EforAll’s mission is to accelerate economic development and social impact through inclusive entrepreneurship in emerging communities. They are focused on fostering small business development and entrepreneurial activity amongst under-networked and under-resourced populations in communities that have been traditionally overlooked for economic investment.
The decision to support EforAll was easy for us as they focus on two distinct issues that we care about: building entrepreneurial ecosystems and supporting underserved entrepreneurs. Their metrics speak for themselves as their entrepreneurs have been: 57% unemployed or underemployed (when they started the program); 70% female; 41% immigrant; and/or 55% minority.
They also locate their programs outside, but near, communities that are traditional hubs for entrepreneurship. In Massachusetts (where they are based), they run programs in cities like Lawrence, MA, and Lowell, MA – both recovering factory/mill towns that lost their economic driver years ago when most of the factories closed down. In these two cities, EforAll has launched more than 130 small businesses and startups which have created almost 400 jobs in the community.
While there’s been tremendous growth in Colorado, it has been uneven across the state. We believe the importance of investing in the types of entrepreneurs and communities that EforAll works with is crucial, especially as the wealth inequality gap in our country continues to grow.
I’m particularly excited that EforAll has decided to launch their first Colorado site in Longmont. I’d like to invite you to come to an event on April 17th from 8:00am-9:
If you are interested in getting involved or supporting the effort, email Harris Rollinger who is the Executive Director of EforAll Colorado.
James Oliver, Jr. has written a fun book that is part memoir, part advice, for what he calls Parentpreneurs (entrepreneurs who are trying to raise kids.) He’s got a website with a bunch of history about him, his journey, and the book. It’s also got some pictures of his twins, which even I, as a non-kid kind of person think are pretty adorable (although they are apparently
I’ve had an email correspondence with James going back to 2015. In November, I got an email from him that, among other things, said:
“Brad, I think I mentioned I’m raising money for a WeMontage relaunch, which is taking a while-as expected.
In the meantime, the way I’m taking care of my kids is mostly via book sales. The book reviews have been wonderful-someone called it the
realestbook about being an entrepreneur they ever read. And the amazonreviews are fantastic.
In order to provide for my kids, I need to sell 300 books this month via my website (www.themoreyouhustle.com – because
amazondelays royalty payments by two months); that’s only 10 sales per day. “
I read it during my Q418 vacation. It was a quick read, fun and interesting, and game me perspective on James’s life as an entrepreneur and parent. The book also made clear how awesome his wife is and how important she is to his entrepreneurial journey.
If you still have some holiday spirit left in you, grab a copy of James’ book The More You Hustle, The Luckier You Get. You’ll be doing James a solid by helping him get WeMontage back up and running and get some valuable perspective and lessons along the way.
As we start spinning up Defy Ventures in Colorado, we are doing a Business Coaching Day at the Arkansas Valley Correctional Facility in Ordway, Colorado. It’s one of our first Defy Colorado events and Governor Hickenlooper will be joining us for the day.
There will be around 80 Entrepreneurs-in-Training. While we were planning on having spaces for 50 volunteers, we’ve already filled over 40 of them before even talking about the program so there are only a few spaces left.
If you are interested, the event is happening on February 8th, 2018 from 9:00 am – 4:30 pm. Contact Melissa O’Dell to sign up or get on the list for the next Defy Colorado event.
For a taste of what the experience is like, watch the video above or go to my post Understanding Privilege – My Experience in Prison.
In the fall of 2007, my friend Phil Weiser, Executive Director of CU Boulder’s Silicon Flatirons Center, convened 25 leaders from CU Boulder and the Boulder / Denver startup community. We spent an afternoon talking about the idea of an entrepreneurial university. Phil called the meeting a Roundtable, even though the table was long and rectangular.
The discussion that day was heated. Some in the room that day questioned whether entrepreneurship should – or even could – be a significant part of CU Boulder. Others made the case for entrepreneurship. Few of us anticipated the level of follow up from that discussion and the report that emerged set the stage for a lot of activity at CU Boulder over the ensuing decade.
