Category: Entrepreneurship

Jan 9 2020

Present From The Head Of The Table

I’ve noticed a degradation in presentation styles when displaying slides on a screen. This is starting to become a pet peeve of mine, so feel free to ignore me or tell me to get over myself if you disagree with this advice.

Assume a conference room with a large screen TV (or two) on the wall at the “front” of the room. The conference table – often a long rectangle – has chairs along the side perpendicular to the TV. The classical “head of the table” is at the far end facing the TV.

Why in the world would the presenter sit anywhere other than in one of the chairs at the end of the table closest to the TV?

Assume the TV is just showing slides. Don’t you want everyone in the room looking at you and the slides?

Assume there is video conferencing. In most cases, the slides will dominate and the video conferencing participants will be in small windows on the screen anyway. And, when they are looking at their computer while you are presenting, they will mostly see the slides anyway.

The only time this doesn’t apply is when there isn’t a presentation. When you are trying to engage the people on the video conference in the room during the meeting, and there is nothing being presented on the screen, the pet peeve that I have doesn’t apply.

In the world of paper presentations with no video screens, it made sense for the presenter to sit in the middle of one of the long sides of the table to engage the whole room. But, when there is a screen with stuff on it, position yourself near the screen so the people in the room can look at you and the screen at the same time.

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Jan 7 2020

Frog in a Blender

The phrase “frog in a blender” was in my head all afternoon. Earlier in the day, one of my partners described a situation as the cliche-ish “boil a frog slowly” and I responded with “We’d all be better off if we just put the frog in a blender.”

That generated grimaces.

I couldn’t find any “Will it Blend” for frogs, but I found the next best thing – Pickled Pigs Feet.

It doesn’t have quite the same rhythm, but you get the idea. As I hummed the song I made up to the phrase “Frog in a Blender“, I figured there must be a real song named this. There is, it’s awful, and the lyrics are horrifying, but whatever. My song is much better.

As I was driving home, working on the second verse, I flashed to a conversation with a friend I had a few months ago.

He said, “How do you eat a shit sandwich”? I responded with “Gross – no idea.” He said, “Quickly.” After I chucked, he said, “Ben Horowitz told me that.” So, I’m going to attribute that one to Ben Horowitz, which fits nicely with some of his anecdotes about shit in his book The Hard Thing About Hard Things.

I like to be as deliberate as I can about decisions. I try to make them quickly, but with a reasonable amount of data and critical thinking. Sometimes this works, other times it doesn’t. When I reflect on the things that have caused me the most pain, it’s when I let a shit sandwich sit in my refrigerator for a while, looking at it every day when I get a kombucha. Or, when I wake up one day and realize that I’m the frog that has been boiling slowly.

I wonder if eating a shit sandwich quickly is the same as putting a frog in a blender. Both are pretty awful, but it seems like the best approach is to get it over with quickly.

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Jan 3 2020

The Future Of Work Is Distributed

I’ve been a remote worker for 24 years. While I have an office in Boulder, I’m physically in my office for a small amount of time.

For many years, this was a function of travel. My investments have always been geographically distributed across the US and I spent the majority of my time between Monday and Friday on the road.

I learned how to work in hotel rooms, in other people’s offices, in conference rooms, at coffee shops, and in houses (mine and friends.) In 1995, at the dawn of the age of the commercial Internet, this involved landlines, answering machines, pagers, and fax machines. Today, my bet is that most 25-year-olds have never used one of these things.

In the past few years, there have been several high profile examples of scaled companies that have a completely distributed workforce. Automattic (WordPress) is my favorite, as it’s been organized that way by design from inception. Zapier is another one that has gotten a lot of press lately around its distributed workforce approach. In a moment of delicious self-reference, Zapier put up a blog post titled 25+ Fully Remote Companies That Let You Work From Anywhere.

Many companies in our portfolio have multiple locations and increasingly distributed workforces. There’s a profound difference between “two locations” and “distributed”, but they are part of a similar phenomenon where the constraint of the physical is lowered.

As I reflect on my own work patterns, they are less and less connected to any particular physical space. This doesn’t mean that physical spaces are eliminated from my life, but that my work isn’t actually dependent on any of them. As I type of my laptop, in a room at my house in Longmont, with Amy sitting next to me, it’s easy to see how my day is going to unroll with a shower, followed by a video conference, and then an in-person meeting with someone coming to spend some time with me.

