tech | growth | venture | Perspectives from an operator turned VC in an underserved market
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Last week, Jonathan and I had the privilege of joining an SMU MBA class as the judges for the final assignment of the class: pitching a business born from a mod-long hackathon.  During the break, we held a small Q&A session and one question we were asked by a student was, “how far are we from the real thing you guys see on a day-to-day basis?”

To be fair, this class strictly focused the ideation, market research, and MVP demo of an idea so the answer was quite far.  However, SMU does a nice job of offering entrepreneurial-minded students the chance to take classes which get them closer to a finished product.

This interaction did inspire me to finally begin writing a series of blog posts I have been contemplating on pitching and the fundraising process.  I’ve long assumed it would be worth writing a few thoughts on these topics but wanted to do so outside of the standard pitch deck structure, which I cover extensively by providing examples in my previous 50+ Resources for Entrepreneurs post.

Most venture investors at the seed-stage will tell founders one of the first things they are looking for is a strong team. Particularly, we are looking for great leaders and communicators who generate a lot of energy for their team.

These leaders take the noise, rather internal or external, and produce a clear message from it.  For me, the clear message is key especially in a world where you have your consumer’s attention for less than 60 seconds in most cases.

This skill manifests itself in several different parts of the pitch meeting, but none more obvious than the initial setup explaining what the company does and why it does it.  Here are a few tips on how to clearly explain the mission while getting investors excited to hear the rest of the pitch.

1) Let the audience create their own frame of reference and ask a question to which you know the answer.  For example, in this Y Combinator video, Sam Altman is pitching a company from his cohort that is an all-in-one app to house all of your personal EMR’s.

The first question he asks a potential angel investor is, “What do you believe the biggest problem in healthcare is today?”  Sam has actually done something very clever.  When the prospective investor says, “rising costs,” Sam immediately educates him on how this new product is going to drive down the exponentially rising costs in healthcare.

2) Avoid the “imagine a world” type statement, and tell a personal story instead.  We’ve always been a fan of the saying “the best inventions serve the needs of the inventor” primarily because it often translates to founders being more likely to deeply understand their customers.

The team at BioLum does an amazing job using this strategy in their pitch.  All three founders are asthma sufferers, and as a result solving the problem is deeply important to them personally.  The most successful founders are often obsessed with solving the problem over all else; if that problem is personal to an entrepreneur the desire to find the solution is amplified by a significant amount.

Over the next few posts, I will continue to focus on nuanced tips and wrap up with a post on how we think about running the process of fundraising including this deck on which we will elaborate further.  Until then, I’ll be in Austin for Startup Week until Wednesday.  If you’ll be there, feel free to find me and say hello.



Over the last 18-24 months, as we were working to evaluate the product-market fit of an early stage venture capital firm focused on emerging ecosystems, we met with several entrepreneurs. The goal was to gain insight into the strengths and weaknesses of their respective ecosystems and determine how we could best solve their problems.

Lately, as we’ve become more public about our intentions to invest, I’ve noticed some founders who approach us don’t feel comfortable being completely clear in their intentions for meeting.  I’m unsure if this due to the current atmosphere in these ecosystems, if we aren’t doing a good enough job in expressing our desire to help founders to the best of our ability, or I am naive and should always expect to be pitched.

Regardless, I strive to tailor the circumstances of the meeting to the appropriate levels, and to quote Jason Calacanis, when it comes to meeting founders “there’s nothing I love more.”

The reason I do this is that I want to be known for always having time for founders.  People tell me, “I know you’re really busy, I don’t want to keep you.” But it’s my job to meet with founders.  There is nothing I love more.  – @jason

If I know your intentions for our meeting, it allows me to optimize the time we spend together by adjusting three important aspects to any encounter.

1) Setting – If we are meeting as an opportunity for both of us to expand our network, I’m more likely to suggest lunch or a coffee due to the more relaxed nature of the conversation.  However, if we’ve agreed to a pitch meeting our conference room is preferred.  First and foremost, the founder now has the choice of how they’d like to present their deck, if at all, and they don’t have to do so on a laptop screen at an awkward angle inside of a loud coffee shop.  Secondly, it provides me the opportunity to take better notes and in turn offer much better feedback regardless of our investment decision.

2) Preparation – I am a huge fan of Cal Newport’s Deep Work and Greg McKeown’s Essentialism which means I’ve learned to immensely value other’s time as well as my own.  If we are meeting as a casual get to know you, I’ll do some light research on you so that I am able to anticipate your needs and how I can help. However, my preparations for pitch meetings are often much more in-depth and take up large portions of my day.  It’s crucial to me founders leave those meetings feeling as though they got something other than another opportunity to pitch and if I’m surprised by the pitch I won’t be able to be adequately prepared.

3) Time Allotment – This one might be a little more counter-intuitive.  If our meeting is a more casual, networking style encounter, I’m more likely to be strict with my time. Whereas during the more formal pitch meeting, I’ll put a 30-minute buffer on the back-end to allow us to go over.  The last thing I want to do is rush out of what is a vital conversation for both parties.

I hope this list encourages founders to feel as though they can be open with their intentions in meeting with me moving forward.  The best part of my job is meeting with people who are on the front lines building businesses that could potentially change a major part of our lives.  Running a business is often a 24/7/365 endeavor, and my goal is to ensure I don’t waste a minute of an already precious resource….your time.

Recently, CrunchBase published a new case study on early-stage funding including the different types of deal structures, priced (equity) and unpriced (convertible notes or SAFES).  The post was a useful, if very high level, overview of the early-stage funding process.  However, due to this simplicity, the article painted a naive picture of how unpriced rounds often work in practice. While notes and SAFES have become the norm in recent years, it doesn’t mean they should be, especially in underserved ecosystems like Texas, Pittsburgh, or Atlanta.

In these metros, early-stage capital is scarce, thus increasing an investor’s negotiating leverage.  Given that context, fundraising is often an extremely difficult hurdle to navigate for local entrepreneurs. Ultimately, unpriced rounds making up the majority of early-stage deals in emerging ecosystems can be shortsighted.  Over the long term, it can limit a startup’s ability to raise future rounds and hinders the ecosystem as a whole by sometimes forcing great entrepreneurs to start companies in more favorable markets where investors are accustomed to optimizing for a startup’s long term success.

It’s easy to forget that, just 130 miles outside Chicago, is the University of Illinois’s main campus. “Remember, Marc Andreessen was building Mosaic at U of I, and Max Levchin,” probably best known as the founder of PayPal, “was down there too.” Carter relayed the story of how Levchin came to Chicago to raise money for his first startup, he was spooked by the terms put forth by the independent investors he spoke with. He probably left for the Valley because we [Chicago investors] couldn’t structure a deal,”  – Jeffery Carter, Hyde Park Angels

Convertable notes and SAFES only make the process more confusing by putting off the valuation and thus hiding the potential ownership (i.e. possible dilution) at the time of conversion especially in cases where the startup has raised more than one note on varying terms.  I believe some investors do like this opacity.

Entrepreneurs are not the only ones put at risk by unpriced rounds of fundraising, the investor hasn’t actually put themselves on the cap table which leaves open the possibility of issues such as the renegotiation of their terms by the next lead investor. This puts the seed investor in the awkward position of getting the terms they believe they negotiated or being the “bad guy” who could potentially spoil the next round.

