Toss Your Org Chart

Org charts suck in a startup.  While they provide clarity around who makes decisions, they also communicate hierarchy and “I’m more important than you” during a time when most of us are wearing many hats and need to be accountable for deliverables across functions.  And if you have less than 40-50 employees, reporting relationships and “who does what” is pretty obvious to everyone on the team, so my negativity towards org charts are really for companies at or below this threshold.

At an early stage, reporting relationships are far less important than defining the handful (most definitely 5 or less) key objectives or focus areas for the company in 90-180 day increments.  Meaning, the only thing the majority of folks should be focused on is what will drive success over the next 3-6 months.  I’ve written in a previous post about the need to focus much longer term and determine strategy in order to determine what those key near-term objectives should be, but let’s assume you know them and need to get everyone focused on what to do, who’s accountable for what objective and which employees work on which objectives.  I’m a big advocate of creating a “one sheet” that lists on one side key activities and who’s responsible and metrics on the other side.

However, one of our founders came up with an awesome visualization that completely replaces the need for an org chart and provides instant clarity on 1) the key focus areas for the company, 2) who’s ultimately accountable for each area (the lead), 3) who the team members are that will work on each focus area and 4) team members that may have more than one focus area (to ensure their time is allocated properly).  This is our visual for BlackLocus with the names and key deliverables scrubbed a bit.  Everyone in the company is assigned to one of these 4 key focus areas. It’s no coincidence, however, that Jesus is accountable for Revenue!

I absolutely love this approach.  Could our priorities and who is leading and working on each priority be any clearer?  Those of you who know nothing about our company know instantly what our near term focus areas are.  Great work Rodrigo!

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Don’t Go It Alone, Get Out of Your Bubble

Since I’ve moved to Austin and joined BlackLocus roughly 6 weeks ago, I’ve probably had 30+ meetings with individuals outside the company.  Why?  Because without exception I learn something from every one of these meetings that will help me be a better leader and reduce risk of failure during this critical phase of the company’s development when there are foundational decisions we are making every day.  You may be thinking, “Geez Taylor, why don’t you just put your head down and get to work instead of networking your way out of business”.  There’s clearly a balance here and I’m not suggesting that you should network for networking’s sake, but rather identify folks that have specific and relevant experience dealing with the issues most pressing right now in your business.  And by the way, it need not be successful experience, there is a ton to be learned from other people’s mistakes.  Wouldn’t you rather learn from someone else’s setback than your own?  Whether its the need to raise money, or perhaps figure out a go-to-market strategy, or even how to tackle a tough engineering problem, there are likely people in your extended network that are ahead of where you are today and have navigated, either successfully or unsuccessfully, the urgent problem you have to solve.  In either case, that perspective is valuable as input into your decision.

Now there is a consequence to seeking multiple points of view and getting so much data as input.  Ultimately you have to formulate a point of view, have conviction and make the tough decision.  And doing so with so much external data can be more difficult and confusing particularly if there are a lot of disparate viewpoints on the same issue or problem.  But that’s what leadership is!  Putting your ego aside, realizing you aren’t the master of everything, seeking external viewpoints and data, then distilling it all and having the courage to make a decision and execute against it.

Early Stage Priority Confusion

During the early stages in a stressful, lonely place I call StartupLand, it can be overwhelming determining where to focus scarce resources, both people and money.  There’s endless product issues to address – customer features, performance, reliability, scalability – and if you have a Minimum Viable Product and a bit of luck there are existing customers to support and retain.  Add to the mix the need to both acquire more customers and add other strategic partners to complement your product.  Don’t forget recruiting, if you are funded and enjoy the ability to grow your team, sourcing and interviewing talent can literally take up 30-50% of everyone on the team in the early days.  Oh, and your Board and investors will require some care and feeding through reporting and monthly or quarterly meetings.  That’s a lot to juggle if you have a small team (5-15) trying to tackle each of these priorities.

So how and where do you focus scarce resources?

By being ruthless about both prioritizing and sequencing those priorities where maximum traction can be proven in the shortest period of time.  And by traction I mean proving that customers will buy your product at a price that has a path to sustainability.  In my experience, it means allocating resources in 2 primary areas in the early days:

  1. Harden the Minimum Viable Product.  Specifically, ensure the product 1) has only the most basic feature set, defined as the minimum set a customer is willing to pay for, and 2) is minimally performant, reliable and scalable meaning just sufficient in all 3 categories to retain customers and enable a six-month window of customer growth.  Probably the single biggest pitfall to avoid is allocating resources to make your product more feature rich than it has to be simply because you think your customer must have those features, all at the expense of making a more basic product work flawlessly.  Your customers probably don’t need those features yet and if you have any paying customers, then you’ve proven they don’t.
  2. Get and maintain momentum in sales/customer acquisition.  If one customer is willing to pay for your product as it exists today, then find another one willing to pay.  Then another.  There is nothing that defines traction more effectively than increasing customers and revenue.  You can be unprofitable and raise money with customer traction.  You can offset costs and hire more people with customer traction.  The world of possibilities to tweak, market and scale your business open up with customer traction.

At the end of the day, these are the only things that truly matter for an early stage startup.  Build the most basic product that you can sell, and then sell it.  And if you can sell it, then don’t build custom features, in fact don’t build any features beyond the product you can already sell until you have more resources on board.  Don’t harden the product for performance, reliability and scalability that you’ll need two years from now, harden it enough to get through the next six months of sales.

