I’ve written before that startup leaders should ignore the advice to write a long, formal business plan. Important eventually, probably, but certainly not at first.
That’s why I was glad to see two folks with much more experience than me with startups write an article on just this topic and discuss what’s more important in Harvard Business Review.
Cheryl Dorsey, CEO of Echoing Green, and her colleague, Rich Leimsider, write:
“Would you take a look at my business plan?”
Some member of our staff at Echoing Green, an angel investor and grantmaker in social enterprise, hears this request every week. And we are often happy to review these start-up plans — which include the typical elements such as a product description, competitive analysis, estimate of market size, and projected financials. But we are interested in much more than these traditional plans. We use other criteria to find new people and ideas that can create large-scale social change.
In short, the business plan is overrated.
They go on to explain what is most important.
Remember all the hoopla about Beyonce lip synching the national anthem at the Presidential Inauguration? I think it dominated the media for close to a week and made her look bad.
But the whole reason it became such big, gossipy news isn’t because Beyonce didn’t sing live. It’s because she allowed it to become a surprise instead of making a preemptive announcement.
She should have quietly released a statement with something like: “I’m deeply honored to be asked to sing the national anthem at the inauguration. Unfortunately, the weather conditions and the outdoor setup make it very hard to sing this song in top-quality. Out of respect for the President and the inauguration, I do not want to take any risks of something going wrong and will be singing a pre-recorded version.”
With hundreds of people sitting around her, did she not think this would come out? Instead it became a mini-scandal when she could have mitigated the shock factor amongst the press and social media who loves to keep breathing air into stuff like this.
This is all to say: surprises are very bad.
While starting my organization, I was reminded of this very early from a board member. He loathed the saying, “Don’t ask for permission now, ask for forgiveness later.” That’s a good way to burn bridges and lose trust amongst people whose trust you need over the long-term.
In the startup environment, I think this advice is especially important when things are very, very unpredictable. Startup leaders have a lot of ambition and personal pride which can often get in the way of admitting setbacks. But when it comes to your closest partners (board members, mentors, and colleagues) it is essential for a few reasons:
1) Bad news is likely to come out anyway
2) If you don’t share, no one can help
3) When it does come out, others close to you will wonder what else you’re not sharing and trust you less
4) You’ll be a better leader by not shouldering all the heavy stuff on your own
The answer: over-communicate. You’ll build trust, create a stronger team, and demonstrate your strong leadership skills.
Articles of the Week: Nonprofit or For-Profit, How to Configure Your Team, Hillary Clinton the “Failure” and More
Hillary: A Lesson in Failure by Ian Bassin
How to Configure Your Startup Team by Mark Suster
Should Your Business be a Nonprofit or For-Profit by Jane Chen
Tech’s new entrepreneurial approach to philanthropy by Jon Swartz
5 Reasons You Should Live With Your Coworkers by David Zax
The Checklist Manifesto and the results of using a very simple tool to achieve some amazing results, kept popping up in articles and books I read. Intrigued, I read it, thinking it could make my work and the work of startups and small organizations more effective.
Author Atul Gawande, a doctor, is searching for ways to reduce basic mistakes in complex, team-based work — which is why I was drawn to the book. His main examples are surgery, commercial construction, and flying as well as interesting stories in public health and investing. After reading the book, there’s no question the checklist works — and is saving hundreds of thousands of lives.
But in the examples, the work has a great deal of repetition and predictability for which to prepare. That’s not to say the work is easy — what could be more complex than emergency surgery with a group of people you barely know. Nonetheless, where the work needs to go (save the patient, land the plane, construct a building) is clear. That’s why a checklist is such a great idea to ensure basics things don’t get overlooked that could kill a patient. But for startups, the path, destination, tools, and strategies are much more ambiguous and evolving in real time.
One point I found particularly interesting was a bit counter intuitive: the idea of a checklist sounds initially very bureaucratic. Instead of empowering those on the front lines who have the knowledge to make the right choices, it’s centralizing the decision-making process. On the contrary.
Dr Gawande explains them like this:
It is common to misconceive how checklists function in complex lines of work, They are not comprehensive how-to guides, whether for building a skyscraper or getting a plane out of trouble. They are quick and simple tools aimed to buttress the skills of expert professionals.
While I don’t recommend this book be a priority read for startup founders, there are a few cases where checklists could be really helpful.
- Hiring — especially if you have multiple team members conducting interviews. You could have a list of must-have qualities/experiences, nice-to-have, can’t-have, etc.
- Fundraising — what questions are essential to ask during a meeting? What questions are essential to research before it?
- Sending blast emails or writing website copy — don’t want mistakes when emailing thousands of people or making something public.
If you’re ever preparing to lead a major effort with a ton of people or leading a much larger organization, you should read the The Checklist Manifesto. While a bit redundant, it’s interesting, thought-provoking, and convincing.