One of my suggestions at the 2007 Roundtable was to borrow some ideas from the MIT 100K competition, which was started in 1989 as the MIT $10k. I got involved as a judge in 1993 and was active through 1997 with occasional visits to the finals in subsequent years when I was around Boston. When I reflect on my investment activity, including companies that went through the MIT 10K (NetGenesis, Harmonix, abuzz, and a bunch of others), I probably should have just invested $25,000 in every finalist company over the last 25 years.
In 2008, a group of student and faculty volunteers from CU Boulder launched the CU New Venture Challenge. Nine years later, the CU NVC today provides a platform for anyone – faculty, staff or student – who wants to start a company. The NVC integrates the campus by including all schools and departments. Mentors from the Boulder / Denver startup scene are deeply involved and many companies are emerging from the NVC, including Revolar, Pana, and Malinda.
Amy and I have decided to help take the NVC to the next level. Our foundation (the Anchor Point Foundation) is teaming up with the Caruso Foundation (Dan & Cindy Caruso) to offer a $50,000 investment prize offered to the “Most Fundable Company” at the 2017 NVC 9 Championships. This is in addition to the $25,000 prize money that the NVC already has available. Jason Mendelson will select and announce the Most Fundable Company winner, who can elect to take investment in the form of a convertible note, at the NVC 9 Championship.
So, the CU NVC is now is $75k competition. Next step, $100k … Finals are Thursday, April 6, at 5:30pm.
At the MIT Celebration of 50 Years of Entrepreneurship in November, I heard a number of fantastic lines that have stuck with me. One of them was from Noubar Afeyan.
“Entrepreneurship is intellectual immigration.”
As I sat in an audience of about 200 extremely accomplished MIT graduates spanning over 50 years, I thought to myself “he just fucking nailed it.”
I’m a huge fan and supporter of immigration, especially around entrepreneurship. If you look at the landscape of success entrepreneurs in the United States you see a remarkable number of first and second generation immigrants. We can argue about immigration policy all day long (and plenty in DC do, mostly to insure that nothing actually gets accomplished) but the historical statistics around immigration and entrepreneurship in the US are undeniable.
Noubar talked about immigration being “going someplace outside of your comfort zone.” Every first generation immigrant I’ve ever met has talked about immigrating to the US as something akin to this. Many entrepreneurs I’ve met have articulated a similar emotion around their experience leaving whatever they were doing to start a new company.
My whole life has been built around the idea of intellectual immigration. I’m constantly exploring new things, getting out of my comfort zone, and moving toward new “things.” As part of this, I’m moving away from (emigrating away) from old, established things.
Thanksgiving is a pensive time for me. The world slows down a little as it gets ready for the mad dash to the end of the year. Four day weekends are rare in the United States and even though the retail world is extremely busy on Friday, my Thanksgiving has a very different tempo as the email slows to a crawl, the calendar becomes empty, and Amy and I generally have a lot of hanging out time.
I’ve always thought Givingthanks should be a neologism but it never seems to stick, so I’ll roll with Thanksgiving. For the next few days as we celebrate Thanksgiving, I’m going to publicly thank a few people in my world who mean a lot to me and have given an enormous amount of themselves to others. I’m also going to give you a way to say thanks by supporting something meaningful in their world.
I’m going to start with my partner Jason Mendelson. We’ve worked together since the late 1990s, which is now pushing up against two decades. He’s become one of my closest friends and confidants. I was honored, with my other partners Seth and Ryan, to be the best men in his wedding. We have our moments, but the long arc of our relationship is one I treasure.
I’ve watched Jason have a remarkable positive influence on many. But I know that one of the activities he’s proudest of is his involvement with CU Boulder, especially around entrepreneurship. Among many other things, he has taught a class on Venture Capital at CU Law with Brad Bernthal. Last month, a group of their students put together the Jason Mendelson Entrepreneurial Award Fund.
