This Is The Single Most Important Page On The Web (If You’re a Human)

Cognitive Biases Shape Us Beautifully And Tragically

If you could only access a single URL on the web what would it be? Not something like Google or YouTube but actually a single static url — so youtube.com/[some specific video]. I was thinking about this earlier today and my initial framing was “what page is performs the most complex task that I couldn’t do myself,” imagining that optimizing for absolute computing power would be the right angle. It took me a minute or two but I realized this was completely backwards and that I should be trying to figure out what content would be most impactful upon a different type of computing power, namely my own brain.

That flip led me back to a page that I absolutely love, and try to visit quarterly or so, when I want to laugh at myself: Wikipedia’s List of Cognitive Biases.

Example from the Cognitive Biases Page

“A cognitive bias is a systematic error in thinking that occurs when people are processing and interpreting information in the world around them and affects the decisions and judgments that they make.” — VeryWellMind

Reviewing this list periodically (as well as reading Robert Cialdini’s Influence, one of my favorite books) always makes me slap my forehead at the ways we are beautifully and stupidly human. Anchoring Bias? Guilty (maybe this very post is an example!). Survivorship Bias? Twice last week that I can remember. And it goes on like that.

Then I shift to wondering about the role of technology in helping us with these biases, and two different paths to doing so. The first is essentially giving up more of our agency and outsourcing an increasing number of our decisions to AI. The second is some sort of listening device (our phone, our watch, our nerd AR glasses) that notices when we’re saying something that fits a cognitive bias and sends an alert to help us reconsider. Frankly *both* are a little freaky to me, but is it really any weirder than me frequently re-reading this Wikipedia list and trying to manually break myself of these biases?

I’m sure we all have a personal redline about things we’d automate and things we wouldn’t. Maybe we like the idea of control over the ‘last mile’ — for example, happy to let a dating app give us top 10 profiles they think matches for us, but we’d prefer to pick the ones we want to connect with versus the same app setting us up with one of the 10. I wonder if these ‘redlines’ are generational (ie younger folks trust the computer more or less than I do), cultural, demographic or more fixed. At the end of the day, we’re all the sum of our cognitive biases.

Notes and More

It’s inspiring to see vaccinations starting to roll out but part of me wonders whether the prioritization framework is actually slowing us down. Whether ‘risk group’ should be accompanied by goals for absolute number of shots given and fastest path to herd immunity. I’m not advocating for myself — I’d gladly be in the last cohort of shots if we could get there as quickly as possible.

📦 Things I’m Enjoying

Finished HBO’s Watchmen, which was great. What should I watch next? Goldbelly is totally my social distancing MVP — we order BBQ from a different place every few weeks. These are the KN95 masks I’ve been using, although there’s now thankfully a bunch of different ones in stock. Mask up!

🏗 Highlighted Homebrew Portfolio Jobs

Tia is healthcare designed for women from the start, combining IRL clinics with URL telehealth. They’re a well-funded post-Series A startup that’s growing quickly to meet the needs of their clients. If you’d like to join the Tia team and build the future of care, they’re hiring.

Don’t Just Stand With Someone Being Harassed. Stand In Front Of Them.

Lessons on Allyship and Community

✅ IRL Friend. That’s the tweet I employ to signify that I’ve finally met up with someone previously only known to me online. Of course 2020 hasn’t had much of that interaction but I know that when we’re all hugging it out again, Danilo Campos is one of the peeps I’m looking forward to seeking out.

Danilo combines calling me out on my bullshit with a recognition that intent matters; we’re all learning; and the willingness to throw more than 280 characters towards our conversations. One such back and forth occurred on the day after the domestic terrorist attack on the US Capital. Much of the timeline was outraged and narrative was we all stand together. For Danilo that wasn’t the whole story.

I know when I see my DM indicator light up in the middle of a Twitter thread that something requires a backchannel. And this one came from him. And it came with links.

It shared a story that I was lightly familiar with but lost track of after its initial coverage. On Long Island, the region where I grew up, a Black woman homeowner, new to the neighborhood, started getting harassed in disgusting ways. Her reports to police went ignored and the threats became more severe. Authorities starting paying attention once the story went viral of course, but why did it take that sort of pressure?

Danilo also shared a DESUS & MERO clip where the homeowner told her story, including one young man who rose to the occasion. He came over each night and started watching her house, Periscoping the whole thing in case anything happened to her or him. The idea was, I’m here for you and willing to put myself at harm to prevent yours.

