don’t think I have any regrets.” As soon as I said that, I immediately felt this gnawing feeling that something was wrong. I’ve always chosen to live life without regrets. And though this may seem to run parallel to my mantra, I knew deep down it wasn’t meant to be.

Luckily, I have had more time to introspect than otherwise during this pandemic. There are 3 possibilities as to why I have no regrets:

  1. It’s too early to tell which ones will be home runs.
  2. I’m not being selective enough, aka I have a flawed investment thesis.
  3. I don’t have the kind of quality deal flow I would like.

While optimistically, I hope it’s the first possibility. After all, it’s only been 3 years since I embarked on this journey. And there probably is a small proportion of startups that will go on to prove me wrong. Realistically, it’s a permutation of the latter two.

Currently, I pick about 40-50% of my inbound (referrals/intros, cold pitch emails/messages, various networking apps) and 100% of my outbound (assuming they get back to me) to have a conversation with. Of those, I usually find 1 out of every 10-15 that I continue the conversation with from an investment standpoint. And out that pool of founders, I usually end up referring 50% of them. Meanwhile, I still try to be helpful in some capacity to everyone else, but only spend about 20% of my time to do so. From a high level, I couldn’t see anything wrong with this funnel. At least, not until my buddy asked me that question.

Sourcing is one of those things that’s easy to pick up, but difficult to master. And now, I feel, not just conceptualize, how steep this learning curve is. There’s a saying in the industry that “luck only gets better with success.” But I have yet to pay the admission fee for my luck to start compounding. So there’s 3 things I have to do:

  1. Reevaluate my current deal flow by analyzing inbound sources and the empirical quality from each (# of startup I’ve introed/total # of startups received from X source).
  2. Hit up the investors I know to help me create a more robust thesis.
  3. Double down on helping my existing deal flow reach their aggressive milestones, until hopefully, the first can hit the ground running.

On the brighter side, it’s great that I’m iterating on this now before I become a checkwriter.

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Brand as a Moat

startup brand, moat, defense, defensibility
Photo by Keith Johnston on Unsplash

What is the underlying notion that makes this product work?

It’s the question that almost every investor, especially early-stage startup investor, tries to answer when they’re entertaining potential investments. Some close cousins include:

  • What social, economic, or political trend is enabling this technology/business to work?
  • Why will people want to continue using this product? Consciously? Subconsciously? How much will they regret not being able to use this product?
  • Why is this idea crazy good, and not just crazy?
  • Is there a predictable road to traction? Product-market fit? $1M ARR? etc.
  • Is this a scalable business?

Needless to say, when I chat with founders, their business’s defensibility often comes up. Every business – small or large – needs to be defensible. Grandma’s cookies are just that good ’cause of that ‘secret’ brown butter element. Or Sally’s lemonade stand sells better than her neighbor’s down the street since she can keep her drinks cool for longer. Just like every good medieval castle has a moat, possibly filled with alligators, every good business has to have that one (or many) unfair advantage, as they call it in B-school. Not that I ever went, but I’ve heard from friends and professors who have. And this is even more true if you want to build a scalable business.

Those who have gone generally claim that their moat is their experience at X Fortune 500 company. Those who have a technical background often claim that their moat is their IP – patents owned and pending. Neither are wrong. And frankly, there are a multitude of factors that come into play when arguing for a business’s defensibility. And most of the times, it’s a permutation of the above and more. But the purpose of this post is to focus on an often discounted notion of brand as a moat. Both the company brand and the personal brand.

Disclaimer:

I should mention that before you even consider your business’s defensibility, and subsequently, brand, first, make a damn good product. I’ve seen too many founders take that leap of faith before they even have a product. They pitch the dream of them making a better world – the company vision – before they even figure out the first steps they need to take to get there.

The only ‘exception’ to this rule, at least from a fundraising and pre-PMF perspective, is if you have an amazingly robust personal brand. Though that may help with early traction, it won’t be enough to sustain a scalable business in the long run.

