Shan, I LOVE your post. So crisp, clean, and spot on.
I think the only thing missing from the list is how we ourselves define our brand. Perhaps adding something like “define your values” or “know your boundaries” can help us think ahead of time how far we are willing to stretch our brands, in both the good and the bad times.
Nice post, Jon! I really enjoyed reading it and a number of your points.
First, I’m struggling with the personal ramifications of “put yourself last.” I’m conflicted because I agree with you that you should take care of everyone else before you take care of yourself during failure. But that said, I think acceptance is another aspect of failing in style. I worry that if we put everyone before ourselves, we will not ever fully accept the decision we have made. Perhaps in that moment we will all be selfless enough to do so, but I hope that we will not regret any decisions along the way.
Second, I think to fail in style, we should also take the time to reflect on our failure, both during and afterwards. One of the beauties of failure is the lessons we take from them. While lessons may not be universally applicable or relevant in every context, thinking deeply about what went wrong and how we can fix it next time can do no harm—only good! I also think it would be great for us to share lessons from our failures with our peers. The more data points we can reference the better, so why not leverage all the resources we have?
Again, great post!
Dave, this is a super well written and thought out post. Thanks so much for sharing it!
I found the “planning” section especially helpful. I totally agree—it feels like entrepreneurs are often so focused on the here and now (and understandably so) that they forget to make a Plan B, and even Plan C. I’ve wondered a number of times if better planning would help entrepreneurs be better at a fourth P: pivoting.
It seems logical to me that if we/entrepreneurs took the time to not only think through the steps you outlined, but also what a pivot might look like, we might be decreasing our chances at failure. Even in understanding that not being lazor-focused on the current start-up idea might distract resources, I would be interested to see how many companies that pivoted successfully had thought through potential pivots before.
Always good to read your work.
Sarah, I think your solutions are a great place to start. I think any way we can work to make girls and women feel that the level of “risk” they have are taking on as entrepreneurs is the same level as that of their male peers will help us make serious strides toward closing the gender gap. In developed economies, I think another way is to get more female investors into the picture as well. I also think encouraging female politicians and female academicians, as well as female business leaders, can help inspire youth. In developing countries, many of the changes need to happen at the institutional level–such as changing laws around property ownership and inheritance–as well as ensuring girls stay in school longer, delay age of marriage, have access to family planning, etc.
Amazing, thanks for sharing!
Amelia, you’re right on point, and this wasn’t something I had space to touch on in my post. But the reality is just what you say: that it is just socially less acceptable for women to be overconfident than it is for men. And that truth holds across sectors, industries, geographies, etc.
I think, though, that a large part of this stereotyping can be overcome by women supporting one another in reaching the same confidence level as men. Through support systems, networks, mentors, and more I think we can start to break down many of these gender norms that have been long imposed and reinforced. Even if only the female population committed to holding men and women to the same standards, we would have 50% of the population on board! And there are many men, especially in our generation, who are encouraging women to knock down these barriers as well. The reality is that we have the majority of the population on our side. So now’s the time for us to grab our start-up lives by the horns and run with them!
Ben, like the others commenting above, I also really liked your analogy and think it’s a great way to frame how we should think about building and iterating on cultures.
One point that I always struggle with is who do you let influence/determine the culture after its initial founding and early stages. During the early life the business it makes sense to me that the founder or founders determine what kind of culture their company will have. But as the company grows and adds on employees and investors, I think it becomes harder and harder to determine who is the strongest driving force in shaping a company’s culture. I see it being extremely tricky for cultures to evolve because in order for change to be introduced, that inevitably means going against some aspect of the existing culture, which I expect also means inevitably meeting internal resistance. And I think that resistance is especially unforgiving if it comes from the founders.
Ultimately I completely agree with you that it’s important to adapt a company’s culture, but I think it becomes more and more difficult the more ingrained the initial culture–which was likely set by the founding team–is in the company. Ideally, you would want the perfect culture set at the beginning, but the chances of that happening are second to none–and like you, I believe that being open to change is critical to the survival of the company. We should all strive to be self-aware founders who will listen and observe our employees to gauge their take on the culture, and how it can be improved.
Thanks for your post!
Thanks for your post, Brian! I think it was especially interesting to read following santanaman’s post on culture as the silent assassin of many great leaders.
Focusing on your first point:
I agree with the sentiment that many of these perceived perks of working at big tech companies or start-ups are distracting, expensive, and perhaps even manipulative more than they are productive. While ping pong tables and nap rooms seem nice, I also think that most of us are able to get through our work days without such amenities, and agree that we don’t need and/or shouldn’t expect our company to provide such things.
But, at the same time, what is interesting about such “perks” is that they often–not always, but often–signal to current and future employees that the company is invested in you as a whole individual, not just the you that is at your desk from 9 AM – 7 PM (wishful thinking, hours-wise?). And when one company starts to do these things, then the expectation across the industry is that its competitors will as well, and so spirals these bizarre interpretation of culture.
