From Founder To CEO. How To Make The Transition.

I’ve been a founder and ceo for the last 16 years. Almost all of it self taught.

Over that time I’ve come to believe that founders can become great ceos. The only way to get there is by doing it. Yes you can get a coach but that only takes you so far. At the end of the day you need time on the field making decisions, fucking up, and learning from your mistakes.

What makes this transition hard is it takes time. You acquire the hard skills by running enough companies with enough varying scenarios that you can build recognition patterns. The soft skills develop by leading people and making a lot of personal mistakes, many of them causing additional emotional stress. All of this often takes more time than your current startup wants to give you.

You see a similar development happen with sports coaches. First time head coaches often fail, get fired, and connect the dots in their next head coaching role. Even Bill Belichick, the most successful NFL coach of all time, went from being a hugely successful assistant to a failed head coach tp a record setting head coach. He just needed more time and more chances to learn how to be great.

Back to startups.

The intensity to start a company is so great that people don’t do it for decades. They do it long enough to succeed or fail and then they stop founding because it’s too hard. The end result is a network of fellow founders who can share broad learnings, but who haven’t has the time to create their own methodology on developing from a founder to a ceo.

So I collected feedback from several who have made this transition and combined it with my own 16 years of making this transition. If I were to develop a founder into a CEO here is how I’d think about it.

Development Triangle

founder to ceo

I think of developing from a founder to a CEO like this….

  • Self – the personal foundation you need, no different than if you are trying to become a professional athlete.
  • People – the people skills, without them no one will follow you.
  • Functional – the functional skills, these are specific to your market and business model.

The assumption is that you already have the personal foundation in place before you take the role. Developing all three parts of the triangle at the same time is really difficult.

Time

The overall thread to developing as a ceo is this transition takes time and energy. It’s not for everyone.

An alternative path is focusing on how to be a great founder. Understanding customer needs, building products that gain traction, and willing people to believe are very hard skills to master. You then have to get great at finding and hiring the right ceo to take it from a product to a company. Garrett Camp is a modern day version of being a successful founder, starting StumbleUpon, Uber, and Expa. I haven’t met Garrett but from the outside it appears he’s obsessed about founding new ideas and teams.

I provide this context so people understand there is no shame in just being an awesome founder. To found, start, and hand off companies can be personally rewarding and financially lucrative (i.e. Garrett is a billionaire).

If you do want to be a great ceo you have to recognize this is a life’s work. You will need your founding ideas to be successful enough that you can learn to be a ceo or you’ll need to join fledging product ideas that need a ceo. You’ll also have to be wiling to try it again if you fail the first time.

The Self

Being a ceo is a long game. It takes time to develop a company and even longer to develop your ceo philosophy. Therefore I believe in foundational building blocks that you will need to stay committed over the long term.

1. Discipline
Cus D’amato was Mike Tyson’s coach. His philosophy was that will is more important than skill. You aren’t born with skill therefore you have to practice and train to become the best.

This only happens with discipline. And no one can generate this for you. You have to find it and harness it until discipline becomes a personal habit.

Mine started as a kid with soccer. I wasn’t always the fastest therefore I had to be the hardest worker. I’d train before school, after school, and then go to team practice. Fortunately this created a set of habits that I now heavily rely upon.

It’s important to note that with discipline it doesn’t mean that you can’t be creative. I find the opposite to be true in that the more disciplined you have the better your creative sessions become. You create with purpose that keeps you from getting burned out.

2. Physical Exercise
This is hard to do consistently. It becomes easy with stress and travel to ignore how exercise is tied to your very survival. But it is.

Consistent physical exercise is very much tied to your discipline so find a way to make it foundational to your life.

3. Emotional Outlet
You are going to need a place, or person, or a set of people that become your emotional outlet. You should recognize this before you even start.

If you are founding a company and have a significant other, they are also founding the company with you. You should talk about the why behind founding the company and what success looks like for the two of you. And you’ll have to keep this conversation going as you level up in the ceo game. Each new level gets harder than the previous one and without the emotional support you will break.

A therapist is also a good way to go. The role is stressful, especially when it’s not going well. Money and expectations are a heavy burden to bear.

Another route is a psychology coach. Ideally you can find a coach who actually develops ceo (ie has been a founder to ceo). Unfortunately the startup industry is full of “coaches,” ie people who listen really well but haven’t been a ceo.

The People Skills

Leading people is emotionally difficult. It’s even harder if you don’t have a methodology for how you organize and run your teams. The analogy would be like coaching a sports team but not having any method for how you prefer to practice, prepare for games, play the games, and analyze the results.

Giving people the structure they need is critical to reducing the emotional stress involved. It’s better to start with something and modify it over time than to start with nothing.

1. Compensation Philosophy
How you pay people matters. Are you going with the traditional negotiated model (hiring manager versus the employee) or are you going with a formula model?

I have moved to a formula model, emulated from Buffer’s salaries.

I have found that a formula model removes a lot of the emotion around hiring, especially ‘renegotiating’ when people leave. It treats everyone the same so the team can focus on the work and not try to figure out why someone is making more than them.

Your compensation philosophy speaks to how you think about the people on the team.

2. Team Structure
You should have a way you like to organize and run teams. This includes the when (daily, weekly, monthly, etc) and the how (functional vs non-functional).

In sports this is similar to having a consistent schedule and a formation by which you play the game. Both of these threads can change over time as the team becomes more sophisticated.

By having a preferred structure you give people clarity on when to work and who owns what. This helps people focus on the work and not be distracted by hierarchies.

3. Feedback
You have to develop how people give feedback within the company. This is both at a peer and structural level.

The biggest challenge in developing feedback is that people are terrible at it within a business environment. This is because no one has taught them how to give and receive feedback. Plus they haven’t learned what kind of feedback they need through out a project. The feedback you need at the problem definition stage is very different from the shipping stage.

Beyond the day to day level of feedback you also have to establish the formal process for feedback, both when and how. This gives people the stability they need in knowing how they are doing at their job.

4. Taking Teams Apart
Unfortunately learning how to put teams together also means that you need to learn to take them apart. This can be at an individual level (moving or changing people) or at a team level (layoffs).

