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Breadwinner
As an investor, I understand why angels, VCs, and even high-profile early-stage accelerators seek evidence of potential future success when evaluating newer startups. Yet would-be founders and startup fundraisers often find that one of the biggest challenges of building something new is supporting themselves and their families while doing it.
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Making Luck
Are you lucky? Does your success flow from being in the right place at the right time? Or, when we dig beneath the surface, do we find that an entrepreneur makes their own luck? Perhaps the story of an amazingly “lucky” entrepreneur will inspire you to also create your own luck!
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Pursuing Mythical Creatures
The fantasy of many intrepid first-time startup entrepreneurs is to build a unicorn. Visions of technological breakthroughs, hypergrowth, and wealth creation sing a siren song as the excitement of living the dream takes hold. Yet, let us not forget that unicorns are legendary creatures rather than something you find in every woodsy glade – and there are reasons for that!
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Resilience
Founders and startup leaders face unexpected challenges, persistent stress and uncertainty, overwhelming setbacks, and endless changes usually for years. Responding effectively and continuing to build the business demands resilience on many levels.
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What’s in a Name?
Naming your high-potential startup is one of the first actions of a co-founding team. The selected name captures the essence of the fledgling company as you go out into the world raising money, connecting with partners, and ultimately selling to customers. It is a more critical and strategic decision than many realize, so let’s examine some lessons learned regarding this…
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In-sourcing and Outsourcing
It often seems like it would be possible to grow a startup faster by outsourcing some of the key functions to an expert service provider. Sometimes, this is true, but often, there is less leverage than you might think – and there is undoubtedly a great deal of risk.
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Evaluating CEOs
Evaluating employee performance has a certain framework, however, that framework is applied somewhat differently when assessing a startup CEO. A CEO is ultimately responsible for an organization's performance, so the core of a CEO evaluation is fundamentally an organizational evaluation.
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Authoritative
How do we recognize leaders? Often, it is the fact that they speak authoritatively, which flows from their confidence, decision-making, and vision-casting. This matters in startups because all startup stakeholders are looking for someone who will hopefully lead an extraordinary value-creation process.
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Hard Fundraising Market Drivers
When fundraising, it is easy for startup leaders to focus intensely on their stories and arguments for why their startup is a great investment opportunity. While a cogent case must be built and delivered, exogenous factors often play a critical role in fundraising success and failure.
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CEO Whispering
The job of a startup CEO is multi-faceted and endlessly challenging. Yet, there is no degree or comprehensive playbook out there to provide the training for how to succeed. Enter the "CEO Whisperer."
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Critical Success Factor: Decision-Making
Startup leaders, especially CEOs, must be effective decision-makers because a huge portion of the job of leading a startup is making an avalanche of decisions in many domains and often with limited context. Decision-making is a skill that can be developed. Yet it also demands the confidence to decide even when context and information are limited. If you are not…
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Benefit of the Doubt
Collaborative relationships are at the core of building a startup business. This is value creation at its finest – and navigating the relational dimensions can make the difference between success and failure because good relationships unleash the power of the benefit of the doubt.
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Hold Out for the Right Stuff
As a serial entrepreneur, one of the things I have learned about founding startups is the critical importance of holding out for the right idea and the right team. You will invest years of your life trying to realize the potential of your startup vision – and the idea and the team are critical success factors.
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Careful What You Wish For
High-potential startups are practically defined by their ability to rapidly grow their revenue, so naturally, startup founders and CEOs feel tremendous pressure to get on the revenue train. However, be careful what you wish for!
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Unintentional Blocking
Leadership means empowering teams, not freezing them.
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A Risk-Based Lens
As a startup CEO, a robust risk-based lens is one of our most potent decision-making tools.
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Talking Entrepreneurship on Invisible Ink
Listen in to this wide-ranging discussion on many things startup! Starting, team building, fundraising, financial planning, and more.
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Clear-Eyed Optimism
A startup CEO must balance optimistic vision with realistic risk assessment, seeking advice from peers, and knowing when to pivot or stop.
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NIFO is Good Governance
The Board of Directors oversees company operations, focusing on strategic direction and risk management, while management handles execution and reporting.
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Considering Grants
Securing grants can aid startup funding without dilution, but involves strict restrictions, extensive effort, low success rates, and potential investor concerns.
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Starting Shares
Incorporating a high-potential startup in Delaware, authorize ten million shares to avoid costly amendments, enable effective vesting schedules, and minimize franchise tax.
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A New Era of Board Service
Former startup CEO explores new career paths after decades in leadership, focusing on board service and mentoring first-time CEOs.
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Walking Away from Potential Investors
Fundraising entrepreneurs should sometimes walk away from potential investors. Here is a list of examples of when that was the right call.
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Due Diligence Data Rooms
A due diligence data room is an electronic repository used in startup fundraising to provide potential investors with detailed, confidential company documentation for evaluation, helping to secure investment.
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References and Testimonials
Entrepreneurs face challenges introducing innovative products, needing to derisk the process for prospects and secure early adopters with testimonials and references to build broader confidence.
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The Nature of Warm Introductions
Warm introductions are vital for fundraising, leveraging trusted networks to efficiently connect startups with investors amid a crowded market, enhancing deal screening and investment opportunities.
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Negotiating Power in Startup Fundraising
Negotiating with investors is tough for startups due to information and power imbalances.
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The Illusion of Control
Owning over 51% of shares doesn't guarantee startup CEOs control due to dependence on investor funding and their significant influence.
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Know Your Numbers
Investors prioritize startups led by individuals with strong business acumen, essential for translating technical innovation into successful, scalable businesses. Demonstrated financial management skills, including understanding financial statements and core business drivers, are crucial to gaining investor trust.
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Fundraising Seasonality
Understanding market fluctuations in fundraising is crucial for startup CEOs. Recognizing patterns helps manage efforts and expectations effectively across different seasons and investor behaviors.
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Discerning Signals in the Noise
Startup leaders must discern critical signals from noise to navigate and innovate effectively in a chaotic environment, utilizing data and customer insights.
