Category: Entrepreneurship
We are sandwiched between Thanksgiving and Christmas in a country that is recovering emotionally from two disasters named Sandy – one natural (Hurricane Sandy) and one man-made (Sandy Hook). Our politicians in Washington are playing a zero-sum game around the Fiscal Cliff. The CEO of the NRA just held a press conference and said “we should be able to afford to put a police officer in every school” and he called on Congress “to appropriate whatever is necessary to put armed police officers in every school in this nation.”
I get 500 emails a day – sometimes more. Many of them are from people I don’t know looking for advice and funding – I try to respond to them all. Every single day at least one of them goes off the rails as a result of my simple and direct feedback, often that I’m not interested in what they are doing. Here’s an example from a few minutes ago.
well if you ever come across investors who give a fuck the business plan is there online, recently updated this morning.
I did clicked your link, it’s just internet plays, you can’t swing a cat without hitting an investor investing there. Like I said if that meant anything there would be no talks of a fiscal cliff. We been investing in the internet for decades and worst for it.
If you in a hole you stop digging but if you are an internet investor you invest in an app that digs a bigger hole.
Brad you live in the same country I do, so where ever you are on the socioeconomic ladder, you in the same fucking hole. Except you investing in shovels and telling me you an expert in that. Oy vey.
This was in response to me passing because the business was something outside software / Internet and I stated that it was outside my area of expertise and pointed the person at our themes.
If this was a once in a while thing I wouldn’t call it out. But it happens every single day. I suppose if I ignored all the random emails I got, this wouldn’t happen, but then I’d be “one of those VCs that isn’t responsive.”
Fortunately this is 1 out of 500. The vast majority of stuff I get from people I don’t know is positive. The ad hominem attacks I get – either from people I don’t know or people I try to be responsive are part of the drill. But every time I’m on the receiving end of one, I think to myself “that’s not a winning strategy.”
Everyone is allowed to feel how they want to feel. But recognize that if you are an entrepreneur, trying to create a business, raise money from investors, sell products to customers, and hire employees, that angry, hostile, and bitter is not a winning strategy. And – if it hasn’t been working for you, maybe try something different in 2013.
George Orwell Talks To Us From The Future About a Free and Open Internet
I thought this was a powerful and clever video about the risks to the free and open Internet. It’s worth a watch with an appropriate cynical and concerned view.
I was happy to see Google launch their Take Action site last week about a Free and Open Internet. I’m a supporter and strongly encourage your support as well.
Vint Cerf (one of the actual creators of the Internet) talks more about the need to keep the Internet free and open.
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Amy and I wrote a meaningful amount about entrepreneurs and depression in Startup Life. Since we finished the final draft a few weeks ago, I’ve given several talks where depression came up as I’ve woven my own experience with depression into the short (less than 15 minute) version of my story. I’ve received a surprising (to me) number of emails from people thanking me talking about it publicly, along with my discussion of the anxiety disorder (obsessive compulsive disorder) that I’ve struggled with my entire adult life and that was severe during the serious depressive episode I had in my early to mid 20s.
So the idea of depression has been on my mind. It doesn’t surprise me that I feel down and flat as I sit here in the Charlotte, North Carolina airport on my way to Lexington, Kentucky on day 16 of a 19 day trip. I’m tired, strung out, missing home, missing Amy, and running out of extrovert energy. I’ve had a great time with all the people I’ve been with and the events I’ve had around Startup Communities. I’ve had several extraordinary experiences like dinner last night in Toronto with a dozen fantastic entrepreneurs who I hope to have continuous involvement – as a friend and potential investor – in the future. But as I sit here, I’m surrounded by a lot of grey, and it’s not just the clouds outside that are the remnants of the storm.
I’ve reached out to most of my friends in New York to check in on them. They are all doing fine even though a few were hit hard and are now effectively homeless as lower Manhattan gets cleaned up. I picked a spot in the airport far away from the TV – I couldn’t stand the endless news cycle that mixed Sandy with Romney with Obama. I had some extra carbs hoping that would help – it just made me feel sleepy. Yup – I know what this feeling is.
I know many entrepreneurs who deal with different levels of depression. My close friend Jerry Colonna is extraordinarly eloquent about this and how it impacts entrepreneurs. Ben Huh, the CEO of Cheezburger, wrote a powerful post about his struggle with depression titled When Death Feels Like A Good Option. And I’ve had many conversations with other entrepreneurs about my, and their, struggle with depression.
