Tag Archives: Mark Suster

9 Women Can’t Make a Baby in a Month

Blogs and blogging, Weblogs,

I’ve been meaning to post about Mark Suster’s 9 Women Can’t Make a Baby in a Month for a couple of months now. What a great reminder, and useful in a lot of contexts.

Mark makes his point about the dangers of overfunding a startup with too much outside investment. He says:

Over funding often produces bad behavior in early-stage companies. You hire people too fast, you over build your products, you try to force market adoption and you do PR blitzes before your product is really ready for prime time. And having too much money certainly raises board expectations that you will do big things quickly. No board is going to give you $25 million up front and then expect your year-one staff expenditures to be $2 million.

And that’s great; well said. But I think the underlying problem applies to a lot of other areas in a business. Having three developers doesn’t mean the software project will be done three times faster. A lot of things take time, and time doesn’t divide into meaningful units like bricks.

Mark is a venture capitalist who also maintains an excellent blog called Both Sides of the Table.

Mark Suster: Be a Line, Not a Dot

Angel investment, Starting a Business, Venture Capital,

This morning I added Mark Suster’s Both Sides of the Table to my blogroll here because his post Invest in Lines, not Dots reminded me that I’ve been meaning to include his blog for a long time. His idea here is something everybody should understand.

His single line chart here,combined with his title, makes the point extremely well.  As a startup looking for investment, you need time to become a line. You start as a dot:

The first time I meet you, you are a single data point.  A dot.  I have no reference point from which to judge whether you were higher on the y-axis 3 months ago or lower.  Because I have no observation points from the past, I have no sense for where you will be in the future.  Thus, it is very hard to make a commitment to fund you.

So instead of that, Mark suggests, you need time to communicate progress:

For this reason I tell entrepreneurs the following: Meet your potential investors early.  Tell them you’re not raising money yet but that you will be in the next 6 months or so …  Hopefully by then you’ve made good progress.  You’ll be able to give them an update on key hires, pilot customers, key tech innovations – whatever.  Keep these interactions low-key and short.

Do you see the dots vs. lines concept in that? I think it’s one of those great concepts that seems obvious, but only after you’ve heard it. I also really like Mark’s emphasis on entrepreneurs and investment as a long-term relationship. Here’s his conclusion for entrepreneurs:

you might be pumped up with that super quick round done at a high price.  But just remember that raising money is a bit like Ireland in the 90′s – no divorces allowed.  I know VCs and sophisticated angels can be difficult, slow and price sensitive, but I also know that in tough times unsophisticated investors can be a right pain in the arse.  For some companies – they become deal breakers on further funding rounds.  By definition if somebody is investing in you as a dot (limited thought, limited due diligence, maximum price) they are a dot to you, too.  You can’t really know them in 2 minutes yet you’re letting them own part of your business.

That’s an excellent post. Go read the original. He has several additional line charts, and great advice.

A Few Good Posts for a Friday

Entrepreneurship, Web/Tech, Weblogs, , , , , , , , , ,

These are some posts I recommended reading this week.

  • My absolute favorite this week was Mark Suster’s 9 Women Can’t Make a Baby in a Month, on TechCrunch. Mark’s Both Sides of the Table is a great blog, by the way. And this is the thought at the heart of that post:

    Over funding often produces bad behavior in early-stage companies. You hire people too fast, you over build your products, you try to force market adoption and you do PR blitzes before your product is really ready for prime time. And having too much money certainly raises board expectations that you will do big things quickly.

  • Inside Facebook explains how to convert your Facebook profile to a business page. Thanks to John Jantsch for pointing this one out. I’m a perfect example, I think; I’ve used Facebook only to support my writing and speaking, so it’s much more of a business page than a personal profile anyhow.
  • TechCrunch features Jonah Paretti, entrepreneur, teacher, and true expert on contagious media (in fact I think he coined that term).
  • I really like Denise O’Berry’s post Google Cracks the Code on What Makes a Good Manager. Here’s the quick summary:
    • Be a good coach
    • Empower your team and don’t micromanage
    • Express interest in team members’ success and personal well being
    • Don’t be a sissy: be productive and results-oriented
    • Be a good communicator and listen to your team
    • Help your employees with career development
    • Have a clear vision and strategy for the team
    • Have key technical skills so you can help advise the team
  • And finally, since today is April 1, otherwise known as April Fool’s Day, this one by my daughter Megan Berry of Klout.com: Measure Your Text Messaging Klout.

What’s Really Wrong With Urgency Addiction?

Advice, Management, Personal Productivity, , , ,

Business Insider tipped me on this post from Mark Suster on his Both Sides of the Table (investor and entrepreneur) blog. Especially the drawing below. Notice importance on the vertical, and urgency on the horizontal. At first glance, it seems to me like operating in the upper right quadrant is a good thing. You’re addressing urgent and important problems.

But that’s what makes the post interesting (or more interesting): in fact, if you live in the upper right, you’re suffering from urgency addiction. He’s paraphrasing Steven Covey in the book First Things First as he answers:

You retain less knowledge.  You take shortcuts.  You make too many trade-offs.  You suffer too many internal stresses.

Okay, I guess. I wasn’t entirely convinced, to tell the truth; and Mark himself notes that urgent and important is still pretty attractive. He says:

Actually, people with the “urgency addiction” thrive on the pressure.  We rise to the occasion as it stirs our creative juices.  There is something about the adrenaline rush of being under time pressure that excites us and teases out our creativity.

Don’t you want to join him there, in that upper right quadrant, when you read that? I do.

But then it turns out, reading even further, that I want to be in the zone of effectiveness. Do you think maybe that’s why they named it that? Here’s how Mark (again, paraphrasing Covey) describes it:

The examples that Covey talks about here are things like exercise and planning.  They can’t be rushed.  If you can carve out some time during your day to not sit in meetings but instead to dedicate to thinking about the longer-term, strategic initiatives that are important to you then you’ll do bigger things in life.

That sounds really good to me: Exercise and planning, and long-term thinking too. It makes me think twice about urgency addiction. If only there weren’t those urgent important matters to deal with first…

(Image credit: I took it from Mark Suster’s Both Sides of the Table. Click it for the original)