My takeaway was, sometimes you need to stand behind someone. Sometimes need to stand with them. And sometimes you need to stand in front of them. They’re all forms of help, but those of us who are most able and privileged can practice the “standing in front” more often (with permission and grace) if we’re going to be really friends.

I Just Got Paid For Work I Did 20 Years Ago.

Startups Should Work To Make Their Employees Wealthy Not Just Their Founders And Investors

Earlier this week a modest deposit appeared in my checking account, one I honestly never expected. You see, it was for work I’d performed from 2001–2003 at a startup called Linden Lab, the company behind virtual world Second Life. And when that company was acquired in late 2020 by another private party, my stock purchased in 2004 turned into cash. The transaction size was small compared to the IPO and SPAC headlines from the past few months, but I had the benefit of being an early, single digit employee, and hence a stock value of around .04/share if I’m recalling correctly. That low price was part of what enabled me to purchase my vested options when I left, a conundrum that exiting employees often face.

Thinking about this outcome, and jumping into a Linden Lab alumni Zoom over the weekend, swirled a bunch of feelings. So much has changed since those years trying to build an online community with a small group of people in Hayes Valley. I subsequently joined a larger startup that got really big and then cofounded a venture firm with a close friend/former colleague. I tried to outrun failure only to realize I need to embrace it. And I achieved ‘Silicon Valley Middle Class’ wealth status.

But the real takeaway was that if you want to work at tech startups and can find one you’re excited about that is both (i) A+ people and (ii) treats you fairly with regards to compensation, including equity, take the job. Don’t overthink it. This is also where I acknowledge we’re talking about being privileged enough to take a job with a startup in the first place, to have even a small amount of savings to risk on the equity and the structural issues which prevent many people from realizing these outcomes. Consider that an asterisk as you read forward and commit to creating opportunities for others, not just yourself.

While I’ve said before that one should approach these situations with eyes wide open [“Sorry Startup Employee #100, Your Equity Probably Won’t Make You Rich”] I also firmly believe ownership is the key to wealth. A career in technology is a very good path to financial stability and stock equity has been a meaningful contributor to that for me and many others. It’s always why, in my venture role, I get so excited when I see an outcome large enough to benefit an entire team, not just the executives and investors. It’s also why I support making early exercise available to your seed/A employees at the very least. And extending exercise windows for longer than 60 days to employees who leave on good terms. And why we work with the founders we back to make sure there’s enough equity set aside to make great hires.

FWIW, we also back up this belief with actions ourselves. Everyone on the Homebrew team receives carry in the fund. What that means is that in addition to salary and bonuses, when Satya and I get profits back from the fund, so do they. You can’t preach ownership mentality outside your firm and do something different internally.

Notes and More

📦 Things I’m Enjoying

Here’s my annual recommendation for the easiest way to make hard-boiled/poached eggs. And I just started Watchmen on HBO — no spoilers please!

🏗 Highlighted Homebrew Portfolio Jobs

Tia is healthcare designed for women from the start, combining IRL clinics with URL telehealth. They’re a well-funded post-Series A startup that’s growing quickly to meet the needs of their clients. If you’d like to join the Tia team and build the future of care, they’re hiring.

Instagram, YouTube & TikTok Are Burning Out Their Creators. Here’s How to Fix That.

Creator Wellness Will Be A Key Goal of New Products

Being a modern creator is, for many, exhausting. The falling economic costs of production and distribution have been replaced by a new set of taxes — physical, emotional, psychological — as your community expects new content, accessibility to their heroes and open book authenticity. Paired with the social media platform algorithms, which in themselves reward frequency and engagement, this combination saps joy and agency from the creative process and burns out the creators. Having to perform 24/7 comes with costs, and that’s only dealing with fans let alone the trolls.

What’s a creator to do? I’d suggest a better question is ‘what can these companies do help creators?’ and that we’re about to enter Phase 3.0 of Creator Wellness, one where the products build in their own affordances to assist their supply-side participants.

Phase 1.0 was the earliest days of “user generated content.” Our understanding of impact upon creators was immature or unconsciously naive because the teams building the platforms often didn’t resemble (in all definitions of the word) the creators on the platform. At the same time the huge growth of these audiences meant that “being a creator” and “going viral” were phenomenons that quickly outstripped previous models in scale and volume. Creators were left to figure out their well-being on their own.