The startup brand

Your startup’s brand is a collective composed of the:

  • Company mission,
  • Company vision,
  • Internal culture,
  • And, the openness and responsiveness of the team.

The vision is that ultimate dream. The mission is what you’ll do now to get to that dream. Back in college, someone I really respect put it to me like this:

“The vision is the Sun. The mission is that ladder up. You can’t get to the Sun without building a ladder. If you only stare at it, you’ll eventually blind yourself. And if you just build a ladder, or else you might up on Mars instead, poorly equipped to survive there.”

Culture is something that you can set at the beginning, but know it’ll be an evolving beast with every new hire and every new incident. What you let happen defines the new culture. Although I share my thoughts in a post earlier this year, Ben Horowitz puts it into a much better perspective in his book, What You Do is Who You Are: How to Create your Business Culture. Quite a story-filled read, especially when you’re looking for something to do at home now.

And, the above three culminates into how your team acts.

  • Do your current customers/users feel like their concerns are either addressed or at least, valued?
  • Do they feel they are a valued member of your community?
  • What is your customer satisfaction rate? NPS score?
  • How do you prioritize and act on customer feedback?
  • Are your users engaged? How do you reengage them, if they become inactive?
  • For apps, what are they saying on the App Store/Play Store?
  • And, how are new customers hearing about your product? What do they hear? What are their explicit and implicit assumptions when using your product?

Why it Matters

Together the 4 elements answer the fundamental questions:

  1. Why would a potentially great customer want to use your product?
  2. Why would a potentially great hire want to join your company?

In the past few months, many VCs have been shifting their investment focus from consumer and towards enterprise/SaaS. There’s the argument that consumers are (1) more expensive to acquire (increasing CAC; the average number of apps a person downloads a day is zero), and (2) harder to retain. (For a more in-depth explanation, I would recommend you to check out the “Consumer App Conundrum” section here.) Aka, it’s more competitive than ever in the consumer markets. When we get closer to perfect competition over a saturated market seeking attention, having a great product just isn’t enough anymore. When some of the most active and vocal consumers happen to be people on the younger spectrum (millennials and Gen Zs), to fight for their attention, you need a brand that resonates with them on causes they care about – whether it’s diversity or climate change or another social cause.

We see this notion affecting two other verticals: the public sector and enterprise.

  • The privatization of X (let X be education, healthcare, transportation, etc. for all that were empirically public sector functions)
  • The consumerization of enterprise

For the purpose of this piece, let’s look at the consumerization of enterprise. What does that mean? Before enterprise sales worked from a top-down approach. A founder of an enterprise/SaaS startup pitches to a senior executive at a Fortune 500 (or similar) company. And the executive makes the call and the budget allocation towards their team’s usage of said product.

Now, many startups/companies, like Slack, Trello, Lever, and Soapbox, are taking the bottom-up approach, garnering brand loyalty among the people who will be/are using the product itself. And I predict that’ll be so in the near future for Superhuman, the fastest email client, and Woven, my favorite calendar app, as well. After all, progress happens at the most junior level. If you take it in relation to a tech startup of 200 in its growth phase, the founders or executives can make a plan and set deadlines. But if your most junior developer isn’t working on it, the whole business halts to a stop. All this makes me quite bullish on products in the low-code/no-code space, as well as in towards the future of work.

Moreover, this has led enterprise products to be heavily personalized, constantly updating, and has paved the way to multi-modal business models (i.e. subscription and pay-per-use). All this maximizes user satisfaction, which in turn affects their productivity, and transitively, the business flow.

Although the job market looks wildly different now than it did 3 months ago, when I assume the average founder is looking for cash preservation over growth, you still should be cognizant about the latter going forward.

Your Personal Brand

Your personal brand as a founder, or just as a professional, really matters. If you are a founder or thinking about becoming one, start building a public voice. Get people excited about you and what you’re all about.

