Brad Feld - Venture Deals

well Boston in New York Barnett born in New York and live in Boston so two of my favorite cities Brad Feld the man who does not need an introduction entrepreneur VC author 20-time mich marathon runner what are you up to 2021 on Sunday in a different state every time because you know Brad gets bored staying in any place at one time I think Brad is one of those people that if you look at life is good like what you do and do what you like I think that defines who Brad is I don't think Brad gets up in the morning and says I'm going to work I think work and play and everything is just all combined and it's who he is and it's what he does and it's something that I truly admire because what a great life to have that you love everything that you're doing most of the time when we are talking about defining moments for this conference I was thinking about well what was the defining moment that I've had with Brad that really kind of made me think and pushed me to be different than I am today and I have a story and what it's about we were working on a company together in New York and the CEO is a very he's just a challenging guy and I did not know how to communicate with him so I called Brad and I said Brad I need your help I I want to get on the same level of this guy and I really really want to work with him and so Brad coached me for a while and he was telling me the right things to do and say and think this way and kind of get into this guy's head and at the end of the conversation he said to me Pamela everybody has a line and you should always take your line and walk up to it and step on it but never process because your line is the most important thing that you can have and so I thought about that and I was like I thought about it for a long time and I was like my line my line and at first I was letting my line be my comfort zone and that's not what he meant by any stretch of the imagination he meant what is that place that identifies you that if you ever went over it would change who you were as a person and so ever since the day that we've had that conversation I've pushed myself to really define that line and then try everyday to get closer to the line and make a difference and so that is something that I've gotten from Brad it was a defining moment and that I truly respect so without further ado mr. Brad Feld never I can hear me okay cool thanks for coming I wanted to talk today from the headset of advice I would give myself if I was doing my first company for the first time again how many of you are on your first companies and how many of you are on a company that's not your first okay so I think it's probably equally interesting for those of you that raised your hands the second time or hopefully it'll be interesting for you as well if I travel back in time and gave myself advice there are two things that I would focus on that I didn't do in my first business the first was I would be absolutely completely and totally obsessed with my product I think that especially sort of in the world of venture capital in the world of tech startups and we're sort of living in this environment right now where there's a lot of excitement about what's going on and there's you know 74 TechCrunch articles every day and you hear about all these financings that are happening and all this sort of noise in the system which is good there's an enormous amount of activity and momentum and excitement around entrepreneurship an early-stage company creation if you are the founder if you're the entrepreneur if you're the CEO the most important thing to focus on early in life or your company is your product the most important thing to focus on in year two of your company is your product the most important thing to focus on in your 20 of your company is your product and so when you're starting your company at the beginning arc of your company be obsessed about your product how many of you were working on a startup that does something that you don't give a about good you would be surprised when I think back to my first company and my friends who are entrepreneurs a number of them who started a company and we're doing a company because they wanted to do a company that they were entrepreneurs because they wanted to not work for the man or they are entrepreneurs because they wanted independence they wanted to take control what was going on which by the way is completely elusive there are so many people that are not obsessed with their product and if you focus on your product all the time much of the other things that are issues drift away so it's awesome that this generation of entrepreneurs and this generation of companies and the people that SBB has been attracted to and vice-versa love their product because that's a starting point but you have to stay on it how many of you have had a product release how many of you haven't released product okay how many of you have okay how many of you that released your product had a shitty first release okay and how many of you quit wait you're here so you didn't write it's totally normal how many of you asked you how to shitty first release decided to give up on your product and try something totally different and how many of you that had a shitty first release have had a second release did you go better anybody's not go better how about third release yet they're really sad now are you working on yeah are you obsessed about this third release and do you feel like if it doesn't go well you're in trouble and the important thing is he's here he's smiling he's talking about it don't be afraid of those earlier releases not being great and don't be afraid of the second one not being great and the third one not being great keep putting him out there how many of you release once every six months how about every three months I've been every two months one month two weeks weekly daily okay the last couple are gonna have better success than the early ones I predict if you're releasing weekly pushing towards daily you will be more successful than if you release at any other frequency this time most of everybody here not everybody has web-based write web-based internet software there are things I'm not web and