One of my favorite parts about starting an organization is also one of the toughest: the range of things you need to get done each day, week, and month. And there’s also the swing in emotions and energy. Here’s a snapshot at what that actually looks in the first few months of a startup based on my experience:
- Send hundreds of cold letters to potential funders
- Get ignored and rejected hundreds of times
- Send more letters
- Launch a website
- Manage social media
- Recruit a board
- Run board meetings
- Manage your board
- Pilot your program
- Adjust when things don’t go as well as planned
- But celebrate what does
- Prepare for a meeting with a potential donor
- Quickly get over a disappointing outcome
- Call your mom, while skipping down the street, when the meetings lands you money
- Write a basic strategic plan (but hopefully ignore advice to make it a long, formal one)
- Design a logo
- Create collateral
- Find a friend who knows Photoshop to make it look nice for free
- Negotiate with vendors
- Interview interns
- Enjoy the energy of additional people as your team grows
- Send more cold letters
- Get rejected more
- Get a huge adrenaline rush just off a reply from a cold letter
- Meet with dozens of people for advice and feedback
- Grapple with contrasting advice and ideas from very smart people
- Modify your programs based on what’s working and what’s not
- Upset some people as a result and please others
- But gain confidence in making tough decisions
- Leave your
officeapartment for the first time in three days
- Start asking around for an open desk at an office
- Get excited when you’re organization finally has an address that isn’t where you sleep
- Realize it’s lonely as a startup leader
- Worse, you’re too broke to go out
- Stress about how little money is in your account
- Forget about hiring and worry about just paying your rent
- Go to lots of events because of the
free foodgreat networking
- Keep recruiting more board members with modest success
- But the persistence pays off when a leader who you admire says “yes”
- Raise your first five figure gift
- Email all of your prospects to share the news
- Then your first ten figure gift
- Pay yourself for the first time in three months
- Try to file for your 501c3 status on your own
- Realize it’s a pain and complicated and find a pro bono lawyer
- In the meantime, find a fiscal sponsor so you can accept donations
- Update your website, again and again and again
- Dial for meetings — follow-up with all the people who received your letters
- Ask people who are bought-in to tap their networks for introductions and money
- Question if you should have started an organization one week
- And the next week see evidence of your organization succeeding
- Then remind yourself: “Fuck yea, we’re going to make this happen!”
What else should be on the list?
I think a new website GiveSmart.org, created by The Bridgespand Group, is such a great resource it’s worth its own blog post. But I don’t think that because of its intended purpose:
GiveSmart.org is designed to help philanthropists make better decisions and get better results from their giving. This website is part of Bridgespan’s Give Smart philanthropy initiative, which also includes the book Give Smart: Philanthropy that Gets Results by Thomas J. Tierney and Joel L. Fleishman (Public Affairs, 2011).
Instead, I think it’s a fantastic resource for new founders to learn about philanthropists — how they think, what motivates them, etc. Fundraising is one of the toughest areas to efficiently improve because opportunities to learn directly from philanthropists are limited. Yet, it’s one of the areas in most need of efficient improvement because prospect meetings are high-stakes for new organizations.
The GiveSmart.org video library with dozens of interviews gives an inside perspective among philanthropists. And better understanding motivations, priorities, etc. is key to raising money.
I’ve worked fairly extensively with four veteran fundraisers. Last year, one was giving me advice that was entirely opposite the advice of another. Both were veteran fundraisers and both had raised tons of money.
While I certainly wasn’t new to the game, it was a tough situation when two smart people tell you two very different things about the same situation.
Furthermore, of the three I was the only who new the nuances of the situation entirely.
The point I’m making is not about fundraising, but about building. Free advice is abundant (so is expensive advice). I’m regularly faced with contrasting advice from smart people that I trust. It can be agonizing, frustrating, and paralyzing.
Here are some ways I approach this tough situation:
1) Look at what worked in the past for me
In the situation above, one side was suggesting a path that was different then the one that got me here. What works for her, won’t necessarily work for me even though she had been very successful.
2) Get a third opinion
Though, this can also result in a third approach rather than a 2-1 majority (most scenarios that need advice from three people are probably not simple).
3) Read and research
Whether it’s a thought-leader whose writing clarifies your uncertainty or a case study, finding others in similar situations can be helpful.
You also have to consider, unfortunately, if the advice-givers have any agenda. The worst thing I’ve done in these situations is to keep putting of the decision. A couple years ago I changed the date of an event because I couldn’t figure something out and was getting mixed feedback. That’s bad leadership.
Tough decisions are, well, tough. Smart people giving you different advice makes it even harder. Good luck!
MIT Brain Scan Shows That Entrepreneurs Really Do Think Different by Anya Kamenetz in Fast Company
How Do You Measure The ROI Of A Risk? (How Do Silicon Valley And Hollywood Approach It Differently?) by Anjali Mullany in Fast Company
Go From Employee to Entrepreneur: 4 Tips by Minda Zetlin in Inc. Magazine