Phase 2.0 was the beginning of Creator Health initiatives. Most of these programs were/are one-off but well-intended — platform companies creating teams to work with high profile creators, build relationships that optimized for longterm commercial sustainability. It’s bad business for creators to burnout. The more scaled efforts, like YouTube’s Creator Academy, should be recognized as thoughtful and caring, but it’s unclear if the advice offered here is hard-coded into the platform’s incentives. If it’s not, then it’s like a school counselor preaching balance to student-athletes while also allowing the football coach to continue two-a-day practices through finals week.

So what do I hope Phase 3.0 looks like? It has Creator Wellness built fundamentally into the product itself, in a way which signals to both the creator and their community that this stuff matters. My guess is it’ll be different for each product, based on unique aspects of the medium, but here are three potential experiments:

  • “Seasons” — one aspect of seasons (tv, professional sports) is that they have [drum roll] off-seasons! That’s right! Rest and recovery time built into the meta-schedule, which establish their own expectations for fans as to when content will be available. If you’re a football fan you might wish the NFL played 24/7 but you’re not yelling at Patrick Mahomes for not suiting up on a Sunday in May. Products will experiment with this type of built-in publishing format as a template, vs something that creators are doing ad hoc.
  • Limiting Publishing Velocity — Imagine if the platforms themselves created scarcity and toned-down the “most post” overdrive by experimenting with their own versions of healthy rate-limiting (limited publishing windows, capped amount of content per day/week, etc). Could take lots of forms but potentially feels artificial if not built into the product from the start — ie I think this has to be fundamental product DNA and not slapped on later.
  • PTO — Ok, hear me out. What if each year, creators who cross X-threshold of success (views, dollars, whatever) were given PTO from the platform. You get to take a week off from engaging and (a) are not penalized in the algo and (b) you get paid the average amount of your earnings from the preceding 52 weeks. And when you take it, there’s a special “On PTO” account status visible to your community, which activates some feature like “best of content” or other system-provided interaction mode while the creator is on their break.

What else do you think can be done at a product-level to help support Creator Wellness? Hit me up on the Twitters.

Notes and More

📦 Things I’m Enjoying

Finished the first three seasons of Ozark, and I just wish there was one episode where everything went right for this family (even if they don’t deserve it). And here’s my annual recommendation for the easiest way to make hard-boiled/poached eggs.

🏗 Highlighted Homebrew Portfolio Jobs

Tia is healthcare designed for women from the start, combining IRL clinics with URL telehealth. They’re a well-funded post-Series A startup that’s growing quickly to meet the needs of their clients. If you’d like to join the Tia team and build the future of care, they’re hiring.

Why I Worry About Venture-Backed Mental Health & Addiction Startups

And My Ask Of Investors In These Companies

It’s frustrating if you’re a customer of an expense report SaaS startup and the company goes out of business, but it’s potentially devastating if your tele-therapist or addiction counselor suddenly disappears because the platform that employed them ran out of money. This is my most significant concern about the wave of mental wellness startups being funded with venture dollars — what happens to the clients of the ones which fail?

Photo by Matthew Waring on Unsplash

Traditional venture capital models lean into what’s called ‘power laws.’ Basically the idea that you are backing risky new ventures, many of which will stumble along the way, but one or two of the companies you back will be such outsized successes that the investment gains from those will more than offset the others.

Venture capital is a great instrument for high growth companies, or those who are very early in their development but intend to pursue a high growth strategy. If a normal small business must optimize for unit economics and profitability early in its lifecycle, a venture-backed business seeks product-market fit in a big industry and then trades nearterm profit-taking for long-term marketshare, with the idea that profits can be extracted later. I’ll pause for a moment now to emphasize that I don’t believe there’s anything fundamentally wrong with this tradeoff, which shouldn’t surprise you since I am a venture capitalist. If you’re reading this post because you think capitalism is a fundamentally broken system or that venture itself is evil, I’m sorry to share that I don’t agree. But I will absolutely acknowledge that companies which take any outside capital implicitly and explicitly incorporate the needs and expectations of that capital into their business planning. And for venture-backed startups this tends to be “get them customers.”