Internet release a handful so you didn't I'm in the frame of reference of web-based software but hi what's your business and who's the user and are there individual people that use them no big companies use them but within those big companies do they have individual users you do it for them so you you weren't it internally and what's your interface with your customer that's what I was looking for right so even if your software release is not happening every day your customer interaction is and be obsessed around that interface so people talk about how important it is to know what your customers saying and and listen to your customer etc when I talk about being obsessed with your product I don't mean at the exclusion of the interaction with the customer the customer is part of the product when your company is five years old and a thousand employees your company is part of the product how many people think that the Apple stores are part of apples product versus being a retail outlet that should be a rhetorical question right I mean apples the the reason that they might remember gateway anybody ever go to a gateway to store you're like embarrassed to be in the place good how things everywhere and wacky and the computers were shitty and half of them didn't work and the people were strange boys in an apple store you kind of want to just hang out like the only thing missing from an Apple store is food and if you bring it in they I don't know if they like you didn't bolded it you bring it in and in Boulder actually in the Apple store in the corner there's usually a dude getting high so it's really kind of a copy like Boulder place sometimes it's one of the employees but but the point is that the whole the whole of the company becomes the product and so when I talk about being obsessed about the product I don't just mean the website I just don't mean the mobile app I mean the whole lifecycle experience of what you do I was not obsessed about my product in my first company and after about four years I got very bored of my first company and we sold it after seven years and I was glad that we sold it was successful business but it was hard it was a grind because I didn't love the thing I was doing I didn't wake up each day completely enraptured with the thing I was doing even when I had customers yelling at me and stuff wasn't working and you know it was two o'clock in the morning on Sunday and another hard drive it failed and we didn't have the right backup stuff and like all that stuff happens but if I'd loved the thing I was working on all of those things would have been fine but what happened was I resented all of that over time and you don't want to be there in your business too hard so number one if I went back in time I would be obsessed about my product number two how many of you have companies that are bigger than 50 people bigger than 25 10 5 three-two-one okay awesome good range good range be totally clear that the company that you're building at the stage that you're in you can architect the environment and the company and the people and the business that you want I have a very deeply held belief that you cannot motivate someone the idea that I can motivate somebody is a fallacy the idea that a CEO can motivate somebody as a fallacy the idea that an HR person's job is to figure out how to motivate people is a fallacy all you can do is create an environment in which people are motivated or not and as the entrepreneur as a CEO as a founder you hold the keys to that environment at the beginning as does employee number five an employee number ten because as you start to build the business the type of environment you're going to create is really configured by that early set of people we did this really well in my first company and I was really proud of how we did it we ended up selling the business we were twenty people and it wasn't until we were at about 17 or 18 people where we started to feel like there was emotional activity in the business that wasn't consistent with their values and wasn't creating an environment where everybody was rising to be their best so there's a point at which it got hard fortunately we sold her shortly thereafter so I have to deal with it but if we've gone to four people that would have stretched me in my first business I was a co-founder of another business which grew I was chairman I've agree to about 1,500 people before I ultimately failed we never got any of that stuff right and we started the business we said we're gonna get this right because we all come from another environment where it wasn't right the company that bought my first company was all up and then I started this company with some of those people we're not going to do that stupid stuff and we did all that stupid stuff again and most of it was very simple it's because nobody on the senior team none of the founders were focused on creating an environment that had a context of motivation we all viewed it as our jobs to machine that into the business what's your name Alan wasn't working hard enough so it's my job that's at Devon tell Alan he wasn't working hard enough and try to motivate him to work harder that's gonna be really effective right yeah waste your time make him do it with me I'm an idiot anyway so now you lost respect for me right oh I mean that's how that goes versus hey let's have a beer yeah what's going on like are you happy all right is you is is it good like am i doing anything that I'm doing that's slowing you down right I mean like so that kind of dynamic versus come on man you're not doing your job or let's have a performance review I'd like you to meet my friends Bob and Bob useless your small businesses at this stage your small groups you're gonna have make bad decisions in terms of people you're gonna hire a wrong person you know you're not gonna feel the fix a person fire them if they don't fit you might hire somebody who's incredibly talented but they just don't fit you can't change them to fit focus on that context early and really really link it back to the first thing I said which is be obsessed about your product because the whole of your company is your product and every day when you wake up think about