The goal of any aspiring startup ecosystem should be collectively working to eliminate onerous term-sheets to better incentivize founder upside for the ENTIRE lifecycle of a company, not maximizing the “paper” upside of one investor for one round. This perspective enhances the goodwill between investors and entrepreneurs while encouraging both sides to continuously participate in the scaling of great companies.  We achieve this by taking four simple steps:

  1. Use priced seed rounds whenever possible.  Legal fees used to be the main sticking point for doing an equity term-sheet but now the prices can be fairly comparable.  As mentioned above, there remains little reason to delay valuation for sophisticated investors.
  2. Provide extreme clarity in the event the round must be a note or SAFE. One of the best practices we’ve implemented is showing our entrepreneurs pro forma cap tables in the event of down rounds and at the “cap” set in the term sheet.  This allows us to highlight the various levels of dilution possible for founders.
  3. Simplify the terms. We advise the startups with which we work to offer only one round of convertible notes with the same terms to all participants. As Fred Wilson has recently pointed out, $1-2M “feels about right” for the as the maximum size of the raise. Obviously, this depends on the product and other factors affecting the anticipated runway.
  4. Provide a list of established VC resources and discussions of notes.  By doing this, we allow founders to do the research themselves and collect opinions from both sides of the table.  Y-Combinator, Fred Wilson, Seth Levine, and many others have written extensively on this topic.  We encourage founders to seek, and in many cases we provide, these resources.

Anyone who has discussed venture investing with me knows I passionately dislike unpriced rounds though that doesn’t mean I won’t do them.  The ultimate goal for us has, and will always be, to partner with the best possible companies. However, if we do participate in Notes or SAFES we work extremely diligently to make sure the terms are clear and founders thoroughly understand the pros and cons of the structure.

I caught up with a friend yesterday who is an up-and-coming architect in the Austin area and it turns out we are facing a lot of the same challenges in launching a new venture.  We both are working to optimize processes in order to spend the most time possible on the core aspects of our firms.

During a 2016 shareholders meeting, Elon Musk said “We’ve realized that the true problem, the true difficulty and where the greatest potential is, is building the machine that builds the machine. In other words, building the factory.”  Similarly, Homebrew’s Hunter Walk has been quoted as saying “the company is the first product, and you have to be really intentional about how you build it before it’s ready to scale.”

This highlights an important reality of building a great company or product: the processes and frameworks put into place will often decide the level of success achieved and those operational components should be designed with the end-goal in mind. As my partner Jonathan recently wrote, the best of the best almost always “perform the common uncommonly well.”

1) Start EarlyThe larger a company grows, the more difficult it becomes to put processes in place.  This one is straightforward, as a startup begins to scale it becomes exponentially harder to move everyone in the same direction.  Getting a group of 10 engineers to agree on a product development methodology is easier than asking 40 to do the same and infinitely easier than asking a team of 100 or more.  This isn’t just an engineering or product problem, the same rules apply to marketing, finance, and sales. Bonus: it will make cross-functional execution that much easier.

2) Overly-Simplify: The best early-stage companies have an innate ability to focus when it is most difficult to do so.  Early-on, startups are vulnerable to chasing shiny objects as everything feels like a big opportunity.  Instead, avoid temptation and focus on executing toward one core product or market.  Example tactics to accomplish this include: shorter meetings (i.e. standups), picking 2-3 metrics that are core to success (ex. contribution margin and conversion), and selecting 1-2 strategic priorities per timeframe.

3) Scrutinize: Be honest with yourself.  One of the most effective practices I’ve seen teams use is the agile concept of a retrospective.  This gives teams the chance to discuss what’s working, what isn’t and ideas for improvement.  The most crucial element to this step is accountability, without it, these meetings don’t help move the company forward but instead become chances to be overly critical without inspiring action.  Begin each “retro” with a review of how well the team executed on previous takeaways and keep score.

Operations within early-stage companies often get overlooked as there are more exciting challenges to tackle.  When processes are in place, no one notices because things are running smoothly and challenges do not begin to surface until later in the game. However, neglecting them is akin to puncturing a boat while it is still in port; it may leave the dock, but it won’t make the entire trip.

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Nothing is more critical to a growing startup than pricing strategy, and all too often startups leave too much money on the table by not charging enough. This makes it difficult to take full advantage of the new value their product creates.  As Marc Andreessen recently said, if he could put one phrase on a billboard in Silicon Valley it would be “raise prices.”

My hypothesis on why startups currently have an issue with pricing is the recent (but now seemingly over) period of apathy towards negative margin growth. It conditioned startups to capture as much of a market as possible without thinking deeply, or at all, about pricing. While this gets a product into the hands of users, it does leave open the question of what buyers are willing to pay for it.

To answer this question, it’s useful to turn to Econ 101’s first lesson – supply and demand – and more specifically, consumer surplus.  Why is consumer surplus good?  For one, you always want your customers to feel as though they are getting a deal.  More importantly, it becomes possible to leverage that feeling to push out the demand curve for the core product, which is what any business really wants to accomplish.


Free or discounted complementary goods increase consumer surplus while shifting the demand curve

While perhaps unintuitive, one of the best ways to do this is by “giving away” complementary products or features.  The result pushes out the demand curve for the core product, selling more at a higher price, while simultaneously increasing the consumer’s perceived value (consumer surplus).

It’s easy to see the effect of this strategy in two of the most popular technology business models: Enterprise SaaS and Marketplaces.

  • Enterprise SaaS – Much like iOS and Android, Salesforce has an app store called the AppExchange. Consumers aren’t charged for access to the apps but instead the large selection combined with easy integration of popular applications pushes out the core product’s demand curve, allowing them to charge more than would otherwise be possible for the core product.
  • Marketplaces – There’s a reason almost every successful customer acquisition platform has a “tools” or “analytics” section on the selling side of the marketplace, the goal is help the
    supply side sell more.  Charging $10 for add-ons such as a pricing tool makes little sense in this case because the value is hard to quantify for a seller.  Yet, introducing it for free then subsequently raising the customer acquisition (i.e. booking or listing) fee by a few percentage points has little effect on diminishing the over supply.

Finally, it’s important to address the 800 lb. gorilla in the room: Amazon Prime.  Amazon has leveraged discounts on services that may seem arbitrary but actually create a large consumer surplus for the core product. Let’s take a look at a few of the discounts offered to Prime members on ancillary services.

Amazon Music Unlimited: $9.99 non-prime / $7.99 Prime

Amazon Digital Storage: (100 GB): $11.99 non-prime / 5GB and all photos free for Prime

Amazon Audible Channels: $60 non-prime / free with Prime

By including discounts on these complementary goods, Amazon has increased the demand (i.e. pushed out the curve) for Prime.  Furthermore, the consumer surplus created by including these complementary goods is less than the increase in unit marginal cost for Prime’s main service, faster shipping.

The next time you are thinking about your product pricing strategy, take it from these tech behemoths: it’s not only what you charge, it’s what you give away too.

Special thanks to Jonathan Crowder for helping me think through this post.

Recently, I crossed a passage in Let My People Go Surfing which deeply resonated with me because so few people seem to leverage the giving nature of others.

I had no business experience so I started asking for advice.  If you admit you don’t know something people will fall over themselves trying to help.  – Kris Tompkins

I love the humility and curiosity shown in this quote. It highlights an openness to feedback that is not regularly encouraged.  Often, entrepreneurs in early-stage, high-growth companies (like Patagonia was at the time) feel as though they are drowning in decisions that could make or break their company at a moment’s notice.

These situations create a strong need for honest, candid feedback on the tough choices that move a company forward.  The ability to deliver advice that is sometimes hard to hear relies solely on creating a relationship that is authentic and not artificially created.

The best mentors are able to challenge without being overbearing.  No one knows the business better than the founder, but the ability to have an open, fact-based debate with a mentor is always healthy.  Mentors should help guide when needed but the decision is ultimately in the hands of the entrepreneur.

Lastly, the best mentorships eventually become two-way streets.  I’ve been on both sides of the mentorship table, and it’s always exciting when I can do something to help one of my mentors.  It takes a great person to donate their time to invest in your success, and one of the most fulfilling aspects of the relationship is when you can turn the tables and return the favor.

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Most of my last few weeks have been tied up in various meetings.  The unique part has been that in those meetings my role has been quite different depending on the topic and the participants.

