Brad Feld

Month: December 2006

My partner Greg Galanos forwarded me a great article from the Philadelphia Inquirer titled “The Economy Revealed: Why understanding economics is hard” that builds on the more difficult to digest but equally interesting essay / research by Alan Page Fiske titled The Inherent Sociability of Homo sapiens.”  Fiske’s theory is based on the conclusion that all human relationships are built from four types of interactions: communal sharing, equality matching, authority ranking, and market pricing.  In Fiske’s theory, these four building blocks (which he calls “relationship models”) result in the entire range of the very complex and diverse social life of humans.

While I’m not going to dig another layer into the theory and the research to decide if I believe that it’s true / valid / complete, it’s very provocative and stimulating, especially when you start applying it to a wide range of situations – especially ones that are filled with conflict or behavior between two people that are operating at cross purposes.

Start with the summary article in the Philadelphia Inquirer.  If you are interested, read Fiske’s essay.  If you are really ambitious, take it a step further and then use some “communal sharing” and post your discoveries here for all to see.

Oh – and why is economics difficult?  Actually, I never had too much trouble with the IS-LM curves.  It was all that supply side stuff that confused me.

In 1983, when I was a senior in high school, I started my first company.  There were six founders – they are the gang below:


John Gruberman, Drew Debelak, Jeff Funkhouser, Steve?, Kent Ellington, and me (the smiling dude holding up the book on the bottom right.)  I can’t remember the name of the company, but it was probably something clever.  I’m 99% sure the book Kent (middle / bottom) is holding up is something about incorporating your business.

We’d cooked up some idea around Dungeons and Dragons, the game us little nerd boys played while we weren’t eating at Taco Bueno, listening to Rush, playing with our computers (Kent and I programmed a killer Yahtzee game on the TI Personal Computer which “accidentally” got shipped on their “auxiliary program” disk – Kent’s dad was the product manager before joining Compaq at the very beginning), or pretending to chase girls.

At some point, my other five partners decided to kick me out of the business for some reason – I think it was because they were all going to UT Austin and I wasn’t.  I remember not being very happy with most of them (except Kent) for a while.  I went to live in Boston, they went to live in Austin, and we basically went our separate ways.

I often forget about this being my very first company and often refer to Martingale Software (also a failure) as my first company.  I guess I’ll call this one my Zero-ith company.

In the life of most companies with an active board of directors, it occasionally becomes necessary to recruit a new director. In the case of VC backed companies, a new director candidate is often the suggestion of one of the investors. In these cases, the suggestions are often the result of the VC in question having a past, successful working relationship with the proposed candidate. These candidates are often suitable in terms of “knowing the venture drill”, likely a cultural fit, and appropriately skilled for the challenges at hand. However, the relationship between the VC and the proposed candidate can often be seen as “too close.” Therefore, if independence is a highly ranked criteria for you, Jim Lejeal and I suggest you consider a more formal and deliberate process (and we humbly offer this as the latest post in our Board of Directors series.)

Before you start the process of recruiting a new director, consider the following:

  • Manage the process with enthusiasm. A competent and enthusiastic new board member can re-energize an existing board. Use the process of inviting a new director to join the board as a chance to improve the leadership of your company.
  • Perform the recruiting effort with care. Adding the wrong new director – just like hiring the wrong key employee – can result in a negative and costly outcome. Executing a carefully thought out process can increase the chances you will end up with a great new director for your company.
  • Complete the recruiting effort in a timely manner. Adding a director is a serious affair and in our experience can help make good companies great. We’ve seen the process drawn out unnecessarily and take a back seat to all kinds of other activities. Treat recruiting a director just like recruiting a member of the executive team – do it quickly and take it seriously.

Now, let’s assume you are ready to begin recruiting a new director and your board has agreed to do this in a methodical way rather than just get “some friends or experienced execs we’ve worked with before” on the board. Following is a framework for running a process.

Determine who is responsible for running the process: Some companies like to have a formal nominating committee; others are happy to have the CEO work with one director to run the process. In most early stage companies, a combination of a CEO and one director is a great working group, recognizing that one of them ultimately has to take responsibility for getting it done. While “best practices of board governance” typically will put the responsibility on a director, the CEO is almost always heavily involved in early stage companies.