whether or not you're configuring an environment that's causing the people in that environment to be obsessed about your product those are the two things I tell my first-time entrepreneur self hope that's useful let's be you take forever much fun I'm good okay about anything by the way Mike Mike Mike so that you could be on the internet since you signed the document saying they could put you on the internet and they want to do that so that the government doesn't take down the SPP site for putting on the Internet Marcus from work happy my question wanted a good name work happy or Cappy but that's not how people work happy it's exactly that awesome so my question is what do you what do you look for or what questions you find most valuable when you're hiring someone so I don't let me answer the question precisely but I need to put a little context I don't actually hire any very many people anymore all right in our venture firm we're 11 people and we have no aspiration to ever be more than eleven people we're we've raised the second fun we're gonna raise the third fund is exactly the same size then we'll probably call quits we just have no desire to grow our business we do a thing what you think we do it really really well that's what we do I don't hire cut people in companies very often because the CEOs do that so when I work with a company I help evaluate I had this conversation with CEO the other day he's hiring somebody on the senior team one of the other investors doesn't think it's the right fit he's adamant it's right fit and I I interviewed the person and the person was good I think they're not awesome they could be awesome I don't know right hard to tell from an interview and the dynamics of that interaction where it's a CEOs choice so here's the data and you choose and the CEO basically said I just want to know that I have permission to up a higher and the answer is of course you do right as long as you do something about it and if we're wrong which we probably are because the investors are wrong often when they do a flyby and if you have conviction go with it so I wanted to provide that context there's a classical chart there's a two-by-two matrix so it's a Harvard thing because at MIT we have three by three matrices but it's a two-by-two matrices matrix ed on one axis it has fit with the role the job fit and the other axis it has culture fit okay fit with culture so low to high low to high so fit with job and fit with culture high is easy right don't fit culture don't fit job hard now that's easy to sorry you don't iron right so higher the fit don't hire that don't fit but what happens in those other two low fit with the job but - with the culture that's tricky because a lot of people can grow into a job and a lot of people can take a lower job in the organization and build up and a lot of people the job you think you need may not be what you need you actually need something that's slightly different but if they do it with a culture you're sort of on the right trajectory now I'm not talking about you're trying to hire a software engineer that doesn't know how to program I'm talking about within that box okay but the other one is really really hard so really competent great fit with the job super experienced terrible culture fit doesn't fit in the culture I have learned that the chance of that person working in a young company is low and that the entrepreneur should move on and that you should look for somebody that doesn't you know that has the culture fit dynamic because there's so much in the young company that's impacted by that fit especially as you think about how your culture is going to evolve so I try to encourage entrepreneurs if the like this particular person I think the culture fit of this person that we're talking to is really good I just don't know if if you know they're gonna fit in the job but they have a skill set for it so you solve that you comp it a little bit lower you give a little bit less equity you're a little more critical on the front end right like you think a little harder as the CEO hiring that person good next question I don't know I'm not the mic I'm not the runner actually I am the runner I better not say that I have a long way to run on Sunday medical from smack question is how do you keep your guidance on product being your own personal product and listening more to the voice of the customer like I'm having a challenge keeping keep wanting to build this product for me because I'm so passionate about it it's a good it's a good nuanced question because if you there are two philosophies of life right there's a one how many people here whether Steve Jobs autobiography yet everybody should read this book's phenomenal book okay it's just it's a fun book to read Walter Isaacson is a great writer I mean how many people here have a Mac come on give the guy's dead give him some love but but he's amazingly interesting personality and his philosophy Steve Jobs philosophy was who gives a what the customer thinks I know what the answer is and that's how he and you see that throughout the book and he was right sometimes in wrong sometimes and there sometimes he was profoundly wrong and there are some times when he was profoundly right and as he got further and further through his career he got better at being right and then there's other things classical how many people here went to business school sorry I did too although when I went to business school wasn't called an MBA hahaha the the you know you go to business school and you learn about product fit and you learn about you know how to define what the customer needs are and you go through that whole cycle and it's a very process driven that has very little to do with what your conviction is and very much to do with what the customer thinks or how many of you are familiar with Eric Ries and Lean Startup stuff how many of you read Eric's book read Eric's book everybody else it's a really great book it's very accessible Eric's got a great sense of how to put this it's a superb compliment to my book books I have to do more faster is the other one Reese RI es it's called the Lean Startup Eric has taken an idea that was originally popularized and