The best resource I have read is Ben Horowitz and The Hard Thing About Hard Things.

Anything Ben puts down on this subject is worth picking up.

The Functional Skills

Many of the functional ceo skills you need are business model and market specific. Most of them are developed by fucking up before learning the right approach.

The nice things is these functional skills get easier over time.

1. Editing
Editing is the most important skill you have to develop.

As a founder you write, but as a ceo you edit. This means being able to listen, cut to the core, and then pull out the key insights. It doesn’t matter if it’s a product, customer, or team issue you have to learn how to cut to the core problem and communicate it.

I use a few tools to learn how to edit…

  • Customer Journey – it’s a mental map of before, during, and after. It helps you quickly map out process to understand the core problems. It’ helps you to identify what you don’t understand.

  • Visual Hierarchy – a core element to design thinking, it stresses that arrangement of information implies importance. Getting good at this helps you structure the most important information up front with the problem, the why, and the what.

  • Skimming – if you can skim and still understand it then the information is well organized. You can’t skim everything but it’s a skill set that helps you to focus on what is most important. If something is too complicated to skim then something is wrong.

  • Malcolm Gladwell – he is incredibly succinct. Reading and listening to his podcasts you can learn from someone that is able to distill complex topics in simple ways. If not Malcolm find other communicators who you believe are great editors.

2. Communicating
What you say matters. Learning this is painful as you transition from the early days (everyone personally knows you) to the later days (very few people know you). People will start reading everything you do and making assumptions.

The energy you bring. What you say. When you say it. Even who you say it to and in what order. It becomes overwhelming to worry about.

Communicating is harder when you are wearing multiple hats. Especially as you build out a leadership team, there are times when you will hold dual roles and people will struggle to understand if you are speaking as the ceo or as the functional leader. It’s your job to clarify.

What people want is…

  • Consistency. They don’t like all your new ideas or changes to plans they already executed.
  • Clarity. They need you to be succinct and to the point so they can make decisions from what you say.
  • Confidence. Being calm throughout the peaks and valleys gives people the confidence that they are making the right decisions.
  • Transparency. Don’t underestimate the decisions people will make if they have the same information you do. I’ve always found that if you are totally transparent and provide clarity around the why, people will follow you. When you start hiding stuff people will bounce.

3. How You Win
You have to figure out what quadrant you can own in the market. This skill takes practice in looking at how the market traditionally competes without you and how you can win on a new paradigm. I call this finding your quadrant.

You learn to do this at a product level (i.e. how you differentiate) and at a business level (i.e. how do we win the market). From this clarity you then learn how to communicate and adjust resources to execute against your opportunity.

4. Decision Making
You have to learn how to make ceo decisions. Keith has a decision framework I agree with. It’s based on your level of confidence and the impact of getting the decision wrong.

As your company scales you move from lots of small decisions to a few, very large decisions. These become the decisions that keep you up at night.

The learning skill here is to figure out which decisions you need to make and which ones you don’t. The less you can make and and still deliver, the better.

5. Have Capital It’s your job to make sure the team has the money it needs to execute their plan. This can come from debt, equity, or by being profitable. It’s on you to pick the right strategy and then find the right partners.

Finding the right partners gives you rocket fuel. While finding the wrong partners is death by a thousand cuts.

The skill set to master is story and investor speak. Learning how to simplify your business and then find people who are excited about the title wave you are trying to ride.

Conclusion

This is a work in progress as I develop my own philosophies on making this transition. A lot of what I have learned has come through struggle. It’s a struggle I love and try to get better at every day.

If you need anything please dm me @marcbarros.

Do you want to be a ceo? How to decide.

It’s been a long time since my Contour ceo days. Being 21 when I started and 31 when it was over, a lot of it has become a blur.

It started with two undergraduates in a shitty rental house north of Seattle. One person was hand making helmet camera lenses and the other was selling and marketing them. There was no ceo, just two kids with no idea what they were doing.

That continued for another 10 years, just with more people and nicer offices. We were still making cameras and trying to sell them. But somewhere along the way our titles changed.

I became the ceo.

Even today today that sentence makes me pause. It’s so matter of fact and yet my journey was anything but that. Instead it was a meandering of highs and unforgettable lows. Most of which was spent fighting for our survival as number two in a market that investors didn’t want to fund.

At the time I knew I was in the ceo position. In retrospect I didn’t know I was the ceo. I had never internally committed to the role and what it takes to be the best at it.

Now I know what it takes to make that decision.

It’s More Than A Job

Being the ceo is more than a job. Because to do it well you have to let it consume you. You have to emotionally internalize that people are counting on you to lead from the front, with consistency and decisiveness. Everything that goes well is because of your team and everything that doesn’t is because of you. Unfortunately those expectations aren’t just 9-5.

I often refer to being a great leader as being a great coach. The best coaches in the world are obsessed about their system of play, the players on the field, and how to keep a group of people moving forward. They are constantly iterating and finding small ways to make everyone better. You can’t do that from just 9-5.

Letting a cause consume you is’t a bad thing. You just have to realize what’s expected and the level of commitment that it takes. While you are the ceo, the role will always be there. Even on Sundays.

Money Is Stressful

It takes a lot of energy to get past the survival point. Either by raising enough capital or becoming profitable the stages of constantly running out of cash will consume you. Even if money hasn’t stressed you out before there is something to having customers, partners, and investors on the line that dramatically increases the concern.

Some ceo’s love raising money. The chase to have enough capital is what drives them. For others raising money is terrifying. Whether asking your friends or strangers, the thought of raising capital is too much to bear.

Learning to raise money is not a natural skill, it takes practice and just because you’re good at it doesn’t mean your company won’t always be on the brink of running out of cash. It can take multiple years until you have a sustainable company. That’s years of being stressed about money.

As the ceo it’s your job to make sure the company has the capital or the profits it needs to survive. You have to relish in this stress.

Learn To Contain Fear

Every book written by a ceo recounts their fears along the way. Hard Thing About Hard Things is one of the best. Ben is honest enough to share what it means to be a war time ceo and the decisions he had to make along the way.