Which leads us to the fundamental difference between, say, a small self-funded online therapy practice and one that has taken millions of dollars in seed capital: the latter can acquire a larger number of patients much faster using investment dollars for both customer acquisition and to subsidize the economics of serving those clients. That’s what always gives me a little bit of pause in this particular area — the scale ahead of the sustainability

This post is an open question, not a conclusion, because there are plenty of startups which are trying to grow this market using technology and new approaches. Their success will mean that many more people can access mental wellness and addiction services than were potentially able to do so before. And hopefully the efficacy of these programs is even higher when software can be used to support provider matching, behavioral nudges and other extensions to what counselors themselves can do with patients. If we don’t have mission-driven entrepreneurs believing there are opportunities to dramatically improve the service and outcomes in these areas then we tragically don’t move forward. And if 2020 taught us anything it’s how important mental health is to our lives and how many more people who suffer from loneliness, depression, anxiety could benefit from proactively engaging around their health beyond pharmaceuticals.

So when a founder pitches me a business (and please do! hunter@homebrew.co) in this market I’m simultaneously excited and conflicted. This is personal for me. Since 2011 I’ve been in therapy and seen great benefits in my life. I want others to have similar access ongoing or as needed and know that it’s difficult for many because of economics, time and access limitations. Startups can help fix these problems and we’ve seen a number who are solving infrastructure problems for therapists and clients (aka picks and shovels).

Whether you’re the platform providing the therapy or the software powering the therapist, entrepreneurs in this area should have their own version of the Hippocratic Oath. What I’d ask the investors in these companies is that they share the same values. Push for responsible growth and make sure patients are well-served. Realize that when you look at stats that involve quality of customer interactions, drug prescriptions, etc you’re talking about real people, not just percentages. And perhaps most essential, have a plan for what happens if the company doesn’t succeed. What does client offboarding look like, how long would it take and how much would it cost? The answer might be that in a failure-case you don’t use the remaining capital for one last growth hack but instead have a responsibility to get patients to a new provider. We, as investors, have to be very careful about unknowing exposing vulnerable populations to venture-risk.

Update: Coincidentally The Atlantic had an article out today about troubles at one such startup.

Notes and More

📦 Things I’m Enjoying

Miley Cyrus’ new album Plastic HeartsHaus’ sampler pack of delicious, low ABV spirits, and OMG these ImmuneSchein Ginger Elixirs are so good — you just mix in some hot water and yum.

🏗 Highlighted Homebrew Portfolio Jobs

Arthur.ai is a software startup making it easier for companies to manage and monitor their AI/ML models. This includes not just observability and explainability but fairness. A great, inclusive culture and team plus a brand new $15m Series A round means it could be your next job. They’re hiring lots of folks across engineering, product, design, marketing, sales and such!

Manager OKRs, Maker OKRs: How Early Stage Startups Should Think About Goal-Setting

You’re Not Yet Google, So Don’t Blindly Mimic Their Processes

Google’s internal management approach has sustained and scaled pretty impressively over the years. Quantitative goal-setting, setting stretch targets — these principles are as evident in the 2020s as they were when I arrived in 2003. Underpinning it all are OKRs — Objectives and Key Results — the framework by which individuals, teams and the entire company is managed. Xoogler Don Dodge did a comprehensive job of documenting OKRs in an earlier blog post, but the basics were always this: Each quarter individuals and teams document their objectives for the next 90 days and grade the goals they set 90 days earlier. In Q4 teams also set metagoals for the next year. Now we have software startups who have basically built their business around OKR-style planning! Or you could, of course, use this OKR template from Homebrew portfolio company Coda.

Photo by Jeffrey F Lin on Unsplash

My Nine Years at Google meant 36 Quarterly OKRs and the correlating number of annual planning exercises. My role at YouTube had me often working through our OKRs with Larry and Sergey (one of those stressful exercises that in hindsight was amazing). I believe OKRs were originally recommended to L&S by John Doerr of KPCB, and since that time, OKRs have spread through tech companies, sometimes carried by Google alumnus themselves. OKRs are sensible, straight forward and on a planning cycle managers understand. And that’s the problem.

In 2009 Y Combinator founder Paul Graham wrote an essential essay called Maker’s Schedule, Manager’s Schedule. The post discusses how engineers need long periods of dedicated time to build and managers (or people whose work generally involves lots of meetings) can honor this by not scheduling interruptions in the middle of these periods. It’s great — you should read it.