Why?

Personal brands are extremely scalable and have built-in virality. You put one post out. Some percent of your followers engage with your content by liking or commenting. Then either by social media’s algorithms or by their innate excitement, they’ll share your content with their friends. Subsequently, new folks discover you and your content. And this becomes a virtuous loop, or network effects, as we call it, that helps get you scalable traction. This is why celebrities, like Dr. Dre and Maisie Williams, and their ventures garner quite a bit of traction among consumers and among investors. This is also why influencer marketing has been so bullish over the past few years.

At some point in your company’s lifespan, your personal brand will become the company brand. And that’ll become either shining beacon or the downfall of your company. More than just the followers you have on social media and in public, you are judged by everyone constantly on your aptitude and behaviors. How open, conscientious, agreeable, extroverted, and neurotic are you? (Yes, I took the 5 traits from the Big 5/OCEAN test.) Each and more have an impact on your personal brand. If we look at the culture behind Facebook, we see how large of an imprint Zuckerberg has on it. For Apple, Jobs.

In closing

The best thing about brands as a moat is that it’s effectively free! But both take years of work in building. As someone on the investing side, I love stellar brands. And it’s one of the elements of a business I weigh heavily on for its potentiality in network effects, summarized in the “Why you?” component of my NTY investment thesis (why Now, why This, why You).

Hmmmm, now thinking about it, personal brand may be the biggest reason I’ve been changing my handwashing habits in the past week… after watching Gordon Ramsay, Alton Brown, and Conan O’Brien‘s tutorials on it.

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The Best Way I’ve Heard to Ask “What did you learn?”

how to say no, learning

Yesterday, I grabbed a coffee with a friend – now a newly-minted manager. Between congratulations and hearing what she’s been up to, we dove into a rabbit hole about performance reviews. And out of everything she shared, there was one question that caught my attention:

What do you say “No” to now that you didn’t say “No” to when you started?

People are inherently loss-averse. We react stronger to losses than gains. Economic prospect theory has taught us that much. Essentialism, probably best popularized by author Greg McKeown, or a methodology that helps us differentiate between external noise and our internal signal, takes it a step further. For example, the questions:

  1. How much do you value an opportunity?
  2. And, How much would you sacrifice to obtain an opportunity?

… carry two different emotions. We take many aspects of our lives for granted. But when we lose any aspect of it – be it a body part, a friend or family member, or a habit – where we once lacked appreciation, we now find true value.

What we say “No” to carries layers of scar tissue – of our past we don’t want to relive. The French language has an incredibly apt way of describing knowledge. Savoir denotes simple knowledge acquisition. Connaître implies a familiarity with knowledge that is deeper and carved into one’s heart. When my friend decided to ask that question, she is looking for what her team members connaissent.

I love it! And I’m gonna steal it (well, with her permission)! For each time frame, we have a new set challenges to ‘pattern-recognize’. Founders have it cut out for them. And just by the nature of their work, they need to learn – fast.

Taking it a step further

Josh Waitzkin, author, chess champion, and martial arts champion, on Episode #412 of the Tim Ferriss Show, puts it quite elegantly:

“When I studied Tai Chi for a year, I thought I knew what I was doing. And I thought I was really started to understand it. But after 2 years, I realized everything I thought after a year was wrong. It was just wrong. But now I understood.

And then after 4 years, I realized everything I thought after 2 years was wrong. And he went on with this story and this pattern, but now I understood. And after 8 years, everything I thought after 4 years was wrong. And now I’ve been training for 16 years; everything I thought after 8 years was wrong. And now, I finally understand…

It’s easy to think we’re in the dark yesterday, but in the light today. But we’re in the dark today too.”

So, in foresight and honest vulnerability, I will take my friend’s question a step further:

What will you say “No” to tomorrow that you aren’t saying “No” to today?

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