For some reason we’ve embraced failure as an entrepreneurial trait that is ok, but we still struggle with acknowledging and talking about depression. Entrepreneurs function with a wide range of stresses and emotions that often have overwhelming intensity. In many cases, we are afraid of admitting depression, and are often highly functional when we are depressed. But that doesn’t deny the fact that entrepreneurs get depressed. To deny this, is to deny reality, and that’s against my value system.
I just went back and read what we wrote in Startup Life about depression and it made me smile. I’m really proud of the work that Amy and I did on that book – I think it is the best book I’ve been involved in writing (Venture Deals, which I wrote with Jason Mendelson, is a close second) and I’m hopeful that it has a lot of impact and value for entrepreneurs and their partners.
Just writing all of this makes me feel better. Thanks for listening. Time to get on the plane and go to Lexington.
Amy and I shipped the final draft of Startup Life: Surviving and Thriving in a Relationship with an Entrepreneur yesterday. “If you are interested in this book, go pre-order it now on Amazon to help our pre-order numbers”, said Brad the Book Salesman.
The backlog of things on my to do list is at an all time high. I’m normally super responsive to everything and have zero backlog. That is not the case right now.
The only thing in front of me for the next seven hours is the Detroit Marathon which I’m going to go suit up for after I finish writing this blog post. I don’t expect this to be a pretty marathon – I haven’t been running very much, or consistently, since my bike accident six weeks ago, but I’m running to support my partner Jason Mendelson who, along with Jill Spruiell and Becky Cooper from Foundry Group, are running their first marathon. Our partner Ryan McIntyre is also running today, along with Andrew Tschesnok of Organic Motion. I think it’s pretty cool that 36% of Foundry Group is running this marathon.
While my backlog is huge, I’ve been focused on making sure I’m responsive to all the top order stuff. In my hierarchy this is Amy, my partners, the CEOs of companies I’m an investor in, anyone else who works for a company we are investors in, and our LPs. That’s it – everything else is in “the next bucket.” I’ve gotten plenty done outside of this, but all my excess available time over the last thirty days has been allocated to shipping this book. If you check with Kelly and ask about my schedule, she’ll suppress a laugh as she tries to fit you in somewhere.
Every time I ship something I have new respect for all the entrepreneurs and people who work for the companies we are investors in. I’ve had a lot of time (almost 30 years) to work on my “prioritization algorithm” and feel like I’ve got it well tuned. I’ve always had a continual overcommit problem – where I take on slightly too much and then have to back off on some optional stuff – and this cycle repeats itself regularly in my life. However, when you commit to shipping something, like a book, you have a deadline and suddenly have to execute against it. The high order priorities come into clearer focus. The separation between them, and everything else, become crisp. When I’m sitting in a hotel room at 11pm after a day that started at 5am, I no longer am thinking that I’m going to get through all of my email. Instead, I’m learning the brilliance of using Google Circles to search my inbox for circle:”foundry ents” label:inbox and make sure I get all of those done before I go to sleep.
While I’ve got a ton of other things I want to get to that are interesting and relevant to me, none of them are either timely or important, at least to me. I realize they are timely and important to the person on the other end so I’ll eventually get to them, but the prioritization filter gets tight and the first constraint to enforce is timeliness. I try not to spend any time on stuff I don’t think is useful. As Amy likes to tell me “I’ll be the judge of that” – and I am the judge of what I want to spend my time on, and I’m sure I get this wrong some of the time. If you aren’t in the “inner circles” (yes – Google really got this right) then you have to wait. I’ll eventually get to it, but it won’t be first.
Everyone I know talks about how busy they are. And I’m sure they are. But if you haven’t shipped a product lately, I encourage you to configure something you are working on to look like a product that you are shipping. If you don’t have an external deadline, give yourself one. When you are working on something that has to ship in two weeks, you realize how much stuff is trying to get your attention that isn’t a priority, or even relevant to your mission on this planet. It’s a good way to remember how to prioritize. And it’s an excellent reminder to me about the pressure the people I invest in are under who continually ship products.
If You Can’t Explain What You Do In A Paragraph, You’ve Got A Problem
Here’s an email exchange that I had in the past 24 hours with an entrepreneur. Remember, I try to answer all of my emails and be responsive to any inquiry – this was a random one (which I get between 25 and 100 a day).
Entrepreneur: I just wanted to touch base with you and see if you are taking on new startups right now.