When I look at my schedule next week, I’m in my office on Monday for my partner meeting, but there’s literally no other reason I need to be in my office next week. I have some in-person meetings, but if the weather is nice, they will be walks outside. Any of them could be video conferences instead of face to face meetings.

In the past five years, as I’ve limited my travel, I’ve gained back a lot of time not spent moving from point A to point B. When I’ve chosen to travel as I did recently on a multi-day trip to Seattle, I’ve been able to be deliberate about where I was and who I spent time with, and none of it required me having a physical space.

I continue to strongly believe that place matters for the development of sustainable startup communities. But, this is different than physical office spaces. I’m going to explore this more over the next year as I continue to embrace the lack of constraints around physical space in my world.

If you have good or bad experiences with distributed work, I’d love to hear them. I know there is an increasing number of technologies in use for helping manage organizations that are distributed – I’m interested in real stories of what works, vs. marketing hype. And, given that humans are intensely social creatures, I’d love to hear stories about how you maintain the appropriate level of physical interaction in a distributed workforce.

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Nov 13 2019

Laser Engraved Personalized Chocolates

I love chocolate. I love lasers. So it would be logical that I’d love chocolates that are engraved with personalized messages with lasers.

I met Jennifer, the founder of Noteworthy Chocolates, in Boston at the Authors & Innovators event. She handed me some chocolates engraved with “Authors & Innovators” we talked a while and she sent me a long story about how she figured out how to laser engrave chocolates.

A week later a special box of laser engraved chocolates arrived at my office for me and Amy.

They were clever and delicious. Jennifer won me over and I expect that laser engraved chocolates will be on my gift rotation (for gifts I give my friends) in the future.

If you like chocolates and lasers and want to give some customized laser engraved chocolate gifts for the holidays, Noteworthy Chocolates has you covered.

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Oct 28 2019

Pandere Shoes, Anchorage Startups, and Techstars

Pandere Shoes is an Alaskan founded and women-owned startup that creates expandable footwear that accommodates a host of conditions such as edema, diabetes, and neuropathy. 

I met the co-founder Laura Oden when I was in Anchorage last month to speak at the Accelerate Alaska event. She came up to me after I gave my talk and told me that her company wouldn’t exist without Startup Weekend and Techstars.

While that caused a big smile to cross my face, I asked her to tell me more. She described how she met her founders at Techstars Startup Weekend in 2016.

Laura struggled for 40 years to find shoes to accommodate her lymphedema which caused one foot to be chronically swollen. Off the rack shoes only fit one foot and she needed a shoe that would expand to accommodate her swollen foot. Over time, the team realized that millions of people all over the world were struggling with a similar problem.

This was the idea she brought to the Startup Weekend. At the end of the 54-hour event, Pandere won the top slot and the company was born. The event fostered confidence that buoyed the team through enough contest wins to develop a prototype.

When you think of Alaska, you probably do not think of it as a popular location for producing shoes. The founders loved where they lived and put together a support team of shoe experts and designers in Boston, France, and Portugal. They were able to obtain early capital from prize winnings, along with mentorship from fellow entrepreneurs and investors. While Alaska is not a shoe capital, it is now headquarters to a shoe company addressing a global problem.

Pandere launched publicly on Nov 2018 and has produced five unique styles that accommodate wide and extra widths for men and women who cannot fit into traditional footwear, with more styles to come. Their shoes are made in Portugal. Every shoe sale generates a donation to the Lymphatic Research and Education Network (LE&RN). 

When I got back to the hotel at the end of the day I bought a pair of Pandere Saturday Shoes to give them a try. I have wide feet and they are often annoyed with me from all the running I do. The Pandere’s are wonderfully comfortable and have replaced my OluKai’s, which replaced my Allbirds, which replaced my Vans as my daily kicks.

The team at Pandere continues to #givefirst by giving back into the ecosystem that fed them. They have stayed involved in the community by volunteering as coaches, hosting dinners, and offering advice to budding entrepreneurs.

And hopefully, I’m helping them out a little by highlighting them here. I love origin stories that link to Techstars, and this one combines Techstars, Alaska, women-entrepreneurs, and shoes that I’m loving.

Give them a try at the Pandere Shoes online store.