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Looking through the Keyhole
Investors and Board members can't fully understand a startup's intricate operations, akin to viewing through a keyhole. They should focus on crucial aspects rather than all details.
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Investing in First-time vs. Serial Entrepreneurs
First-time startup founders bring passion and unique insight, but face steep learning curves and skepticism from investors who prefer experienced CEOs for reducing investment risks.
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Winding Down with Professionalism
Deciding to end a startup is tough, yet executing a professional wind-down maintains integrity and potentially preserves future entrepreneurial relationships and opportunities.
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Making the Decision to Stop
In my last post, I discussed the powerful motivation that drives entrepreneurs to found and build a high-potential startup and the odds against building a successful startup. Most startups do not make it, which means that many entrepreneurs will someday face the profoundly difficult decision to stop and abandon the attempt. What does that look like—and why is it so…
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Making a Difference
What motivates entrepreneurs to pursue building high-potential companies? Making money? Independence? Making a difference? The answer might surprise you.
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The Challenge of Raising Money as a Solopreneur
What is the minimum team size when raising capital for your high-potential venture? Greater than one.
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A Startup’s Chart of Accounts
Building a business requires accounting for the funds flowing in and out of it. Honestly, it is one of those necessary evils that few entrepreneurs want to spend time on even though it is essential.
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VC Intro Call Playbook
For first-time VC fundraisers, when the invitation comes for an initial intro call to learn more about the business, the questions arise. What to expect? How to approach the conversation? When to follow-up? While every situation is unique, this post lays out a playbook to help get you started in successfully navigating introductory calls with venture capitalists.
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What Gets You Up in the Morning?
Founding a startup to solve a problem is a big commitment. Before you launch, you need to carefully examine your heart and motivations to ensure you are ready for the challenge of such a marathon undertaking!
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Interpreting Fundraising Market Statistics
Fundraising startup CEOs only raise money every one to three years. In parallel, they are moving through the stages of growing their company. So it is always a challenge to gather intelligence on the fundraising market conditions.
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Banking for Startups
As an entrepreneur jumping into the deep end and starting a business, one of the earliest actions you need to take once you form a corporation to “house” your fledgling business is establishing a banking relationship to conduct financial transactions. What does that look like for a startup?
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Building a Financial Function
Few startup founders come from a finance background (except perhaps fintech startups!), so building out the foundational financial function is often outside the founders’ comfort zone. Yet, building a robust financial function becomes essential as a startup grows, especially if it raises money.
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Keep the Red Pen Under Control
Building an empowered team is essential for growing a high-potential startup – and achieving empowerment requires a leader to be disciplined in delegating and giving feedback – or else!
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Whole Personhood
There is something about the advancing years, marked by birthdays, New Year’s celebrations, and life stages, that invites pausing for a bit of introspection and reflection. What makes up a whole life?
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Light
I love it when someone points out yet again the difference between light and darkness. You cannot “create” darkness directly or say, “Let there be dark,” because darkness is the absence of light. To “achieve” darkness, you must remove sources of light. Any light at all diminishes darkness. On the other hand, light pours out from itself. A light source…
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The Why Behind
Getting everyone aligned and moving in the same direction is a critical startup leader responsibility and skill. Articulating the “why” behind the direction makes all the difference by supplying the underlying reasons, motivations, or rationales behind a particular direction, decision, proposal, or action.
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Thresholds of Spending
What seems like “a lot” of money? There is no absolute answer as it really depends on what you are used to spending routinely. This is one of those phenomena that affects entrepreneurs as they grow their companies – and it deserves some intentional management.
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Consider Your BATNA
Deep into a critical negotiation, how far do you go? What risks do you take? How should you think about your possible positions? These are essential questions that a startup leader must navigate in myriad scenarios – and BATNA is one of the most potent tools for deciding what to do.
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Appreciating Important Things in Life
The holiday season is upon us – and I always find that this time of the year induces stepping back and reflecting on life’s bigger picture – seeing the trends and threads weaving together into the hills, mountains, and deep valleys that our life journeys consist of.
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Cap Table Housekeeping
Good housekeeping of a corporate capitalization (cap) table is an essential demonstration of a startup leader’s competence, yet it is full of potentially painful pitfalls when moving along the learning curve.
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Generations
I have spent decades in the startup ecosystem. Enough time to have evolved from being a beginning first-time founder to now surveying the landscape as a veteran startup CEO, board member, occasional angel investor and VC limited partner. Now, as I look around, I see distinct generations — generational waves of great people networked across the ecosystem – and that…
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The Complicated Logistics of A Close
Fundraising for a startup is hard work. But you have finally reached the moment when you have a term sheet and enough commitments to close. Now, time to spin the many plates and get that fundraising round across the finish line!
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Fundraising is a Means
Fundraising for a startup takes enormous effort over a sustained period. Companies that raise rounds issue press releases after closing. One might mistakenly begin to think that fundraising is an end instead of a means to an end.
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Aligned on Success
Startup fundraising is a grueling process. By the time the deal closes, a startup leader often feels embattled and exhausted, wondering if taking on investment is possibly the worst thing ever. Yet there is light after closing.
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Understanding the Waterfall
In the most common upside scenario, when an investor-backed startup gets sold, the distribution of the sale proceeds is called the waterfall. Understanding how waterfalls work helps startup CEOs and investors grasp the implications of various fundraising terms.
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Wait to Spend Until the Money is in the Bank
When raising money or doing a big corporate deal, it pays to remember that the deal is not done until the money is in the bank.
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Crawl Walk Run
High-potential startups are ultimately successful as they transform innovative product and service offerings that address important unmet needs into profitable businesses. One of the significant value step changes occurs when the startup begins to connect the dots and advance commercially into its chosen target market.
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Section 1202 Tax Matters
Recently, I was reminded of the “downside” of a successful exit, specifically, that capital gains earned on investment in a startup are, generally speaking, subject to taxes. In other words, the IRS wants its piece of that nice big check. Wouldn’t it be nice if you could just keep it all instead?