Perform a GAP analysis of your existing board: Begin by taking a look at your existing board and identify where your board’s skill set is strong and where it can be improved. Some key criteria that are often needed for growing companies include independence, financial expertise, and specific product, sales, or marketing skill sets. A great rolodex – especially for customer prospecting or future financing – is often nice to have, but should be not be the only thing you are looking for.

Establish and prioritize your selection criteria: The criteria you determine you need from your GAP analysis are unlikely to be equal in importance given the current state of your company and the nature of your existing board. Make sure you’ve got a handle on the critical capabilities, the nice to have ones, and the ones that don’t really matter much.

Work as a board to create a candidate pool: Engage all your directors in this as they are likely to be the best source of potential candidates. In addition, by getting everyone involved at this point, you’ll be able to confirm the capabilities you are looking for in your new director.

Approach at least three candidates simultaneously: Not everyone will be interested in the opportunity you’re offering. In addition, after the first meeting, you might not be interested in the candidate. By approaching a few candidates at the same time, you’ll benefit from being able to compare the candidates while hedging your bets in case a few of them aren’t interested (or interesting.)

Explain your process to each prospective board member: Be candid and upfront with each potential director that you talk to. Explain what you are looking for, why you are looking, and what your time frame and process is. Explain that the ultimate decision whether to invite the candidate onto the board is a shared decision of a company’s board and that a number of interviews need to be undertaken in order to actually extend an offer to join the board. Emphasize that the diligence process is a two-way street and that the candidate should feel comfortable performing their own diligence on the opportunity. Finally, explain that other candidates are being considered so there are no surprises.

Have more than one meetings: Make sure you spend enough time with each candidate that you are seriously considering. Get to know the person – just like you would with anyone that you would add to your leadership team.

Assist your candidates in their diligence process: Share information with the candidates to assist them in getting comfortable with your company and the opportunity to be a director. Make sure the candidates have good access to all other directors as well as members of the senior leadership team. Encourage everyone to be open – both about the good and the bad. Clearly explain your expectations of time commitment, board attendance, and compensation. If you are comfortable, share the last few board reports. Use this step in the process to understand more about the candidates you’re considering.

Schedule one-on-one meetings with at least a majority of your existing board members: All of your existing board members should have an opportunity to meet the candidates before an offer is extended. Often this isn’t practical, but make sure your existing board members’ expectations are well understood. As part of this step, consider doing reference checks on your candidates, especially if they are not known to all directors.

Observe the natural ranking your process creates: Running a parallel process of talking with more than one candidate simultaneously will give you the benefit of determining who is your top candidate. Collect feedback from other board members that have participated in the process to rank order your candidates.

Invite and Approve: By now you have run a comprehensive process and you are likely at a point where it’s clear who you’d like to have join the board. Typically the formal step of adding the board member is to invite them to their first board meeting where they will be formally added to the board by way of a voting action on the part of the existing board. Check with your attorney in advance on the most appropriate way to do this – especially if you have any specific voting provisions associated with appointing a new director.

I ran an interesting experiment the past 30 days.  I simultaneously used three different desktop configurations – my traditional Windows XP three monitor setup (at home and work), Mac OS X running on a 30” Cinema HD display (at my house in Keystone), and Vista running on a new Lenovo X60 laptop (wherever I went.)  The surprise winner – at all levels – was Vista running on the Lenovo X60 laptop (with Office 2007.)  It just blew away the other two configurations for performance, ease of use, configurability, and integration with all the stuff I work with (my home network, my office network, my data / music / pictures which live on both, the Internet, all the crap I have stored all over the Internet, stability on all the Internet access points I use (including wireless and EVDO), and all the stuff I play with every day.)

I was completely surprised.  I expected to fall in love with OS X running on a 30” monitor on a smoking hot Mac Pro.  I ran Firefox on each of the machines with Google Browser Sync so for the 33% of the time I spent in a browser, life was basically the same (hmmm – important double message there.) I had Parallels and CrossOver running on the Mac so I could run Windows apps when I needed / wanted to.  I suffered through Entourage for a while (man is that a shitty program – I completely blows my mind that Tasks don’t sync and what’s with the new mail window always being in the top left of the screen), tried Outlook in both Parallels and CrossOver (ok but not great), but spent way too much time in front of the Mac fighting on the margin to get the computer to do what I wanted it to do for me.