I definitely don’t think that these perks are the only way to let your employees know that you care about them–I would much prefer stronger professional development programs, healthy feedback cultures (as you discuss in your second point), open discussions about next steps in my career, etc. And I also agree that just because your company doesn’t have them, doesn’t mean the culture is boring or bad. After all, as we learned, culture is much more about how employees make decisions–which is impacted by things like the founder, belief in the company’s mission, collaboration, and more–and not about these artifacts that seem shiny and fun, but in reality, might not add any real value to our lives, professionally nor personally.
I will say though, at the risk of contradicting my comment that at the end of the day, if Google wants to feed me every day, who am I to complain 🙂
Thanks for your post, Kate!
I actually have a question around your third point:
Is it appropriate, as a potential employee, to ask the company who is backing them? I can imagine in many cases such information is not necessarily public–please correct me if I’m wrong–and I feel like that might be an awkward question to raise during the interview process. Do you have any tips/advice on how to navigate finding the answer to that question? Are there resources available that we can use, or do you have ‘strategy’ for poising the question in a way that is not offensive or too “probe-y”? Or is that question completely open and acceptable in the start-up world?
Thanks in advance for your thoughts!
I’m so excited to see watch you all grow, Enke!
I was wondering if you could share some thoughts on being an investor AND one of the co-founders of RAW IS EVERYTHING. While we’ve learned about how putting in some of their own capital can affect founders’ relationships, I believe–and please correct me if I’m wrong!–that here you are referring to larger investments (i.e. on more the angel level)? If so, I would be so interested to hear more about how that impacts relationship dynamics, good and bad, with both your other founders, as well as other investors–both current and future. I could see this being a great way to ensure alignment, but would also expect there to be tension.
Best of luck, and can’t wait to use your products!!
I totally agree–the what, aka venture debt vs equity, terms, etc. are all super important, ESPECIALLY when it comes to ensuring alignment with investors! (Something I’ve definitely been taking away from Entr Fin.) The decision to leave out the W/H was a function of trying to dedicate space to some of the “softer” qualities that we sometimes forget to try to understand ahead of time.
Thanks for reading 🙂
SC, I loved reading your post. I appreciate you taking the time to speak with leadership at these start-ups—It’s super valuable as a reader to know that you got your insights from multiple people who have gone through something as tough as a mass lay-off.
Most of my thoughts on this topic are related to the emotional costs—and therefore unforeseen economic costs—that the start-up experiences in a mass layoff. Such costs are especially salient when it comes to your fifth point on providing severance support.
I think it’s easy for companies to under-estimate the personal costs of big lay-offs. I worked on a massive headcount reduction this summer—which fell in the 10-30% range—at a spin-off company. Even at this larger, global corporation, where you would expect relationships between management and employees to be less personal, it was incredibly painful to watch the process—and I was just an external party. Employee morale was plummeting as people watched their colleagues and friends being let-go in massive waves, and my peers who had worked with the company before repeatedly commented that the senior clients’ general energy level was much lower than usual. I can imagine those emotions being even more amplified in a start-up environment, where we can usually assume that the company is smaller, personal relationships are deeper, people are more deeply invested in the company, etc.
Perhaps one way to deal with the emotional impact of a lay-off is to make sure that the severance packages and garden leave times are extremely generous, rather than just giving the minimum legal requirements. The trade-off, of course, is that it is much more costly for the start-up to increase severance packages during a time when it is incurring a large amount of one-time costs. But given that productivity is correlated with morale, it would be interesting to see if knowing that their peers received generous severance packages would help make sure the employees who are left feel like they’re working for a company that takes care of their people.
It’s not an easy topic, and I appreciate you tackling it! Here’s to hoping we never have to go through it (on either side) ourselves.
Unicorn4, thank you so much for your insights! I really enjoyed reading your posts and think you’ve developed a helpful framework for dissecting advice. Advice is not only dependent on who is giving it but also on who is asking for it. Often we ask for advice when we are confused or desperate, which are not times when we make our best decisions. Having such a framework will allow us to better decide how to absorb and apply advice, regardless of our emotional state.
I want to dig a little deeper into this topic looking at the investor as an advisor. I fully agree with your point that entrepreneurs (should) look to VCs for expertise as much as they do financing—the idea of “smart money” is never lost on me. However, I struggle with the idea that VCs are guiding you only with the exit in mind.
I know that the potential for a big, fat exit is a major driver of both the VC’s investment and their guidance, but I think it is up to us to make sure that the VCs we choose are invested in our success in the lead-up as well. And if it turns out that they are only driving toward profit and not the mission we believed we were aligned on, then we should take the onus on ourselves for not choosing the right investors.