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Oct 10 2019

JOMO – The Joy of Missing Out

Recently, I discovered a neat new acronym, JOMO, which stands for the “Joy Of Missing Out.”

While FOMO is an endless part of all things technology, entrepreneurship, and investing, I’ve actively tried to ignore and avoid FOMO across all dimensions of my life. On balance, I’m more successful than not on this dimension, but it’s an endless challenge.

I find it entertaining to turn FOMO upside down, backward, and inside out and actively experience JOMO instead.

When I’m depressed, I describe the feeling as “the complete absence of joy.” In general, I self-identify as a “joyful” person. I smile, a laugh, I’m entertained, I’m playful, and I’m generally happy. Even whenever I’m under incredible stress, I still feel, at my core, joyful.

When I think about missing out on things, my joy meter goes to 10. One of my favorite things in the world is reading on a couch in the same room as Amy. For hours. And hours. Or running, alone in the mountains, for hours. Or sitting in front of my computer and writing. For hours. And on Saturday and Sunday afternoons, if I can get in a 90-minute nap, that’s extra joyful.

When I’m doing these things, I’m missing out on a lot of other stuff. And that’s just fine with me since I’m getting enormous joy from the things I’m doing.

I realize that by this description I’ve made JOMO apply to me. I imagine others can apply JOMO in many different ways, depending on what they do that brings them joy. Ponder this for a while.

Not surprisingly, there’s a book on JOMO titled The Joy of Missing Out: Finding Balance in a Wired World. As is my way, I’ve bought a copy, if only to support the author, but I expect I’ll read it soonish.

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Oct 4 2019

Thought Leadership vs. Cult of Personality

In 2011, my now-partner Chris Moody (and then-CEO of Gnip, which I was on the board of) kicked my butt about my endless statements about hating marketing. His thoughts on recasting “marketing” as “thought leadership” appeared on this blog in a post I Don’t Hate Marketing.

It remains a great example of one of the reasons I blog, which is to think out loud, get feedback, learn, and iterate. From that point forward, I changed my entire perspective on “marketing” and now focus almost all of my ideas around “marketing” on thought leadership.

Recently, we’ve seen leaders of several high profile startups implode, along with the current and possibly future expectations around their business. The one everyone was talking about last week is WeWork. Mike Isaac’s book, Super Pumped: The Battle for Uber, which I read a few weeks ago when it came out, is another contribution to this mix. And, there are a number of others, including many who are trying to keep out of the limelight all of a sudden.

A few days ago, I was pondering the idea of a “cult of personality” around a company or an institution and trying to come up with a way to describe when a cult of personality was dominating what was going on within and around a business. In many cases, a cult of personality can propel a company to extremely high profile or valuations, but it can also very quickly cause things to go completely off the rails.

If you ready my writing, you know that I like to use the word “obsessed” instead of “passionate”, and I much prefer working with people who are obsessed with what they are doing, rather than just passionate about it. I think passion is easy to fake, especially around entrepreneurship, and biases strongly toward extroverts. Obsession is almost impossible to fake, and while it can be unhealthy in the extreme, it is a powerful filter for me when talking to entrepreneurs.

While I was meditating yesterday, my mind was particularly noisy. I don’t know why, nor do I judge myself around it, but as I was watching (and labeling) the thoughts bouncing around, simulating a pinball machine in my mind, one popped out and lingered.

Entrepreneurs who create a cult of personality are obsessed about me, me, me.

I remembered the thought again this morning which prompted this post. I now have a simple way to separate between cult of personality and thought leadership.

  • CP: Obsessed about me, me, me
  • TL: Obsessed about the product, mission, idea

When the entrepreneur or CEO becomes the center of the narrative – or more specifically makes themself the center of the narrative – that’s a big red flag from my perspective.

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Aug 15 2019

Venture Deals Online Course – Fall 2019

Techstars and Kauffman Fellows are once again running the Venture Deals online course that Jason Mendelson and I put together several years ago.

If you’re an entrepreneur who wants to raise capital and grow your business, this online course teaches you the basics you need to know for working with VCs. And, if you are starting off as a VC or a lawyer for venture capital deals and you want a refresher on the core issues in a term sheet, this online course is for you.

Venture Deals is a seven-week, collaborative, “learn-by-doing” online course where you will watch videos from us along with doing project work as virtual teams. The workload for the course is about four to six hours per week, includes several live video AMAs with me and Jason, and covers the following topics.

