Founder’s University is a crash course in building a startup in the valley and preparing to raise a series A.
At Homebase, we’re starting to show signs of scaling pretty quickly and I’ve found myself constantly referring to my hand written notes from the 2 day summit as I encounter issues.
So I figured I’d do myself a favor and digitize them. It only makes sense to share the knowledge wealth…
Some General Thoughts:
- Jason is convinced that the only real shot you have in playing in the big leagues is to build your company in the Valley. You can’t argue that there’s an edge for companies in the valley, but programs like this build a connection to the valley and great companies are being built everywhere today. I think my burn rate and being in the middle of the country with a 3 hour plane ride anywhere is an edge.
- Although some content was repetitive or seemed obvious, it was great to get to hear real world experiences and how they’re applied at scale. More importantly, hear what KPI’s and other important company issues are viewed when you’re raising a real series round.
- There’s definitely a shift or reset happening in what series is an invest and who invests at what round.
- Jason is looking to invest in entrepreneurs who are in the arc of their career and self aware. He’s playing the long game at this point and what’s others who are going long. Show you can get something done.
Beth Scheer – Talent Partner at Homebrew
On how to build a pre-series A team. One of the things I’ve put a high priority on is building an amazing team. Some really practical knowledge on what I need to do as CEO to build the organization.
- 40% of my time as CEO is going to be spent on recruiting.
- Things to think about or a well rounded team:
- Breadth of knowledge vs. depth.
- Functional leaders vs. experts.
- First Sales hire should be a player coach. Someone who can be a killer, and build a team around herself.
- On diversity. It improves problem solving among many other obvious things.
- Be intentional
- Recruit outside your network
- Avoid people like us syndrome. PLU
- There are trigger words that attract certain candidates over others. Loyal, connected, trusted, confident are all words that attract more female candidates for a job. Ninja, wizard, guru will attract more men, and it’s just stupid.
- Candidates – Be transparent about the process, provide bios on who their meeting with.
- Interview Team – Get everyone on same page.
- Environment – Make sure best foot forward for environment.
- Who to recruit and when
- Seed – should be founder led
- Series A – 2-5 years experience
- Series B – 5 years experience
- Marketing / Growth
- Seed – not priority, finding product market fit
- Series A – Generalists, knows acquisition, SEO, content development
- Series B – 8 + years experience. Reduced scope, more specialized teams
- Seed – should be founder led
- Series A – Player / coach, 5 – 8 years experience
- Series B – Been a VP before, 8 + years experience
- HR / Recruiting
- Seed – should be founder led
- Series A – add HR around 30 people, use contract agency to get quality leads. Worth your time
- Series B – Hire in houuse
Rachel Hepworth – Growth at Slack
On Go-to-Market and Growth. Growth is a funnel, not a stage. I’ve always thought this way, but interesting to hear how they applied it at Slack.
- Acquisition – Focus on channel partnerships, share content to utilize them to build your brand.
- Activation – You have to shrink the time to the customer figuring out the value you can offer. Make onboarding easy and helpful.
- Retention – Software is a service, constantly add new value.
David Hassell – 15Five.com
On how to 10x your people. Biggest thing David learned on his journey in the CEO job, learning from changing is natural tendency to be a producer to be a leader. I have this exact issue, my tendency is to just do, but I realize I must have radical delegation to make Homebase successful.
- In building your organization, you have to be deliberate about culture from the get go.
- One on ones with direct reports. Weekly.
- Themes not tasks
- Career growth and development for your people
- Coaching thru challenges
- Curiosity and Wonder
- Put a focus on getting your people into the right roles, as startup CEO your a coach getting athletes to play on a team. They call this the zone of genius.
- Intrinsic Motivation of your people RAMP
- Relatedness – Focus on the positive
- Autonomy – Your intelligence rises, creativity rises
- Mastery – Energy rises
- Purpose – Gratitude
- Communicate your philosophy early and often. To everyone!
- Core Values
- Core Beliefs
- Design Values
- Guiding Principles
- Implement rituals and practices with the team. With your customers. With your advisors and investors.
- Celebrate the wins no matter how small.
- Build a culture of appreciation and recognize people for going over and above.
- Company and team retreats are like gold. Do a leadership retreat as well.
- Do the work.
Mei Siauw – Lead IQ
On Sales prospecting best practices. Sales is hard, in our Homebase’s industry our clients get over 1500 calls a month from vendors. Do things to stand out.
- Video Prospecting, create personalized video show’s someone you took the time. Stands out, no matter how dumb or silly.
- Show someone you spent the time to do your research in email.
- A/B test outbound emails
- Not just copy but testing different people in company
- Track conversion
- Focus on building your own audience and lists that you can market to.
- Look for at least a 10% response rate to be great.
- Targets for B2B sales team. Start with 1000 leads. 3 customers a month.
- 10% response rate.
- 20% convert to appointments
- 30% convert to trials
- 50% convert to customers.
Damien Weiss – WSGR
Vijay Nagappan – MHS Capital
On 5 keys to negotiating a term-sheet today in the valley. This was interesting just hearing the state of investing in SV from both a lawyer doing the deals and a VC.
- 5 things to pay attention to
- Liquidation Preference
- Board Composition
- Stockholder Vetoes / Control
- Have a strong hiring plan, otherwise will be hard to justify later. Work backwards.
- Any employee stock plans are usually negotiated on post money valuation.
- When negotiating, don’t be afraid to try to take some money off the table if you need it to be sane. A financially stable founder is a good founder.
Rishi Garg – Mayield Fund
On Proactive M&A strategy. This talk was particularly interesting. We’re working with many potential partners that could be a potential acquirer of Homebase.
- Large companies move slow. Many deals are done over a several year relationship.
- When is a the right time to engage?
- Selling into the enterprise
- You’re in a crowded space
- Biz Dev is useful anyway
- Inflection points likely
- You’ve got production traction
- You’re in the consumer space
- Nascent or niche space
- Biz Dev not important
- Inflection points unclear
- Product is to early
- The M&A prep sheet
- Acquirer – Who is it, specific biz in larger company or the actual company?
- Rationale – Why are they buying you
- Sponsor – Who’s the champion in the org?
- Status – Are they actively pursuing or just talking to everyone.
- What to discuss in monthly meetings
- Communicate Vision
- Build Relationship
- Try to sell company
- Disclose without asking questions
- Ignore competitive landscape
- Discover their vision or strategy
- Competitive concerns
- Don’t get caught when the music stops if your in a competitive market.
- Are they interested?
- Moving fast
- Clarity on process
- Escalating meetings
- Articulate strategy
- Unclear Strategy
- Most important terms
- Deal Price
- Revesting or earnout
- Execution terms
- Strategic alignment
- Executive sponsorship
- Org model
- Go forward resources
If you got this far, thanks for reading. Reach out and lets discuss how to change the world together.