After one of those meetings, I reflected on how I’ve changed my personal interactions over the years and how I’ve had to adapt based on the topic or individuals involved on the other end.

For me, the intriguing part is this process never ends; the topics and people involved are always evolving. After some thought I believe the cycle looks something like the following:

Step 1: Internally feeling a low level of confidence.  In this case, it’s likely you are in the room with several subject matter experts or professionals who are more experienced than you. The best course of action is to be an avid listener and note taker.  Learn from those around you.

Step 2: Demonstrating externally that you belong, but not quite feeling the same assurance internally.  If you listen and take a lot of notes, the odds are you’ll begin to understand the problem and ask the right questions.

Step 3: You begin to engage with the answers. Instead of just asking questions, you are now able to build upon answers given to the questions you ask and build your own internal insights.

Step 4: Giving others the confidence they need to feel as though they belong.  This skill can be broken into two different parts. The first is explaining a complicated subject in a way where others feel as though they’ve became an expert just by listening to you speak. The second, helping others see their own insights but had not yet realize it.

Very few people make it to step four and it’s one of the skills I feel is needed to lead a company or large team.  It is a truly special strength to instill confidence in others especially when the topic is complicated or the stakes are large.

One of my favorite sayings is “if you’re the smartest person in the room, you’re in the wrong room.”  Get in the right rooms, listen, take notes, engage, and help others see they belong in the room too.

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Yesterday, Capital Factory CEO Joshua Baer announced a partnership with The Dallas Entrepreneur Center to bring Texas’ biggest accelerator to Dallas.  In his post, The Texas Startup Manifesto, Baer proposed a “Texas startup Megatropolis” combining Austin, Dallas, Houston, and San Antonio.

The vision is exciting and highlights many of Texas’ obvious strengths:

  1. Growing at a rapid pace
  2. A low cost of living
  3. Diverse both in people and jobs
  4. Full of business and tech talent
  5. Home to great universities
  6. An energy and healthcare hub

It also highlighted many of the weaknesses:

  1. Underfunded
  2. Competitive, not collaborative
  3. Lack of mentorship

The combination of Capital Factory and the DEC will begin to address these issues and increase the diameter of the Texas ecosystem flywheel.  But to take advantage of the work done by Joshua and his partners, we’ll need do to even more to make sure the larger flywheel gets the momentum it needs to keep accelerating at an even faster pace.

We still need a few key ingredients in order to make our ecosystem comparable to the best.

  1. Operators that have scaled AND exited
  2. Density fueled network effects
  3. Follow-on capital

My favorite pieces of reading are those that say a lot without saying much.  It’s a skill of which I am always envious and explains my addiction to Twitter.  Last night, I came across one such tweet:

The more time I spend in startups, the more I’m impressed by those who scale than those who start. Many can start, few can scale. @mosbacher

My partner Jonathan recently wrote about the 80/20 problem being more right-skewed than perceived, specifically in startups. (I.e. the  difference between great and exceptional is bigger than the one between good and great)  CB Insights recently published a report using a cohort of 1,098 companies who raised seed capital from 2008-2010 that illustrates his point. The funnel below puts into perspective the increasing difficultly of each subsequent round.

According to Crunchbase, 184 companies headquartered in Texas raised seed funding last year. Let’s round to 200 for easy math.  Using the successful exit criteria above ($50M+), 8% of companies exit for a desirable valuation.  That leaves Texas with potentially 16 companies from a cohort of seed rounds in 2016 that have operators with both scale and exit experience. Assume each company has 5-10 rockstar employees (potentially more for the companies that truly scale rapidly) that experienced the entire company lifecycle and we’re left with 80-160 people.

In order to reach our full potential at the fastest pace possible, we need those operators to start, fund or mentor companies. This will create an exponentially increasing pool of talent to help new founders scale.  For new companies, the chances of success increase when it’s not your first time down the road. To paraphrase Michael Seibel, partner at Y-Combinator, it’s easier to climb on the shoulders of others to get ahead.

Another point to consider is the density of the nodes (Dallas, Austin, Houston, SA) in the network. Texas has the distinct advantage of having several major cities within a 3-5 hour drive or 45min flight from each other, but what happens inside of those cities will be just as important.

The effects of startup density are obvious.  When talented people who share a passion for startups interact on a regular basis it’s more likely that successful companies will be founded. The Kaufman Foundation defines density as:

entrepreneurial density = (# entrepreneurs + # people working for startups or high growth companies) / adult population

Since that number is almost impossible to easily obtain, Brad Feld asked the team at CityLab to use another indicator of density, deals per capita (100,000 people). I pulled similar data from Crunchbase using findings from 2016.

Unsurprisingly, the cities & metros you’d expect rank well with this metric, but a a few of the top cities may surprise you. College towns Boulder, Ann Arbor, and Austin are more dense with startups than cities like Chicago, LA, and NYC.

City Deals Per 100,000
San Francisco 616 71.2
NYC 521 6.1
Boston 113 16.8
Seattle 704 14.6
Chicago 105 3.9
LA 136 3.4
Ann Arbor 13 10.8
Boulder 37 34.2
Austin 96 10.1
Dallas 33 2.5
Houston 33 1.4
San Antonio 8 .5


While this data is certainly not perfect, (# of deals can be skewed by the fastest growing companies raising more than one round annually and Crunchbase only let’s you search by cities, not zip or metro) it illustrates the work Texas cities have left to do to achieve a saturation close to other metros and perhaps further illuminates the need for more venture funding in Texas.

Lastly, Texas is sorely missing the big checks.  While seed stage investors from outside of Texas are beginning to invest more in the state, the evidence is still clear the follow-on capital is hard to come by.

This map by the Martin Prosperity Institute shows the per capita investment of venture dollars. Austin is the only city in Texas to find it’s way into the top 20 at $252.

To be seen as an ecosystem ripe for more institutional follow-on investment we must inject more risk-tolerant capital into promising seed-stage companies to increase total deal flow and subsequently support them with the talent and resources needed to scale. These steps will increase the number of rapidly growing startups and make Texas more attractive to those who deploy growth-stage capital.

Overall, the partnership announcement is a huge win for the Texas entrepreneurs.  The ingredients are here for a vibrant and successful startup landscape.  However, we have to take this momentum and run with it to reach our full potential as an ecosystem.

Since our work is primarily focused in areas where the startup ecosystems are just beginning to grow, we often get questions that have been answered by more veteran investors or founders in more established markets.  Inspired by John Gannon’s blog and instead of finding them one-by-one in my bookmarks, I’ve decided to start compiling them here in order to make sharing easier.

The resources I post are ones that have helped me throughout my career or have been recommended several times over by established founders or VC’s.  Much like John’s blog above, I’ve posted resources that are also geared to VC only because it’s impossible to sell to anyone whom you don’t understand well.

If I am missing anything or you’ve found a resource you’d like me to add please comment below. I’ll be editing the list regularly as I come across interesting content and subtract the outdated ones.