Think about that for second – CU students and alumni of his course has put together a scholarship / award fund. That’s a testament to how much the class – and Jason’s involvement in it – impacted them. The initial fund has $50,000 in it and provides cash awards, scholarships, or stipends to students enrolled at CU Boulder who demonstrate excellence in the field of entrepreneurship.
Ok – so here’s how you can give thanks – to me or to Jason. You can contribute any amount to the Jason Mendelson Entrepreneurial Award Fund online. It’s a charitable gift and it will be helping support a student at CU around entrepreneurship.
Jason – on this Thanksgiving 2016, thank you for everything you do to make the world a better place.
A month ago Mark Suster (Upfront) and I hosted 75 colleagues for a full day at the California State Prison, Los Angeles County – also known as Lancaster. We did this as part of Defy Ventures, an entrepreneurship, employment, and character development training program for currently and formerly incarcerated men, women, and youth. It was a top 10 peak life experience for me – easily one of the most profound things I’ve experienced to date.
Mark wrote an incredibly detailed post about the experience. Rather than repeat it, I’m going to point you to his post How I Promise You One of the Most Meaningful Days of Your Life. In order to understand this post, you have to start there. So – go read it now – I’ll be here when you get back.
If you want more views of the day, read Ali Berman’s (Techstars) The Day I spent in Prison, Kerri Shea Beers’ (Techstars) White Privilege, Prison, and a Shot at Redemption, Ben Casnocha’s Visiting Prison Again — With Defy Ventures, Caroline Fairchild’s (Linked) I spent 12 hours in prison with 75 venture capitalists and founders. Here’s what happened, Rick Klau’s (GV) Last month, I went to prison. Next month, I’ll return, Jason Wang’s Going back to prison as the founder of my own startup, Kobie Fuller’s (Upfront) How a day in prison could give you a lesson on judgement, and Kara Nortman’s (Upfront) Spending a day in prison lead me on a path of radical self-improvement. Everyone wrote about the same day (we were all together) if you want to triangulate on the experience.
I’m going to focus on the part of the day where I finally began to understand the notion of privilege. It’s worth starting with one of the definitions from the Merriam-Webster Dictionary:
“the advantage that wealthy and powerful people have over other people in a society.”
The exercise lasted about an hour and was just before lunch. We’d had a lot of interaction with the EITs (we are volunteers, they are entrepreneurs in training or EITs) and were feeling as comfortable as one can feel in a level four maximum security prison. Catherine Hoke, the founder and CEO of Defy who ran the event, told us it was time to shift gears. As she described what we were going to do, she told us that it was imperative that we respond honestly. This wasn’t going to be a legalistic exercise, but it was going to be uncomfortable. We then got the rules.
The exercise was called Walk the Line. There were two strips of tape running diagonally across the gymnasium we were in. They were a yard apart. The EITs lined up on one side. The volunteers lined up on the other. We then all took five steps back from the line. As Cat called out questions, if our answer was yes we walked to the line. If our answer was no, we retreated to our position five steps behind the line. We were instructed to look around and connect visually with empathy across the line. We were not to look at the ground or at Cat. We were allowed to shake hands across the line and hug on our side of the line. Cat ended by reminding us that the dominant emotion we should be carrying is empathy.
She then started asking us questions. I’m going to list them all below along with comments in italics on how I felt in response to some of them. I encourage you to read them out loud – it’s the only way you will go slowly enough to really understand what was going on. Each question consumed about a minute as people walked to and back from the line, shook hands, looked at each other, hugged, and cried.
- I like hip-hop.
- I work out 3 or more days per week.
- I’m older than 20 years old. 25. 30. 40. 50. 60. 70.
- I dropped out of high school.
- I’ve earned a four-year college degree. Suddenly, I had a feeling about what was to come. Every EIT was away from the line. Almost every volunteer was on the line. This was an almost complete reversal from the previous question.
- I’m a natural-born hustler. There were lots of smiles as both sides were generally on the line.