Me: Can you send me a paragraph and I’ll tell you if it’s something we’d be interested in. Everyone else to bcc:
Entrepreneur: It’s difficult to accurately describe the company, myself, and everything else in a single paragraph. To write something so small but somehow include every important aspect is near impossible, if not impossible. My company is too complex to be described in a single paragraph.
I responded politely that I didn’t think this was something I’d be interested in exploring. I did skim his longer description and took a look at the website (which was a landing page with some a vague description of the business.) I could determine from this that it’s not something we’d be interested in (it’s outside of our themes) but this entrepreneur also missed his chance to engage me more deeply since he couldn’t articulate what he was doing.
I was in Oklahoma City earlier this week with the entrepreneurs at the Blueprint for Business accelerator (it’s a member of the Global Accelerator Network). There were five companies there and in addition to the various talks I did around Startup Communities I stayed at BP4B until about 10pm doing 15 minute meetings with each of the teams. I did my typical 15 minute “top of mind drill” where I start by saying “tell me about yourself as quickly as you can and then let’s spend most of the time talking about whatever is on the top of your mind.” Several of the teams explained themselves in a minute or less and then had 14 minutes to ask me questions; several of the teams took five to ten minutes to explain themselves leaving less time for questions.
I strongly believe that a founder should be able to explain what they do in one paragraph. I’m not a believer in the “one sentence mashup approach” (e.g. we are like pinterest + groupon + facebook for dogs). Rather, I like three sentences: (1) what we do, (2) who we do it to, and (3) why you should care. Sometimes this can be two sentences; sometimes four, but never more than a paragraph.
Yesterday, I spent 30 minutes with one of the teams in TechStars Seattle that I’m a lead mentor for. They are a month away from Demo Day and wanted to practice the very rough version of the demo day presentation. I gave them a bunch of feedback – some specific, some general, including:
- Show don’t tell
- I hate doing the overview / bios at the beginning
- You wasted the first 60 seconds
- Weak explanation of what you are actually doing and why I care
- Still don’t really know what you do
If you are an entrepreneur, you have less than 60 seconds to get an investors attention. Don’t waste it.
FAKEGRIMLOCK showed up recently at HBS to give a short lecture on Minimum Viable Personality. In Grimspeak, IT AWESOME.
If you want more of FAKEGRIMLOCK, go check his post on my blog from a while ago – BE ON FIRE – which inspired my book Burning Entrepreneur – How to Launch, Fund, and Set Your Start-Up On Fire!
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A few weeks ago an entrepreneur of a fast growing consumer-oriented company told me that he has every new employee do customer support for two weeks. Their approach is they onboard the new person, given the a one week “get settled into your role / get up to speed on the company” period and then they spend weeks two and three full time in the customer support organization.
I’ve let this roll around in the back of my head and think it’s absolutely brilliant. The first week is a typical “first week at a new company” which includes a formal day of orientation on the first day. The next four days are structured around on-boarding the person and getting them involved in their role and their team, but not too deeply. This allows there to be a “break in period” where the person is learning the systems and structure of the company.
Week two is a full time immersion in the customer care organization. Total front-line stuff. The same first week any new customer care rep would get. Day one is whatever the normal orientation is followed by four days of “training wheels customer care.”
Week three is a fly on the wall from a managers view of customer care. Rather than front-line support, this is involved in all the meetings – up and down the customer support organization – to understand what people are dealing with. The last day includes a debrief meeting with the CEO.
I think a version of this process could be created for virtually any size company in any market segment. You are trying to have the person do three things: (1) be on the front-lines of the company and understand what that looks like, (2) engage directly with the product and customers, and (3) understand how the organization works from the customer point of view.
There’s a powerful second order effect, especially if every employee does this regardless or rank or title. In the first month of their tenure, they see the organization from the inside out. This creates a powerful common view that can generate an entirely different set of early actions for anyone in a new role. It also creates a powerful culture dynamic. And it does a little of what we try to do in the first month of TechStars – which is to “slow down to speed up.”
I’m curious if anyone out there is doing something similar or has suggestions to add or modify this.
Last night Amy and I had an awesome dinner at Perla with Fred Wilson, Joanne Wilson, Matt Blumberg, and Mariquita Blumberg. Fred and I have been involved in Return Path for a dozen years and this has become an annual tradition for us when Amy and I are in NYC. At 12 years of service, Return Path gives a six week sabbatical and a pair of red Addidas sneakers as a “get ready for your sabbatical” gift. Fred and I got the sneakers, but not the six week sabbatical.