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Milestones
While building a startup, leaders must make critical strategic decisions about what to focus on to derisk and add value. One manifestation of this planning work is determining the key milestones that must be accomplished and the resources required to take each step. Because this is so important, it is a key focus for investors who are evaluating startup investment…
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Making Bets
As a startup leader forging new paths into the future, there is always uncertainty about the consequences of significant decisions. We cannot see what will happen perfectly, so we have to gather the best information available, test assumptions when possible, and ultimately pull the trigger and make a bet.
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Funding Foundations
A house built on sand is unstable, indeed. A house built on a solid foundation can support itself even when the winds howl, the rain comes, and the floodwaters rise. In business, cash is the lifeblood, and the source of that cash reveals the nature of your foundation.
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CEO = Chief Salesperson
Because a successful entrepreneur ultimately must build a business that profitably sells a product to meet a sufficiently sized group of customers’ unmet needs, selling is one of the keys to success.
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A Full Suite of Fundraising Decks
Fundraising decks come in various shapes and sizes to suit multiple purposes. There is no one-size-fits-all, so it pays to have a sense of the numerous sorts to make intelligent decisions about what to create and send in various circumstances.
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Founder – Investor Alignment
To improve the chances of achieving the best outcomes, it is imperative to establish alignment between the founding team and supporting investors in high-potential startups who raise money.
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Side Hustle vs. All-in
At the beginning of forming a startup, there is a phase where there is tension between doing the startup alongside whatever is paying the bills and committing to going all-in. Let's reflect on the factors that play into this decision.
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Opportunity Costs
The founding CEO of a startup always has more to do than they can fit into their available time – even if they are working every waking hour (which I do not recommend, by the way). That means one of the most significant success factors for such CEOs is their ability to consider opportunity costs and make wise decisions about…
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Reputations Matter
The right investors can make a world of difference in building a high-potential startup. Wise entrepreneurs will evaluate potential investors just as carefully as investors evaluate potential investments.
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The Double-Edged Sword of Competition when Fundraising
Sophisticated potential investors always ask about a startup’s competition. A well-developed answer is essential because “no competition” is not a good answer, and “too much competition” is also challenging.
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Investor Levers of Control
Just as I was zeroing in on the closing of my first equity investment in a startup I had co-founded, my corporate attorney said, "Once this investment is closed, they can fire you." What? The investors won't own more than half of my Company. How can that be?
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Board of Directors – Good News + Bad News
“You’re screwed!” my Board member said over his shoulder as we accidentally ran past each other in an airport. “Wait! What? Why? That Board package was filled with great news!” I exclaimed. He paused long enough to give me a pearl of wisdom I have never forgotten.
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Drive, Intelligence, and Integrity
One of my favorite investors and mentors said that the essential characteristics he looks for in startup founders -- drive, intelligence, and integrity -- cannot be taught. That got me thinking about why those characteristics are essential to successful startup building and how we might recognize them.
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You Cannot Learn All You Need to Know on the Internet
The internet is a phenomenal resource, but it can be hard to figure out exactly what applies to your startup because so many variables influence how to combine elements into a cohesive solution. Remember that you cannot learn everything you need to know to build a startup online.
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Considering A Whole Life
Building a startup takes an extreme level of work and commitment. Yet, there is more to life than just work. Here are some thoughts on how I have navigated this tension over twenty years.
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Keys to Customer Discovery
When you venture forth as an entrepreneur, exploring new innovative territory that you want to build into a business, it is crucial to validate that your product concept resonates with your target customers. That is the essential function of early customer discovery.
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Startup Financial Modeling: Things to Know
What are some of the different uses of startup financial forecasts, and what is the one thing we know for certain about them? Financial forecasting is an essential business planning tool. For startups, financial models are critical tools that serve many purposes and ultimately embody the financial implications of a host of strategic decisions and assumptions.
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The Essential Fundraising Question: What is Your Plan?
When introducing your startup to potential investors, there is so much to cover. Remember that the most important question to answer is what is your plan? All else is context.
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When Fundraising, the Company is the Product
Building a novel product and bringing it to the world to address customers’ unmet needs is a big job. And simultaneously, building an innovating company to enable that novel product’s success is ANOTHER big job. The two are related – even overlapping – and that sets startup leaders (you!) up for getting the two confused and mixed together.
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The Three Strikes Communication Rule
When building a startup, connecting with others is essential. And the onus is often on us to take the initiative and reach out to potential investors, partners, customers, and even friends or acquaintances. Yet when do we cross the line between persistence and annoying?
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Cultivating Your Community of Champions
As a startup founder-CEO, do not go it alone. Cultivate a community of champions who have your back and are willing to support your growth as you seek to deliver innovation and transformation.
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Feeling Nibbled
In the home stretch to close an equity financing round for an early-stage startup, it can start to feel like each refining interaction is just another hunk of flesh nipped away. The key to navigating this stage is never to take your eyes off your goals or let your emotions get the best of you.
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Fundraising in a Tough Environment
Lately, the startup headlines have focused on the tough fundraising environment. What is a startup founder to do when their startup is reliant on investor cash to advance?
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Legal Matters
As a startup founder/CEO, you quickly discover that you need to develop a working knowledge of legal contracts because there are so many contractual agreements that you need to review, and yet hiring an attorney every time you have a non-disclosure agreement or some other contract is often beyond the financial resources you have available.
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The People Matter
Even as we confront new implications of AI, I think people and the relationships between them still matter. And this is even more true in the land of high-potential startups that have their roots in the novel insights of the teams building them.
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Your Investor is Not Your Boss
Sometimes startup leaders, especially first-time CEOs, make the mistake of thinking that their investors are their boss(es), available to help them solve their startup's problems. While experienced investors may offer some excellent value-add as they bring their distinctive point-of-view to the table, they should not be treated like a boss.
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Beyond Your Comfort Zone
The first time you venture forth to lead in the unknown world of high-potential startups, you will definitely be moving outside your comfort zone. Fear and self-doubt are normal, despite enormous pressure to pretend you are not experiencing them.
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IP Licensing for a Spinout Startup
One way to begin a new entrepreneurial adventure is to find some attractive intellectual property and license it as the foundation of a new startup. Here are some of my lessons learned for such a path.
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Compensating Tiny Teams
Tiny startup teams of less than ten offer unique compensation opportunities and challenges, so creativity and open communication are called for!
