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|Mar 29||Public post|
This section is meant to help you grow as a leader, manager, or entrepreneur.
I’ve included Claire’s writings before in this newsletter. It is no surprise when the company she founded is solely focused on helping growing organizations keep their employees engaged. In this piece she speaks on how leaders need to make sure they aren’t being a superhero to their employees.
A superhero manager (did I just make that up) is actually a bad thing. They are ones that hear a cry for help and immediately leap into action to save their employees. It doesn’t necessarily fall under micro-management, however it does stunt your team’s growth substantially.
When you remove the ownership piece of solving a problem form the plate of your team, they become worker drones. This may help you in the short-term to hit project deadlines correctly, but you cannot innovate at scale by managing this way.
I have worked for companies like this. They usually look up after a decade and realize that they keep starting over every five years. Why is that? Because the leaders are the only one innovating. When that happens you end up with a homogenous pool of ideas. By allowing your team to solve their own problems (where you fascilitate their activities) you give them the freedom to think.
As someone who created a program at my last job that encouraged team members to think…you can get some really intriguing ideas from your team if you allow them to look forward instead of down from time to time.
This section is designed to help you improve your skills as a strategist and tactician.
I have followed Kate Bourgoin on Twitter for awhile now and it’s no stranger that this piece is about falling in love with customer engagement. In this piece she details some staggering stats and makes a convincing argument that if you aren’t talking to your customers nonstop, you may as well be trying to build a startup with a hand behind your back.
How about this - “Companies that invest in ongoing customer research grow 2-3x faster.” That’s crazy.
Everyone knows how to do it and what to do, but it’s like exercise and investing. It’s boring. It does not trigger any dopamine hits. In Kate’s words, it’s not sexy.
A while back I wrote, in this very newsletter, that your customers should be your first product managers. It is incredible that in something as hard as building a company, founders find that they have a “phone a friend” option that will significantly increase their chances of success. Yet they never make the call.
CB Insights says that the #1 cause of startup failure is lack of market. This is largely senseless. Everyone knows customer development is important, yet when they go to validate the model/product they want to build they take shortcuts. They aim for the easiest targets, not necessarily the ones with the best insights, and this cripples them long term.
This section was created to introduce ideas that may not related to starting a company, yet is important to your success as a founder.
There are a lot of benefits of setting up short feedback loops in a startup. Matter of fact that dovetails perfectly from the section directly above. But did you know that creating short feedback loops in your personal contribution affects the success of your company as well?
Kat Boogaard talks about the massive benefits of using micro productive stints to become more effective at the macro level. It incorporates setting goals and then inviting immediate feedback to keep the “high” of accomplishment going.
I experienced this in my first time as a manager. Personally, if I have a deadline I self-manage myself until I hit it. Even if I procrastinate, I accept that I made the error and work nonstop to get the work done. In the past I projected this onto my team. Instead of giving them short milestones and then having them accumulate to accomplishing the huge project…I set a date for the deadline three months away and left them to their own devices.
It didn’t go well. I wasn’t keeping them engaged by having short feedback loops and cutting the project into digestible chunks. As they say…how do you eat an elephant? One bite at a time.
Around The Startup Ecosystem
This section was built to update you on important events, opinions, or pieces happening in the world of startups.
Paul La Monica does a great job sharing who actually made a lot of money in the IPO. Dilution is an area that is really sensitive for founders. It can be a catch-22 where you get investors that will happily dilute you quoting the phrase "a small piece of something is better than a large piece of nothing.” It turns out GM, Alphabet/Google, and Fidelity (among others) each have shares worth over one billion dollars.
When it comes to a $30B valuation of Lyft…the founders don’t even become billionaires. They will make over $500M with this exit, but the absolute dollar amounts isn’t the problem. It’s that they built the organization and receive less than 1/30 (3%) of the value. That can be hard to swallow. But let’s take it a step further.
There has been a lot of discussion within the startup-focused twitter community. This debate is centered around whether or not working for a startup is a smart financial decision. It all started when someone quoted an engineer after the recent exit of his company saying that “the company exited for $200M, I made $15,000.”
Follow the link below and read the thread from both sides of the table. Sahil is the founder of Gumroad, one of the original companies that allowed creators to sell digital goods (ebooks, courses, photoshop presets, etc…) at scale without creating a standalone website.
What I found extremely interesting was the response of employees from formerly exited startups. Some agree that they risked a lot to be paid so little according to what their shares eventually became to be worth. Others really applauded the fact that working at a startup can accelerate your career 2-3x as fast as working in normal corporate atmosphere.
I lean towards the latter argument.
If you go into a startup exchanging lower salaries for equity and expecting an exit, you have a higher chance of being disappointed. On the other hand, if you go into it looking forward to the opportunity to scale your talents as quickly as possible…getting paid for building a company that exits is simply icing on the cake.