Sure, there’s lots to do from this point, but until #1 & 2 are achieved, nothing else matters, so don’t be tantalized to spend the cycles working on other high value, but optional workstreams.  Be ruthless.

So Much to be Thankful For

2011 has been an amazing year for me, personally and professionally, at least that’s the way I choose to see it.  As I wrote in a previous post, I’ve been through the gamut of life events this year.  Marriage, baby, new job, cross-country relocation.  But as I reflect it all boils down to this – I’m happy.  I have an amazing wife, a healthy new child that is making me a better person, and a new stimulating role at BlackLocus in a city that I love – Austin.  I also have all of the things I had before!  A wonderful and loving extended family that has always given me unwavering support through the good and bad.  Finally, for the first time since childhood, I live near my brother who has two young children.  I feel truly blessed that we can be close and I can build a relationship with my nieces.

So today, like every other day, I’m thankful.  Happy Thanksgiving!

Why Are You Here?

It’s a question that should be expressly discussed and understood by leadership team members in a startup, particularly amongst the founders.  It was the first agenda item at my first leadership meeting at BlackLocus and it ended up setting the tone for the rest of the day.  From that 15 minute discussion, I feel like I know my team members more deeply and can now focus on helping them achieve their aspirations.

Why is this question so important for me to understand in an early stage company?  Because I’m getting ready to go to battle with this handful of individuals and I must understand the level of motivation, commitment, passion and what drives someone to participate in the inherent ambiguous, stressful and all-consuming experience that a startup demands.

I’ve participated in a handful of these discussions in the past and they go one of two ways.  The abysmally useless way is when you go around the room and everyone says something to the effect of “I just want to build a great company” or “I love startups”.  The refreshingly transparent way is when you create a safe environment for full disclosure of both ego and monetary goals.  It’s perfectly OK to say, “I want to make a shitload of money by building a valuable company”.  In fact, that’s exactly what I said when it was my turn.  Its about creating a culture of transparency, honesty and mutual respect from the get-go.

A week later, I still remember precisely what each of my colleagues want to achieve from this experience.   One of the most honest and interesting aspirations I’ve ever heard came out of this session.  One person wanted to build a successful enough legacy to be invited to give a University commencement speech.  Not only is that honest, but its so cool and inspiring that I want to help them achieve it.

BlackLocus Wins “Best in Show” at Under the Radar

We’ve had a great two days at the Under the Radar Conference in Mountain View, CA.  It’s a commerce-focused event, featuring roughly 30 emerging companies in 5 categories that pitch in competition format to an audience and a panel of judges.  Today I had the opportunity to pitch BlackLocus under the “Measurement” theme to a panel of 3 judges including Liz Gannes, Senior Editor with All Things Digital, Will Lowry, VP AT&T Platform Partners and Mark Silva, SVP Emerging Platforms Anthem Worldwide.  The session was moderated by Rafe Needleman, Editor at Large for CNET News.  To see the 15 minute pitch and Q&A session, click here and go to 3:45 in the video if you want to skip the panel intros.

The good news?  We won the Audience Choice Best in Show award among the 30 companies and the Judges Award for our category!  We also met some leaders in companies that would be extremely valuable partners and most important, we connected with some large, Fortune 200 retailers that are prospective customers.  All in all, a great use of our time and money to participate.

The other good news (disguised as bad news)?  Along with positive exposure and press comes an onslaught of demands that stress the team to deliver on.  It’s a constant battle at this stage, how to prioritize activity and only that activity which has the highest return when there are dozens of things we know need to be done.  And priorities are not always obvious, these decisions require some stakes in the ground but more important, they require measurement, learning and adjustment to turn on a dime as information becomes available from customers and partners.

I’m returning to Austin today and looking forward to debriefing with the team and getting everyone energized about the path ahead of us.  Strap in, its going to get nutty!

Startup America Partnership, Austin-style

I was invited to attend a luncheon this past Friday hosted by the Austin Chamber of Commerce and the Austin Technology Partnership to discuss the soon-to-launch Startup America Partnership Austin program.  Startup America is a national program launched this past January at the White House and founded by the Case and Kauffman Foundations to further entrepreneurship across the country.  It’s mission is to provide entrepreneurs with the resources they need to conceive, launch and grow new companies and it is taking a local approach to mobilize resources supported by the muscle of a national brand.  There are some heavyweight influencers tied to this effort including Steve Case, Michael Dell, Reed Hastings (Netflix), Reid Hoffman (LinkedIn) and Magic Johnson.

Austin, through the leadership of the Austin Chamber, is taking a pioneer role in being one of the first handful of communities to officially launch its program under the SA brand.  The idea is to gather expertise, talent, customers, services and capital and package these resources at highly discounted rates and/or unique offerings to assist entrepreneurs at various stages of their company’s development.  Another large part of the Austin mission is to create a net inflow of entrepreneurs from other cities to choose and build their companies in Austin.

I was introduced at the lunch by John Price, a friend, serial Austin entrepreneur and Chair of SA Austin, who is spearheading much of the launch effort for Startup Austin in conjunction with other local organizations including the Chamber and SXSW.  In many ways, the story of my new company BlackLocus and its relocation from Pittsburgh to Austin combined with my relocation from Los Angeles, reinforces what Startup Austin is trying to achieve on a broader scale – promote entrepreneurship not just by home growing it, but also by attracting talent from other places in the country to start and grow their companies in Austin.

I’m excited to work with John in any way I can to assist in bringing additional talent and new businesses to Austin.

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