Manager time vs Maker time gave me a lens to not just evaluate day to day schedules, but the general cadence of how we plan and build at Google. We consider ourselves a company founded and driven by Makers (our engineers), but somehow we settled into a Manager planning rhythm, one which mimicked accounting cycles rather than how things actually get built.

“Quarterly goals?” Why are three months the right duration for building features, why not two months or four months? And there was the amusing “last week of quarter” push to try and ship all the features you’d committed to ~90 days earlier.

Even more confusing were annual goals. By Q4, it’s pretty clear whether you’re going to hit the annual goals, the high level targets meant to inspire a year of work, but because you haven’t started next year’s planning cycle, the team has no documented targets for what the next 12 months look like. (Obviously the best managers start with an evergreen vision and then break into planning cycles — this isn’t about roadmapping within teams — but the Quarterly + Annual segmenting is still derived from financial planning, not hacking).

What would I recommend for the Maker-side of early startup companies instead of Quarterly + Calendar Year Annual? These three:

  •           One Month — “What are we building this month” is the key question. Team leads get together the morning of the Monday prior to month’s end and document the next month’s feature releases. This is a bottom up process which includes items shipped completely intra-month and component work of projects which are greater than 30 days long (if you can’t break a complex project into at least 30 days goals, then it’s too big). Four weeks, a few weekends. Enough time to get a lot done. You don’t need to micromanage — for example, if the team spends two days per month bug fixing, just hold that time aside in your calculations, don’t document the bugs you intend to fix.
  •           “N+12 Months”  “What will our product and business look like a year from now?” I like the idea of a rolling “one year out” vision, processing new learnings and opportunities. At any given time the entire organization can have a true north for where we want to be a year from now. It evolves, it learns, it doesn’t tick down to zero but rather always looks out over the horizon.
  •           Minimal Quarterly/Annual KPIs — Recognizing that quarterly and annual goals are important for financial reporting and goaling, you should keep a very narrow grasp on what you actually want to measure — just key drivers of business — and set quarterly targets. There can be a reality check — do these quarterly targets get achieved given what we’re building?

For me, Monthly Goals combined with N+12 Goals create the right short-term Maker cadence with longer term vision. I never got the chance to try it at Google, but hope to find companies using this sort of planning cycle to see how it works for them.

[This post updates a version I wrote in 2013. Wanted to refresh and re-share because it’s planning season!]

Notes and More

I’ve historically not been a “New Year’s Resolutions” type of guy, but have found a certain mindfulness in at least taking stock of what’s working well for me and what’s less useful. And then deciding whether it’s the recognition of these that matters or there’s work to be done to change my perspectives and outcomes.

📦 Things I’m Enjoying

Miley Cyrus’ new album Plastic HeartsHaus’ sampler pack of delicious, low ABV spirits, and OMG these ImmuneSchein Ginger Elixirs are so good — you just mix in some hot water and yum.

🏗 Highlighted Homebrew Portfolio Jobs

Arthur.ai is a software startup making it easier for companies to manage and monitor their AI/ML models. This includes not just observability and explainability but fairness. A great, inclusive culture and team plus a brand new $15m Series A round means it could be your next job. They’re hiring lots of folks across engineering, product, design, marketing, sales and such!

Leaving SF? Bring The Best of SV Values With You, Not Just SV Dollars

Why Startup Ecosystems Need More Than Just VC Funding

Hi. I read your [Tweet, Medium Post, WSJ OpEd] about leaving the Bay Area for [Texas, Florida, Seasteading]. I totally understand. Even though I might be more progressive politically than you, I too am frustrated by San Francisco’s [tax policy, failure to pass housing bills, conflicted attitude towards tech companies]. But no hard feelings and your [pictures with the mayor of your new city, floorplans for your new house, comparison of your new tax bill to your old effective rates] do occasionally make me jealous, although we don’t have any near term plans to leave.

One ask though. Don’t just take your intelligence, your hustle and your [angel, VC, SPAC] dollars to the new city — bring the best of SV values with you too. While it’s fair to assume we named Homebrew after [coffee, alcohol, opensource software package manager], it’s actually a tribute to the Homebrew Computer Club. The HCC was a group of early PC enthusiasts who met in the 70s and 80s to just tinker, share, build. And it was perhaps most notably where Jobs and Woz connected.

