tech | growth | venture | 2017 July
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Remember those terrible word association problems from your SAT? (A is to B as C is to D) I do, and this is the first time I’ll be using them again almost 15 years later.  But they serve an important purpose in this post as the framework for equating a few common pitfalls of large companies to the high-growth startup.

– Big Company: Bureaucracy; Startup: Democracy

Two of the biggest inflection points for a growing startup happen when headcounts go from 10 to 20 people and subsequently 20 to 50 people. During the former, employees begin to transition from generalists to specialists.  For example, the engineer who was also serving as a PM moves focus to just one of those roles and a startup hires the remaining position.  Yet after this phase, every employee in the company still has knowledge of most decisions that are being made.

As your company continues to grow, roles become even more generalized and senior leadership is brought in to help scale the company. Key decisions are now made by the exec team, and often those early employees begin to feel left out of the process.  It’s crucial to avoid the temptation to save “culture” and include everyone as often as possible.  Don’t get me wrong, I believe in transparency and communication from leadership but when everyone has a vote in key decisions your progress is bound to slow to a screeching halt.  Stick to the Jeff Bezos meeting size, if it takes more than two pizzas to feed everyone it’s too large.

 – Big Company: Paralysis by Analysis;  Startups: Fear of Failure

We now live in a world of almost unlimited data, and the best data any startup can capture is proprietarily customer-centric.  The only way to capture it is to get your product to market.  Entrepreneurs by nature are often visionary, and see the long-term possibilities of the product they are creating. Therefore, it’s often counterintuitive for them to release something that is not up to their personal standards.  I’ve seen products that took over 6 months of development fail, not because they weren’t well thought out, but because the customer wanted something we didn’t see. The cruel joke of entrepreneurship is that most of the time, no matter how great you are, certain aspects of your product will be rejected by the market and that’s okay.

“If you cannot fail, you cannot learn.” – Eric Reis, Author – The Lean Startup

Large companies use data to become proficient and knowledgeable.  However, the returns on data analytics are marginal (at least when done by humans) and often lead to a blind spot where large firms are unable to see the unrealized potential of what lies ahead, preventing them from developing new products that grow market share.  The best early-stage companies are able to get a viable product to market quickly, and thanks to a myriad of new tools, collect as much data as possible including how customers use their product, customer acquisition costs, and customer value.  Combining these types of data with a vision for the future of an industry can be a powerful pairing.

– Big Company: Hire for Resume; Startups: Hire for Culture

When I decided to go back to school in order to get my MBA I knew I was adding a checkbox to my resume for certain positions within large companies.  Little did I know, my passion for startups would prevent that from becoming useful.  Yet, my intentions highlighted an issue with many large firms, they hire exclusively based on things like titles and advanced degrees.  While it’s true that these things can be an indication of effectiveness and leadership, it is certainly no guarantee.  Large companies often neglect things chemistry and creativity.

If large companies neglect culture fit, startups can often do an exact 180 and over-value it.  While I still immensely value culture, I’ve also learned that results (good or bad) are part of the culture and often what is seen as good culture is actually vanity perks masquerading as such. What does this look like in hiring? It means doing things like having subordinates interview their potential new boss for “buy-in” or expecting someone to adhere to the “work hard, play hard” schedule.  I’ve fallen into that latter bucket with people we hired only to be proven completely wrong about the person’s work-ethic and capability.

Remember, while many of us are working to disrupt the incumbents in large industries, we’d still be served to look to them for examples, both good and bad.  After all, we’re working toward being as large as them someday.

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What a few months it’s been, Choose Energy sold to Red Ventures and my partners and I made our first investment into a startup.  These big events have led to a lot of discussions among myself and my friends and colleagues.  This led me to reflect on the biggest factors in my growth up until this point, and it was easy to conclude that I’ve been incredibly lucky to work with so many people who shared their skill sets to help me expand mine and gave me the opportunities to put those newfound skills to work.

