Don’t Try to Fake The Language

The language of startups has become pervasive. It feels like it started with Eric Ries’ great book The Lean Startup when words like MVP and pivot started showing up in all conversations. Back then it was new, fresh, and focusing.

Today, there are hundreds of words that people throw around in the context of their startups. Many, like traction, are completely meaningless. If you need a dose of some of the language, just watch a few episodes of Silicon Valley.

I’ve noticed something recently. For founders outside Silicon Valley, and even plenty within Silicon Valley, the language seems forced. Fake. Awkward. Uncomfortable. Words are used incorrectly. They are strung together in meaningless sentences. They are used to obscure reality or try to avoid the meat of a question.

It’s not necessarily a cliche-ladened problem. It’s also not a verbal tick issue. It feels like some people are trying to fake it, without really knowing what they are saying.

Don’t try to fake it.

Let’s wander away from startup for a moment and use the example of my fake philosophy expertise. I’d use words and phrases to demonstrate my fake philosophy prowess such as existentialism, free will and determinism, philosophy of language, being and nothingness, nihilism, anthropotheism, and neonomianism. I barely know how to spell the last few words, let alone understand the philosophy behind them. I could give you a definition (e.g. anthropotheism is the belief that gods are only deified men), but I have no real concept of what underlies the word or the philosophy behind it, or how it fits together with anything else. I can look it up on the web (that’s where the definition came from) and if I didn’t say I had no idea what it meant, it puts me in the fake smart category. But when I start a discussion with someone who has studied philosophy, either formally or informally, I’m hosed and it’s quickly clear that I’m faking it.

An easy example from my daily life is the founder who leads off talking about his business by saying “we’ve got a lot of traction.” He then goes on to say nothing about what this means, gives no metrics indicating “traction” (whatever that is), and generally stays vague about what the company does. When he takes a breath, I ask “what do you mean by traction?” After some nonsense tumbles out, I ask more precise questions about metrics, and get answers that don’t demonstrate any real, meaningful progress of any sort. I ask a few more questions to try to find leading indicators of progress and get qualitative descriptions of why people would want the product.

Then there is the misused definition problem.

Founder: “We had $50k of MRR last month.”

Me: “How much MRR did you have the previous month?”

Founder: “$14k”

Me: How much MRR did you have the month before?”

Founder: “$27k”

Me: “Why did you have so much churn from the $27k month to the $14k month?”

Founder: “We didn’t – that was just how much we sold that month.”

Me: “What do you mean, that’s how much you sold that month?”

Founder: “Well – that’s how many $ of transactions went through our system.”

Me: “You realize that’s not MRR, but that’s Gross Sales?”

Founder: “What’s the difference?”

Me: “What percentage of each transaction do you keep in your marketplace?”

Founder: “5% – we are trying to grow market share.”

Me: “So your net revenue last month was only $2.5k, right?”

Founder: “Um, ok.”

If this happened every once in a while, that would be fine. But it happens every day. Sometimes it’s simply lack of understanding of what the words and metrics mean and how they work. But other times, it’s clearly an effort to demonstrate how much progress has been made by either avoiding the real metrics, obscuring what is going on, or trying to come up with a big number to get someone’s attention.

Don’t worry about loading up your discussion with cliches and trendy words. Focus on telling the story of your business. And don’t try to fake it.

Sometimes I Ask Myself If The Juice Is Really Worth The Squeeze

One of my all time favorite blog posts is Ben Horowitz’s The StruggleIf you are a founder and you haven’t read it, open it up in another tab for after your finish this post.

On Friday, a CEO I know sent me the following message.

“Brad – I crafted the entry pasted below this morning for my eyes only (and for my own therapeutic purposes), but in thinking about it today, I realized that you’re probably one of the only people I know who might be able to relate or who has interacted with others with similar sentiments. I’m in a good place mentally and it simply feels good to share this with someone else.”

I read it and immediately asked if I could post it anonymously. It’s in the same category for me as The Struggle, but with a different tone. Fortunately, the CEO said yes so I can share it with you. It follows.

Sometimes I wake up and look in the mirror and don’t recognize myself.

Sometimes I haven’t slept properly in days or weeks and I look in the mirror and most certainly don’t recognize myself.

Sometimes I get frustrated that going to bed is like suiting up for battle. I know that many sleepless and restless hours lay ahead before it’s okay to go back to work.

Sometimes I see how physically drained and weak I’ve become. Long gone are the days of being a muscular collegiate baseball player with MLB scouts at my heels or a lean and mean Ironman triathlete and marathon runner. My mental desire to achieve athletic greatness is at an all-time high, but my physical prowess leaves a lot to be desired.

Sometimes I wonder about underlying health issues that aren’t noticeable in the mirror and might not rear their ugly head until years into the future.

And sometimes, I see the disappointing medical test results and wonder if I’m on a path towards failure. Sometimes I don’t even know where to get started to get back on track.