What would a modern HCC look like in your new city? It certainly would be visually different — the HCC was very white and very male. But besides fixing that, maybe a lot of the values would be the same. Sharing versus stealth. The love of building versus just the love of funding. Challenging each other constructively, even sometimes competitively. Supporting failures in addition to cheering successes.

Maybe I’m overly nostalgic for a Silicon Valley that we’ve romanticized but never really had. Maybe being an incumbent industry versus underdog means there’s too much power in tech to ever return to hobbyist roots. But I [like, respect, have muted on twitter] many of the people moving away and am actually hopeful they find what they’re looking for in their new locations. It’ll be good for the US overall and good for entrepreneurs everywhere if they bring the best of SV values with them. So that’s my hope.

Farewell travelers! I look forward to visiting you as soon as I’m able to access [OneMedical’s COVID vaccines, Benchmark’s private plane, the a16z stash of antibodies].

Your friend,

hunter walk

What Happened When I Deleted Every Meeting From My Calendar

And Four Ways For You To Reclaim Your Time

You want to see the real answer to what you value? Look at your calendar, because how you spend your time is the truest representation of what you care about. I’m going to caveat this entire post with the acknowledgement that almost no one has true ownership of all their time and that the vast majority of people are not in positions to exert agency over their work hours. Many professions ask that you are a schedule taker, not a schedule maker. Sometimes this is merely a result of their working arrangements or nature of their lives and commitments. Other times it’s the unkind practices of their employers, in particular the trend towards “flexible shifts,” where large retailers and hospitality companies treat their workers as widgets. But for those of us who have at least partial influence over how you schedule your time, I want to make a plea: delete all your meetings and start over Jan 1.

What does your calendar look like today? Probably lots of schedule cruft and inefficient combinations of reoccurring meetings that pockmark your days while interrupting productivity. There are also novel calculators meant to help you understand the true cost of a meeting. So blitz the entire thing and restart, replan. What could your new calendar look like?

Fewer standing meetings: Are there 1:1 or team meetings that just aren’t worth their allocated time, have the wrong combination of people attending or are scheduled too frequently? Use this opportunity to change any combination of those defaults. Turn status meetings into updates via email, 60 minute slots into 30, and the like.

Remember, the true cost of a meeting is often obscured. A 30 minute meeting for 12 people is SIX HOURS of work removed from your company’s productivity!

Block off working, thinking and self-care time: Some of us (me!) need to see time held back in their calendar for specific type of work or activity. Put this time *in* your calendar versus assuming it will just occur organically in the nooks and crannies alongside scheduled meetings.

Create long stretches of uninterrupted time: For some of us, the work we do often requires flow state and more than just 30 minute windows here and there. Context shifting between activities can often degrade the effectiveness of the “open” slots anyway. Give yourself longer period of time to get the work done. Try to group meetings together on just a day or two a week, or at least in clusters of a morning or afternoon, rather than scattered throughout.

Turn off the video: I remember Ben Thompson said something at the beginning of the pandemic to all of us who were not used to being largely remote workers. It was something to the extent of “those of us who have been doing this for a while know that you keep most conversations to voice, not video.” And it’s so true. Nine months in, I’m now wearing reading glasses when I type to reduce monitor eye strain and making more and more of my 1:1 calls into voice versus video. Not so I can multitask or avoid brushing my hair but so I can concentrate on the content being discussed and not get distracted by the sight and motion of visual medium. Sure there are plenty of times that video is optimal (groups, first impressions, etc) but change your defaults. What if instead of assuming every virtual meeting was going to be video, you changed to voice. You can still screenshare, etc when necessary (I’m suggesting things like Zoom with video off, not just actual phone calls), but reset your expectations for seeing the other person.

So these are four ways that I intend to take back my time for a more productive and happier 2021. How about you? My Xoogler friend John writes about this a lot too.

Notes and More

Wow, 2020 has been a year for sure. I’m sending you all hugs of appreciation just for keeping it together over the last 12 months. And if you’ve been able to go beyond that and be someone else’s rock? Make sure you exhale and take care of yourself too.

📦 Things I’m Enjoying

Miley Cyrus’ new album Plastic HeartsHaus’ sampler pack of delicious, low ABV spirits, and OMG these ImmuneSchein Ginger Elixirs are so good — you just mix in some hot water and yum.