Must Read Books

Venture Deals by Brad Feld – considered by most to be the bible of startup fundraising

The Hard Thing About Hard Things by Ben Horowitz – a16z partner and co-founder Ben Horowitz discusses the ups and downs of running a business

Founders at Work by Jessica Livingston– a collection of stories about the day-to-day activities of startup founders

Venture Capitalists at Work by Tarang and Sheetal Shah – a collection of stories about the day-to-day activities of venture capital investors

The Lean Startup by Eric Reis – the book that codified running a startup in a way that is nimble and able to learn from customer feedback quickly

Shoe Dog by Phil Knight – memoir of Nike founder Phil Knight, a story of pure hustle and perseverance

The Business of Venture Capital by Mahendra Ramsinghani – similar to Venture Deals, but more in-depth (Brad Feld wrote the foreward)

Deep Work by Cal Newport– strategies about how to focus your day and keep control of your schedule, very important for anyone who will be pulled in a million directions

High Output Management by Andy Grove – considered the Silicon Valley handbook for organizing, directing, and developing employees

Zero to One by Peter Thiel – the PayPal and Palantir co-founder discusses how to create enough value and more importantly how to capture it

Contagious by Jonah Berger – how do you make things catch on and go viral? Berger takes a systematic approach to the process of virality

The Outsiders by William Thorndike – 8 different stories on CEO’s who were great at capital allocation using rational blueprints

Predictably Irrational by Dan Ariely – insights on behavioral economics and consumer tendencies

The Everything Store by Brad Stone – the story of Amazon’s creation and what makes it great

Creativity Inc by Ed Catamull – leadership book by former Pixar CEO whom Steve Jobs credited with his growth as an executive

 *full transparency, the links for books are affiliate links from Amazon*


Blogs / Medium Posts

HaystackVC – Semil shares why he made each investment + several interesting insights on markets outside the Bay Area

Fred Wilson’s MBA Mondays hint: you should be reading Fred every day, but this particular tag discusses everything from fundraising, hiring, strategy, etc..

Elizabeth Yin – one of my favorite blogs, Elizabeth does an amazing job with transparency from all angles of the startup world

Feld Thoughts – author of Venture Deals, Brad has been investing since 1987. Look for a lot of thoughts on the mind of great founders and what questions they should consider

Above the Crowd – Bill Gurley is one of the best VC’s ever, and THE resource if you are building anything marketplace related

50 Things I’ve Learned About Product Management – how you manage a product, and the product that makes the product matters

John Tough – my mentor, Chicago based, great perspectives on the Midwest and the path from VC to operator and now back to VC

Thomas Tunguz – data-driven approach to issues facing startups, from product to fundraising and everything in-between

Hunter Walk – VC at Homebrew, previously a Product Manager at Google where he led YouTube, great perspectives from an operator turned VC

First Round Review – one of the best, if not the best, seed stage investors in the country takes a look at management, fundraising, product and other topics from an operational viewpoint


Fundraising / Pitch Decks

Alexander Jarvis Pitch Deck Collection – widely considered the original pitch deck guide with the biggest collection assembled

Dconstrct– company looking to build upon Jarvis’ work to create a searchable database of pitch decks

Why You Should Have a Data Room – the team at Kiddar Capital looks at why you need a data room for fundraising and what should go into it

How We Raised $7M from Foundry – Adam Healey, CEO of Borrowed & Blue provides a 7-step guide to fundraising from a major VC

First Round Review – Fundraising – the fundraising section of First Round’s blog above

Great Story = Great Pitch – all great pitches are actually great stories, it’s not only about what you do but it’s why you do it and why it’s important that counts

Getting Your Head in the Fundraising Game – Mark Suster from Both Sides of the Table offers 10 tips on how to be a more effective fundraiser. His blog is another great resource.

How to Communicate with Investors – Reza Khadjavi, CEO of Shoelace walks founders through the process of taking dots and turning them into a trend line.  A great, execution focused look at raising capital

Font Series A Deck – Mathilde Collin, co-founder and CEO of Front, shares their series A deck, a few thoughts on the process and best of all critiques her own deck


Business Models / Strategy

Financial Modeling For Startups: The Spreadsheet That Made Us Profitable – provides a great starting point for building a financial model and even better it’s one that comes with an execution story behind it

Metrics that Matter – Part 1 – Jeff Jordan, Anu Hariharan, Frank Chen, and Preethi Kasireddy provide 16 (and then 16 more) metrics that matter for growing startups.  It’s impossible to raise if you don’t know which of these metrics are important to your business and how you are going to improve upon them.

Metrics that Matter – Part 2 – a continuation of part 1

How to Analyze Your Startup – Tunguz takes a look at how to evaluate your startup from a VC’s perspective. Additionally, he’s right, frameworks rule:

Product Canvas

Business Model Canvas

Porter’s Five Forces



This Week in Startups – Jason is one of the first investors in Uber and got his start as a VC scout.  His new book is Angel.  And as the podcast description says, “Need strategies for improving your business of motivating your team? Just want to catch up on what’s happening in Silicon Valley and beyond? Your journey begins here.”

Masters of Scale – Silicon Valley investor / entrepreneur Reid Hoffman tests his theories of growth with famous founders.  Hoffman is most well-known for PayPal and LinkedIn.

The Pitch – A show where real entrepreneurs pitch to real investors—for real money.  If you are going to pitch investors there is only one way to learn, by doing.  But this show is a close second.

The Official Saastr Podcast – Jason Lemkin and Harry Stebbings host operators from various SaaS companies focusing on scale and hiring. They host the occasional investor as well where the focus turns to the metrics that matter for capital raising.

The Twenty Minute VC – Venture capital’s youngest star, Harry Stebbings, interviews VC’s from across the country.  Here you learn what VCs are focused on, how they invest, and the traits that make entrepreneurs succeed or fail. You can also find Harry at Mojito VC.

a16z – a16z’s partners discuss the biggest trends in tech with industry experts, business leaders, and other interesting thinkers and voices from around the world.

Other Important Resources

Y Combinator – the original Startup Library with tons of great resources dating back to 2008

Crunchbase – easy and free place investors often glance at to check high level business info

Angel List – you should absolutely have one for recruiting and fundraising

Product Hunt – great place to get your product featured at launch


Recently, I decided to take a “themed” approach to my book selections.  The first theme has been centered around a new approach to my work habits.  I asked myself three questions (selected book):

  1. How can I learn more effectively and efficiently? (Make It Stick)
  2. How can I spend time in a deeper state of concentration so the most important tasks always get my best work? (Deep Work)
  3. How can I prioritize my day around getting the most important tasks done? I.e. owning my schedule instead of letting it own me. (Essentialism -thanks, JT)

As I engaged with these books and started applying their lessons to my day-to-day workflow, I wondered where else could their principles be applied in a startup setting.  For the latter two books, the answer soon became clear, meetings.

Why do some teams leave meetings without accomplishing their goals and how can they apply the theses of the books above in order to walk away from meetings feeling ready to execute?

Deep Work = (Time Worked x Intensity of Work) – Distractions

How many meetings have you been in that include a “brainstorming” session? The validity of brainstorming has come into question in recent years due to the increased propensity for social-loafing, regression to the mean, and production blocking.  While brainstorming is meant to increase creativity, we are actually at our most creative when our work is done in solitude.

Without great solitude no serious work is possible. – Picasso

Instead of asking everyone to express several ideas all at once, encourage (or perhaps require) members of the meeting to spend 1-2 hours beforehand working through the topic of the meeting individually in order to allow them to achieve a state of deep work on the problem at hand.  The results will be of higher quality and buy-in can still be achieved since everyone will have something to contribute during the meeting.

Essentialism = Less but Better

While leaving any meeting with a plan of attack is a must, it is a partial completion of the actual requirement.  Great meetings end with a prioritized list of to-dos and deadlines.  We all have the tendency to want “more” and to chase shiny objects.  This is especially true early on in a company’s life when there are many things to do.

However, leaving a meeting with ten top priorities is, as Greg McKeown puts it, “ironic.” Make it a practice to prioritize what can be accomplished in the time period given.  In my experience the following limits have worked well:

  • Quarterly: 3-4 priorities
  • Monthly: 2-3
  • Bi-Weekly: 1-2

Additionally, encourage your team to say “no” when they feel overwhelmed or that a task is unimportant to the greater goal at hand.  Healthy debate will lead to an even clearer list of priorities on which to execute.

Leaving a meeting with no clear direction (decision maker, execution plan, priorities) is one of the biggest wastes of company resources imaginable. We often think about tangible costs but almost never compute the costs of pulling multiple team-members into an hours long meeting.  If you’re having the issue of multiple, yet unproductive, meetings I encourage you to try some of these tactics geared toward the individual to make your group sessions more effective.

