F3 is a FREE weekly newsletter where we find the best concepts on the internet that will move the needle in your business.
|Jun 21||Public post|
This section is meant to help you grow as a leader, manager, or entrepreneur.
When I first became a leader, I was well-prepared. I approached it from a very logical standpoint and read all I could on the matter. What was somehow missed, was managing team members. I knew all about leadership…very little about managing. And it is true what they say, the managing is a skill that is honed over time and that cuts both ways. Reinforcing bad habits will make you a bad manager over time.
I wish I had come across this post earlier in my career. The first two points were something I was NOT good at. I believed that if I let team member be free, and gave them feedback, they would thrive. At the end of the day I only cared that they got their work done, except for they weren’t. Why is that? Well it’s because I had no structure. I had a scoreboard and let them figure out their own map to hit their targets. The reason why I didn’t know that they were struggling in a structure-free environment? Enter Nora’s second point…
We were not all in the same office and I did not communicate enough. In my mind, they would operate like I would, if I needed help I would ask for it. Having someone check in on me all the time would be an annoyance at best, a distraction from my ambitious goals at worst. Boy was I wrong. That’s how a project went for one full month without anyone working on it - which ended up with them having to pull longer hours to hit a deadline - which meant their final project was embarrassing for me to present to my bosses. All because I was not communicating…anything. Didn’t think I needed to.
You can probably tell by now why I included this piece, there are multiple points on here and just by touching on the first two, I could lead a two hour lecture.
This section is designed to help you improve your skills as a strategist and tactician.
Fred Wilson penned this one and I included it not because of it’s depth, but because of it’s candidness.
A SAFE is a form of raising early venture capital that was pioneered by Y Combinator. It turns out that founders who utilize SAFEs have a much higher chance of over-diluting themselves, bringing on “dumb” money, and screwing up their cap table (sometimes beyond repair).
SAFE stands for Simple Agreement for Future Equity and it great simplifies the process of raising cash. In this piece, Fred speaks on the fact that when you use a SAFE you can easily overcomplicate the cap table to the point where founders don’t even know how much of their own company they will own in the event of a Series A investment. It can really end up making things messy.
One of the more important reasons (to me) is that in a lot of cases it means the people who signed the SAFEs and invested early own less of the company than they were initially promised. Even when I first started learning about the startup financing stack, the SAFEs were ones that seemed to cloud the transparency of the cap table. While I’m not sure that it should be the end of all SAFEs, I do think that founders should learn a lot more about the ramifications of layering them early on in the startup development cycle.
Fred says the words “house of cards” and while I’ve never seen it, I can imagine that there is not one person from the previous rounds that are ecstatic when they find out how their equity dilutes when a priced round comes along. Maybe if it’s a lifeline for the company where something is better than nothing, but even then, I bet they are a little salty.
This section was created to introduce ideas that may not related to starting a company, yet is important to your success as a founder.
Probably one of the most important pieces, I will ever share on here. The reason why most huge success stories are a decade or more in the making, is some parts sheer luck of timing. For the most part though…it’s because they did one thing consistently. They may not have even done that thing very well consistently, but it’s all a matter of opinion, right? If the customer finds value then that is all that matters. Need examples?
Slack ($16B) - Make communication between teams simple and engaging
Mailchimp ($1B) - Didn’t have the most robust suite for email marketing, but they had a very consistent aesthetic and UX value-set (they believed that any kind of business owner should be able to use their software regardless of background).
Amazon ($942B) - Sheer, almost brutal, focus on delivering goods to consumers as efficiently as possible.
I’ve always believed work compounds. You may be working in obscurity for years before you actually realize your dream. But, it is inevitable as long as you are consistent in the quality of your output.
Around The Startup Ecosystem
This section was built to update you on important events, opinions, or pieces happening in the world of startups.
I know that both of these companies are publicly traded, however, this is a huge win for current and future DTCs and DNVBs. I just heard on “How I Built This” that unicorn, Allbirds, still uses Shopify for its backend.
When I first heard the news I immediately recalled the movie 300 where Leonidas (Gerard Butler) launches a spear at King Xerxes. The narrator says, “he just wanted to see that the God-King could bleed…”
This is the biggest most meaningful move any company has made to see if Amazon could bleed. And it’s exciting.
Usually when Amazon even hints that they’re going into a market, entire sectors of the stock market will dip. You notice that other companies struggle to even keep up with their innovations as they end up running circles around traditional retailers. What makes this move by Shopify so intriguing is this…when Amazon launches same-day Prime delivery they are generally fighting against Wal-Mart (and other retailers like it). Amazon has an inherent leg up because they have the volume of sellers making new products on a daily basis. To sell in Wal-Mart, you have to go through an extensive process of evaluation.
As a side note - If Wal-Mart REALLY wanted to compete they would launch a new brand underneath the behemoths umbrella that would allow makers to easily get their products/goods in front of an audience. If that product/good does well over the course of a quarter in the sub-brand, they could then expand to Wal-Marts in the city, then the state, then the region, then the country, then the world. It’s a data driven approach to source the next generation of products/goods.
Back to the story, the reason why Shopify launching this fulfillment network is so powerful is that when a maker launches on Amazon there are two major flaws: 1) They have no access to the information of any of the buyers, meaning upselling/reselling is next to impossible to predict 2) It’s basically pay-to-play…especially if you want to retarget previous buyers.
With Shopify, your customers are your own. You can market to the directly with email marketing. You can have newsletter signups. You can run paid social ads against them. Send them discounts on new products based on previous purchases. You get the point.
You have so much more control over your customer’s experience and repeat revenue than hosting your products on Amazon. If they play it right (they will) this move will actually cause Amazon to begin hemorrhaging makers of goods/services. I’ll be keeping my eyes on this one as it’s a huge act of war.