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Co-Founder Dreaming
There is a time in the inception phase of a startup as an idea takes shape and a team assembles when a shared dream emerges. By dreaming together, co-founders lay the foundation of a shared vision, an understanding of each others’ inspirations and motivations, and the beginnings of trust.
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People Management for Startup Leaders
One of the greatest challenges of founding and growing a startup company is learning to manage a team of people to accomplish amazing things on a shoestring as fast as possible.
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The Value of Being Decisive
Being able to decide without all of the information you might wish for is a critical startup leadership skill. Often, a clear direction to move drives more value creation than taking time and resources to achieve an incrementally better decision.
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Startup Patent Strategy
Patent strategy for startups is complicated and nuanced, yet it can be the essence of creating protected assets that can ultimately be transferred to other organizations. Being smart and intentional up front is essential to generating such value for a startup.
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Specialties Matter
Gathering a startup team is always a challenge. Yet, nearly all startups demand assembling a diverse range of skills that will cover your bases. This enables forward progress to the next milestone and the subsequent funding that allows you to further expand your team. Understanding the relevant specialties and sub-specialties and how to access them will often be critical to…
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Recruiting Hearts
One of the great rewards of joining a new and exciting startup is collaborating as a passionate team to achieve an inspiring vision and make a difference. It is the anthesis of the concept of “quiet quitting,” “just a job,” or “being a cog in the wheel.” The challenge for a startup leader is building a team culture like that,…
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Screening for a VC Match When Startup Fundraising
Fundraising for your startup always seems high stakes and stressful, especially for first-time entrepreneurs learning the ropes and rules of the game. One key concept is to realize that potential VC investors come in many varieties, and finding the right match is critical to success.
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Growing into the CEO Role
Every CEO that exists was once a first-time CEO, and no one offers a training class to prepare for being a startup CEO. At some level, everyone taking on the CEO mantle must learn and grow their way into fulfilling the demands of this role.
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Wrangling a Fundraising Round
Accomplishing a fundraising round for your startup is often confusing and mysterious for new startup founders. Lately, I have been reminded that the path is not as obvious when you are venturing forth the first few times as it becomes after you have been around the track. To help, in this post, I am providing a roadmap to the significant…
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Praying through Transitions
Seasons change like chapters in a book. As a builder of high-potential startups, each of my startup journeys has lasted somewhere between a couple of years and eight years, which means I have regularly transitioned between startups – and my faith has been a major factor in how I personally navigate those seasons.
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Things I Wish I Knew When I First Started Fundraising
For first-time entrepreneurs, fundraising for your startup is fraught with unexpected pitfalls. Here is a list of some of my key lessons learned over 20 years of raising over $75M for startups.
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The Preeminence of the Customers’ Problem
Immerse yourself in your customer’s problem. The urgent and important problem IS the opportunity. Don’t build a solution looking for a problem.
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Beware of Glittering Generalities
While "glittering generalities" can serve to cast a vision or set a direction, because they lack a sufficient definition of how you will accomplish the goal, they are not actionable plans for building and operating a business in and of themselves.
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It Takes a Village to Build a Startup
A village combines the contributions of many people to build a functioning community, which is an excellent metaphor for what it takes to build a successful startup. And this Thanksgiving season, I am reflecting on how thankful I am for those who have joined the villages I have been part of.
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Pricing Strategy
One of a startup’s most significant decisions is pricing strategy. This decision is critical because it sits at the nexus of so many different dimensions in the startup’s strategic positioning, and coming up with a good, balanced solution for all these dimensions is so strategic. Failure to solve this well can cripple or kill a startup.
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Multi-faceted Recovery
Recovering from significant health crises and other big changes is complicated and takes time; many factors weave together to make these processes complex to navigate. Yet, even in that complexity, there are opportunities, because of the complexity we discover multiple options and paths to move forward.
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The Value-Creating Power of Person-to-Person Relationships
Relationships are the glue that knits together people who will engage in the innovative process of bringing something new into the world. Relational integrity is key to forming those strong relationships that can enable those breakthrough moments of forward progress.
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For Me, It’s Not Just Business
Startup CEOs come in different styles. For some, "it's just business." But, for many founder CEOs, it is far more than that as they pour all their passion into their startup and embody it profoundly. That embodied passion is often the activation energy that propels the startup out of the gate and onto a successful trajectory as it persuades others…
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Wingmen — Those Trusted to Go With You into Battle
When you lead your startup into battle, you need an inner circle of wingmen (and hopefully, wingwomen) backing you up. They are the trusted few who have earned the right to fly by your side and make an impact.
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Running the Hurdles
My father was a track and field hurdler in college. Just thinking about the challenge of trying to go fast while staying in stride to cleanly clear each hurdle in sequence reminds me of the challenges of complex, multi-party sales situations like hospital sales and venture capital fundraising.
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Applying the Least Work Principle
Developing a great, user-friendly, innovative product is often the heart of building a successful high-potential startup. But, as the team blazes new trails, they must successfully sift through user feedback to nail the design. The Least Work Principle is one of my tools for interpreting what users mean instead of just what they seem to be saying.
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The Highlight Reel Effect
When we hear stories of other startups, especially successful ones, it is easy to perceive that the path they traveled was straightforward and easy, especially if we lose sight of the highlight reel effect.
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Being Trustworthy
Trust is foundational for good relationships, either personal or corporate. At its best, It is bilateral, yet trust cannot be demanded, only given. All we can control is our side of the trust relationships we are part of.
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Circles of Control, Influence, and Concern
I certainly did not invent the concept of the Circles of Control, Influence, and Concern. Still, I did learn about these ideas early in my career (I believe from Stephen Covey), and it has proved a go-to framework for thinking about the work of building a startup.
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Scar Tissue
Things always take longer than we wish (including in startups!), and this is especially true of post-surgical recovery. As we heal, our bodies go through a series of stages that can make progress hard to discern.
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The Growth Moments
As you grow your startup, you will be confronted with moments that require fast decisions. Self-aware moments where surprise catches you off-guard, and you have to think instantaneously about what is good for the company.