In contrast – and surprisingly – Vista and Office 2007 just worked.  Maybe it’s the way my brain is wired, but I was massively more productive on the Vista laptop – with the tiny screen and one window in focus at a time – then I was on the beautiful OS X machine with multiple windows open.  On the Mac, I couldn’t find stuff, things didn’t work quite right, the apps were limited, and when I tried to change the config, I occasionally went down various rabbit holes.  On Vista, things just worked the way I expected them to.  And yes – in addition to the normal Office desktop apps, I use browser-based versions of them (OWA, Gmail, and Google Docs & Spreadsheets.)  The rich desktop still rules (I prefer FeedDemon over everything else, I like to blog offline – I went back to BlogJet because Windows Live Writer had a few nasty bugs, and email / tasks / contacts / calendar – at least for me across my little universe – is way more fun in Outlook than anything else.)

Fortunately, all is not wasted.  I brought my Mac Pro with the 30” monitor back from my place in Keystone this morning and deposited it on Ross’ desk for him to install Vista on it (alongside of OS X).  I’ll continue to play with OS X and experiment with it, especially when I can run a side by side comparison with Vista on the exact same hardware, but I have a gut feeling I know what the outcome will be.

Today, someone forwarded me John Milan’s article on Read/WriteWeb titled “Changing Climates for Microsoft and Google, Desktops and Webs.”  I’m waiting patiently for part two of the article as it’s nicely provocative.  While Google / Apple are much more trendy than Microsoft these days, there’s something deeper going on that shouldn’t be overlooked, especially in your friendly, neighborhood global corporations.  As Amy likes to say “what happened to DOS – it was good enough.”  Call me a heretic.

I wrote a post this summer titled CEOs That Are IntrovertsWhile I’m very comfortable in group settings and have no problem in front of a crowd, I’d much prefer to be alone, with Amy, or with one other person or couple.  Some of my best friends are introverts – and one of them sent me this magnificent article from The Atlantic Monthly by Jonathan Rauch titled “Caring for Your Introvert.”  The next time you are with me, please feel free to pop open your laptop and sit quietly doing something near me while I work on my computer – I’ll enjoy it a lot (and – depending on whether or not you are an introvert – you might also!)

For all you 24 junkies out there, we are within 45 days of the beginning of Day 6.  Prequel’s are starting to show up.  Make your reservations now for a TV near you on January 14th and 15th.

A few weeks ago I launched a new blog called Brad Feld’s 50 by 50 to document my trials and tribulations of running 50 marathons by the time I’m 50 (I’ve done 8 and I just turned 41.)  I decided I wanted to segment my daily running stuff from Feld Thoughts as many of you don’t care about my running obsession.  I’ll still occasionally post here about major events (e.g. completed marathons), but I’ll save my daily runs, running thoughts, experiments with running technologies, fears, and scatalogical running experiments for my running blog.

If you want to follow these exploits, you can subscribe to the Feld Running feed.  Simultaneously I’ve set up a FeedBurner Network for Marathoners – if you are a marathoner, blog, and want to join the network, just email me

My running blog is hosted on YourRunning – a website for runners that is run by Enthusiast Group.  I’m an investor in Enthusiast Group and it’s been a blast work with Derek and Steve to figure out the best approach to a “bloggy-like” network for “enthusiasts.”  YourRunning is the third site that we’ve launched – joining YourClimbing and YourMTB.

Enthusiast Group is hiring – both an advertising / marketing online specialist as well as new enthusiast-in-chief’s for upcoming sites, including birding, skateboarding, body building, road biking, and horses / equestrian.  If you are interested, drop Steve an email.

Will Herman has an excellent post up titled Board Meetings – A CEO’s Point of View.  While I’ve never been on a board where Will was CEO, he and I have been on several boards together, and he’s an incredibly valuable and impactful board member.  His “top 11” list of suggestions is a must read for any CEO that has a board of directors.  Also – look for some new posts in the Board of Directors series that Jim Lejeal and I have been writing coming soon to a blog near you.

Mark Suster of Koral has a great story up on his corporate blog about his experience raising venture capital.  I’m just glad I don’t appear to be one of the assholes he met with at the beginning of the process.