- I’ve been self-employed or started my own business, legal or illegal. The smiles continued, with some chuckles interspersed, as a lot of people on both sides were on the line.
- I’m committed to starting my own business. 100% of the EITs were now on the line.
- This is my first trip to prison. Very few EITs were on the line at this point, meaning many had been in prison before.
- I felt at least a little nervous about coming to this event today. 100% of the volunteers were on the line. 100% of the EITs were on the line.
- I regularly feel judged by others … for skin color or economic status. The volunteers take a step back, the EITs stay on the line.
- I regularly judge others.
- I regularly judge myself.
- I came here to give of myself.
- I came here to take or to receive for myself.
- I can already feel myself comparing myself to others, or judging myself or others, right now. 100% of the people on both sides are on the line. Cat reminds us that we are answering honestly and thanks us for doing this.
Even if I don’t know all of you at this line …
- I will to do my best to set aside my judgments and comparisons so I can connect with you.
- If you become vulnerable in this exercise, I will show you respect and will do my part in creating a safe and reassuring environment for you.
- If I see or sense pain or vulnerability, I will offer a hug to reassure you. Both sides of the line are full. I feel anxious all over – I’m sweating and staring ahead across the line, making eye contact in a way that I think is empathetic with the person directly across from me. He looks uncomfortable. I feel uncomfortable.
- I grew up in poverty. Boom.
- My parents paid for braces to straighten out my teeth. All the EITs are off the line.
- I heard gunshots in my neighborhood. (wave for “a lot”) All the EITs are on the line. Several volunteers who I know are on the line.
- I was suspended or expelled from school. Almost all the EITs are on the line. Several volunteers are on the line.
- Violence took place in my home. Again, all the EITs are on the line.
- Think of the age when you lost your innocence: I lost my innocence after age 18, 16, 14, 12, 10, 8, 6. As the count down begins the EITs are on the line while the volunteers quickly back off the line. By age 6 there are still a startling number of EITs on the line. I have tears in my eyes as a wave of emotion comes over me. I don’t feel like I lost my innocence until sometime in my early 20s. I can’t imagine self-identifying with losing it younger than age 6.
- For most of my childhood, I was raised with both of my biological parents in the same house.
- At least one of my parents wasn’t exactly a positive role model for me – or wasn’t even around.
- I was born out of wedlock. I was born to a teenage mother.
- At least one of my parents abused drugs or alcohol.
- I suffered through the loss of an immediate family member before the age of 18.
- My mother or father has been to jail or prison. At this point, the patterns are clear. The EIT directly across me stays on the line through all these questions but the first one. I’ve been off the line since the first one. Now he has tears in his eyes. I keep his gaze while thinking how fortunate I am to have had my childhood and not his.
My beliefs and values before the age of 18
- I learned that I couldn’t trust anyone. It continues. Now I have tears again. He smiles at me. He breaks my gaze and looks at the person next to me. I use this moment to look up and down the line on my side. Very few volunteers are on the line. One who I know is on the line and is crying openly. But we continue.
- I learned that it’s better to keep my mouth shut and my feelings to myself.
- The way I was living, I thought there was a good chance I wouldn’t make it to age 21. There are hugs on our side of the line as we process what is going on. At this point the word privilege isn’t being used (nor does it get used openly throughout the day), but the idea of privilege and how it impacts one’s belief system and values is what is front of mind for me.
Past Criminal life – Cat reminds us that Defy doesn’t work with criminals, but with people who have committed crimes in their past.
- I’ve been arrested.
- I’ve done criminal things for which I could’ve been arrested, but didn’t. (drunk driving, weed) A series of experiences run through my mind as I think of how different things could be for me if I hadn’t grown up white and middle-class in the suburbs of North Dallas.
- I’ve committed a violent offense (even if I wasn’t convicted). Cat stays on this for a while. As all the EITs are on the line, a few volunteers join them. Cat isn’t satisfied and calls out “a bar fight is a violent offense” and a dozen volunteers sheepishly walk to the line. Then a few more do. And we sit with this one for a while.
