The Entrepreneurial Framework

In the last few months, I had the good fortune of talking to several early-stage entrepreneurs including some in college (Thank you True Ventures Intern Corps) thinking about joining a startup and some others beginning to work on their own startup. Most of these conversations ended up about ‘how to think’ about being a founder, less about how-to-raise money or how-to-build a company.

As I began to think more about this question of “how to learn”, I understood that what we were really talking about was developing a framework for iterative learning. Before a founder or a group of founders begins building the startup stack, they have to build the founder-stack.
Being a founder is not going to happen by osmosis nor accidentally, it is a result of continuous preparation for receiving, understanding, and translating your learnings.

Just like the  best improv is delivered by the most practiced actors and not by someone walking off the street and on to the biggest stages, the best startups are built with constant practice and hard work at learning how to learn, not merely by accident.

The founder stack for learning has three fundamental components:

Ideas: How to think about ideas that will become products
People: You, Your co-founders, your employees
Operations: Everything other than technology, products, people.

Note I do not (yet) mention technology, marketing, or sales as part of the founder stack – that comes later and is part of the complete startup stack. And even though I am going to write about the idea part of the stack first, in the end that is the easiest thing to conceive, build, and deliver.

Ideas

(i)         Thinking with dissatisfaction

One of the first pieces of the entrepreneurial scaffolding is learning to think with some degree of dissatisfaction with the current state of things. As a founder, you should be able to ask yourself ‘does it fit’? And if not, why, and then ask what problem does it leave unsolved.

(ii)       Leverage new platforms

When new platforms emerge (mobile, social,…) behaviors that exist elsewhere may need to exist on these platforms in a new form.

(iii)     Find the voice of many

Amplify your set of thoughts about a problem to be solved by as many other voices defining that problem. Talk to as many as possible – coworkers, friends, family, peers – about the problem – and listen.

In my experience – echoed by many investors and founders I have talked to about this topic – the best ideas emerge from understanding the problem from multiple angles and deriving a rich understanding of the problem, not extending known solutions with new technology or features you can build.

To sharpen your understanding of the problem, quantify it!

-   Is it a productivity problem? (users want to do more with less time, people, and resources)
-   Is it a collaboration problem? (silos exist for capabilities and knowledge but haven’t been interconnected yet)
-   Is it a cultural consumption problem? (users want to be seen/observed/lauded for engaging in this behavior.
-   Is it creation ex-nihilo? (users say wow this is a great/useful new new thing) this may be where no equivalent behavior or product exists in other forms.
-   Is it a connection problem? (users want a connection to other users or to information/knowledge). There is huge and lasting value in solving connection problems – think wheel, trains, books, email, search, social,…
- Is it an ‘insights’ problem? (the data sets exist, but infrastructure and applications to deliver insights from data do not yet exist)

People & Values

I believe you will need multiple personalities working with you in the mix of misfits that is a vibrant, healthy startup.  Some of these personality-types are:

The eternal optimists – the problem definers, the eternally dissatisfied with status-quo, the impatient ones who can’t wait for change to come fast enough.
Grumpy Ass Kickers – these are the builders, the craftsmen and women, the hackers for whom nothing exists till it is built and working. They make the wheels go around, not just tell you how the wheels are put together. They take no prisoners, their edges are blunt and effective and always rooted in reality, not an optimist’s imagination of reality as ‘it should be’. They m a k e reality from ideas.
Intuitive humanists – who instinctively and constantly pay attention to the soft-fabric all the time, nurturing the people and enabling them to deliver their best for your startup.

The initial mix can be any one of these, the eventual mix in successful startups is the right mix of all of them.
Not all of them may arrive simultaneously but you can actively look for the missing skill-set as you grow the team (or conversely, think about these when you are thinking of joining a startup – do some of these exist in that team?). But also recognize differences and impedance mismatches between these archetypes. Put in place regular and clear communications to figure out productive working relationships…. Which brings me to:

The hard art of soft skills

We, humans, are a complex organism and everything people do in addition to our skills or craft does not disappear when they start or join a startup. we do not stop being humans when we work.