Whenever you add growth, investors, and employees you carry a burden…what you created might not work out. Your combination of offering and delivery will fail and you’ll have to explain to everyone why you lost their money and their job.

This fear is real. It gets easier after you bankrupt a company as you learn failure isn’t the end of the line for founders. If you are honest, hard working, and self reflective about why you failed, someone else will give you another chance.

Everyone finds their own way to manage this fear. You will have to do the same. Thankfully the internet is full of ceo self help tutorials for how to manage this fear. From a personal coach to counseling to a private network of fellow ceos.

Have Zero Expectations

The way I deal with potential failure is by not having any expectations. I expect none of it to work out and therefore I’m obsessed in making sure we have enough swings at the plate.

Zero expectations doesn’t mean you expect it to fail. It just means being methodical in your approach in trying, measuring, adjusting, and trying again. The assumption is that your company is one giant experiment. Therefore you’re on a quest to figure out what does and doesn’t work.

This approach also helps to keep the peaks lower and the valleys shallower. Because as soon as you set expectations the only option is to disappointment them.

Want The Ball

Everything else aside the easiest way to think about the role is that you have to want the ball at the end of the game. When it’s all on the line you have to be someone that says I want the shot.

Every company has a handful of these do or die moments. As Ben calls them, sometimes you have to roll a hard six.

Conclusion

It’s ok to be a terrible ceo when you start. I was for a decade.

Being a ceo is an unnatural skill. It takes a lot of practice to be great, which means you need enough time on the field to develop at it.

Lots of great assistant coaches are terrible head coaches. It’s not the same thing. It’s a whole new set of skills you have to learn. This is why most head coaches are a twenty year journey. They start with small, unknown programs and move their way up over the years until they reach the top of the sporting world.

The same goes for being a great ceo. There is no practice for it. Even being a great startup executive doesn’t mean you know how to be a ceo.

I do believe you can learn to be a great ceo. As long as you think of it as a 20 year journey…the role gets easier over time.

If you have any questions dm me @marcbarros.

Prioritizing – What To Work On and How To Switch Topics

Are you a maker or a manager?

I’m a maker. Moment is a maker company with 40 people of which 39 are making.

In a maker culture the biggest leadership challenges are…

  1. Deciding what to work on.
  2. Mentally switching between multiple topics.

In the early days, what a team works on is relatively simple…what is going to work to bring a new customer?

Everything a team is working on is in support of getting a new customer. If you spend a $1 in engineering it’s because you believe that $1 will turn into new customers through what you ship. If you spend $1 on new computers it’s because you believe those computers will turn out work faster which gets you another customer. A dollar is a dollar and you are trying to guess at which dollar spent will result in another customer.

Sometimes those customers are investors who fund your business and sometimes those customers are people paying for what you offer. Regardless, getting good at deciding what to work on just takes practice. Every team learns to solve this in their own way.

Learning how to mentally switch topics is much harder. Not everyone is wired for it, especially if you are a maker. Managers don’t really go deep enough into any topics to have this issue. But if you are trying to make, then covering a broad range of topics can be debilitating.

Here is what helps me.

Why Covering Multiple Topics Is Hard

It’s important to briefly understand why this is hard.

First, people are not taught how to cover multiple topics. Traditionally companies are organized functionally and therefore like minded, skill specific people are grouped together. People are taught the functional responsibilities of their role. Over time people get comfortable with this definition and therefore learning new domains becomes less interesting.

Second, speed compounds the issue. Small teams need to move quickly. Which means people can get overwhelmed if they are trying to both learn new subjects and execute the domains they already know. They end up gravitating to what they know and ignoring the stuff they don’t.

Third, you have to be vulnerable. Admitting what you don’t know, asking for help, and getting better takes more self reflection. Not everyone is interested in this.

Fourth, it takes discipline. Consistency in your personal approach and team process matters in learning how to master this skill. Not everyone thinks about the discipline of their work.

Deciding On Team Structure

Team structure is the first way to define the problem.

If you structure the company functionally…sales, marketing, engineering, etc then covering multiple topics comes down to one person. Functional teams are highly dependent on what the other teams do, therefore you need at least one person who is exceptional at switching topics and making sure the separate groups are connected.

If you structure the company with cross functional teams then you have to teach breadth to a larger group of people. You will go slower in the short term in developing these skills. In the long term you will go faster as you have multiple leaders who can take groups of people into whole new markets.

At Moment we organized into cross functional teams. Each team has a lead, 3-7 people, and the resources they need to deliver their own goals. This means we have to teach multiple people how to cover multiple topics effectively. Personally I believe in coaching as the long term gains outweigh the short term ones.

If you don’t have time to coach people, then being functionally organized reduces the problem to a single person inside the company.

Define Your Feedback Process

How do you prefer to review work and give feedback?

If you can see work, understand the issue immediately, and provide succinct feedback then you can build your schedule around a series of short feedback sessions. What you say has to be correct and you can’t come back later and change it. Otherwise your team will get fed up.

The number of people in the world who can do this is very small. In my fifteen years I’ve met one.

If you see work and your first answer isn’t right, then you need a schedule that gives you time to think, reply, and correct your own reply. You’ll want to create a schedule that groups similar subjects and creates as much thinking time as possible. The weekly schedule at the back of 7 Habits Of Highly Effective People is one way of doing this.

Personally I have to think before responding. I need time to look at the whole context before providing feedback. Therefore to give myself time to think and still run a company I group my schedule.

  • Team meetings and 1:1 sessions are the same 2 hours every day.
  • Phone call availability is the two hours around my team sessions.
  • Email is only at the beginning or end of the day.

This gives me at least half of a day, every day to really think about 2-3 topics. If the topic is big then i get one per day. If the topics are smaller, then can get in 5-6 topics in a day.

What has helped the most is working off-hours from the team. That means early mornings or weekends. I can’t resist Slack so not being online helps me to better concentrate.

Set A Communication Style

How you communicate further dictates your schedule and ability to switch topics effectively.

If you prefer to provide verbal feedback you need to be online when your team can talk. You have to develop how your team does phone calls or you will quickly get a meeting culture. And lastly, you have to learn how to be very succinct.

