Mar
12
15



Why Every Tech Company—Large and Small—Needs a China Strategy

Everyone knows that China is a complex place for U.S. companies to do business. From the obvious cultural and language differences to the regulatory landscape to the sometimes unpredictable political climate, it can be a country where even the most experienced entrepreneurs and executives stumble. Nonetheless, it is an increasingly vital component of any company’s long-term strategic plan, particularly when it comes to tech.

That is why Redpoint recently hosted a gathering of our founders and CEOs to talk all things China. Our firm has been active there for more than a decade, investing in excess of 30 China-based startups, including such standouts as Qihoo 360, iDreamSky, and APUS. With offices in Beijing and Shanghai, Redpoint is an established, well-networked presence on the native tech scene. More than that, we have friends who know what it takes to be a winner in China. We invited two of them—Tao Li, a former Qihoo 360 executive who is now CEO of APUS, and Jim Wilkinson, Alibaba’s Head of International Corporate Affairs–to share their perspectives.

Most global tech companies already understand the importance of China. But startups often misunderstand that many of the same economic drivers apply to them as well. They believe that because they are small or just getting to market, they don’t yet need to consider the China question. This kind of thinking is short-sighted. Why? It comes down to the three Cs: Cash, Customers, and Competition.

Cash

China is awash in cash and anxious to invest it. Tech giants like Alibaba, Baidu, Tencent and others are investing in homegrown and international startups like never before. In fact, the number of venture-backed technology companies coming out of China has increased six-fold in just four years. “Every U.S. company needs to have a strategy to get money from China,” explains David Yuan, the partner heading up Redpoint China. “It is increasingly a funding source. This is a way for Chinese companies to learn and penetrate the market.”

This spending spree is in part due to a maturing local venture capital community as well as the emergence of big global brands and platforms like Alibaba in China. One-third of the top 20 Internet companies as measured by market cap are China-based. They are looking to deploy capital in ways that can increase their reach both domestically and internationally. Wilkinson says Alibaba, for instance, “will look at anything to attract more people to its platform or improve the user experience.” That, he says, translates into opportunities for innovators with disruptive technologies as well as companies selling goods and services that China’s massive population wants. That’s why Alibaba in 2014 alone pumped cash into a wide array of startups, from Lyft to FirstDibs to Tango. This investing trend is likely to accelerate and include outright acquisitions, some of which will be very high profile companies.

Customers

Whether on the consumer or enterprise side, China represents an endless stream of possible customers. The numbers tell the story—700 million internet users, more than 300 million online shoppers, 520 million smart phone users—just to name a few. It is virtually impossible to ignore such a gargantuan market, which is why companies of all shapes and sizes are teaming up with China’s behemoths to bring American goods to Chinese consumers. Even giants like Amazon, which just announced the opening of a storefront on Alibaba’s Tmall.com, understand the importance of partnership. “Companies can go through Alibaba to get to the China market,” explains Wilkinson.

In fact, going through Alibaba or other native platforms may be the only way for U.S. consumer companies to reach China’s population. While seemingly more open than it was even five years ago, China remains a country governed by a strong nationalist interest, which often shows itself through protectionist policies. The Chinese government is actively discouraging local companies from buying American products and services due to security concerns as well as a basic philosophy that all key markets should be dominated by homegrown companies.

Both Wilkinson and APUS’ Li caution anyone looking to do business in China or with Chinese companies to first understand the rules of the game. Wilkinson says most people’s notions about China are outdated. He advises companies to visit multiple times to educate themselves before doing deals. That means not just understanding the business climate but also the political and regulatory climates as well. Even better, says Wilkinson, is finding a Chinese entity to guide you. “It’s very hard to go it alone,” cautions Wilkinson. “You need a partner.”

Putting in the effort is more than worth it, says Li. Significant opportunities are still available in China, particularly for those focused on the enterprise space. That market, says Li, is only now developing as China looks to the U.S. and elsewhere for the next waves of innovation. Smart young companies can and should take advantage while China’s tech and business community still welcomes their ingenuity and next-generation insights. “At the entrepreneurial level, you can do well in China,” explains Li, noting that won’t always be the case as China continues to move up the learning curve.

Competition 

While China can be a potent partner, it is also a ferocious competitor. The local tech scene, once content to copy successful U.S. business models, is now able to innovate and develop in ways that rival the U.S. like no other country can. Indeed, China has the talent, resources, and ambition to match and in some cases outdo Silicon Valley on the global stage. Look no further than Li’s APUS for proof. In just six months, the company, known as a launcher for Android, has more than 100 million users—almost all of whom are outside of China.