Variously cast as ethics, values, culture, soft-skills, EQ, or emotional intelligence, people are always an evolving summation of these. If you don’t engage in careful seeding, tending, and pruning of ALL of these sides of a person, you will be signing yourself up for distorted growth where the ignored facets will eventually overcome everything else.

This applies to you (as a founder) as much as to everyone else you contemplate as co-founders or others thinking of you as a co-founder or early employees at a startup.

These soft skills become especially important when you factor in the pace of change of technology & platforms. The hard skills will be changing even faster than the last two decades of tech. Soft skills are the only anchor when everything else is adrift constantly.

Before you build/express your craft, craft-yourself. You are your first creation – make it the best possible on all fronts.

Superstar engineers or hackers are only as valuable as their ability to change, they are only temporarily valuable for their specific hard skills. In superstar teams, it is ok to fail first or fail fast and learn faster IF the people involved are capable of failure… and change.

Many startups and large companies do engineering bootcamps – I advocate an early ‘skills-camp’ where the focus needs to be on:

  • negotiations
  • conflict resolution
  • interviewing skills
  • and communication, communications, communications.

The time to define, build, and grow your values is not after founding or joining, it is before you begin the begin.

Operations

As you develop a framework for evaluating ideas and people, there are multiple other pieces of infrastructure that need to be built – finance, HR, operations,…

There are at least two good reasons to understand non-tech operations as a founder: Either you (or someone as inept as you) will be doing this for some time, or you will be hiring someone or outsourcing them to one or more service organizations (HMC).

Finance is not accountants sailing the chartered seas, it is merely an information system on top of monetary transactions that collects, calculates, and reports information related to money and equity in a startup.

Finance = Terms + Tracking + Planning

Terms = $, contracts, lease
Tracking = Reporting (Burn & Balance, then everything else)
Planning = Monthly, Quarterly, Annual plan. refine all the time – what did you learn in the past month, quarter, year?

If you’re in college, begin by tracking your own or a group’s expenses. Do you already belong to a group or association/non-profit? Find out who does general accounting for that group – buy them a caffeinated drink and bug them to explain how money comes in, on what terms, and how it goes out the door, and how it gets reported to those who care (legally) or those who run that group.

If you’re already in a startup, bug your CFO, CEO, or the hired hands doing accounting, planning, reporting. Make it a monthly objective to learn it bit by bit. Perhaps 1 hour every week?

IF you’re in a big(ger) company, go introduce yourself and what you do to the CFO or controller, ask them that you’d like to understand numbers and logic that go in to a balance sheet and especially estimation/planning. If they ask why? tell them this is a part of your training as a future manager of people and resources. Again, if you don’t take this step, it won’t happen. Trust me that even in a 50 person company, the CFO isn’t going to think “How can I teach accounting to everyone here?”

For new college grads joining startups while they are thinking of starting their own someday, develop this framework further by asking and trying to understand all the micro decisions that get made inside a startup every day – about features, products, markets… and above all – users. Pay special attention to the user-part. Are those around you substituting their best guess for user’s opinions or experience? Have they made a habit of pinging random users for seemingly mundane decisions? If so, insert yourself in this process – not to define a solution for the user, but to understand the problem from a user’s perspective. Volunteer to make a few paper protos to give your startup a reason to get in front of potential or current users and learn learn learn – all about the problem.

Startups are not epiphanies that happen – they are constructed with insights and confirmations via hard work. A simple first step is building a scaffolding for learning – your entrepreneurial framework.

Suggested reading:

Eric Ries, Alex Osterwalder, Steve Blank, Patrick Vlaskovits, Andrew Chen, Hiten Shah

p.s. I hope the following blog posts will be written:

Framework for learning to engineer growth – Andrew Chen

Framework for learning to sell – Noah Kagan