The mistake people make is to assume that a long conversation is an effective conversation. The reality is people can only remember a few things that you say. It may make you feel good to say a lot but the ratio of what you said to what is executed on can be way off.

If you prefer to provide written feedback then you need to develop a consistent method that everyone can use. You have to teach that method to your team so everyone creates a habit in using the same process when giving feedback on the work.

Personally I prefer written feedback. I use briefs to create, commenting on briefs to edit, and then Slack to give real time feedback. I try to focus on information hierarchy so that written docs are both easy to skim and organized for finding information you need. I also find written feedback lets you go deeper on topics and gives you a chance to write and re-write that feedback.

Where this breaks down is Slack. My need to reply quickly trumps quality and it takes away valuable thinking time as I get hooked on the feedback loop of reply, wait, and reply again. I send way too many messages and it’s not good for anyone, me included.

Finish And Take Short Breaks

When working on multiple subjects I focus on two micro habits.

  1. Finish the subject.
  2. Take mental breaks.

When focusing on a topic I have to finish it. this means taking the work to either a spot where I can re-start quickly OR to the point that I can publish my feedback.

When focused on a single topic you can get in the flow so starting or stopping isn’t as big of a deal. But when working on multiple topics you have to artificially create your flow by learning how to stop and re-start at the right point. It takes at least 15 minutes just to mentally catch up to where you left off on a subject so these start and stop points are critical.

The second habit is taking a mental break in between topics. If the work is along the same thread, lets say a product, then I can turn that on and off in the same day. But if I am switching topics, lets say looking at finances, I have to start fresh as if I was starting my day over.

Generally this means…

  • Closing my browser and all the tabs.
  • Getting up and walking around.
  • Getting something to eat or drink.

These are sub 5 minute breaks but what when I sit back down and open my computer to a blank screen it gives me a fresh approach on the next topic. If I sit back down and the last project is open and half done I can’t clearly think about what’s next.

Proactively Communicating

A word of caution is learning to switch between topics can be overwhelming, especially as the work stacks up. I don’t have any feedback for how to tackle this feeling other than working through the list.

But I can say the best way to manage this is to pro-actively communicate. A simple, I got your message and will get back to you by blah, really helps. This gives people confidence that you heard them and are working on it.

If you have questions email me or dm me @marcbarros.

Be Consistent

I can still remember Darryl’s conference room. It’s not your typical setup with walls and a desk. Darryl’s conference room was the bar. And when he invited you to a meeting it wasn’t, lets get a drink happy hour. I mean it started that way, but it always had a purpose.

It was a Thursday. I remember because that meant he had something he wanted to say. Friday beers were reserved for bullshitting, but a mid week beer was something different.

I never knew how to act with Darryl. He was more than twice may, been through Vietnam, and part of two mega hit startups in Tonka Toys and Watchguard. This was my first job let alone my first CEO role. But somehow Darryl was a believer in what we were building, despite our crappy office and modest success.

The first beer is the happy one, catching up and pretending that a sixty something year old and a 28 year old have anything in common. But by the second beer he lets you know what he’s thinking. Being a military guy he lives by the chain of command. He respects you but also lets you know when you aren’t cutting it.

At some point he looked at me and said…you need to be more consistent.

I started typing notes into my phone, waiting for him to add more. He didn’t.

I was relieved that’s all he had to say. But then I grew more concerned….what the hell was he talking about?

I actually didn’t know. And being the immature CEO that I was, I didn’t ask.

Fast forward a few years and during my time running Contour I never fully understood what he meant. I heard him but never got it.

It’s been ten years since we had that beer. I understand what he meant.

It’s taken a while. Perhaps it was becoming a husband or a father or a second time CEO. Or perhaps it’s just being the old guy in the room, but I can see in others what Darryl meant.

Being consistent is hard. It’s hard as a parent and it’s especially hard in running a company. Most of the time you have no idea what you’re doing, piecing it together a you go. You’re trying to sound purposeful, but on an undefined path it’s hard to be consistent.

Most entrepreneurs are creative in some way. To generate an idea takes some level in ingenuity. And so being consistent feels like it can be in direct conflict to the craziness people need to create because it’s boring.

Over the years I’ve found the opposite to be true. Discipline has resulted in more space for me to create while providing the consistency others around me expect.

If you are running a team everything you do gets replicated. So if you are random in your cadence, the team will be random. If you don’t document your work, they won’t either. The list goes on, but your approach on the details speakd more to your consistency then anything else you do.

Everyone has their own process for being consistent. Here is what works for me…

My Day

I try to start it the same time every day, before 6am. This isn’t a work thing, it’s a life thing. It takes a week but your body adjusts and appreciates the regularity. This has gotten harder with kids unpredictable nights, but it still works. By the time everyone starts their day I’ve already accomplished something.

I use Evernoteand start my day with a short list of what I need to work on next. I’ve tried blocking time as they show in 7 Habits Of Highly Effective People. It became too complicated so I went back to a simple list. It provides focus and relief when each item is completed.

I took email and slack off my phone. I’m on my laptop enough. I could never resist not clicking the icon and just checking what’s going on.

I use Calendly and block out the same 3 hours, three days a week, for any phone calls. This channels interruptions to the same window of time. I don’t schedule anything on Thursdays or Fridays, it’s my chance to think.

I make it home for dinner. It matters for my family and in return it matters for me. It’s hard to come home, cook dinner, and have energy but the habit has helped a lot.

I try not to open my laptop after 8pm when the kids go to bed. If I do I stay up and lose my morning rhythm. Waking up early has forced more discipline to when I go to bed.

My Process

I don’t have meetings. I have sessions. It’s a mindset for me that makes me think about how we make each workout better. Whether 1:1 or with a group we run a session together no different than if we held sports practice.

Agenda structures rarely change. We practice getting good at running the same types of sessions for several months before we evolve the structure. Growth in team size is what impacts these changes.

We start Moment with a 10am daily stand up. This was company wide up to 30 people, now it’s by team. It’s the same time every day regardless of your time zone. It’s our chance to connect with each other, even if for just a few minutes.