🏗 Highlighted Homebrew Portfolio Jobs

Arthur.ai is a software startup making it easier for companies to manage and monitor their AI/ML models. This includes not just observability and explainability but fairness. A great, inclusive culture and team plus a brand new $15m Series A round means it could be your next job. They’re hiring lots of folks across engineering, product, design, marketing, sales and such!

How To Grade This Week’s airbnb and DoorDash IPOs

[I originally published this on Medium pre-IPO, so the tense is outdated, but I think the framework holds]

Using a Weighted Scorecard Instead of Just “Did It Pop or Not?”

Every big tech IPO results in predictable Twitter chatter. If the stock price pops on its first day some folks believe the bankers took advantage of the company because it didn’t optimize the amount of money it raised in the offering. If the stock prices doesn’t pop (or even trades down a bit), they get the ‘damned if you do, damned if you don’t’ outcome of headlines that read “TechCompanyX IPO Meets Lackluster Demand.”

Since two of the largest consumer tech IPOs post-Uber are occurring this week (airbnb and DoorDash), maybe we can short-circuit the simple hot takes with a different approach? I’m going to suggest that any evaluation of an IPO should look more like a scorecard, where you evaluate the company based on the goals of an offering, weighted by their relative importance.

65% Did the Company Raise Enough Money

People usually treat this as 100% and only look at Day One close relative to offering prices as the maximization function question. And while yes, managing the ‘pop,’ is part of this, it’s an overly narrow view. In an IPO the company receives a sum of money equal to the share price they debut at multiplied by the number of shares they sold — aka the float (hold aside the cost part of the equation for now. You can potentially get a high share price by constraining float but that’s more akin to a private offering than public one where you’re looking for the market to price your business. You can also sell a ton of the company to the public, trying to find the true market price for demand.

Rather than focus on just share price though, let’s look at the amount the company raised. Was it a meaningful total, at a price better or equal to what they could have received on the private markets, and how does the company intend to use the proceeds. That’s a harder question than just a “did the stock go up or down on Day One” but it’s the question we should be asking.

25% Did the Company Set Itself Up Well for Year One Performance

One public company CEO I know, upon seeing the pop in her stock during offering week looked and said privately “I didn’t sign up to deliver those numbers.” Meaning, she knew the Year One performance required to sustain that valuation was beyond the company’s likely results over the next quarters. A lot of the IPO is about positioning for Year One stability — meeting your numbers, potentially doing a secondary offering, getting your employees and venture investors incremental liquidity, etc. The early trading performance and expectations set during the pricing and road show need to align with a post-IPO strategy.

5% Did the Company Take Advantage of the IPO as a Marketing Event

You get a lot of press and chatter from your initial filing all the way through to the ‘CEO rings the bell’ story. How well did the company manage to tell their story? Did they build momentum and goodwill or trip over their shoes?

5% Did the Company Prepare Employees Sufficiently for Post-IPO Life

I was at Google for their IPO. We watched it go public and then went back to work. Sure we all cared about the stock price but I think generally the founders and management did a nice job of setting expectations that this was a milestone not a conclusion. Some early folks on the business side started quitting as lockups expired and they found themselves with millions, or tens of millions of dollars, but there wasn’t an exodus. A strong post-IPO HR plan includes communication, retention grants/etc, helping employees get access to trusted financial advice and so on.

Am I Right?

So are these the four areas to focus on and are they weighted properly? I don’t know but would love to hear from folks like Dan PrimackKatie RoofLise BuyerBill Gurley and Jessica Lessin.

I’ll use feedback to adjust these categories and weighting and then later this week, or early next week, we can score airbnb and DoorDash.

Notes and More

Happy Chanukah this week!

📦 Things I’m Enjoying

COVID’s second wave rattling the US means that small businesses are going to have a really challenging holiday season. Here are three of my Bay Area favorites that ship: Ritual Coffee Roasters3 Fish Studios (art), and Bitters & Bottles (alcohol, can be shipped within CA).

🏗 Highlighted Homebrew Portfolio Jobs

Boom is building a supersonic aircraft. No, seriously, they are. Quite credibly and quickly too. It’s a well-funded, A+ team that is growing across a number of functions. Look here for jobs and you can tell your grandchildren you helped build this plane!

What To Do If You’re a Startup CEO & You Don’t Know How To Sell

You’ve heard the expression “All sizzle, no steak?” Or the Texan equivalent of “All hat, no cattle?” [sidenote: it’s weird that cows feature prominently in both of these]. Basically these sayings are referring to people who talk a big game but then can’t back it up with action. Sparkly but no quality behind it.