articulated by Steve Blank around this notion of customer development and by the way Steve stuff which is the four stages to the Epiphany is also very powerful and very good but it's a much longer much more rigorous sort of a treatment of this that concept of continually testing is is what Eric talks about it's put your product out all the time collect data about what people are actually doing with it run hypotheses to see what people's reaction to the different hypotheses are adjust I think that it's a blend of both I think you have to have deep conviction about what your product is and what the personality of your product and your company are and I say personality it's a little dangerous to use it because I hate to anthropomorphize companies that way you know the voice of right but what it is that you are as a business what you represent and that comes from the founders the product then comes from the founders but being obsessed about the product does not ignore everything else you put out a product first iteration didn't work did what was the answer then that she went like in a dark room and closed the doors and had no windows and disconnected from the universe and tried it again and then sprung it forth on everybody right if you miss and you're way wrong which will happen to everybody not just at the very first release but somewhere along the way you've got to iterate aggressively much of that can come from data and as entrepreneurs how many of you have deeply metric and deeply instrumented your application so you know what people are actually doing how many of you do cohort analysis on a weekly basis to understand people's adoption of the product and how long they use the product for and what the drop-off of usage is all right basic things you learn these from Eric's books it's sort of around you know if you don't know what cohort analysis is just Google cohort analysis for web software on the Internet I'm sure something interesting will come up hopefully not porn and the you'll get these things so you have to do both it's not an or or it's not an you know it's not a a or B it's both other questions notice that there's a my name is Graham Lawler by the way from ultralight startups there's a proliferation of seed accelerators these days and so people ask me either to get involved with seed accelerators or to advise them on how to create one I'm curious about how to make money with a seed accelerator okay so let me let me define the difference between an incubator and an accelerator first an incubator is a place you go that has desks and chairs and phones and internet and is either a place you pay to be part of or somebody gives you for free but essentially it's a place to be and you know there's smart people hanging around but you're kind of there for a while I'm not interested in that so when I answer the question I'm not talking about that universe I don't think that's a particularly interesting thing I think it's fine but I don't think it plays to the sort of highest value and the most important driver in entrepreneurship an accelerator is a console here familiar with tech stars because you're boston new york's you know tech stars so tech stars is the one that I helped create it's 90 days long so it's a fixed duration you start at the beginning you get money and you get the program for some equity in your company you come out the other end ninety days later and the goal of an accelerator is to accelerate you and the program itself is a combination of things which includes physical infrastructure you're all in one place for 90 days with all you all of your your cohorts other in case tech stars ten companies or so you have a small team of people which is run by a managing director here in Boston it's Katie ray and in New York it's Dave Tisch that run the program and help you very deeply on an individual basis with the companies plus of course the cohort then you have a whole series of mentors that surround you and those mentors engage very deeply with you typically a company will have somewhere between two and four lead mentors who are spending at least an hour a week sometimes a day or two a week with you okay so that's what an accelerator that I think is a fully functioning mentor driven model looks like the economic model for the accelerator is very simple each program costs about half a million dollars to run the half a million dollars consists roughly of about half and I'm saying approximately you could do it for three hundred and ninety seven thousand dollars right but let's just round it up to five hundred thousand half the money is investment in the company so in techstars each company gets eighteen thousand dollars in exchange for six percent of the company six percent in founder stock so you're not giving it's not really an investment like a preferred venture angel type investment and in fact many of the companies that go through tech starts have already raised some money raised you know one hundred thousand dollars from friends and family or maybe raised a million seed round from some VCS so techstars looks like a co-founder techstars gets diluted with each additional financing just like a cofounder has no special rights for future or anything like that but it gets that equity that's about half the money the other half the money is the program itself paying the staff physical space some events some other things okay that that money that funds tech stars the way TechStars is funded is from local angels and VCs so we tried to make tech stars very much of the local community so the boston investors and tech stars i don't know the number of them now 20 or so and in New York it's 2025 no it doesn't have to be everybody just whoever wants to participate so they contribute the money for that half a million dollars and the equity goes in the companies and when the companies exit the money goes back to you know the whatever ownership the 6% gets diluted down to 3% the company gets bought for ten million dollars that's $300,000 it flows back to techstars and then flows back to techstars investment that's the economic model of an accelerator our experience with tech stars and we open source the data so if you actually go on the