We have one leadership team session every Monday at 9am pst for 30-60 minutes. Each team replicates this structure with a weekly session of their own. The agendas doesn’t change much. We review our numbers, last week, this week, and schedule changes. What we do as a team, starts the company cadence for the week.

I hold 1:1 sessions with each member of my team. I try to never miss them as this is their time and my job is to be there for them. They set the agenda and I can add to it. I didn’t start this until about two years into the company when we built teams and leads.

We have a company session every other Tuesday for 1.5-2 hours. It started as planning our next two weeks and now it’s my chance to address the team and the team leads chance to engage the whole company. This isn’t a beers and BS session, it’s practice for playing at higher level.

We have a board meeting every six weeks. I used to think this was dumb. I’ve come to realize that a leadership team needs it. It forces us to step back, analyze what’s working, and discuss that with the board. We don’t make presentation decks, just write a running google doc with our analysis and topics to discuss. We share that whole doc with the team after the meeting. They get the same information the board does, no secrets.

We run the team on trimesters, not quarters. Quarters happen too fast. By the time you plan one, it’s nearly over. With trimesters we can make bigger goals. Most important we can afford to take the whole team offsite for week to kick off a new trimester. These sessions have let us knock down nearly all the walls that live between us, while working to build, shape, and define our culture. We document every offsite so new teammates can understand our past.

I’ve sent 70 business updates over the first five years of Moment. They started every other week and over time they have moved out to 1x per month. They force me to step back and think about the business. They aren’t list of stuff we’re going to do. They include short paragraphs of analysis with snapshots of data that we are learning. Everyone receives this same update via email…all the employees, investors, and board members.

I write everything down and require our team to do the same. We start every kind of project with a brief. It makes us define the why, what, when, and how. We still struggle to read them in detail, but we’re getting better.

Every team has a data dashboard and nearly everyone on the team does a short weekly update that is shared company wide. We teach early on how to read and analyze data. It’s equivalent to learning proper technique for passing a ball.

My Weakness

Slack makes it too easy to read, follow, and comment on everything. I’m still working to improve at communicating less. In particular being better at grouping my thoughts into one post instead of a string of comments.

Being Inconsistent

Things I see people do when they are inconsistent.

They change their team session times. For whatever reason they aren’t able to hold the same session at the same time every week.

They use complicated charts because they think lines and bars are boring. If lines and bars are boring they assume people won’t read them.

They don’t document their work. Whether it’s the structure of a Trello card, a brief or a process they do it in their head and then have to explain it to everyone else. You should assume nearly everything you do needs to scale beyond you in the future and therefore however you run things today is how the next person will run it.

They add more than one piece at a time. Everything you add, whether a feature, an idea or a market takes practice to learn how to do it well. You want to build into complexity over time.

….All of this is easier to do when things are going well. When shit hits the fan is when your consistency really gets tested.

It’s OK To Obsess

In sports there are champions and non champions. In music there are hits and non hits. In sculpture there is “the david” and everything else. In startups there are winners and non winners.

It doesn’t mean that the non winners aren’t successful, nice, wonderful, endearing, deserving, hard working, empathetic, etc. They just aren’t champions.

When you walk into Camp Nou you can feel it. The old concrete, the steep rafters, and the bright lights. The anticipation of history, there are no empty seats when the game starts. There is no complacency in being late. There is no one lagging back from half time. Everyone understands the significance of the moment, the history that is about to unfold. And for the next two hours they celebrate it. They watch, applaud, awe, and even critique….but most important they appreciate it.

We have lost that spirit of appreciation towards company builders. The legend of Ben Franklin has been replaced with Jeff Bezos and his cruel culture. Ford and the marvel of making the Model T is now Elon and his exploding cars. The magic of Walt Disney has become Howard Shultz and his ‘racist’ coffee cups.

We are quick to judge and even faster to give up. We are afraid to try, try again, and keep trying until there is nothing left to give. We aren’t willing to put ourselves out there, to be utterly vulnerable to the world. Because in order to be successful you have to be willing to be judged, to be critiqued. And if you win…to be hated.

If pouring your soul into your work, isn’t your game that’s ok. If wanting to be the best isn’t your thing, it’s safer not to try. If being obsessed isn’t what fuels your existence, no one will judge you.

But to those of you that do, we should be giving you a standing ovation. We should be appreciating the detail and the commitment, the courage and the journey. We should first marvel, then critique.

If you know someone who has started a company don’t tell them to work less. Don’t confuse their desire to change the world with your own fears. It would be like telling Michelangelo to stop working on The David because he should have better balance.

My Addiction

 

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It’s just after 11pm on a Friday night. My mind is tired, to that point that I can feel it fighting to gain just a little bit more adrenalin. Because slowing down would cause me to collapse at my laptop.

I’ve been here before. Many times in fact. Especially during my first startup there was little that prevented me from being a train reck of a workaholic. The harder I pushed, the harder it was to stop. The more my body and mind yearned to be worked until exhaustion.

Fast forward eight years and I can feel it happening again. Like a drug addict that just needs one more hit, I push for one more ounce of thought to advance the business.

Except this time, sitting at my desk at 11pm, I have a lot more to lose. With two young kids and an amazing wife I can feel life slipping by as I spend just one more minute on my startup. Just one more glance at my phone. One more thought before bed.

The deeper I go the easier it is to justify this path. To say, oh just after this project it will slow down. Except it doesn’t. Not because it can’t, but because I’ve forgotten how to. What started as a side project has become a constant being. To the point that I’m sitting here at my laptop, long after my family has gone to bed, doing the work of three people.

I’ve written about this slippery slope before. In between companies and free from the burden of growth I wrote a guide about enjoying the ride. That was almost three years ago. Long enough that I have forgotten my own words.

As I sit here again, I realize that this is a choice. No one forced me to push myself to exhaustion. No one required that I say good night to my family. No one listed this as a requirement to being a founder. And yet I’m here…a few steps from sliding right back back down that hill.

Previous to being an entrepreneur the only thing that I was ever addicted to was soccer. I didn’t just play on the weekends, I was the kid with a bag of soccer balls in the back of his car practicing before and after school. I even convinced my principal to give me first period off in high school so I could train.