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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.


Over the decade, I’ve been blessed to work a variety of different jobs with a diverse group of people. I’ve gone from retail store manager to a publicly traded company, to a growing startup while acquiring my MBA somewhere in between. During that time, I’ve worked with some exceptionally talented, hardworking people who all had two characteristics in common: curiosity and tenacity. There are two phrases you’ll never hear them say during a conversation or meeting, “I don’t know” and some form of “that’s going to be too difficult” respectively. However, I firmly believe that ignorance and level of difficulty should never be adequate reasons for refusing to solve real business problems.

I recently read Raghav Haran’s Career Advice No One Tells You in which he asserts “having the right mentor is the real key… And you’ll avoid the mistakes that keep others stuck for years on end.” He couldn’t have been more correct. One of the best pieces of advice I ever received from a superior was, “remove the phrase I don’t know from your vocabulary.” This mentor wasn’t insisting that I know everything. In fact, he was adamant that I couldn’t, even though I thought I did at 20. Instead, he encouraged me to always use the phrase “let me look into that for you.” This small change in my expression of ignorance had a profound effect on my career moving forward. Not only was I expressing a desire to learn that which I did not know, but I was holding myself accountable for getting back to others with the information they desired because I had promised I would. I’ve worked with several exceptionally bright people and all of them amplify their natural intelligence by being the most curious person in the room. I’ve seen retail managers find their passion by mentoring teenage sales associates and MBA graduates learn how to code on the fly, and both become extremely successful in their fields because they had a passion to learn.

Being curious requires a certain level of tenacity to research problems even if the answer and data are not always clear. Due to the amount of data available in today’s business climate, it often takes an immense amount of hard, tedious work to get the results we want. The most successful people I’ve seen in my young career are those who know the hurdles ahead and regardless still tackle the task at hand. I don’t want to confuse the amount of resources (cost) of a project with amount of effort that goes into solving a problem; great business people consider ROI almost naturally. However, it is human nature to be confronted with a complex problem and naturally respond, “this is going to be difficult.” I encourage everyone to reject this natural notion.

I’m often reminded of a summer working with my electrician uncle in California when I’d follow him around the Bay Area for a few extra bucks. We spent an entire blistering summer day changing lightbulbs at a low-income apartment complex. When I asked why we were doing this instead of the more complicated (and to me, fun) jobs we’d been working on previously, his response stuck with me, “there are a lot of lightbulbs that need to be changed, and people who want to pay me to do it.” The very best of my peers and mentors always had the inclination to encourage myself and others to immerse themselves in the problem regardless of difficulty or level of enjoyment even from an early age.

Hard-work and curiosity often go hand-in-hand. It’s rare in today’s specialized economy that an individual possess all of the skills required to solve a problem. Yet, those who do solve the problem, or get the closest for their company, are those who are willing to learn a new skill, dust off an old one they haven’t used in years, or execute on the mundane. While my career post-grad school might be in its infancy, I’ve worked with an extremely diverse group of people with varying skill-sets. However, all of the most successful had an unquenchable thirst for knowledge and the work ethic to solve any problem before them.

Be curious. Be tenacious. Stay hungry.

“You get what you measure.” A concept that seems simple enough, yet even the world’s best businesses get wrong.  Measuring the wrong things drives poor decision making and undermines performance.  Simply put, using a metric the wrong way is as bad or worse than not measuring anything at all.

Let’s take a look at a few metrics that are useful when assessing the health of a startup but might not always be what they seem from an operational perspective.  Before we begin, it’s important to note that these are just examples, and each metric is worthy of a deep dive.  For our purposes, we are just looking to highlight a few metrics that can be perilous if other factors are not taken into consideration.

Customer Lifetime Value (CLV or LTV)

What it actually measures: Effectiveness of acquisition channels or marketing programs to acquire similar customers

How it’s misused: Comparing the cost of customer acquisition with the cash flows that come from the customer over time, often mistaken as the margin made on a customer and relaxing the drive for near-term profit.  Lifetime value is extremely useful, but should be used in combined with metrics like payback period to ensure a startup won’t have to choose between cash flow and growth.

What can go wrong: CLV doesn’t account for revenue timing, i.e. cash flow implications for SaaS businesses. It is inherently uncertain via discount rates and attrition which imply assumptions about future market conditions . If LTV > cost of acquisition, many will justify “pouring gas on the fire”

Let’s take an example. A customer costs you $50 to acquire and pays you $4.99 on a monthly subscription, it will take over 10 months to breakeven on this customer leaving a lot of time for uncertainty. Even if the customer stays, it will take 13 months to make 30% margin on just the cost of acquisition which doesn’t account for the overhead of the business itself.  The other issue to consider here is supply and demand. As you work to buy more customers, the price will go up and the payback period will be pushed out. It’s highly unlikely to get more efficient the more you spend, typically the outcome is the opposite due to competition and the removal of first adopters which are always cheapest to acquire.


What it actually measures: Churn can be measured in two ways, customer churn or revenue churn.  For the purposes of this post we’re looking at churn as the percent of customers lost monthly.  It is inherently a measure of customer satisfaction and a startup’s ability to retain customers through renewal campaigns.

How it’s misused:  A startup focuses only on the percent of churn instead of combining the measure with the rate of new customer acquisition.  Instead of looking at the percent of churn, it becomes important to look at the actual number of customers lost.  When % churn stays steady, there becomes a point where customers acquired = customers lost and growth slows to a halt.

What can go wrong: Startups recognize the problem too late.  As the number of customers churned grows, two things happen.  First, the cost to retain becomes high through marketing spend and /or operational overhead to put systems in place for retention.   Second, the cost to acquire new customers to replace the churn AND grow becomes burdensome at scale.

Let’s use an overly simple example, last year a startup acquired 5,000 customers at a $100 CPA for a total of $500,000 spent.  This year it needs to grow year over year 70% to 8,500 customers acquired for this year and a goal of 13,500 total customers under contract.

Assuming the CPA stays constant (remember from the CLV discussion this is unlikely), new customer acquisition will cost $850,000 to reach the goal of 13,500 under contract. But what happens when 20% of last year’s customers churn? Now, we have 1,000 less customers and need 9,500 to meet our goal meaning we’ll spend an extra $100,000 to meet our growth numbers.

To drive the point home even further, here is an extreme example.  This week Facebook announced it has 1.23B daily active users as of December 2016.  If they churned 0.5% of users in January 2017, they would lose 6.1M users.

This concept seems simple enough (we use compounding interest in finance all the time), but as a startup focuses on growth and scale it is easy to forget about churn.  The goal is optimal net customer growth, the optimal spend of acquiring new customers and the reduction of churn.


What it actually measures: In its simplest form, revenue is the income a business receives from operating activities, but like most things it is much more complicated in practice.  For our purposes, revenue can actually be divided into three parts: booked revenue, recognized revenue and collected revenue. These three are often referred to as the flow of revenue.  Depending on the business, booked revenues can be realized and collected immediately or spread out over a period of time.

How it’s misused:   It is perfectly fair to champion “bookings,” “annual recurring revenue” and other numbers that often exceed actual revenue, as defined by generally accepted accounting principles because they are often better indicators of a companies growth prospects.  However, monitoring the flow of revenue becomes just as important as a startup grows. Startups should dedicate as much attention to the rate, both time and frequency, at which they are collecting revenue as they do to booked and realized revenue.

What can go wrong: The (un)realization of revenue. In some industries, bookings do not always turn into revenues. Marketplaces are one such example of an industry where bookings are often materially different than realized revenue. The marketplace doesn’t actually realize revenue upon signup or booking, but instead is compensated when the customer uses the actual service.