web you got a tech stars org slash results or tech stars calm now slash results you can see all every single company that's gone through the program and what they raised and the ones that exited what that looked like and I can tell you that the the the boss of the boulder program year one has already returned about two times the money that was invested and the year two has returned a little bit over one times like 1.2 or 1.3 and our expectation is that both of those programs are probably return at least three acts based on the stuff that's still there so there is an economic model that works I'll be at relatively small dollars in the grand scheme of things but that's that's how the economics work come on up 100 TechStars let's put up 100 grand you know Allah you know the Y Combinator arms race healthy unhealthy yeah then why come in our arms race okay so so techstars now in addition to the $18,000 you get you also get a convertible note for $100,000 that goes into your program on day one that's what ties referring to and we decided to do that for two reasons one was from sort of a market dynamic perspective the other accelerator I need to come up with would I need to come up with something for YC that's not Y Combinator you PI you work on that but they they did a similar thing couple years ago so you know that that made sense from a perspective of sort of being at market with what you know other folks that we view as peers from our perspective do the real driver as we talked about it though was many of the companies that were in tech stars were spending time in the first two months raising some money and many of them were coming into the program and literally spending cycle time rounding up 50 $100,000 so they could add a person or two in the first two months of the program it was frustrating to us cuz you want to say don't do that but it was very distracting in terms of the activity that the entrepreneurs were doing and our view was well if we can give them some additional capital on the front end not a ton but enough so that they don't really start focusing on the fundraising until month three they'll have 60 days where they're not worried about that sort of incremental capital raise and that was the real driver behind that decision SPB participated in that a number of the venture funds that have been around the program participated in that there's actually a way for all the mentors to participate in that if they want to through an investment in a fund that David Cohen runs who's the CEO of tech stars you know so there's sort of again same sort of dynamic is let's get the people sort of around the community participating in this and giving these companies some additional capital there was also a desire among some of the folks us included the participated in this that we were spending a lot of time across the whole program and we wanted a little more ownership and a little bit more investment in the companies across the program that we weren't gonna invest in as venture investors so this was a way to have a little bit more of an economic interest that was the driver I think from the company side we're gonna start doing it in the first classes in Boston this year and the techstars cloud program which is in San Antonio that's just rolling out now and you know our sense is it's going to be very impactful because it'll the companies that don't have any capital will allow them not to have to think about the capital for a little bit longer and if you already have some capital it lets you add another couple of people sort of during the program if you want to yep back hi I'm Glen blue hello Glen Oh from gaggle amp you talked about the the big thing about focusing on product first year second year or 20 years if there was the top one thing to remember first year besides product in the top one thing to remember about second year besides product what would it be well I have a friend who says that there's only one that you're you CEO so there's top thing a CEO should think about yeah I have a friend that says there's only there's only one top thing a CEO should worry about which is don't run out of money so don't ever run out of money I think that in the first year of your business and I'm assuming that you're going from an idea to something that's a shipping product in that first year period I don't know whether it's in the first three months in the first year I think the CEO actually again has two very clear priorities priority one in the first year is to make sure that everybody that's in the business whoever they are are completely focused on the product because that's the business of the business until you have a product out the door and it's not that the CEOs doing all the work he or she is making sure everybody else co-founders consultants whomever is also focused on that work I think the mistake I see some very small two three four person founding teams the CEO ends up doing a lot of the work versus making sure everybody's doing the right work the non CEOs don't do the right work there's a lot of vibrations and the thing that comes out isn't right and it's very frustrating and the CEO and the co-founders are very frustrated I especially see this by the way when you have a technical CEO and the business partner doesn't know what to do and the CEO doesn't spend enough time with the non-technical bit co-founder to help guide them on what the right things to do are on the product so that person then goes runs whatever drill they know if they're inexperienced I don't have a drill but if they're they've been through it a couple times they have a drill a lot of times the drill is not right and you know so making sure that everyone on the team is doing the right things in the context of product the second is equally important make sure everybody on the team are the right people on the team so again it's not that you have to hire the right people and that sort of thing you have whatever people you have in year one but it's making sure that they're doing the right things and when they're not doing the right things they're interacting about it and when there are conflicts and issues they're surfacing so it's the psychological part of the