Why feasts are essential to startup success

Management literature is filled with long books about company culture. This post will tell you that winning culture is actually really simple. It will give founders an easy way to 10X the performance of their team. Simplicity is power. Use it.

A group of men armed with spears had cornered their prey. They felt excitement and relief. Soon they would return victorious to wild cheers from the tribe. The women had prepared for a feast. Tonight they would be eating, dancing and singing. It was the greatest part of being alive.

For more than 20,000 years, humans were hunters living in tribes. Life was harsh and brutal. Among the few pleasures was the feast. To get a feast required collaboration of the whole tribe. The adult men hunted. The boys assisted. The women prepared fire, fruits and water. Everyone contributed to their common goal. The feast.

Today our lives have changed. But our brains haven’t. Humans still get immense pleasure from collaborating to reach a successful outcome and then celebrate the victory together. When athletes win Olympic medals even the assistants and masseuses go bananas. And this fact is of great importance to startup founders.

The really simple way to build a winning culture

I coach startups on many different things. One of them is how to build a winning startup culture. And that is actually quite simple.

Founders must leverage the hunting tribe mentality. They must break down their journey into small milestones and turn these milestones into hunts. They must assign every team member a role in the hunt and provide a feast when it ends in success.

In practice it means this:

  • Have team meetings Monday morning.
  • Set one overall goal for the entire team to reach by Friday. Hang it on the wall.
  • Place desirable rewards on a table. Like champagne, dinner reservations or concert tickets.
  • When you reach the goal, celebrate hard and congratulate every single member of the team. Even the interns and advisors.

You now have a team that pulls in one direction. Now everyone knows their priorities. Now everyone is motivated and feels important and appreciated. And because of human history, you will develop a true winning culture in the process.

 

Advertisements

The essential questions founders should ask investors

Most founders do investor meetings like a job interview. They look their best and hope to be picked. Most founders know it’s a mistake but don’t know what else to do. This post will teach you to turn the table and interview the investor. It will provide you with a set of essential questions to ask. The answers are more important than you can imagine. Use them.  

I made a huge mistake. And I want you to learn from it.

When I was a founder, I thought VC money was the same.

Because of this delusion, I didn’t care who the investor was. So I approached all investors in the same way.

I showed off and hoped the VC would throw a term sheet. It was a show on my part. I thought I did good. I was mistaken.

In fact, I did terrible. My pitch was good. But I forgot the most important part of the meeting. To learn who I was talking to.

Why does it matter? Because the VC demands your time and attention. And that’s your most valuable asset.

You want the time and attention he demands to be beneficial for you. And that’s a function of three things:

1) The experience of the firm 2) his personal experience 3) his view of your startup.

I didn’t know. So I didn’t ask. You shouldn’t make the same mistake. So here is a list of questions I wish someone had given me:

Essential questions about his firm

  • How many funds have you managed?
    • Because experience is important. First funds tend to give bad returns.
  • Who are the Limited Partners of the fund?
    • Because in the end, the investor serves the interests of the Limited Partners.
  • How big is the fund?
    • Because fund size determines how little and how much they can invest. And how much follow-up funding they can provide in the future.
  • When did the active investment period start and when does it end?
    • Because the lifespan of the fund determines the urgency to invest and to exit again.
  • How is the management of the fund structured and how do you make decisions
    • Because it matters greatly how decisions are being made and who have decision power.
  • What is your investment thesis?
    • Because a clear thesis is an indicator of professional intellect. In other words, they know what they are doing.
  • What are the limitations of your investments?
    • Because it’s nice to know if the investment can be turned down because of technicalities.
  • Which companies in the portfolio have given you learnings and expertise to help us?
    • Because expertise matters. And real expertise comes from experience.
  • How do you do due diligence?
    • Because due diligence can be very long and costly. And you will pay.

 

Essential questions about the investment manager (the one to join your board)

  • What is your thesis about startup success?
    • Because a clear thesis is an indicator of professional intellect.
  • Which other companies in the portfolio are you managing?
    • Because he gets most of his learning and network through his own portfolio.
  • How do you approach the role of being board member?
    • Because you want to know if his style is compatible.
  • How can you add value to our company?
    • Because the answer reveals if he fundamentally sees himself as a controlling mechanism or someone who is there to help build the business.
  • How are you incentivized?
    • Because he will focus on what makes him rich.

 

Essential questions about his/their view of your startup

  • What do you think are main opportunities of the business?
    • Because the answer reveals if he has valid growth thesis.
  • What do you see as the main risks of the business and how would you mitigate those risks?
    • Because the answer reveal if he has experience with your type of business model.
  • What do you see as the main priorities the next 6 months?
    • Because the answer reveal if he is aligned on the short-term strategy.
  • How do you see the exit path of the company?
    • Because VCs are driven by exits and you want to know if they are aligned on the long-term strategy.

If you ask these question, you will get a conversation instead of an interview. It will be a conversation with between parties evaluating each other. And most investors will respect you for this.

Good luck in your next meeting.