- I’ve been convicted of murder.
- I was sentenced before 18 years of age. I’m ready for this experience to end. Between 25% and 50% of the EITs are on the line. All of them are black. Another switch just flipped in my brain.
- I’ve spent more than two years of my life in behind bars. 4. 6. 8. 10. 12 (go all the way up). Guys that look like they are in their 30s are hanging on the line through 20 years. We keep going. 30 years. 40 years.
- I’m a lifer. Yup – there are a bunch of EITs on the line.
- I’ve actually been shot or stabbed.
- I’ve lost someone I loved to gang violence.
- I’ve lost someone I’ve loved to AIDS. I was one of the few volunteers on the line for this one. I didn’t expect this question at all and it sent me back to my late 20s when my fraternity big brother died of AIDS. I remembered the dream I had on an airplane just before he died but about a week after he called me to say goodbye. I kept looking ahead at the EITs on the line.
- I’ve lost one or both of my parents.
- I’ve lost a child.
- I haven’t properly grieved some of my losses.
- I have suffered, or currently suffer, from depression. A lot of volunteers are on the line along with me. I feel a sense of relief that the stigma associated with depression might be lifting, but then I remember the context I’m in.
- I could use a hug right now. Everyone walks to both sides of the line. Hugs ensue.
- I’m a father (or mother).
- My lifestyle caused me to miss out on valuable years in my child’s life.
If you could see inside my brain …
- If you knew every one of my dirty secrets, and knew the real me, you wouldn’t love me.
- I feel ashamed of my past.
- I feel inadequate, at least in some ways.
- Sometimes my feelings of inadequacy lead me to overcompensate in some areas, or act out.
- There are some things I haven’t forgiven myself for, and may never forgive myself. A number of volunteers walk to the line, including me. I thinking of a specific thing that has happened to me as an adult. It’s something I don’t talk publicly about because I haven’t yet resolved it myself. Or, more honestly, I haven’t forgiven myself for letting it happen to me. I feel ashamed against the backdrop of everything else.
- There are some people I haven’t forgiven for hurting me.
- Not forgiving others or myself is hurting me to this day.
- I am kind to myself; I do a great job of nurturing myself and taking care of my own needs.
- I’m on a journey of personal transformation. Almost all of the EITs are on the line. People are starting to smile again.
- Others look at me as a role model. I’m aware of the importance of my influence.
- I might not be able to explain it, but even though I’ve been revealing difficult things and have made myself vulnerable in this exercise, right here, right now, I feel safe, accepted and loved.
- I already love Defy!! Everyone on both sides is on the line.
I know that words above doesn’t do the experience justice, but at the end of the hour I was emotionally exhausted. There were at least 25 of the EITs who I had made eye contact with that I wanted to go talk to. There were an equal number of volunteers who I wanted to talk to. Instead, I tried to relax a little. I grabbed on to one word – privilege – that I knew represented a fundamental difference between most of the people on either side of the line.
While it’s easy to talk about privilege it’s hard to really understand it. It’s even harder to experience it if you are the one with privilege. I thought I understood it, but I didn’t. As I let the next five minutes quietly unfold in my mind, I decided that I was no longer going to assume I really understood privilege. Instead, I was going to engage with society in a way to help those without privilege have a better opportunity. Through that, I’d understand it better, have empathy for others who didn’t have privilege, and channel my actions as a human into making the world better from that frame of reference.
I’ve committed to go to prison with Defy four times in 2017. If you want to join me as a volunteer on one of the trips, just reach out. I can promise you a life changing day.
I’m in Minneapolis with my partner Seth. We had a meeting at Best Buy headquarters, met with a gang from the Mayo Clinic who drove up from Rochester, spent the afternoon at the Techstars Retail Accelerator which is at Target headquarters, and had dinner with Revolar. We are at the Techstars Retail Accelerator again today, then at Leadpages for a board meeting, and wrapping up with an internal Target event and an external startup community event put on by Beta.MN.