formation of the Corp beginnings of a team and you're building the language of the company and there's not a right answer there's some companies that are very top-down hierarchical there's others that are very flat and fluid there are some companies where everybody argues with each other all the time there are some companies wherever buddies very nice there are some companies where people talk and there are some companies where people just email doesn't matter that's yours to define as the entrepreneurs but getting those two things right in year one is super important I think as time passes I don't know periodicity of neck of second year is too granular but as time passes and the company starts to grow it really comes down to three things that the CEO should be doing thing number one make sure you don't run out of money so dealing with the financing of the business and the financing might be that your cash flow positive cash generating business and don't have to raise any money but knowing how knowing and managing that dynamic in the business doesn't mean that you're the person managing it day to day but you have to be sure that you don't run out of money that's your responsibility number two making sure that you're continually getting the right people on the team and being relentless about scaling and building that team think number three making sure that the thing you're doing is linked to the strategy of the business that you actually are trying to accomplish something that has a vector in a trajectory doesn't mean that you're going to get it right doesn't mean that you're always on target but that you have a clear understanding of where you're going with it I think if a CEO focuses on those three things there's an awful lot of day-to-day that you're gonna do but if you do those three things and really concentrate on them don't run out of money make sure the right people are on the bus and they're working hard on doing the right things all the way through the organization and that the thing that you're trying to do is actually connected to what you're trying to do the thing that you're doing is connected to what you're trying to do you know you you also as you grow I mean I've been involved in some companies are grown very very fast if you're CEO and you're the CEO of a fast-growing company you will melt down you will have meltdowns on a regular basis you will do this and hopefully it's not like in front of a group of people but but but you will have those moments and you need to make sure you have people when you have those moments that you can talk to and that can help you and sometimes they're your investors and sometimes they're your peers and sometimes they're your spouse and sometimes they're your parents and sometimes they're your dog it doesn't matter right but know that you're gonna melt down when you melt down it usually means that you have a step function gap coming in terms of people because most of the meltdowns in a fast-growing company at a CEO level is because you've just outgrown the people at some part and you've got vibrations that are causing all kinds of things to roll through it doesn't mean you have a fire the people get new ones it means you have to change a configuration somehow and I like to tell people use that moment of feeling like you're melting down as a way to step back slow down and evaluate what's going on and you know rearrange that configuration I have two minutes which equals five right we have five minutes I'm calling it I was trying to get the right base for that but there isn't a base to bei there wasn't a base that translates to two five so the formula is n times or that number times two plus one okay got it I'm Colin from MIT so entrepreneurship Center hey Colin you've talked a little bit about mentoring and the role of taking on mentors and how important that is okay can you talk a little bit about why it's important to give back because everybody here has so many things on their plate and so little time to give back but why that's rewarding and why that's important sure I have a very deeply held belief very deeply held that deeply held belief is that you can have an extraordinary experience on this planet if you operate under a philosophy of giving without an expectation of what you're going to get back and I believe that to my core and that's the essence of mentorship I think that if you are willing to give with no expectation of what comes back not for everything you do but philosophically and how you interact with other people and this works by the way for customers for employees for investors for partners I believe that you will make much more progress faster and the reputational dynamic of investing and other people and things will pay off much greater than you could ever anticipate you will invest in people that will give you zero back and you will invest in people and things that will give you way more than you'd ever expect it back but the some of it will be much greater than the linear dynamic and I think what happens is especially powerful around entrepreneurship I believe that if you want to build a long-term sustainable vibrant entrepreneurial community and I believe that the United States there's hundreds of cities where you could do this those have to be led by entrepreneurs the government can't do it the venture capitalists can't do it the service providers can't do it it has to the university can't do it so it's nice to have entrepreneurship centers at MIT but that can't be the leader those are feeders the entrepreneurs have to be the leaders so if you're an entrepreneur do you want a healthy vibrant entrepreneurial community around you or not if the answer is no okay whatever I didn't get stupid but if you want to help the entrepreneurial community especially because every entrepreneur says it'd be nice if there is more capital here well the healthier you and more vibrant your entrepreneurial community is the more capital you're gonna have be nice if there's more talent here the more companies that are vibrant in building the more people that are learning how to have the experience more talent that's developing dot that dot that dot that's the motivation so if you're