I sat across from Joanne and since the restaurant was noisy our table ended up having two separate conversations going. Joanne is awesome – if you don’t read her blog, you should start right now, especially if you are interested in NY entrepreneurship, women entrepreneurs, food, and the thoughts of an amazing woman. I still remember meeting her for the first time around 1995 and thinking how dynamite she was.
Oh – and if you are a seed stage company in NYC looking to raise money, you are an idiot if you don’t immediately reach out to Joanne and try to get her involved. She is one of the most thoughtful angel investors I’ve ever met.
We talked a lot about seed stage investing during our part of the conversation. Joanne has done about 25 investments in the past few years and has a very clear strategy for what she invests in. She works incredibly hard for the companies she invests in, is deeply passionate about the products and the entrepreneurs, and clearly loves what she does.
During the conversation we had a moment where we were talking about feedback. I told her about my approach of saying no in less than 60 seconds. She told me a story about giving entrepreneurs blunt feedback in the first meeting, which I always try to do also. And then she said something that stuck with me.
Joanne will often start a meeting by saying something like I give you permission to hate my feedback. You can decide that you want to tell me ‘fuck you’ after the meeting. But I’m going to tell you what my direct and honest reaction is.
Now Joanne is a New Yorker through and through. Aggressive, direct, and clear. But never hostile. Ever. And a deeply loyal supporter. So this feedback, while direct, is incredibly powerful. It’s often extremely hard for someone to hear, especially if they are in “I’m trying to convince you to fund my company mode.”
I play the same way. At Foundry Group, one of our deeply held beliefs is that we always be intellectually honest, no matter how difficult it may be. At TechStars we pride ourselves on providing direct feedback, but always saying “this is only data”, letting the entrepreneur make their own decision about what to do.
These are versions of Joanne’s permission to “hate her feedback.” It’s a powerful way to frame any discussion. And I know I’ll be using the phrase “I give you permission to hate my feedback” many times in the future.
We constantly hear about “product market fit.” But my post yesterday about The Power of Passion When Starting Your Company was about “founder market fit.” And I’ve come to believe that – especially among first time entrepreneurs – founder market fit is much more important than product market fit at the inception of the company.
I stumbled on the phrase a few times over the past year and it’s been rolling around in my head a lot since. The first time was on Chris Dixon’s blog Founder / market fit which led me to a guest post by David Lee of SV Angel on More Thoughts on What Makes Great Entrepreneurs Great.
I’ve seen this over and over in TechStars. Founders come in with something they are super excited about. As they get exposed to mentors and feedback, they quickly start moving around within the market (or domain) as they search for a clearer focus, which could be defined as product market fit prior to getting a product out there and doing any real testing. This search is usually qualitative – it involves real feedback from potential customers and users, but it’s not a measured, tested approach.
In parallel, there’s often a Lean Startup methodology going on that does more quantitative tests of the specific product. But in a lot of cases, the qualitative feedback at the very formative stages is just as, if not more, important to make sure you end up in the right zone to test.
Underlying all of this is the regular shift away from something the founders are passionate about. The Orbotix example in my post is a great one – it would have been easy for Adam and Ian to decide to work on something that had a better product market fit, like iPhone enabled door locks, instead of something that not only hadn’t been invented yet, but also wasn’t obvious what market would really want it (a ball controlled by your smartphone – ok – that’s cool, but who will buy it?)
They, and their co-founder and CEO Paul Berberian had a vision for who would want a ball controlled by a smartphone. And Adam and Ian were obsessed with the idea. The three of them had extraordinary founder market fit, well before they figured out the product market fit.
We’ve got lots of other examples of this in our portfolio. I can’t tell you the number of times I get asked “what would someone ever use a personal 3D printer for?” But Bre Pettis at MakerBot is completely and totally obsessed with bringing 3D printers to the masses. While product market fit is getting clearer with each new product release, the founder market fit in this cases was awesome. Or Isaac Saldana of SendGrid, who initially named the company SMTPAPI. He has a great chapter in Do More Faster where he wrote about how he “Looked for the Pain” as a developer, found it in sending transaction email, and created SMTPAPI (now SendGrid) to address it. Or Eric Schweikardt who is unbelievably focused on creating the next generation robot construction kit at Modular Robotics. Sure – the “market comp” in this case is Lego Mindstorms, but Eric’s vision for the market goes well beyond this, and the product follows.
I’m not suggesting that product market fit isn’t an important concept. It is. But at the very beginning, especially with first time entrepreneurs, founder market fit is even more important.