Sometimes I look around and realize that many childhood friends have steady corporate jobs, children and other pursuits. They work to live rather than live to work and they are able to parse work stresses from the rest of their lives.

Sometimes I’m jealous, but mostly I’m lonely and longing for friendship with those who understand how emotionally and physically draining running a business can be. Can’t someone else understand why I can’t commit to an 8pm dinner on a Tuesday night when I’m absolutely drained?

Sometimes I ask myself if the juice is really worth the squeeze.

And sometimes, I admonish myself for such thoughts. My life is not that hard relative to those who have more physically demanding jobs.

Most of the time, however, I love my life and my job has been a source of great energy and inspiration. I know we’re onto something big and the journey has allowed me to surround myself with amazing colleagues and supporters. I only wish that I could find the perfect harmony between health, happiness and my career.

Do We Need A New Word For Entrepreneur?

Has the word entrepreneur become too trendy as to have lost its meaning? I’m hearing it and the word entrepreneurship being used in so many conversations incorrectly.

Here’s a simple example. On a daily basis, I have an email exchange with someone who says they are an entrepreneur. I respond “What company did you start?” They respond, “Oh, I didn’t start a company, I was the fifth employee of Company X.”

Another example is the email that I get from someone in a large company who says “I want to create more entrepreneurship within BigCo.”

Now, these are well-intentioned people so I’m not critical of them. But I’m critical of the use of the word entrepreneur in these contexts.

I like Wikipedia’s definition.

“Entrepreneurship is the process of starting a business, a startup company or other organization. The entrepreneur develops a business plan, acquires the human and other required resources, and is fully responsible for its success or failure.”

Merriam Webster’s is also solid.

“a person who starts a business and is willing to risk loss in order to make money”

This morning I read an article in the New York Times titled With Start-Ups, Greeks Make Recovery Their Own BusinessOther than the fact that the New York Times hasn’t yet figured out that It’s Startup, Not Start-up or Start Up it was a good article that got me thinking about this rant.

In 2010, the Startup America Partnership finally got the US government to separate the notion of small businesses with high growth businesses. The word startup was firmly introduced into our lexicon as shorthand for high growth business and now is a comfortable one. While we are still stuck with one government organization – the Small Business Administration – that tries to help both small businesses and startups, the language around this continues to evolve.

For example, I think we are finally starting to differentiate between local businesses (your local restaurant, coffee shop, bookstore, gas station, movie theater, clothing store, art store, or anything else that sells to your local community) from a startup business (a company that might be small, but is selling to anyone anywhere in the world). The language isn’t quite right, as local businesses can evolve into startups (The Kitchen, run by Kimball Musk, is a good example). But we are getting there.

And then there are a several words trying to characterize different stages of startups. A scaleup is a startup that is scaling quickly. A gazelle, a word that has been around for a while and is becoming popular again, is a startup that has achieved critical mass and is a rapidly growing company, kind of like a scaleup, but falling comfortably into the animal taxonomy that seems to include unicorns and dragons.

And that takes us back to the word entrepreneur. Theoretically, the entrepreneur is a person who creates any one of these companies (local business, high growth business, startup, scaleup, gazelle, unicorn, but not a peppercorn.) And entrepreneurship is the act of creating and operating the business. Note the and clause – you need to be the creator and the operator to be an entrepreneur, not just the operator.

As I type this, I realize I’ve buried the lead. I’ve always loved the word founder to describe the person the word entrepreneur refers to. When I started Feld Technologies, I referred to myself and my partner Dave as the founders of Feld Technologies. This was well before anyone used the word entrepreneur (the 1980s) and for many years I used the word founder. Somehow my brain shifted to entrepreneur and entrepreneurship and that’s taken over for me. But it’s now uncomfortable, awkward, and tiresome.

I think I’m going back to founder. It’ll be interesting to see how hard it is to rewire my brain. We’ll see if it lasts. While it’s not clear to me that it matters, given my pedantic obsession with eliminating the hyphen in words like startup and email, it’ll be fun – at least for me – to see where it goes.

Are You From Where You Were Born?

In the article The biggest tech company founders from every state I win the callout for Arkansas.

“Arkansas: Brad Feld has bounced around a lot: born in Arkansas, raised in Dallas, then lived in Boston for over a decade before moving to Boulder, Colorado. He’s most known for founding Foundry Group, a prominent venture capital firm that focuses on early stage investment, but also co-founded startup accelerator Techstars.”

I was born in Blytheville, Arkansas on an air force base in 1965. My dad was in the Air Force for several years during the Vietnam War after being drafted. Once he finished his service a year later, he moved to Boston to finish out his residency at Mass General Hospital. Then, in 1969, he and my mom, with two kids in tow (me and my younger brother Daniel, who had just been born) moved to Dallas, Texas. My parents knew one person in Dallas when they moved there and they chose Dallas (over Kansas City, which was a near second) as a place they wanted to build their life. My dad’s brother Charlie followed him to Dallas a year later in 1970.