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What is that Light?
There are moments when you are not sure if what you see is a light at the end of a tunnel or an oncoming train.
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Strategic Startup Scoping
Recently I was chatting with a founding team who had been asked by their investor to broaden their business scope to span several vastly different industries as customer targets. Their questions reminded me of how critical and challenging it is to determine the right strategic scope for a high-potential startup.
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Trusted Collaborators
I have been reflecting on how I make decisions for my startup – and the role of my trusted inner circle.
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Creating, Refining, and Executing
When building a startup, you create “stuff” that gets refined and becomes the playbook the team executes.
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Every Startup is a Custom Job
Innovative high-potential startups are, by their very nature, “custom jobs.”
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Discovering the Meaning of Gradual
The neurosurgeon said, “No restrictions anymore. Just add things gradually.” Easier said than done, apparently!
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The Dilemma of Two Good Options
Sometimes when you have one spot to fill, you find you have a great problem: More than one outstanding option to fill that spot.
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Pants and People
Growing a high-potential business presents many opportunities and encounters with people that can be pretty intimidating. My mentor taught me that remembering the human dimension can help you engage authentically and effectively. That insight has helped me often.
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Big Sticks
Organizational leaders often carry a “big stick” that sometimes puts excess weight behind any minor questions or requests they might make. This dynamic can waste a lot of organizational resources, so it is essential to be mindful when you find you have a “big stick.”
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Striving for Highest Best Use
Resources are always limited in a startup. Applying the principle of the highest best use is a way of making more optimal choices to accomplish goals.
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Midway through the Recovery Journey
Major surgery packs a wallop. Those who have major surgery have a challenging recovery journey to embrace. Twelve hours under in the OR, a direct intrusion into my frontal cortex, narcotic and other heavy-duty meds, and days in the hospital wiped out my already-depleted reserves. Now I am midway through this process and sharing what I have noticed and the…
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Fear of the Uncontrollable
As the day approached for my neurosurgery, the community of people who knew about this looming event expanded. Practically universally, when someone found out, their first response was, "that must be so scary!"
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Coping with Curve Balls
Sometimes life hands you a shock – and coping with it affects everything.
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Preparing to be Unavailable for a Time
What do you do when something comes up, and you must step away for a time? How do you and your team prepare for such a thing?
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A Startup CEO Essential: Optimism
Recently I have been chatting with others in the entrepreneurial ecosystem, and we have been reflecting that, at their core, entrepreneurs must be optimists.
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The Importance of Framing
Effective communication often comes down to framing. What is important, what is an implementation detail, and how does the information fit into the mental framework of the recipient?
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Managing the Wounded
When you have someone join your team, one of the key things to keep an eye out for is where they are wounded. Note that I did not say “if” they are wounded, only “where.”
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Investors Who Survey the Landscape While Protecting the Focus of Their Startup Teams
actionable intelligence while still protecting the focus and time their startups must sustain to actively build value.
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Building a Fireproof Team
Building a robust and resilient team requires constant intention every step of the way so that when the going gets tough, or a crisis erupts, the fireproof team can respond. Investing to build a strong startup team that can field a startup’s inevitable curveballs is essential.
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Virtual Team Integration
We just hired five new employees, expanding our team by almost a third. As a fully virtual company, one of our challenges is how do we help our new team members integrate so everyone feels like we are one team.
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Answer the Question
When someone asks you the time, in general, answer the question directly rather than explaining how the watch is made. This principle can be applied broadly to sales and fundraising activities in a startup.
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Taking Vacation
Full disclosure: I am on one. Here are a few reflections on the importance and process of unplugging.
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The Value of Performance Tests in Recruiting
Evaluating potential new team members for skills and capabilities fit is always challenging due to inherent information disparities in the recruiting process. Performance tests can provide pivotal insight.
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The Definition of a Leader
Leaders come in all shapes, sizes, colors, and styles. Some are more effective than others, but in its most fundamental form, the definition of a leader is someone who can attract followers.
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The Deep End of the Pool
You are often confronted with problems you haven’t solved before in a startup. Problems that no one on the team or perhaps anywhere has solved before. Being comfortable jumping into the deep end of the problem-solving pool is essential for startup success.
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Evaluating Markets Before Founding
Analyzing your potential market and testing concepts with potential customers are critical steps in deciding whether you have the ingredients for a potentially successful startup.
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Executive Mindset
An executive mindset does not depend on the job title but on the ability to synthesize, direct, and know when to enforce and when to break the rules.
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The Great Divide
Sometimes the communication gulf between technical and non-technical people crushes forward progress, yet too often, both sides throw up their hands, and the gaps remain unbridged. Startup leaders cannot afford to let such chasms persist.
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I Am Not Your Friend
Shortly after we closed our financing round, my investor sat across the table from me, drinking coffee, and declared, “I am not your friend.” Uh, what?
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Keeping Eyes on Your North Star
Finding the right north star for your startup's stage of development is a powerful focusing tool to maximize your progress.
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Each is Unique
Each and every organization is unique, with its own culture, objectives, processes, and history. Remembering that matters because effectively engaging with an organization and its people requires holding all your assumptions loosely so you can listen and jointly problem-solve.
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The Rocket Launch Feeling
This is a post about a feeling. A feeling that comes as you build a high-potential startup rocketship. One of the most exciting and terrifying times in developing a startup is when you can feel that rocket trembling on the launch pad, with fuel burning fast to generate the massive thrust required to begin to move and transition into enormous…
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Provide Your Capacity to Your Team
As a startup leader and manager, supporting and enabling your team is one of your most important jobs. Yet sometimes, being available feels like you are not doing "enough."
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The Dimension You Cannot Change
Building a startup is one giant multidimensional puzzle, but time is the one immutable dimension you cannot adjust. You can use time to your advantage in your startup, but you never lose sight of your personal need to manage your own precious time.
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Beginning Again
Sometimes things do not work out. But that is not the end of the world because the next step is to start again.
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Work-life balance?
It seems that work-life balance is a routine subject in today’s culture, emphasizing making sure you keep your “work” under control to make sure you have time for the rest of your “life.” What if that does not feel like the right answer?