If your business is booking revenue at a high rate, but not collecting it you’ll be carrying a high accounts receivable balance and hinder your cash flow.  In this case, yield becomes an important indicator of performance. While this is just one example across one particular type of business, revenues / cash flow are the lifeblood of any business so it’s critical revenues are measured the right way.



It was revealed last week that Facebook is experimenting and planning the wide release of a stories feature similar to Snapchat. Haven’t we been here before?  But count me out amongst the many who criticize Facebook for it’s lack of creativity and imagination.

Snapchat’s IPO roadshow will likely reveal just how well Facebook’s strategy is working, but my guess is the impact will be significant especially with customers who prefer the comfort of the Facebook / Instagram platform. Truthfully, Facebook can leverage this familiarity to build a product that is functionally the same but not as good and still likely re-capture a significant share of user engagement from Snap.

The reasoning is simple, take a look at Mary Meeker’s Internet Trends report from last year.  Facebook was DRAMATICALLY better than Snapchat when it came to user engagement (even with Millennials) in terms of AUM’s and time spent on the site, the only place Snap excelled was video.  Since most people visit Facebook first and more frequently, what happens when Facebook is just good enough to keep Snap’s users from needing their feature?


Silicon Valley, and the tech community as a whole, can sometimes become an echo chamber.  However, it’s important to remember the majority of users live outside of the Valley and are more concerned with convenience and utility than originality.

I’m a proponent of listening to the market over building a feature that is “different” or the latest tech.  I’ve personally made this mistake, and have seen it made more than once.  We’ve focused on extra features, design, and new shopping UX’s when customers craved simplicity that competitors provided.

The key to unlocking new business was accepting the market feedback that was so visible all around us. We spent time and resources on building for the sake of building when the customers really wanted optionally of enrollment, an update that took little time and provided a high ROI.

Even when you are building tech that is advanced, always do so with your users in mind.  Never underestimate your competition, if they are growing by leveraging a feature you don’t provide, consider building it or risk losing the customer base you’ve worked so hard to capture.


Over the past month, I’ve focused on my growth in product during the span of the last few years. This led me to reflect on my initial days as a product marketing manager and internalize where we succeeded but also what we could have done better. From those thoughts, I’ve tried to put together a basic framework for mitigating risk in those formative days, weeks, and months.

These ideas are certainly not definitive or complete but I do hope it provides a relatively good structure for your initial thoughts about your product or business. The journey of product building only increases in complexity the further you get from day 1, having a process early creates habits that pay dividends in the long run.

Frame the problem

Fall in love with the problem, not the solution. Research it, talk to users, and become immersed in the problem before building the solution. It’s impossible to build a good product if you don’t understand what problem you are trying to solve. However, just like in economics there is a diminishing point of return on data and research. Nothing replaces feedback from the market.

When founders have an empathetic understanding of a market and they are connected to the problems they are solving, it’s a more ‘mature’ approach to a starting a startup. People tend to forget that your company is your first product, and you have to be intentional about building your company before it’s ready to really grow and scale. — Hunter Walk

Whether the problem is lack of energy choice, expensive diagnosis of a chronic illness, or unacceptable access to higher education, your solution to the problem will change over time. Yet, the product will only succeed if it solves a real problem for its users.

While admittedly a bit biased, this is where the best product managers are able to leverage extensive industry / business knowledge. It is important to have a grasp on which markets will be best for the initial launch, the partnerships that could allow for rapid expansion after traction, and the message that will resonate with customers.

Speaking of messaging, never underestimate the power of storytelling. Whether you are looking for users or investors, the product should be easy to understand and resonate with your audience. Empathize with the needs of the customer and show them you solve their problem.

Sometimes the product canvas is messy

Execute the go-to-market

If real estate is all about location, the go-to-market is all about execution.
Once you’ve researched the problem, it’s crucial to put a timeline in place for getting the product to market quickly.

Simply put, great execution is entering to market in the shortest amount of time possible with a minimal product that solves the problem. As my teammate Jonathan Crowder likes to say, “viable” is part of MVP. Bad execution is a lack of speed to market and inability to apply learnings from market once it has launched.

To achieve the necessary speed in our go-to-market, we broke up the B2B product launch into small sprints. Our goal was to get into the market as soon as possible. As a marketplace in a highly regulated space we looked for a market where the regulation was lowest and where we could generate the supply-side quickly.

Another criteria which we held in high regard for prospective partners (the supply) was the ability to service other markets quickly when we expanded. This strategy paid off almost immediately as the demand for the marketplace exceeded our early expectations and we were able to quickly answer the demand in additional markets where the completion was low.

On that note, if you are fortunate enough to gain traction it is important to understand why. Don’t over celebrate the early returns. This lack of understanding led me to champion a few features that eventually were built and not needed. Which leads me to….

Measure and evolve

The power of incentives and unintended consequences have always influenced my strategic business decision making. I firmly believe that what you measure determines the actions you’ll take and those actions will effect something you don’t anticipate.

It’s important to define these metrics before hand, otherwise you’ll shape them to your narrative or change them to ones that shed your product in a more favorable light.

A little over a year ago, the team at Andreessen Horowitz published two blog posts on startup metrics (32 metrics total; part 1 and part 2) that everyone looking to start or run a company should read. Here are the ones specific to product:
Active Users
M-O-M Growth (if you have a seasonal business, Y-o-Y is just as important)
REVENUE (per user, repeat customers, margins are all critical)

It’s likely that one, or all of these metrics will shed light on issues with your product / business along the way. The important part is working feverishly to improve them as quickly as possible, don’t prolong the problem by refusing to accept the results.

When beginning to improve the product, don’t fall into the trap of making too many changes to the baseline user path at once. Early on it’s likely you have too few resources to measure and then act upon several changes immediately. Focus on the changes you believe will impact your metrics.

As you scale, your capacity for complexity grows but be aware, the increase in infrastructure will tease you to attempt to make more changes than can be accurately assessed resulting in assumptions that might not be true. Adding complexity too quickly often keeps products from success.

There’s no 100% right way to build or launch a product. However, having a repeatable problem solving structure is important for achieving the desired results at scale. Pick a strategy that will allow you to remove emotion from the process and make decisions that are objective and rooted in data. Stay grounded in this approach and the results will follow.

A few days ago, I posted a few of the resources I used as I grew into the product marketing manager / product manager role. With this post, I’m focusing on the things that you won’t read in those books but will likely learn on the job. Being a product marketing manager or product manager is always glorified on podcasts, blogs and in books. However, the path to success is often an exercise in your tolerance for being wrong and your willingness to listen.

Stop, Collaborate, and Listen

Are functions dependent on engineering asking you about the roadmap frequently? If so, it’s possible you’ve made the product roadmap a blackhole. Good product managers clearly and frequently communicate about the product roadmap. Great product managers go one step further and build shared understanding about the trade-offs that have to be made on an ongoing basis.

It’s important to remember that you are the gatekeeper to a finite resource within the company, one that several of your teammates need to achieve their goals or execute on their strategies. Approaching this responsibility with the humility it deserves will go a long way to ensure everyone is on the same page. Ask yourself, if someone has a better thought, would you know?

Product managers will often comment that they “own the product vision”, I couldn’t disagree more. The PM is responsible for executing it and building the vision with everyone in mind. The entire team should be proud of the product the company releases to the market. I’ve always been a fan of healthy internal debate. But while debate is good, buy-in is better.

You Can’t Be a Perfectionist

Scope creep is real. If everything you do must always be 100% complete and perfect before you release it, product management isn’t right for you. Customers will always provide the biggest insight into improving your product. The longer you wait to release it, the longer you have to wait for feedback. In businesses where cash flow and runway are key, this can prove disastrous.

Instead, put a process in place early. Keeping to a two week sprint cycle might seem rudimentary but the habit will ensure that you are keeping accountability and progressing toward a better product on an ongoing basis.