It’s two full days of immersion in the Minneapolis startup community. As I crawled into bed last night after jamming through my email, I smiled and thought to myself that Seth and I had a good day with a bunch of people talking about the power of entrepreneurship – and how the entrepreneurs are the leaders – while getting to work with a bunch of entrepreneurs.
I woke up to Fred Wilson’s post Understanding VCs and nodded my way through it. I particularly loved how he started.
VCs are not heroes. We are just one part of the startup ecosystem. We provide the capital allocation function and are rewarded when we do it well and eventually go out of business when we don’t do it well. I know. I’ve gone out of business for not doing it well.
If there are heroes in the startup ecosystem, they are the entrepreneurs who take the biggest risks and create the products, services, and companies that we increasingly rely on as tech seeps into everything.
What Fred said.
VCs – go read his post and reflect on it.
Entrepreneurs – go read his post and take it to heart.
Fred – thanks for saying it so well in your inimitable direct style. Understanding VCs is one for the books …
A few weeks ago I had lunch with John Dearie to discuss a new non-profit he has started called The Center for American Entrepreneurship. Several friends and people I respect a lot are on the board, including Lucy Sanders (NCWIT), Troy Henikoff (Techstars Chicago), Bob Litan (Brookings Institute), Rebecca Lovell (Seattle’s Office of Economic Development), Monisha Merchant (formerly Senator Bennet’s Economic Advisor), Jonathan Ortmans (Global Entrepreneurship Network), Jason Seats (Techstars), Dane Stangler (Kauffman Foundation), and Vivek Wadhwa (Stanford).
When I know, work with, and respect more than 50% of the board of a new non-profit, I pay attention. I’m glad I did – the conversation with John was stimulating. He has a vision and the experience to create a non-partisan organization to engage and educate people, especially policymakers in government, regarding the critical importance of entrepreneurs and startups to innovation, economic growth, and job creation.
While that might sound like a mouthful, I’ve been railing against the limitations of the way our government thinks about entrepreneurship for a decade. I’ve had a number of meetings over the years with the Small Business Administration (SBA) whose name says it all. I’ve often encouraged them to rename themselves the High Growth Entrepreneurship Administration, or even to create a separate organization, or split the SBA in two, or, in a fit of libertarianism, eliminate the SBA altogether. But, I know that none of that is going to happen because of a number of factors, including the fundamental lack of understanding in government about the difference between small business and high growth entrepreneurial businesses. Oh, and inertia.
Over the last few years, I’ve been exploring the idea that we really have two types of small businesses: local businesses and startup businesses. Both are important, but they have very different needs and contribute to the fabric of our economy in very different ways. As John and I were talking, he slid his book, Where The Jobs Are: Entrepreneurship and the Soul of the American Economy, across the table to me. I turned the pages and then over the weekend I read it while laying on the couch after a run.
It’s a great book that every policy maker in government at any level should read. It’s the first book I’ve seen that lays out an effective set of policy recommendations, with substantiation, for the startup society that we are living in. Against the backdrop of total government confusion about economic growth dynamics, combined with endless shallow rhetoric about what to do, I found it to be refreshingly optimistic.
While The Center For American Entrepreneurship website has a series of pages describing the issues and solutions to them, I didn’t find a crisp summary of the book on the web. So I decided to create an outline of the policies and the recommendations. They follow. If you disagree with any, or have any to add, please toss them in the comments as I evolve this as a list of “ways government can help startup communities.”