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Celebrate!
Building a startup can be a long slog. Look for the moments to celebrate. For your and everyone else’s sake.
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The Discipline of Blogging
Nearly 100 posts since early COVID. Why do I impose the discipline of blogging on myself?
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Consulting as Startup Preparation Ground
Experience as a consultant can develop useful transferrable skills for leading a high-potential startup. Yet, by itself, it is seldom enough. Here are some reflections on both sides of the coin.
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The Stress-Management Power of Thankfulness
Every year, the Thanksgiving holiday reminds me of the stress-management power of being thankful. I suppose the challenge is continually seeking to revisit what I am grateful for all the other days of the year.
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The Real Competition
What is the actual competition that an innovating startup faces? It is probably not the product that most closely resembles what you are offering to the market!
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Free Is Not Inexpensive
Innovative startups, by definition, are introducing a change into the world. And change is never easy. While each startup’s market is unique, all will be seeking to induce potential customers to take a risk, and consider making a change from their current status quo. Yet while the trial may be “free” in terms of paying for the product, remember that…
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You Can’t Crash if You Don’t Launch
Iterative product development is at the heart of many a startup founded on technological innovation as its core value driver. Lessons learned from earlier iterations (failures) inform the next prototype until the problems are solved, and requirements are met. Yet until you have lived this process, most startup stories only share the highlight reel of the successful tests, making it…
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Essential Entrepreneurial Enabler: Herding Cats
Driving forward in a startup almost always comes down to herding the relevant cats into alignment to achieve the goal at hand. Herding cats requires an essential blend of skills – and the results can be quite value-creating.
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A Sense of Urgency
Speed is a startup’s greatest advantage, therefore, startup leaders and teams must always act with a sense of urgency. This is such a comprehensive driver that I find it weaves together many of thoughts shared on this blog over the past 18 months.
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An Ownership Mentality
Entrepreneurs have an ownership mentality. An awareness that the buck starts and stops with them. This truth underpins many aspects of the experience of creating a business from scratch.
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The Value of Education
Startup CEOs need to bring a diverse set of skills to the table, yet what is the right balance between leveraging formal education and real-world experience to build that skill set?
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Are You Ready to Make the Decision?
Leading a startup means making important decisions with incomplete information. Achieving startup success demands relentless forward motion, so when do you have enough to make a bet?
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Startup Families Care for One Another in Sometimes Unexpected Ways
Startup teams start small – and they often feel like families, with co-founders in “business marriages.” The relationship dynamics of people within a startup environment are often different from joining larger, less personal, more established companies as an employee – and it shows when the larger context of people’s lives intersect with business operations.
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Prerequisites for Synthesis
Last week, I wrote about one of the essential skills for startup leaders: synthesis. Synthesis is collecting and quickly combining ideas and parts of ideas together into a coherent whole, to provide a critically important framework of ideas that informs startup planning, decision-making, and storytelling. As I reflected further on the core enablers for effective synthesis, three essential prerequisite elements…
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The Magic of Synthesis
When I think about what skills I rely on every day to build a startup, synthesis routinely tops the list. The need to integrate many pieces of information into a coherent whole that enables you to plan, tell a compelling story, and manage risks is a never-ending need that is entirely dependent on this skill.
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Company Building with the Lord
Each entrepreneur brings themselves to the practice of company building, which includes their beliefs about themselves and their place in the world as a foundation on which to build. For some, this spiritual strength sustains us through the trials, tribulations, and sometimes triumphs that inevitably emerge along the journey.
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Life’s Foundation: Health
Building a high-potential company requires tremendous energy, focus, and stamina. It is essential to invest in maintaining your health to sustain your ability to keep building your startup.
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Good Partners
Developing good partnerships demands common ground, open communication, complementary strengths, and ultimately formalizing the relationship.
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On the Same Side
Recruiting venture investors always feels adversarial as they ask tough questions and challenge your assumptions. However, once their money is in, you are all on the same side.
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Pick Your Spending Rate Wisely
When you have funding, remember that your investors did not invest for you to hold back and be too conservative. They expect you to build value by making bets, taking risks, and owning the consequences. Pick your spending rate wisely.
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Win-Win Partnerships
When considering partnerships, it is crucial to build a strong business rationale for both parties. Finding some intrinsic synergies between the products, business models, and customer bases can make one plus one equal more than two.
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VC Board Member Archetypes
Every venture capitalist is unique; however, when one is joining your Board of Directors, there are some patterns that can guide you in ways to engage them effectively.
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Are We Ready to Ship?
Sometimes the work of a startup seems overwhelming – especially as the moment of truth of shipping a new product for the first time approaches. When that happens, it is time to break down and characterize the problem(s) – and then systematically work for acceptable solutions.
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Keeping Promises
Keeping promises is an expression of integrity and builds trust. This is one of the most potent principles to apply in successful startup building as well as successful life building.
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Delivering Sound Bites
Leading a startup often means being the face of and speaking for that startup. Here are a few tips and techniques gleaned over the years on how to nail interviews by delivering useful sound bites.
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Going Virtual
COVID-19 hit like a freight train in the spring of 2020. We went 100% virtual in a day. And began learning and evolving our approaches to work to adapt to a new reality. Here are some initial reflections on our particular case study for the impact of the pandemic on our team.
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Individual Customers are the Key to Successful Selling
Just like recognizing that you must design products for people, you also need to realize that purchase decisions are made by people as well. That means the core of your sales strategy needs to revolve around learning about and building relationships with the specific people you serve best within your customers' organizations.
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Starting Sales in a Startup
High-potential startups are businesses – and businesses thrive on revenue. That means that figuring out how to successfully start selling your product is at the heart of building a successful startup.
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Comparing the FDA 510(k) and De Novo Device Pathways
Check out the similarities and differences of two different paths (510(k) and De Novo) for getting pre-marketing authorization from the FDA for a software-as-a-medical-device.
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The Value of Doing Something Intrinsically Hard
Difficult challenges create barriers to entry, competitive advantage, and value. Seek them out.
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Reflections on Startup Children
Startups are like the children of their founders. What are the implications of this analogy?