Even when we are working on longer term projects with revenue impacts we’re committed to releasing something that will give us a positive outcome in the near-term. Not only is this important for business reasons, it allows us to always collect customer feedback to improve our product. Additionally, the engineering team gets a chance to impact the business regularly with new features. Never underestimate the importance of this, engineers LOVE knowing they are building products that have an impact on the top line.

Shiny Objects Almost Always Fade

There’s a time in every company where the path to explosive growth seems hidden or the initial push has slowed. At LAUNCH this year, Jason M. Lemkin warned SaaS companies that it is tempting to enter a new segment with your product when you hit the wall.

We aren’t SaaS at Choose, but I do believe every company eventually faces the decision to improve the core business or enter a new segment. It’s likely you have plenty of room to continue to improve the core even if it isn’t exciting. Focus on your mission and take a deep dive into what your customers want. Scott Belsky of Benchmark uses a phrase I love, “mission centric, medium agnostic.”

As much as we wanted to be a “purely digital” platform for energy choice, some consumers needed the comfort of a voice on the telephone. Our mission is energy choice for all because we believe it saves customers money and allows them to pick the source of their energy, should we care if they do this online or on the phone?

As it turns out, a great shopping platform combined with industry leading selection is an avenue to success once we gave customers a choice in the way they transacted. Focus on your customers, not what other companies in different industries are doing with the “latest tech”.

Execution is a Sprint, Vision is a Marathon

We have a strict rule at Choose, once a sprint starts, it doesn’t get changed. However, that doesn’t apply to the day before the sprint or the quarterly roadmap.

Your goal as a PM should always be to execute on the highest value features, this changes frequently, especially in startups. However, being adaptive doesn’t come without its traps. It is easy to be coerced into creating throw-away work.

Recently, we had to make the decision on which core piece of our product we wanted to improve first. We subscribe to the Bill Gurley theory that conversion is the most important metric, and with this in mind decided to improve the checkout process for our customers. This was a massive undertaking, so we broke it into actionable pieces.

First, we focused on changing the validation scripts and content. The sprint, easy fixes that would have immediate impacts. Due to the nature of our business, each checkout has idiosyncrasies that dictate they all have slightly differing code leading us to the marathon. We improved the code base to allow us to be more performant and flexible with improvements. The result: we’ve reduced the time to add new features in checkout by about 66%, and improved conversion by ~20% after customers enter checkout.

You’re Going to Be Wrong

Know this, building the right product is hard. If you’re doing it right, and moving fast you will be wrong a lot. It’s what you learn and how fast you adapt that determines how successful you’ll ultimately be.

After we had launched our B2B product at Choose Energy, I was damn sure we needed to build two things: 1) an input for our customers to enter their monthly electricity spend to get a better price and 2) a way for our partners who weren’t on API’s to upload prices more quickly. I pushed for these almost every chance I got. Neither worked and I’d wasted our engineers’ time. I was certain that customers valued price above all else and this was our way to give them the most savings. As it turned out, they valued their time more.

Instead, our customers enjoyed the simplicity of just selecting home, small business, or large business and seeing prices immediately after. Our partners didn’t put out more tailored rates because the new upload features weren’t a vast improvement on our old process nor did they increase acquisition.

Don’t be afraid to admit mistakes, the sooner you admit them, the faster you can correct them and build something your customers love. Even more, don’t be afraid to make mistakes. 80% certainty is almost always good enough, driving out all uncertainty tends to waste a lot of time and speed matters.

There you have it, a few skills I’ve learned on the job in product and the experiences that go along with them. You might have noticed there are two skills noticeably absent from the list. HUSTLE & CURIOSITY. Simply because I believe you need those skills to excel no matter the job, and they’re hard to teach. I hope this list leaves you with a few skills you can apply to your day-to-day basis and as always, if you have more to add, I’d love to hear it.

Last week, I introduced a series which I hope will be of use to new product managers in markets outside of Silicon Valley. For the first installment I am focusing on a few resources that really shaped my view of product management over the last three years.

Udemy (Coursera, EdX, Khan Academy)

Silicon Valley is full of classes for aspiring PM’s or PM’s who are looking to reach new heights in their careers. I work in Dallas where the cupboard of resources for true product management courses is bare and courses are focused mostly on young developers learning to code.

A few years ago, I made the decision that having a few PM / coding skills would come in handy down the road and enrolled in a few classes on popular online learning marketplace Udemy. Coursera, EdX (I took CS 101 from Harvard here), Codecademy and Khan Academy all provide free or low cost classes for anyone looking to learn a new skill.

I wanted to focus on a few coding languages and a high level overview of web development.  Below is my Udemy curriculum with a synopsis of each course.

The Complete Web Developer Course — Build 14 Websites: This was the first class I tackled upon enrolling in online courses and was a great entry point for someone with limited knowledge of website tech stacks. This 10 section class spans 245 lessons and covers intros to HTML5, CSS, JS, jQuery, WordPress, PHP, SQL, and API’s (including Google Maps’ and Twitter’s APIs). Additionally, you’ll learn how to setup an FTP to send files to and from a sample website you build early on in the course. This class won’t dig deep on any topic, but after it I felt a rudimentary understanding of how web development works at a high level.

The Ultimate Excel Programer Course: I know, I know, no one programs in Excel anymore but hear me out. For anyone who has never coded before, and three years ago this was me, programming macros in Excel is a great starting point for two reasons. The first, VB in Excel corrects your syntax and makes it obvious where your code is broken. There’s even in a function that allows you to run through your code step by step which not only allows you to correct it easily but shows you exactly which lines of code correspond to action. The second, learning a language with assistance was invaluable when I moved to languages like R, Python, and SQL. Suddenly, coding didn’t seem so unfamiliar anymore.

The Ultimate Python Programming Tutorial— This course was my first into to common programming terms like strings, boolean, and lists. However, I had learned some terms like loops and else in the Excel programming class above. This course focuses on the basics of Python, a great language especially for data applications. The most useful skill in this class is learning to define and call functions through out your code. Something that proves useful if you are running the models consistently with the same variables.

Applied Data Science with R — Full disclosure, I am a stats junkie. It was my favorite class in grad school and I continue to love it. Just knowing how to run and interpret regressions the right way is an immeasurable skill. This course will walk you through some basics in the R language and a few key concepts in statistics (though I’d recommend a full course on stats if you’ve never taken one). R is a powerful tool for statistics and having even a minimal grasp on it will allow you to run models and explain them with ease given the vast amount of packages available in the R library. Think of R as a multitool in your pocket.

Note: while I did not take a class on it, I highly recommend anyone looking to be a PM learn SQL. I was lucky enough to have a colleague teach me the basics and then I expanded on my knowledge through YouTube, Stack Overflow, and other online resources.


One great thing about product management is that due to its immense popularity as a career path, there are a plethora of books from which to choose. Here are a few of my favorites:

Hooked, Contagious, Inspired: I placed these books in the same category because they all have different approaches on how to create and implement products people love and how those products gain traction. Hooked focuses on how to build products that consumers will use repeatedly while Contagious turns its attention to methods that are used to get ideas and products to catch on. The combo is powerful: how to build habit-forming products and how to spread the word. Inspired takes a slightly different approach focusing on how to decide which product opportunities fit best with your mission, how to implement Agile once you’ve decided how to move forward and how to manage expectations / goals of management.

Agile Product Management with Scrum (short form of Essential Scrum): This book is the resource for learning Agile at a high level and provides best practices for implementation. There are two versions here, the first which while shorter still provides valuable techniques for organizing your product team and the second which is the long-form for more granular learning. This book is most similar to a text book and should be required reading for anyone getting into the field. It’s likely you won’t stick to the techniques word for word but they do provide a framework for product strategy.