I don’t view myself as being from Arkansas even though I was born there. It’s one of those weird artifacts of one’s life. I used to be able to roll it out in big group introductions when each person is asked to say one thing about themselves that no one else in the group knows. I now have to come up with something else, like the age I was when I read The 158 Pound Marriage by John Irving (answer: inappropriately young.)

I grew up in Dallas, Texas. When I went to college at age 17, I thought I’d move back to Dallas and live there after I graduated. Within a year of living in Boston, I knew I wouldn’t move back to Dallas, even though I never really thought I’d stay very long in Boston.

Twelve years later I moved from Boston to Boulder, Colorado. While I lasted 11 years longer in Boston than my dad did, I sometimes feel like I lived in Boston for 11 years and 364 days too many. Upon serious reflection, Boston was very good for me, but it never felt like home.

When Amy and I moved to Boulder in 1995, we knew one person. He moved away several months later. Then, a year later, my brother Daniel moved to Boulder. I don’t think we realized we were following the same pattern as our parents and my Uncle Charlie, but 20 years later, we are still living near each other in Boulder and 46 years later my dad and his brother are still living in Dallas.

I’ve now lived in Boulder longer than anywhere else. So – where am I from? While I comfortably say that I grew up in Dallas, I’m from Boulder and have built my life, with Amy, around being here.

My parents, who were both born and grew up in the Bronx, are definitely from Dallas. Same with my Uncle Charlie.

Until the Business Insider article put me as being from Arkansas, I had never really pondered where I was from very much. It was easy to describe where I lived, and it often felt self-indulgent to parade around as a Texan, which at some point I got over. But I never felt like I was from Arkansas or Boston.

When I say I’m from Boulder, it feels good.

Why I Don’t Call People Out By Name

Yesterday’s post titled The Silliness Of Recapping Seed Rounds generated a robust discussion. It also inspired Joanne Wilson to write a post titled Recapping a round?? which is a description of a different situation and a different company, but generated a similar negative response from Joanne. In her case, the new investor insisted that the cap on the notes (for money that had already been spent) be raised so the seed investors would get less ownership than they’d signed up for, regardless of the investment the new investor is making.

I’ll just let Joanne, who works harder than almost anyone I know, and certainly adds more value to her angel investments than many VCs do, simply speak for herself.

“How do I feel about this? I am furious. I feel like I got hosed. I took a big risk by putting money in early on and now a VC with power behind them comes in and says here is the deal or we won’t let you in to our fold. What should have the investors done? Revolt? What is the point of that? Then we all lose. So I did what I believe in first and foremost and that is supporting the entrepreneur. The one caveat I made with the entrepreneur (which is purely blowing air) is that if this VC doesn’t secure a killer Series A for you then I will personally come out to SF and make this all public and have a showdown. If you are going to screw me and all the investors who came in around me then you better make it something we can all feel good about in the long run because right now I am just holding my nose.”

In my comment thread, and in Joanne’s, a number of folks asked us to call out the various players (especially the investors and the company) by name. I have no interest in doing that and I’ve said so. I’ve gotten a number of private emails asking me about the players. Same response – I’m not interested in calling people out by name.

Someone eventually asked me why and I thought it was worth a response.

I don’t write things like this blog to attack people. I don’t do it because I need to vent when I get upset. My motivation isn’t to create public fights. It’s also not to use this blog as a bully pulpit to negotiate, as someone suggested.

Instead, I do it for the same reason that Jason Mendelson and I wrote around 30 blog posts about the term sheet in 2004 and 2005 and then followed it up with our book Venture Deals: Be Smarter Than Your Lawyer and Venture Capitalist. We started writing stuff like this to demystify the process for entrepreneurs.

I think stories and examples are often the best way for people to learn things, including me. By writing down my thoughts about situations, I process them. I put them out there for anyone who wants to learn from them, explore them, or match them against their own experience. I try to do it in a way that contrasts all the rah rah bullshit that goes around with the resistance, hesitation, or inability for people to talk clearly and directly about the challenging stuff. And it’s especially pertinent as time passes, as things continuously change.

Not everything I write ends up being correct. I miss nuances. I don’t understand all the pieces. I learn by putting my thoughts out there and engaging with people in their reactions to what I write.

As a result, there are many cases like this where there is no value in naming names. The actual participants are just part of the story, but not the central theme. It’s my interpretation of what happened. Whomever else is involved with this situation (the investors and entrepreneurs) can decide whether it matters to them, or not, and act accordingly.

But I’m not a reporter. I’m just trying to teach. And learn. And observe. And hopefully help a few more entrepreneurs as they continue through an endlessly challenging, complex, and stressful journey.