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The Risk of Idea Stealing
Inexperienced entrepreneurs often worry about sharing what they are working on with others, fearing someone will steal their idea. While there are a few circumstances one should be cautious about, generally, it is far riskier not to share.
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Communicating with Investors at the Right Frequency
The more frequently you communicate, the deeper into the details you need to delve. To manage the level of detail and involvement, control the communication frequency.
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Why An Approved Budget Does Not Equal Control
Do you think approving a budget means you have control? Think again. Budgets do not equal control. Especially in a startup.
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Investing in Force Multipliers
Trading off between investing in a more systemic, force-multiplying solution versus just trying to keep up with the immediately overwhelming work at hand is difficult. Sometimes this mental image helps me recognize when I should consider stepping back and making a different choice.
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Startup Fundraising: Keep it Clean
When fundraising for a startup, keep your focus on your company's long-term needs by keeping your funding rounds on the straight and narrow.
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Structuring an Angel Round
If you decide to raise investor capital to fuel your startup, a common first step is raising seed funding from angel investors. Here are a few hard-earned observations and tips from my experiences raising millions in angel capital across several different startups.
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Qualifying Angel Investors
Angel investors – those who invest their own money in startups – are often an essential capital source in the earliest stages. Good angels are wise, insightful, and patient partners for early-stage founding teams. Qualifying them well is essential to setting your startup up for success.
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The Cost of Context Switching
Leading a startup that depends on inventing new technology requires mastering the balance of context switching. Too much kills innovation. Too little means losing touch with what is essential
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Intentionally Empowering Each Other
One of the great aspects of being part of a high-performing team is how each member of the team intentionally contributes to empowering each other, which elevates both our collective process and our combined results.
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Driving for Speed with Finesse
Speed is one of the great advantages of small, talented, focused startup teams – and the driver of the racing startup vehicle is the CEO. Yet like racing, it is essential to drive with finesse to maximize speed while not spinning out of control.
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The FDA Are People, Too.
Government agencies seem like monolithic entities governed by complex rules that are hard to relate to. Still, under that seemingly impenetrable exterior, it helps to remember that, just like your startup, the agency is made up of people, too.
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Effectively Engaging the FDA
Some vital resources and lessons learned along our software-as-a-medical device FDA journey may help others who are finding their own pathways to market with a regulated product. While these ideas are focused on the FDA, they have broader applicability to working with other regulatory bodies as well.
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Play Strengths, Not Weaknesses
Our impulse is that we should improve upon our weaknesses, whether they are yours or your teammates. Sometimes our impulses are wrong.
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Catch Them Being Good
Carrots and honey beat sticks and vinegar every time. When leading a team, pay attention so you can catch them being good.
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The Most Important Thing
Successful startups focus on the most important thing: building a real and successful business.
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Inviting a Yes
Making progress often depends on someone else's 'Yes' to unblock what you are trying to accomplish. Check out the ideas in this post for inspiration on how to be intentional and creative to increase the probability of the 'Yes' you need.
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Good Leaders Define Reality
One of the critical roles of an effective leader is to define reality for the group they are leading. In doing so, they cast a vision for the future direction of the organization.
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The Magic Project Management Triangle
Balancing the dimensions of time, scope, and resources is a widely applicable framework for managing projects of all scales. Whatever your title, as a project manager, managing stakeholders' expectations and consistently performing successfully depends directly on your ability to set and deliver on your targets (scope) on-time (time) and on-budget (resources).
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Waiting Can Be So Difficult
As leaders, sometimes we are face situations where we must wait on third parties to act. That waiting can be hard, painful, and exhausting.
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Focus. Execute. Panic is Unhelpful.
The ability to control your reactions and execute under pressure is essential to successfully leading a startup.
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The Spiritual Side of My Entrepreneurial Journey
My entrepreneurial journey is profoundly entwined with my spiritual journey. My faith in God is my underlying foundation and north star as a startup CEO.
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Leadership is Lonely
There are times along a startup CEO's journey that are profoundly lonely. It is the nature of the role.
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Connecting the Why
The most potent guiding star in sales, decision-making, and leadership is knowing, connecting, and communicating the why.
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Products Are For People
The key to designing desirable products is listening, empathizing, creativity, and perseverance. The key to a successful startup is a great product that your customers love.
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Giving Thanks
Success as an entrepreneur depends on the contributions of many. I appreciate all the support, engagement, and encouragement over the years and ventures.
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An Essential Entrepreneurial Enabler: Learning
Learning to learn quickly and effectively is one of the master skills of becoming a successful entrepreneur.
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Using Lawyers Well
Lawyers can be a tremendous resource for a startup CEO, but it is essential to use them well. Knowing the role of a corporate lawyer can make all the difference.
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Diversity in the Board Room
The composition of a Board of Directors can directly impact its effectiveness. Diversity in experiences, viewpoints, expertise, and temperaments all contribute to better ideas.
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Recognizing When You Need to Change Up Your Team
Are you unconsciously suffering from a role fit problem in your team? First recognizing and then addressing the issue is critical to startup success.
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Intentional Onboarding: Setting New Team Members Up for Success
Whether an employee or consultant, or contractor, when you add a new team member, you hope they can bring value to your team. Enabling that is your responsibility.
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Helping VCs Understand Your Technology
The word to the wise in venture fundraising is do not spend too much time on the technology. While true, there is a balance to be struck in this.
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The Role of a Lead Investor
Raising money for high-potential startups is always a challenge. Finding the right lead investor is an essential step along the path.
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Getting Value from Your Board
Jennifer Baird, a serial venture and angel-backed CEO, shares tips for leading and working with a Board of Directors. #BeenThereRunThat
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Family Enablers: The Source of an Entrepreneur’s Strength
Building a company out of nothing is enormously hard work. Hidden behind most startup CEOs are tremendously supportive families. This is one of the secrets to success.
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How to Get a Job as a Founding CEO
Sometimes people ask me how one gets a job as a Founding CEO. They seem to think that you update your resume and send it to someone (who?) and apply for the job.
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Focus Means Saying No
Everyone knows that maintaining focus is essential to startup success, yet distractions are both tempting and endless. A vital tool for the startup leader’s toolbox is the ability to say no.