Now, I recognize that in times when we are burning through cash not all investors are created equal—and it is likely that the one who gives us the most money, fastest, with the best terms will be our shining star. But if/when we have the luxury of choice, I believe we should do our due diligence on the VC funds to make sure that their money is with our vision, not just the exit. Then perhaps we won’t have to waste as much time and emotional energy second-guessing their advice.
Again, all easier said than done, but aren’t most things in this space?
Thanks again, looking forward to reading more!
David, great post and a question I have also been struggling with—mostly because I don’t think you have to be mutually exclusive in answering the two parts of your question, “Is it deeply selfish, or the right decision for you?”
In fact, I think this question becomes most difficult when the answer to both parts is “yes.”
I’m starting to believe that in order to be a successful entrepreneur you have to be selfish in many, it not all, parts of your life. Most of the time, it seems that you have to be willing to choose your business above all else—sleep, vacations, time with partners and family, savings, a stable career, etc. You have to throw yourself completely into what you are doing, especially early on, and I don’t think that leaves mental, emotional, or physical space for much more…
At the same time, your insights are encouraging, and I appreciate being reminded how much we can learn, even from failing. Let’s always remind each other of how fulfilling this path can
I think a key part to answering the question of selfishness is how do those closest to you feel about you pursuing this path. To me, selfishness is a matter of perspective and is only as bad as the extent to which it affects others. However, that is often difficult to gauge. Perhaps we can ask ourselves questions like: Is my spouse and family fully bought into the idea? Are my friends people who will be honest with me and not let frustrations and concerns fester until it’s too late? Will loved ones X, Y and Z understand when they are no longer always your first priority? Am I comfortable setting aside those people and relationships, even if they seem to be ok with it? The list goes on and on, and only becomes more overwhelming.
In the end, I don’t have much more clarity than you at this point. But if the answers to both “Is it deeply selfish?” and “Is it the right decision for you?” are “yes,” I expect there is a third question we should ask: “Should you do it?” And like so many other questions in this class, the answer is probably “It depends…”
Enke, thank you so much for your advice here! I have an outstanding question around formatting:
In your experience and from the perspective of an investor, do you prefer decks that are more eye-catching and story-oriented over those that may be more business model and/or content-focused? Recognizing that a blend of both probably preferred, I am trying to weigh the important of structure vs. content in developing decks moving forward.
Julisa, thank you so much for starting the conversation on an issue that I fear does not receive the attention it warrants in the HBS classroom nor outside. Everyone from Pepsi, PWC and BP has finally come to accept the importance of including minorities and women in the business world, yet as you point out, the start-up world seems to be a few steps behind.
What troubles me is that it is difficult to tease out advice that applies more to women than to men. This is not to say that I believe that men don’t deserve the guidance that women do—I think we can all agree that being an entrepreneur is tough regardless of your gender—but I do think that it is in everyone’s best interest to identify barriers specific to women that we can knock down. In other words, are there steps we can take that will directly impact female entrepreneurs
1) Develop professional networks for female entrepreneurs. I am often reluctant to advocate for women-specific initiatives—I believe that they can sometimes result in more harm than good by excluding men from the conversation—but this is one context in which I think it is especially important for women to be able to easily find peers. This plays to your point about mentorship; my hope is that we take it a step further and ensure that we have platforms where women can engage with one another on all things personal and professional related to starting a business.
2) Leverage the interest of large corporations in investing in female entrepreneurs. Another idea is to ride the wave of interest in female inclusion coming from large private sector corporations. Goldman Sachs’ 10,000 Women initiative is one such example of a private sector giant support female entrepreneurs in developing countries, where the challenges women face in starting and growing businesses are intimidating at best, and impossible at worst. We should be able to convince these players—who have the resources, networks, and PR power—to invest in female-led businesses both in the U.S. and internationally.
3) Get more women into VC. I think one of the best ways to empower female entrepreneurs is to have other women invest in them. It seems straightforward, but what I’ve experienced in my limited exposure to women in VC has been disappointing. Two examples come to mind. First, I went to a “Women in VC/PE” event last year organized by the WSA event. When I asked the panelists how they think about mentoring women, their responses were flippant, insinuating that they didn’t feel that they had time to invest in mentoring young women interested in the industry. The second example came during our FIELD 3 pitch simulation last year. The short version of the story is that I was shocked at how the female venture capitalist “investing” in our section treated the only all-female team, Pregnant & Posh. She shamelessly confessed that she had dissuaded the other two investors (who were both male and had agreed that this team was the strongest) from including P&P in the top three. Her argument was that she knew more about this business as a woman, but to be frank, the rest of us felt that she had just set the bar hire for them. I think beyond all else, it is important that women support one another in entering and succeeding in this space, and I believe that can best be done with commitments from women at the top.
Those are just a few quick thoughts sparked by your post. Thank you again for tackling this issue—you’ve inspired to focus more on this in my own reflections and blog posts. And I look forward to continuing this conversation with you through the rest of the semester and after!
p.s. Congrats on crushing Tressed ☺