As a player, I didn’t make it to the world cup or even to the professionals. And yet I would take that same path every time.

Trying to be a great entrepreneur is something I think a lot about. No different than trying to be great athlete I’ve come to believe that success is built on hard work. A discipline and willingness that the average person is not willing to commit. And yet my personal desire to improve comes in conflict with the relationships that I love in my life.

It’s even come to the point that I’d rather work than socialize. Because socializing feels like I’m being inefficient in the very seconds I’m consumed in conversation. All I can hear is the introvert inside me screaming to get back to work. Back to my quest to move forward.

Unfortunately, the only thing that really stopped me down this path last time was being fired from my own company. It was so finite in conclusion that my stomach still turns from its abruptness. It not only forced me to get off the roller coaster, but to realize I had a problem.

I still have that same problem and I don’t have a solution. Just a realization that this time I have a lot more to lose.

 

Image Credit: dangquocbuu via Creative Commons

Confronting Fear

 

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My wife’s grandfather recently passed away.

At 95 years old he lead an incredible life. One full of love, laughter, and success. And despite the 61 years that separate them, the two of them shared a special bond. As if father and daughter, their relationship was incredibly honest.

When she heard that the end was near she was given a choice. To confront it or to hide.

Confronting death is terrifying. I remember when my mom was dying, I hid more than I confronted. I worked more, pretending to myself as if my startup was more important than the reality of her battle.

My wife didn’t have this conflict. She packed our house and we moved in to her grandfather’s place. Even if he only had a few weeks left to live, being there was more important than not. Embracing his death, no matter how difficult it would be, was not a part of life she wanted to pass by.

Life and death is much more important than the gray we stress out about as entrepreneurs. The fears associated with growth, capital, customer acquisition, or even team building pale in comparison. But the approach to confront what terrifies us is the same, even in death.

There are a lot of times as an entrepreneur where we’re afraid. When your subconscious knows your plan is not working. Your growth is not fast enough, your money is dwindling, the product is not sticking, or the team is not believing. Although the data of your results is binary the depth behind that fear is not. It’s an emotion felt deep down that every entrepreneur understands.

The hardest part is to embrace this fear and confront it head on. To spend real time understanding what isn’t working. To have the confidence to talk about it in public. To be objective about your own business. It’s always easy to judge someone else’s startup problems, but incredibly difficult to be honest about your own.

Communicate regularly, objectively.
Learning ‘business speak’ takes practice, especially for product focused founders. Normally they gravitate to product speak with talk about the immediate tactics.

To combat this, I found it helps to read quarterly and annual letters from public CEO’s. It teaches you how to objectively talk about your own business, including how to measure success. Then communicate in this manner with your investors and employees every two weeks.

Sending a monthly business update is not the same thing. Often startup company updates are just a list of stuff they’re doing, heavily focused on the good. Instead analyze your own business every two weeks and send that analysis, no matter good or bad. Just like public company CEO’s are forced to do every quarter.

Forcing yourself to provide consistent analysis will enable you to be much more objective about your actual results. The Seahawks call this ‘tell the truth Mondays,’ and they follow this process ever week whether they win or lose.

Tackle the biggest problems first.
Dealing with shit all day sucks. Especially when working on problems you are worried about, which often come from money or the expectations associated with raising it. Even in your daily routine, eating your vegetables first is hard. It’s easy to gravitate to the areas of the business that you like, leaving yourself exposed.

This is easier said than done. Often problems are linked and so if you drop one plate the other spinning plate will fall. Regardless, prioritize the most important items first even if what you love gets put on the shelf for the time being.

Let the fear consume you.
Pushing away fear, especially the fear of failure only makes the stress worse. And just because you push it away doesn’t mean it actually goes away. Sure you can make yourself busy in order to forget why your subconscious aches, but it doesn’t solve the problem.

Instead try embracing that emotion. Whether through meditation or a different means, just let that fear consume you. Let it spread from your soul, to your heart, and to every part of your body. Feel its energy until the point you realize it’s just energy. At which point, use that energy to give you clarity of direction.

Watching my wife process what she just lost is incredibly hard. On the surface life without her grandfather is already surreal. But deep down there is a peace. Because every chance presented to her she embraced his life and ultimately his death.

I’m humbled to call her my wife. She has taught me more about life than I ever could have imagined.

Image Credit: Lili Vieira de Carvalho via Creative Commons 

Justifying Why You Can’t Delegate

I was reminded the other day of a struggle that all founders face…justifying why they can’t delegate.

For anyone that hasn’t been a founder this sounds like a trivial issue that just needs a little leadership training. It’s not. It’s actually a big issue that needs a lot of attention.

To the founder, a lack of delegation is the end result of a mental struggle that runs deep. On one hand they are afraid that if they delegate the team will fail, as if they are incapable of delivering more. On the other hand the founder is clearly drowning in responsibilities, frustrated that the team isn’t moving faster or working harder.

Trying to balance short term survival with long term success, the founder gets stuck in a terrible cycle of justifying ‘why now’ isn’t the time for the team to step up. Like the a vacation that never happens, they keep kicking the can down the road until ‘right now’ becomes the permanent state of the company.

This denial dramatically impacts the probability that their company will be successful. By carrying the workload, the founder neglects their most important priorities while building a culture that is not empowered or motivated to win.

I struggled with this a lot in building Contour. I didn’t understand why people went home at 5pm everyday. My solution to this problem was to pick up the pencil on their behalf to finish the work. This resulted in me getting too involved in almost every aspect of the business. Although it sounded good in my head, this leadership strategy wasn’t affective.

I ended up spending time on the wrong priorities, which ultimately built a business that was undercapitalized with a disjointed culture that didn’t know how to win.

It turns out that my lack of ability to enable was rooted in my own limitations as a leader. Now in building Moment I’ve tried to build a culture that is empowered, which alleviates the trust issues in delegating.

1. The Team Has To Decide It Wants To Win
There is a built in assumption by founders that everyone who joins the company shares their same passion for winning and therefore everyone is willing to work tirelessly to succeed.