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And A Tree Fell Across the Path: Responding to Startup Adversity
Unforeseen problems. Disrupted plans. Surprising changes. Startups are all about ups and downs and responding to adversity. When the unexpected occurs, it is time to swing into action.
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Startup Genesis: Choosing a Problem to Solve
Forming a startup means that the founder(s) has an opportunity to choose what problem they will invest themselves in solving. Choose wisely!
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Vetting Prospective Hires
Recruiting team members is always a high stakes process. And that is especially true in a startup. Hiring mistakes are costly, so it is worth taking care to vet prospective new hires well.
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The Shift from Hiring Generalists to Hiring Specialists in a Startup
At inception, the founding team of a startup must be small, but mighty. As the company grows, a shift occurs as the team reaches critical mass, and it becomes feasible to start hiring specialists. Recognizing this new stage of growth is essential.
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My Prospective VC Is Asking For Personality Tests?
“They want us to take personality tests?” My team looked appalled. “Yep,” I said, “And we might even learn something ourselves from the process!”
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Startup Fundraising is All About Trust
Some startup founders approach fundraising as a series of transactions. Think of fundraising as relationship-building -- and remember that the foundation of a good relationship is TRUST.
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For Today’s Startup Problem-Solving, Are We Cooking or Baking?
The work of building a startup varies. Sometimes it is more like cooking. Sometimes it is more like baking. Pick the right skill set for the job at hand.
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Watch Out for Fresh, Hot Data
As company leaders, we want to be well informed about what is happening in our startup. Yet fresh, hot data is fraught with challenges. Treat it with care.
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Keep in Touch: Engaging Your Investors in Your Company’s Story
The end of July is approaching. It is time to connect with my key investor-stakeholders on our company’s progress. This practice of routinely telling our company’s latest story is an essential component in maintaining my investors’ support.
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The Hidden Value of Board Meeting Preparation
It is time. Time to work on the board package, again. The effort feels like an interruption to the team. So the key to maximizing the value to the startup is to recognize and leverage the hidden value of the process of Board meeting preparation.
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Your Company’s Lawyer is NOT Your Lawyer
A few weeks ago, another CEO reached out and asked for a referral to an attorney. My first question was for the company or for yourself? I didn’t always realize that there was a difference.
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Too Early. Too Late. Finding the VC Fund Timing Sweet Spot.
When raising venture capital, understand the venture fund timing sweet spot so you can align your startup’s needs with your potential investor’s needs, or at least realize when it will be hard to fit.
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Getting Baked for Fundraising
Building an investable business takes more time and effort than most people realize. Too often, I see people jumping the gun and trying to fundraise too early.
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How VCs Say “Yes”
When you are raising venture capital, a VC’s most common answer is ‘no.’ Sometimes, if you are lucky, they start to say ‘yes.’ Here is what that looks like.
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How VCs Say “No”
For a startup, raising venture capital is daunting. The numbers are not in your favor. Learning to recognize "no" gives you a chance to move on quickly to the next opportunity for a great fit.
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Permission to Innovate
Realizing the potential for process improvement requires making sure that those who are part of designing the change are empowered to find the best path.
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How Do You Start a Company?
It does not necessarily start with the idea since you can find a worthy idea. So how does a founding CEO actually begin?
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Customer Discovery #2: What a Positive Response Looks Like
When asking for feedback on a product concept, it is easy to be fooled. Make sure you know the kind of reaction you need to hear to know you have a potential winner.
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Customer Discovery #1: n>1
Talk to many potential customers when seeking to validate an unmet need.
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Prioritize Exercise While Building Your Startup
Startups are marathons, not sprints. Figuring out how to pace yourself and your team in a healthy way has real business success consequences.
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What You Measure Will Improve
A concrete measure provides the focus and sense of accomplishment needed to improve continuously.
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The Importance of Co-Founder Vesting
Because life happens, co-founder vesting of equity is critical for a young high-potential startup.
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The Value of Co-Founders
Most venture-backed companies are founded by two or more co-founders. With good reason.
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What Blogging About My Startup Experiences is Teaching Me
Four weeks into my blogging journey, I find blogging is affecting me in ways I never anticipated. As I continue, I wanted to share what I am learning.
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Start with a Delaware C-Corp If Raising VC
When building a startup, you will face many surprising curves, so when the best path is the straight, well-traveled road, take it.
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Getting Value from Your Board of Directors
Working with your Board of Directors is a critical skill for the CEO. Here are three insights about working with the Boards of early-stage, venture-backed companies.
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Maybe You Haven’t Asked Enough People Yet
The most underappreciated aspect of high potential startup fundraising is perseverance. This is the story of what it can be like for a first-time CEO to raise money.
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Picking a Lawyer for Your Startup
An expert corporate attorney is a critical asset for a high potential startup. But what factors should you consider to find the right one?
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The Gift of a Thank You
This past Christmas, I received a present from a complete stranger that made my day – and possibly my decade! It was one of those moments that rocks you back and makes you realize building that startup had a far more significant impact than you ever imagined. The message said …
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Fundraising Differences Between Angels and VCs
Having raised $50M in angel and venture capital for my startups, I am often asked to compare and contrast the two. Let’s dive into the key differences and how both investor types can support a high potential startup.
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Should I Raise Venture Capital?
The short answer is NOT if you can help it! Having raised $50M in angel and venture capital personally, I recommend raising venture funding only as a last resort, and only if the type of business you are building absolutely demands it. Keep in mind that most startup businesses should not need venture capital and will not have the characteristics…
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How and Why I Got into Startups
With a BA degree in organizational psychology and an MBA in corporate strategy and finance, my career started in the big company world. A few years working for a big money-center bank selling electronic money transfer products to large company treasury departments proved to be far too narrow a niche for the gal who dreamed of being a CEO someday.…
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Why I Started This Blog
Learning to build a startup has been an adventure to say the least! Now with nearly 20 years in five different startups under my belt, I find that I have useful lessons to share. My hope is this blog will be a more scalable way to help other founders and entrepreneurial CEOs accelerate their learning curves as they build great…