Almost 4 years ago I was laid off from NRG Energy.  While I should have been panicked, I had an amazing group of friends from SMU that came to my immediate aid.  There wasn’t anyone I asked who didn’t offer to intro me to their network.   Despite these enormously kind gestures, I had no idea what I wanted to do. What I did know is that I was done with energy and had a pile of student debt that needed paying off.

Enter Jerry Dyess.  Job offer in hand (from a chance meeting at a wedding), I agreed to meet Jerry after being introduced to him by a colleague from NRG who had scrambled to help anyone and everyone after the layoffs.  Jerry is the CEO and founder of Choose Energy and among his many skills as a leader, the guy could sell water to a fish.  After 10 minutes I was hooked by his vision for the company and knew I had to be a part of Choose.  It was, and still to this day is, the best career decision I’ve ever made.  Jerry taught me how to be a professional, how to conduct myself in meetings, and how to do subtle things like reading body language.  He also taught me the phrase “things of that nature” which I now use habitually.

After reporting to Jerry for several months, it became clear to him that I wanted a deeper connection to Silicon Valley, and to his credit, Jerry moved my role underneath John Tough.  John is the ultimate mentor.  He expects you to perform at a high level, he shares any and every thing he can to help you grow your skill set, and most importantly (and most like Jerry) he cares about people.  John taught me everything from operational finance to strategy to fundraising.  He remains my biggest mentor and there’s no doubt my future career wouldn’t be possible without his guidance.

I’m not sure what these two saw in me, but for some reason, they decided to let me build and lead what eventually became the US’ largest B2B energy marketplace.  It was the learning experience of a lifetime and one I likely didn’t deserve at the time.  After our new product launched, John set up a meeting with Dave Mount at Kleiner-Perkins who challenged me to think about our business in ways I hadn’t thought about before.  It was the first time I’d been challenged to rapid-fire, board-style questioning and I was hooked.  Jerry and John ensured that I was included in almost every board meeting moving forward and that exposure was invaluable.

Jerry and John weren’t the only Choose employees that helped me tremendously along the way.  As a new product manager, I needed the benefit of learning from people who had been there before.  Kerry Cooper, our then CEO, set up a lunch with Bryan Byrne, the first B2B product manager at Yelp where I learned lessons about how business owners view their time and prioritize it which helped us prioritize features from day one.  Afterward, Kerry and I set up a bi-weekly touch-base where I was able to discuss strategy on how to scale a company with a seasoned executive on a regular basis. This access proved enormously helpful as I navigated my way through the decision-making process of a growing product.

Throughout my time at Choose, I was surrounded by an incredibly talented product and engineering team.  I worked closely with guys like Ethan Wais who has a more capacity to learn than anyone I’ve ever met.  Working side-by-side with him for over 2 years was as challenging as it was rewarding.  Here, challenging is meant to be the ultimate compliment because there was never a day that I didn’t believe I needed to learn something new just to keep up with the guy.

Over the last year, I had the privilege to work Sai Nayagar and our engineering team (Jeff, Chad, Donnie, O’Neal, Jake, Kat and Melody).  Similar to the board meetings, sprint meetings opened my eyes to an entirely new aspect of our business.  This team worked tirelessly, creatively and with great patience while a non-technical product manager learned the ropes.  There’s nothing quite as intimidating as sitting in a room with 9 really smart people speaking in a language that might as well be foreign to you but these people made me feel right at home.

My string of good luck continues as I explore a potential new career.  I’ve had complete strangers on Slack, Facebook, and Twitter introduce me to their network in order to help me get off the ground.  Lastly, in perhaps the greatest stroke of luck of all, my business partner was introduced to me by the best man in my wedding.  Their moms were high school friends who reconnected after a decade.

The biggest lesson I’ve learned is to think of luck as a flywheel that creates amazing opportunities. By being curious and willing to learn it becomes possible to capture the most from those opportunities which in turn creates more luck down the road. I’m thrilled to be moving on to a career where I can not only leverage the lessons I’ve learned and pay forward the amount of luck I’ve had, but also help others create their own.