This just isn’t true.

Winning is first a personal commitment and second a learned behavior. You can’t force this desire upon someone just like you can’t assume they want it. Everyone on the team actually has to make the personal decision that winning is what they want.

If they do, it fundamentally changes the relationship of the founder from a player to a coach. Now they can push the team to get better every day, providing constant feedback and clear expectations. Hearing a team make this commitment removes the self doubt the founder faces after 5pm when everyone has gone home.

2. Clearly Define The Destination And Who Is In Charge
Being clear about the company’s definition of success is important. But being crystal clear to the team about the next milestone is even more important. This clarity enables the team to work backwards in building a realistic plan.

Once the team knows where they are going, make sure they understand who is responsible for what. Every major, day to day responsibility should be covered by someone on the team other than the founder. Even if the team is small this transition is critical for creating an empowered culture.

Keep in mind, the team will fuck it up, but they will also get stronger through their own mistakes.

3. Don’t Underestimate People.
A lot of incredibly successful companies are started by founders that approach a problem without any preconceived notions. Their naivety is what gives them a competitive advantage over the incumbents. But at some point their own naivety gives way to knowledge and they forget their own previous ignorance. This translates into underestimating what their own, inexperienced team can deliver.

Constantly remind yourself that inexperience and ignorance are a strength for startups. That naivety is what enables fuels people to work harder, learn faster, and find new solutions to the problems you face. Give people more responsibility and then get out of the way.

4. Maintain The Right Priorities
Hardest of all, the founder should be focused everyday on ensuring that the company has enough capital, the right people, and the correct priorities. Doing this day in and day out is a lot harder than most founders realize mainly because it takes them away from what they naturally love to do…create new things.

It may feel like eating your vegetables first but if you approach every day in this order you will realize there isn’t enough time to also be in the weeds. Always take the hardest, most terrifying problems first.

*Image Credit: Washington State Department Of Transportation via Creative Commons

Believing

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In New York, there sits a sign. Corner to the largest park in the world, it sits across the street from the Plaza Hotel and in the same square as Cartier. To most it’s just a sign that represents a a store. A place you visit. A place you buy.

Positioned where the whole world passes by, it’s not sitting on the sidewalk. It’s not attached to a building. It’s not waiting for you to discover it.

Instead it floats 30 feet above the ground. It’s lit, in a glass box that says my shape is as strong as my courage. It’s purity is white and it’s symbol is clear; I stand for what I believe in. I stand against everyone that didn’t understand and for every reason I shouldn’t exist. I stand for courage and purpose that many will never relate to.

Set in the backdrop of where movies are shot and proposals are made, sits the Apple sign.

With the world traveling by, if you sit and realize what this sign represents it makes you cry. It brings emotion that you can’t explain. As if the tiredness within you surrenders, you can’t help but stop. Although It’s shape is familiar, it’s message is personal. The pursuit of creating history can take everything you have. The energy to move past ‘no’ is exhausting. The fortitude to carry on is unrelenting. The tenacity not to quit is only measured at the end.

It represents a vision. A man that believed, even after being fired, that anything was possible.

When you build a company everyone can justify why it won’t work. They will tell you how it’s just like this thing or similar to that. They will miss the opportunity by dismissing it as just another.

But to the minority, creating is our existence. It is our quest. It is our purpose.

To the wanderers, the creators, and the entrepreneurs…never give up on your dream. Never take doubt to mean impossible. Never take no to mean no.

“The two most important days in your life are the day you are born and the day you find out why.” ~ Mark Twain

 

Image Credit: Synthesis Studios via Creative Commons.

2008 – Running A Company During Economic Collapse

Panic of 1857

Panic of 1857

There has been a lot of discussion lately (here, here, here, and here) about extravagant startup burn rates.

I haven’t been through enough economic cycles to know if these men are just marketing themselves or if they truly see something that the rest of us are missing. But as a member of the class of 2008 I can tell you that when the next economic down turn does come, it will will leave a devastating impact on everyone

Four years into my first company at the time, the nightmare of 2008 has forever shaped the leader I will become. It has left a mark on my entrepreneurial journey that I can’t translate into words. Both grateful it happened and terrified of when it will happen again, the experience of 2008 is something I will never forget.

To all the entrepreneurs that haven’t been through this, I hope my story helps to prepare you.

October, 2008
It was 9 in the morning on a cool October day. I was siting in my office still staring at the same excel spreadsheet. Nervously drinking my coffee I kept hoping that I would find a mistake that would make this all go away. How could we be running out of money?!

As I heard Mike and Steve coming down the hallway I new this wasn’t just a bad dream. What was about to happen was very real.

There was hardly a good morning between us. Instead there was a nod and a separation. Steve was heading to one room while Mike and I were headed to the other. Having already split up the team, Mike and I were on our way to tell 1/3rd of the company that they no longer had a job.

That walk was the longest of all walks in my life. A simple right, left, and left it felt like an eternity. My hands sweating and my heart pounding, any attempt to practice what I was about to say was wasted. All I could really do was take one step in front of the other.

Sitting down with 7 people, I felt like a child among adults. It was as if they could see right through me as the CEO I wasn’t.

I proceeded to tell them that they no longer had a place at Contour. The shift in the economic climate meant that we couldn’t keep everyone, which meant that we had to cut the crew to save the ship.

One of them cried, one was very angry, and a few said they understood. But none of that changed how horrible I felt in the moment. Watching each of them pack their desk, it was as if time stood still. It was if I was there to forever internalize the impact of what I had done.

Even though I was making a leadership decision during one of the worst eonomic downturns in the history of our country, this felt very personal. I had asked these people to join us on a mission and here I was telling them that the vision I sold wasn’t real.

Unfortunately what I didn’t realize is that fateful day wasn’t even the bottom. It would get a lot worse before it ever came close to getting better.

Surviving
When we started Contour as twenty something year olds we didn’t have anything. The measly $1,500 per month we paid ourselves was than we made in college, but significantly less than what our friends made getting real jobs. It didn’t matter because we were happy. We were two kids in a warehouse with no heat and no expectations. There were no employees to worry about or investors to satisfy. It was just us.