  • Week 1 – Introduction of key players/Form or join a team
  • Week 2 – Fundraising/Finding the Right VC
  • Week 3 – Capitalization Tables/Convertible Debt
  • Week 4 – Term Sheets: Economics & Control
  • Week 5 – Term Sheets Part Two
  • Week 6 – Negotiations
  • Week 7 – Letter of Intent/Getting Acquired

The course is a great accompaniment to our book, Venture Deals: Be Smarter Than Your Lawyer and Venture Capitalist, which is about to come out in a new and improved 4th Edition that will be available by the time the course starts on September 8, 2019.

It’s free, and you’ll be joining over 23,000 people have taken the course in the past. Sign up for the course here!

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Jul 9 2019

Why Gross Profit Is More Important Than Revenue

I’ve been thinking a lot about gross profit (and gross margin) lately. Yeah, I know I can be riveting, but stay with me.

When I was in Boston a while ago (it was very cold, so it must have been January), I had a wide-ranging conversation with Eric Paley. This was before the IPO Summer of 2019 when all conventional valuation metrics have entered the land of “suspension of disbelief” which is short-term good and long-term well-we-will-see-…-eventually

One of our conversational threads was about how to value companies. We ended up talking about using Gross Profit, instead of Revenue, to do valuation analysis.

We’ve been doing this for a long time at Foundry Group. Since we invest across a number of different themes, we’ve had to deal with very different revenue and gross margin profiles since the beginning, whether we realized it or not.

For the purpose of clarity, in my world GP (gross profit) is a dollar amount while GM (gross margin) is a percentage.

Revenue is often equated with Net Sales, which is true in many cases, but Net Sales is actually more precise a measure than Revenue in situations where you have Gross Sales or Gross Merchandise Value as the “top level” revenue number. Also, I often see GM listed as GM%, which is fine. Some people also refer to GM as Gross Profit Margin.

This is regularly confused, even in accounting texts, so depending on which business class you took, you are going to call it a different thing. Oh, and if you use Quickbooks, you’ll probably refer to Revenue as Income, unless you have the current version of Quickbooks where this has finally been fixed. Isn’t accounting fun?

Even if a lot of people realize that SaaS companies have a different gross margin profile than hardware companies, many don’t acknowledge it when playing the valuation game. And, this logic – or lack thereof – applies to marketplaces where GMV is different than Net Revenue which is different from Gross Profit, or Adtech companies which have yet a different “Top Number to Gross Profit” calculation. And, it gets really exciting when a company has multiple revenue streams that include services and derivative transaction-based revenue (say, BPS in a fintech company.)

Today, I’m seeing almost all entrepreneurs and investors in growth companies talk primarily about revenue and growth rate. They tend to adjust the multiples to try to align with a group of comparison companies, but these comps rarely have a similar supply/demand economic associated with the equity of the company in question. And, when the comps are mature cash flow positive public companies, the multiple math diverges even more from anything particularly rational.

I’ve started encouraging the companies I’m involved in to focus on Gross Profit and the growth rate associated with their Gross Profit, rather than Revenue. Try the exercise and see how you compare to the companies you think you should compare to. And think about how much more value you could be creating with the same Revenue number but a higher Gross Margin percentage …

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Jun 7 2019

Deeply Vulnerable Writing on Startup Failure

Jasper Nathaniel recently wrote a long, detailed post titled When Your Startup Fails. It may be the most vulnerable and honest post I’ve read on failure, certainly in a while.

I spent the day yesterday in Grand Junction at Techstars Startup Week West Slope. After a full day of meetings, events, and talks, I ended up at dinner with a half-dozen CEOs of startups in the area (Grand Junction, Carbondale, Eagle, and Telluride.) I was pretty wiped out from the day and general bail out of dinners between 7:30pm and 8:00pm but we ended up going extremely deep on a bunch of personal and emotional stuff so when I got back to my hotel around 10:00pm I was pleasantly surprised with the tenor of the evening.

While there is endless writing about what to do to build your business, how awesome things are going, and why startups are so magnificent, I experience over and over and over again the intense personal struggle for founders and leaders around creating a business where nothing previously existed.

I wish more entrepreneurs would write extensively about their failure experiences in detail.

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