The Lean Startup: This is the quintessential product read for PM’s in startups and for good reason. As you develop a product and companies grow, the natural inclination is to make the product and process that goes along with building it more complex. Eliminating a focus on simplicity and clarity of vision is common. This book will keep you focused on moving quickly based on data insights.

Podcasts / Blogs

One of the traits that I believe helped me quickly evolve as a PM is being highly curious. This took a few different forms; 1) don’t be afraid to take inspiration from your competition or products that do things really well. There are sites that collect product inspiration, use them! 2) Listen to really smart people who’ve already accomplished the goals you wish to achieve. Much like product being a popular topic for books, it is also the foundation for many popular sites and podcasts since most founders are indeed product focused.

Product Hunt (site and podcasts): The reason for using PH is simple, great people posting great products on the site, and great people discussing great product on the podcast. Want to see what’s coming next? Visit the website. Want to hear from successful product owners and founders. Listen to the podcast. (Note: they haven’t posted a podcast in a few months, but the previous ones are still amazing)

Little Big Details: A fun website that posts unique, and sometimes hidden details that make a big difference in UI / UX. Most of these insights come from companies you might have heard of like Apple, Amazon, and Google.

This Week in Startups: It’s no secret that jason has one of the best podcasts in Silicon Valley and for PM’s it is a must listen. The great founders that visit this podcast often, share how they solved their biggest product issues from all aspects including ideation, implementation, and the strategy behind it all. Even if you don’t hear a product insight on an episode, there’s no doubt you’ll learn something about startups that you can relate to or use in your day-to-day.

This Is Product Management: This is Product Management is a podcast about a variety of topics and where they intersect with product management ideas. Past topics have included, IoT, APIs, Venture Capital, and storytelling. The diversity of topics will broaden the way you think about product strategy and what outside forces shape it.

Silicon Valley Product Group: Marty Cagen (author of Inspired mentioned above) and Chris Jones post once or twice a month on all aspects of product management. This is a must read for a variety of reasons but among my favorite is the breadth of topics on the blog. Marty and Chris write on product, product leadership, diversity in product, strategy, vision, and much much more. This isn’t just a good read for product mangers but for those who manage or work extensively with them as well.

The availability of resources for aspiring and evolving product mangers is immense. I’ve selected a few that really guided me during those first few years where I felt a bit underwater at times. I would love to hear from you and any resources you’ve found valuable on your journey as a product manager.

The next part of this series will focus on a few skills these resources don’t teach. Next, we’ll move on to leveraging both industry knowledge and business acumen to guide product strategy. Finally, I’ll put it all together with a timeline of how I approached product management from being a complete novice to only slightly green after learning from these resources and mistakes I made along the way.

Jonathan and I are at the CBI Insights Innovation Summit in Santa Barbara this week. Below are a few quick takeaways from yesterday’s panels and discussions.  Enjoy.

  1. As can be expected, voice and text will be the biggest winners at the intersection of UI and AI over the next few years.  People can now interact with devices without knowing how to read and write. For developed nations, this means that toddlers now interact with computers for the first time by voice instead of touch.  However, the implications for the developing world are even greater. Since illiteracy will no longer be a limiting factor to bringing people online 2B additional people will have the chance to connect to the rest of the world.After the Q4 and CES success surrounding Echo and Alexa it’s pretty clear that Amazon is leading the way in voice. Yet, Google and Apple still have one big competitive advantage, an OS in your pocket.  Consumers generally want to interact with one OS across multiple devices so this hurdle is likely to be key for Amazon.The industries that will be impacted range from retail to content / media to healthcare.  The order of implementation is likely to go from low risk to high risk.  As Jeremy Liew of Lightspeed Ventures said, “health won’t be the first real domain, rather a something like shopping where no one dies if it goes wrong.”
  2. The IPO and M&A climate is changing.  Just as early as a few years ago, growth at any cost was the standard way to IPO  Now, companies are taking a growth at some reasonable cost approach. I wrote last week that non-tech firms entering the startup M&A fray is likely to put a focus on sustainable business models and the IPO market looks to be following suit.  Scott Kupor of a16z believes “companies with 30% annual growth and near-term profitability are likely to have good IPO prospects”
  3. Chamath Palihapitiya of Social Capital was his usual quotable self and several of his insights will be long-lasting in my mind.  Among them:More big companies should partner with VC firms. Combining their balance sheet with access to talent is a game changer. These large, incumbent companies should share the risk with talented startups instead of defining exactly what they do. This mindset prevents them from building big, meaningful businesses. FinTech is a great industry for incumbents to do this. because by definition there must be an ecosystem for consumer interactions.Working around regulatory is immature, Silicon Valley should being working with regulation.  Regulatory standards keep consumer trust in industries like finance, utilities and health where this is paramount.  This trust often leads to more users which leads to more revenue.  In addition to these benefits, regulation helps companies build a sustainable moat and weeds out those who don’t have the courage to run the gauntlet of starting a business.
  4. With the copious amounts of data coming online the way we think and work with data is changing rapidly.  Among the challenges businesses will face; cleaning data that comes from multiple collection points (IIoT, energy) and consumer privacy.AirBnB’s Chief Economist Peter Coles elaborated on both challenges on the panel focusing on big data.  AirBnB wanted to work within the regulatory frameworks of major cities as they expanded their footprint but in order to do so needed to share data with those cities without compromising customer privacy.  The solution: aggregating data in order for these cities to spot trends without violating user trust. Sometimes solutions are beautiful for their simplicity.The other insight Peter provided was on measuring data.  Most of us default to one off queries on our database to solve the problem of now.  Instead, AirBnB has taken the time to create “core metrics” in order to eliminate one-off problem solving.  This is something I know I have done in the past and am betting most of you have too.

There were several more great insights from panelists and presentations from amazing companies like SigOpt and Affective.  The future is filled with talented people solving massive problems.  I’m looking forward to another productive day focused on big industries like auto and insurance.

With most of my usual newsletters and bloggers taking the final week of 2016 off, I spent the last week of the year reviewing the blogs, podcasts, and books that had the most influence on my thinking.  One of those posts was Fred Wilson’s Second and Third Tier Markets And Beyond in which Fred discussed the challenges founders and investors face in markets outside of Silicon Valley.

This post and the conversation around it, led me to start thinking about the other roles in startup ecosystems differ drastically depending on their environment. Naturally, I settled on examining what it is like to become a PM outside of the Valley.  Hint: it’s tough, luck plays a large role, you need a supportive team and you have to love to hustle.

As I began digging into the differences between product management in locations where the mentorship and resources run deep and emerging startup ecosystems, I became reflective on my evolution from the very first days to how I think about managing a product today.

Given that the Product Manager and Product Marketing Manager roles are so prevalent in the Valley, I figured more decorated PM’s than I had written on what they had learned. My assumption was correct.  In this search I came across 50 Things I’ve Learned About Product Management by John Cutler on Medium. While I highly recommend you read the entire list, point number 6 stuck with me:

The best way to get people off your back is to deliver value continuously (with data to back it up). Real results (and a proud team) eat everything for breakfast.

I was, and in some ways still am, green as a product manager, but by far the easiest way to get buy-in from your team is to produce results using the skill-set you have at your disposal. However, what is even more crucial that you never stop growing the skill-set you have at your disposal so you are able to continuously deliver value and insight.

Product management is one of the most desired startup jobs in the Bay Area, and as the entrepreneurial culture begins to spread to other metros, the competition for these jobs will be fierce. There will always be someone more experienced and better qualified but if you enjoy the grind of learning, success will find you.

With that point in mind, over the next few weeks I hope to deliver some insight into how I evolved as a PM outside of Silicon Valley.  In this series, I’ll work through some of the lessons I’ve learned as a PMM, why I believe strategy and business knowledge are just as important as the technical skill, and the resources I leveraged to become a more effective PMM.