While it’s readily agreed among investors that these types of leaders eventually get seen for what they are over the long haul (although distressingly they usually get funded initially), what I wanted to discuss today is whether a founding team that’s the complete opposite (a TON of steak, very little sizzle) can also be problematic when it comes to building a successful company. This topic matters to me not just intellectually but because it’s a combination I find full of potential and often want to support. Especially since VC pattern matching may inappropriately label people this way (can’t sell) who are merely nervous or new to their environment.

What I’ve concluded is that if you’re an “all steak, no sizzle” CEO you’re gonna harm your company if you don’t address this weakness (but good news, you can address it). You may end up decreasing the quality of outcomes by a standard deviation or more. How does this harm occur? If things are going great, you still may get a lower valuation or smaller round. A hire or two that you should have been able to close won’t join. You’ll wonder why “inferior competitor X” got to headline the conference or was chosen for the big partnership with a major distributor. It’s a bunch of incremental frictions that slow you down and cause more entropy than is otherwise optimal.

Photo by Jan Koetsier on Pexels.com

The first thing to confront is that as a CEO you’re the company’s primary salesperson. It doesn’t matter what industry, what product, what revenue model, what stage of development. You’re spending much of your time selling: the vision to employees, the opportunity to investors, the story to the press, the offering to the customers, the relationship to partners. Sales is just storytelling with a desired outcome at the end of the story. Figure that you will *always* be spending at least 50% of your time selling in this manner. Some weeks you’ll be selling more than you’re sleeping!!!

Can your lack of interest or skill in “selling” be counter-balanced by a cofounder or team that’s great at it? Yes and No. Of course you’ll have lots of functional partners who basically sell as a job responsibility. And a non-CEO cofounder who can sell the heck out of your company is just about the next best thing to being skilled yourself. But I’d make the case that if, as CEO, you’re not embracing the unique responsibility -and opportunity- you have, you will eventually not be CEO. And I want you to be CEO for a really really long time. So let’s talk about what to do if you’re a startup CEO who doesn’t know how to sell:

  1. Watch videos of great salespeople and storytellers: This doesn’t necessarily mean literally sales technique videos, although I’m sure there are some solid ones out there. I’m thinking people who are amazing at telling stories, who take different approaches to making you believe. For example, I adore JJ Abrams’ Mystery Box TED talk. Or the Union Square veggie cutter salesman.
  2. Work with a coach: Whether it’s a sales advisor, a communications/public speaking expert or a true CEO coach depends a lot on what you think is holding you back from being effective. And what type of ‘sales’ you’ll mostly be doing. At Homebrew, we keep a list of coaches that work well with startups and then try to help match against need and personality type. The best recommendations are going to come from your community as this is a true ‘word of mouth’ network.
  3. Practice in low stakes environments: For some people it’s Toastmasters. For others it’s signing up to do phonebanking/fundraising for a nonprofit they care about. Or go to a flea market and haggle. Cross-training muscles for discussions that usually make you uncomfortable.
  4. Be the best version of you, not anyone else: Often, the best, most sustainable sales personalities are real — they’re you, just turned up to 11. So know that you are merely drawing out, and drawing on, abilities and characteristics you already have, not trying to become a different person. You can even draw your inexperience or nervousness into the story — “you know, it was always really hard for me when I worked at BigCoX to try and convince folks to join us because I wasn’t always sure myself. But now at OurStartupY I believe in our mission so strongly.”

Are you a founder who trained themselves to become a better salesperson? I’d love to hear your story on Twitter where I’m @hunterwalk.

Notes and More

My heart goes out to Tony Hsieh’s close friends and family, a smart and generous tech entrepreneur who passed away this week at 46. His book, Delivering Happiness, is wonderful.

📦 Things I’m Enjoying

COVID’s second wave rattling the US means that small businesses are going to have a really challenging holiday season. Here are three of my Bay Area favorites that ship: Ritual Coffee Roasters3 Fish Studios (art), and Bitters & Bottles (alcohol, can be shipped within CA).

🏗 Highlighted Homebrew Portfolio Jobs

Boom is building a supersonic aircraft. No, seriously, they are. Quite credibly and quickly too. It’s a well-funded, A+ team that is growing across a number of functions. Look here for jobs and you can tell your grandchildren you helped build this plane!