an entrepreneur even if you're a first-time entrepreneur start investing by giving before you get the last part of that is it's just incredibly satisfying it's a good way to live and it's not that you have the spectrum like I say there's there's two ends of the spectrum in terms of intrinsic and extrinsic motivation extrinsic motivation is if all of you said to me after this talk Brad this was a great talk and that caused me to be happy that's extrinsic motivation I don't actually really care whether you like this talk or not I don't because I'm not an extrinsic ly motivated I'm very intrinsically motivated did I learn anything today because my driver is did I learn something and you know if somebody said well what did you learn today well let me think I'm doing this in real time I learned that people were pretty interested in the product dichotomy I learned that there was an awful lot of people in sPB's boston and new york customer base that were sub 25 person companies and that's pretty exciting to me I learned that there was a pretty broad spectrum of people who are releasing from daily to every three months and I need to think about that harder because I would have expected that more people would have been 2 weeks or less so I mean just some things that you know are though profound know do I know where the profound things going to come from know right so that I think that it doesn't matter where in that spectrum you are because I'm not valuing intrinsic versus emp'd extrinsic we have one minute left which is one times two plus one so we have three minutes left I can do this forever until you put zero up there but it doesn't matter there's no judgment of where you are on that spectrum right it's it's this this notion that you're always going to be getting more out of it than you're investing into it okay last question I picked on him so let's give him the last question I didn't pick on you I embraced you great Matt Johnson from Omni strat you mentioned you know connecting and this you know keep you on track of the strategy of your business you know which aligns with alignment right getting everyone thinking and working toward the same thing how you know what do people use to do that because that's the actual problem that I'm solving with my startup and I can tell you that out there the planning and execution is an afterthought and if it's so important that you make that one of the the chief roles of the CEO you know how do you how are your customers young entrepreneurial customers medium-sized customers or big companies the solution you know that's rhetorical meaning that this it can this the sovereign can support any of them but who do you think your customers I'm it matters how I answer yeah I wanted to take best practices from the big guys and bring it to the masses down to the small businesses okay I got it so the premise of that the processes and big companies are going to apply to small companies is the first thing that I would tell you I would challenge okay the idea the abstracted idea that there are processes that are figured out for big companies and that idea that there could be processes that are figured out for small companies that would make them effective is logical Eric Eric's book again has a lot of that in it but I think a direct mapping is challenging and the the problem is that if you look at how big companies function versus how small companies function I've been in both but I've been way more my time in small companies there's endless paradox about prioritization in small companies because they have no resources and it's a continual resource allocation problem where the scarcest resources time in big companies big companies usually don't have a scarce resource of time and in fact many big companies have enormous inefficiencies in them that extend out the time because they just have more people that are dealing with that and so one of the things to think about is is there a way knowing that the scarce resources time and finished but it's one two three four six letters so we got six more minutes I'm just gonna keep changing my algorithm the-the-the the thing to sort of drill on is if the scarce resource is time how can I help entrepreneurs spend very little time doing something that gives them back more time immediately right so if I use your software and it took me one minute to use your software and I got two minutes back and I did that again I'd be like oh this is good I get I get double my time back every time I invest in it and then if I invest a minute and get five minutes back I'm like that's good and if I only have to do that once a day I get an extra five minutes a day right that sort of process I think is what will help the entrepreneur get engaged in the product so my bet is I don't know that your product at all a thing I see over and over again that entrepreneur an example I just heard your description product you have something to play with you've launched it twice oh yes okay send me something to play with you'll send me something to play with it'll take me 30 minutes to really play with it I can't like figure it out in two minutes or three minutes I don't have 30 minutes to invest in understanding whether I want to play with it or not okay so then you solved that by doing a stupid little two-minute movie with nice soundtrack in the background and stuff that's useless too I don't really understand what it does now right so you kind of swing back and forth the other way so my encouragement would be if that's again I was trying to just understand the spectrum of it break it down into really small pieces and try to if your customer is entrepreneurial businesses figure out how to give them back more time immediately when they engage with whatever your product or service is and have that build I don't know if that's a great answer but it's an answer thank you guys hope this is good have fun today

Channel: Silicon Valley Bank

Views: 8,908

Rating: 4.9207921 out of 5

Keywords: Brad Feld, Foundry Group, lessons, Be obsessed about your product, #SVBCEO, CEO Summit, Silicon Valley Bank, NERD Center, Defining Moments

Id: m_enByHGOak

Length: 43min 16sec (2596 seconds)

Published: Mon Nov 21 2011