By 2008 things were very different. Now we carried a team full of expectations. It made the pressure to perform infinitely more stressful. And yet their expectation heightened every primal instinct we had ever developed along the way. Having come from nothing, we now realized that everything was on the line.

The fateful day of cutting the team from 19 to 12 was just the first step. With retailers no longer calling and customers no longer purchasing we spent the next two months selling every camera we could to anyone who would buy it. Creating friends/family programs, consumer direct initiatives, and amazon deals we focused on bring cash in the door.

What made this even more challenging was the realization that we had a massive quality problem. Dealing with a 20% defective rate we were quickly running out of quality product that we could sell. With the economic world melting down around us we had one choice. Find a new supplier or die.

To this day I still can’t imagine a supplier taking on a nearly bankrupt customer at the height of an economic collapse. But that’s exactly what happened. Not only did we find a new partner, but we took a massive gamble in developing the first HD action camera, which had the risk of blowing our schedule and running out of money before the camera ever saw the light of day.

With each proceeding month, we continued to get more aggressive.

By January we started taking returns rom retailers who hadn’t sold their inventory and resold it to those who could move the product. We provided the returning retailers a credit towards the new camera we were making, while we asked the purchasing retailers to pre-pay so we could keep the lights on.

By February I was so used to vendors calling and asking for payment that I got numb to the fact that I was paying $100 a week on a multi thousand dollar bill. Not having money was the new norm and facing that head on was the only existence I could remember.

By March we had a few hundred dollars in our bank account. The only thing that prevented checks from bouncing was the fact that a few of us didn’t cash our checks. Asking my dad to help cover my mortgage was a humbling experience.

What I also learned in March is that during an economic collapse the IRS is hypersensitive to anyone who is late in paying their taxes. It turns out we were one of those companies. Barely able to make payroll we were neglecting the payment of our employment taxes, which is something the IRS doesn’t appreciate.

Receiving a knock on my door at 8am on a friday morning, the two women in front of me weren’t smiling. In their long trench coats they asked if this was Contour and if I was Marc. Not sure if I should lie, run, or say yes, I said yes to both questions. The following 90 minute meeting ended up becoming a six month ordeal as we begged the IRS not to shut us down while we got back on our feet.

The only thing that really saved us was the IRS’s requirement that everything be handled through the mail. So sending and receiving letters took weeks at a time, providing us the window we needed to keep surviving.

By April we asked the existing team to take a 33% pay cut. Even without being able to guarantee our survival, everyone agreed and no one quit.

By May we were on life support. Despite our situation we asked the sales team to do the unthinkable, to pre-sell our new camera, sight unseen. Our goal was to bring in $30K so we could make payroll for the month. Not only did they reach $30K, but they added another $120K on top of it. This still gives me goose bumps.

By June we shipped the world’s first HD action camera.

By July we were profitable again.

But it wasn’t until September that I realized we had made it.

Sitting in my office, nearly a year since we cut the company, I saw the bottle of champaign that I had been saving. Having received it some 18 months prior from one of our early board members I had never opened it. Although it was a gift to celebrate the launch of our market leading camera back in January of 2008, I had yet to believe I deserved to drink it. Until that day.

In Seattle there is a spot called Gas Works Park. It is one of the most memorable places to watch the sun fade away. With the old rusted pipes on my left, the emerald city resting on the water in front of me, and the golden sun peering through the Fremont bridge on my right, I proceeded to drink the bottle of champaign. Fighting to hold back the tears, I just sat there.

I can still feel the weight of that green glass bottle in my hand. With it’s rounded curves and distinct label I took every sip she had.

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The Personal Struggle
2008 was the hardest year of my life. And in the end there were only two reasons that I survived.

The first was my Mom. Losing her to cancer that same year, was devastating. Despite watching her battle the disease for 15 years I still wasn’t prepared. At 5’2” and barely 100 lbs. I watched her stand in front of that the mirror every day and choose to fight. She never backed down. She never quit. Her fight for life put the importance of everything else into perspective. In the end, the only thing that really matters is who’s sitting around your bedside when you pass away.

The second was my wife. Call it ironic, but we met at my lowest point during that 12 month ordeal. Ignoring how hurt I was from my Mom passing and denying how tired I was from surviving, she just listened. What started through a friend’s introduction became my saving grace. Spending every day together she was the emotional outlet I never knew I needed. Her smile, care, and ability to listen saved my life. Without her, I would have run myself into a brick wall.

What I Learned.
I carry a lot with me from 2008. None more important than these three lessons.

1) Don’t Quit
It’s true, you will be tested the most when the deck is stacked against you. The risk of losing everything combined with the embarrassment of failing are two fears that will haunt your dreams. The struggle to survive an economic down turn will wear on you to the point that all you want to do is quit. But don’t.

There is a path out, just not always the path you want to take.

2) Be Real
Most entrepreneurs are optimists. But with optimism comes denial of the present. Hoping that the bleak numbers of today change into better numbers tomorrow is ripe for failure. Missing your plan doesn’t mean you can make it up down the road. Running out of cash isn’t a reason investors give you money. Keeping more people than you should because you are afraid of the cultural impact, doesn’t mean you are making the right decision.

Selling the vision is an important aspect of being a great leader. Just remember to make decisions based on the information you have today, not the information you hope you’ll have tomorrow.

3) If You Let It, Life Will Unfold In Unimaginable Ways
As entrepreneurs we like to control every aspect of our companies. But as people, this is a fast way to miss out on the most important moments in life. When my Mom passed, I didn’t let it happen. I didn’t talk to her about dying. I didn’t talk to her about her fears. I was so afraid that I never even said good bye.

Meeting my wife was the first time I let life unfold itself. Despite telling myself before we met that I wasn’t going to date anyone, the connection we shared was undeniable. Six years later and more in love than ever, she has taught me that the only way to live life is to let it happen.

I now believe that everything happens for a reason.

*Image Credit: “Run on the Seamen’s Savings’ Bank during the Panic of 1857” by Unknown – w:Harper’s Weekly available at Library of Congress. Licensed under Public domain via Wikimedia Commons –