“Not Enough People with the Skills We Need”
- Incentivize STEM Education
- Launch a Curriculum-Focused Dialogue Between Business and Education
- Launch an Education Reform Dialogue Among America’s Educators
- Incentivize Experienced Talent to Consider Joining Growing Startups
“Our Immigration Policies Are Insane”
- Eliminate the Cap on H-1B Visas
- Award “Graduation” Green Cards
- Create a “High-Skill Immigrant” Green Card
- Create a “Startup Visa”
- Create CitizenCorps
“Not All Good Ideas Get Funded Anymore”
- Make the SBA More Entrepreneur-Friendly
- Incentivize the Formation and Commitment of Angel Capital
- Fix Venture Capital by Fixing the IPO Market
- Cultivate the Formation of Viable New Businesses
- Increase Startups Access to Capital
- Enhance the Science and Technology Capacity of the U.S. Workforce
“Regulations Are Killing Us”
- Devise a Preferential Regulatory Framework for New Business
- Require Third-Party Review of All Proposed Regulations
- Create a Regulatory Improvement Commission
- Rank States’ Regulatory Environment
“Tax Payments Can Be the Difference between Survival and Failure”
- Establish a Preferential Tax Framework for New Businesses
- Allow Cash Method of Accounting for the First Five Years
- Allow 100 Percent Expensing of Business Investment for the First Five Years
- Pass the Startup Innovation Credit Act
“There’s Too Much Uncertainty – and It’s Washington’s Fault
- Gradually But Significantly Reduce the Federal Budget Deficit and National Debt
- Enact Comprehensive Competitiveness-Enhancing Tax Reform
- Increase the Research and Development Tax Credit – and Make It Permanent
- Return Federal Funding of R&D to 2 Percent of GDP
- Jump-Start America’s Trade Agenda
- Negotiate a U.S.-China Free Trade Agreement
- Combine and Modernize Unemployment Insurance and Trade Adjustment Assistance
This cliche, which has uncertain attribution (Winston Churchill, Rahm Emmanuel, M. F. Weiner) is a priceless line that gets tossed out periodically, especially in the middle of a crisis.
Over the years I’ve been involved in many business crises. I qualify this, since my crises have never involved life and death or the survival of the human race. But they are still crises. Some have lasted moments while others have lasted months, and I can think of one that went on for three years – or at least took three years to dig out of.
I’ve only occasionally been in the CEO (or equivalent) role during a crisis. Most of the time I’m a board member or investor. As a result, I’ve participated in dealing with the crisis, but I’ve also been able to observe the behavior of the leader during the crisis. While I’ve had to go throw up in the bathroom after a particularly distressing conference call more than once, I’ve been fortunate to be able to be one level removed from the essence of the crisis.
A typical leader has a natural tendency is to be defensive in the face of a crisis. The first reaction is to blame someone – or something – else. Often the blame is aimed at something abstract or non-controllable, which often has nothing to do with the crisis, but is adjacent to whatever is going on so it’s an easy target. As soon as the blame is out there, the attack begins, which often causes others to be defensive, generating a vicious cycle of anger, hostility, frustration, and obfuscation at the beginning of the crisis.
Over time, I’ve learned that the best leaders take a completely different approach. When the crisis erupts, rather than immediately go into action, she pauses and takes a deep breath. She starts collecting data about what is happening. In parallel, she communicates the crisis to the key people who need to be involved – the board, the leadership team, and anyone specifically engaged in the crisis.
If the crisis lasts moments, rapid action is critical. But if it’s simply the beginning of a broader issue, especially one where the root cause isn’t known yet, the worst thing a leader can do is act immediately. As a teenager, my dad taught me about the idea of unintended consequences and I’ve had the experience, and how to deal with it, pounded into my soul over the years.
If you want to understand this better, I encourage you to read Charles Perrow’s classic book from 1984 – Normal Accidents: Living with High Risk Technologies. I often forget to mention it when asked which books have influenced me the most – Normal Accidents is in the top 10.
So, you are now in the crisis. As CEO, you feel an immense need to address whatever is causing the crisis and resolve it. But that’s only half of it. If all you do is focus on solving the crisis, you are missing the big opportunity, which is to learn from it and integrate it into the fabric of your company. It’s not that you won’t ever have a crisis again – you most certainly will. But if you can change the way your company functions in the context of a crisis in a positive way, you can actually get some value out of the crisis.
Don’t forget to breathe.