To some, China’s broadening influence may seem threatening. But smart entrepreneurs should instead view it as an opportunity, particularly in the U.S., a market that is coveted by Chinese tech companies. “Chinese companies want legitimacy on the global stage,” explains Wilkinson. “They crave it from the financial centers in the U.S. So working with U.S. companies is like they’ve made it.” Adds Li: “Most Chinese companies want to be in the U.S. but they are not ready.”

That is because just as Americans struggle to understand the ins and outs of the Chinese market, the Chinese have the same problems when it comes to entering the U.S. They need—and are actively looking for– American partners to help pave the way. Li says it’s important to take advantage of this educational period now. China will only need our help for so long, he says.

Beyond the U.S., China’s interest in other countries, from Brazil to Indonesia to Russia, can yield more possibilities for startups. Li says Chinese companies are globally focused and looking to build products and provide services for U.S. startups with breakthrough technologies. “China will be a bridge into other big markets,” says Li.

This is all good news for Silicon Valley and U.S. tech companies in general. Done smartly, companies in the U.S. and China, both large and small, can find ways to help one another. Redpoint is seeing that every day and remains committed to working with the only other country in the world with a self-sufficient ecosystem devoted to finding and bringing to market the next great innovations.


Sep
17
14



There’s a Dragon at the Door

All eyes are focused this week on Alibaba. The Chinese-based ecommerce powerhouse will make its debut as the largest technology initial public offering in history. By the time of the closing bell on its first day of trading, Alibaba could be the fifth most valuable Internet company in the world, sandwiched tightly between fellow behemoths Facebook and Amazon.

This is big news in and of itself. But Alibaba’s IPO is just one of many factors that, taken together, should be viewed as a wake-up call for U.S. tech companies. China is on the move, no longer satisfied by winning in its own markets. The technology landscape from Shanghai to Beijing has shifted and now boasts enough money, talent and entrepreneurial zeal to rival the U.S. establishment in marketplaces around the globe. To think otherwise is naïve, shortsighted –and potentially very costly.

In a recent letter to investors, Alibaba’s charismatic Executive Chairman, Jack Ma, was unequivocal. He wrote: “In the past decade, we measured ourselves by how much we changed China. In the future, we will be judged by how much progress we bring to the world.”

Looking around at what is already unfolding, I believe him.

As of a week ago, about a third of the top 20 Internet companies in the world with the highest market capitalizations are Chinese based. This includes Tencent, Baidu, Qihoo360 and others that are lesser known in the West. These companies are aggressive and nimble. They are also innovative, moving away from copying what they see succeed in the U.S. to blazing their own business models that we are now looking to imitate. Tencent, for example, is envied as the global leader successfully selling virtual goods at scale. The company has also racked up huge market share by using free games to lure customers to its apps stores and other services—a strategy Microsoft appears to be adopting with its purchase this week of Mojang AB, the Swedish maker of the wildly popular Minecraft series.

This growing confidence is thanks, in part, to a flourishing community of well-educated entrepreneurs. Many of these folks are as good as any found in the U.S. They are willing to take risk, are relentless in their drive to win, and are immensely hard-working. Even China’s government has had to acknowledge their burgeoning power and contributions to the overall economy. The Ministry of Commerce acknowledged in 2013 that entrepreneurial ventures now account for 75 percent of new jobs annually. No surprise, then, that China is taking steps to make the starting of companies easier and less costly.

Beyond the revving of this Silicon Valley-style creative engine, Chinese Internet companies are moving in ways that make clear their aspirations to be dominant global brands. They are investing their considerable cash more aggressively than ever, particularly in the U.S. In just the last two years, Alibaba and Tencent alone have put big money into 13 U.S.-based early stage companies. Most of the startups have been in the mobile or e-commerce spaces, including Snapchat, Lyft, Tango, Whisper and Kabam. This is in addition to countless other smaller infusions of capital in other enterprises. The Chinese tech giants are also establishing serious outposts in the U.S. and in other markets, like Latin America. It is only a matter of time before we will see important, sizable, brand name acquisitions of U.S.-based tech companies.

The bottom line is that U.S. tech companies should worry as much about what the technology giants in China are doing as they do about Google, Twitter, Amazon or Facebook. WhatsApp, acquired by Facebook earlier this year, is the world’s leading messaging application with 600 million monthly active users. But Tencent’s WeChat is a competing product that draws on some of the lessons learned by WhatsApp, Instagram and others. It offers a unified messaging app that embodies a combination of Facebook, Instagram, Twitter, Viber and Paypal in a single experience. In a very short time, WeChat already boasts almost 450 million monthly active users worldwide. And it has only begun to tap into markets outside of China.

The writing is on the wall. Alibaba’s IPO, while an important milestone, represents much more than just a big day on Wall Street. It is a coming out party for one of the most valuable Internet companies in the world—and a slew of other ambitious China-based players. They may be thousands of miles and multiple times zones away. But make no mistake: They are already at our doorstep.

 

Published on LinkedIn 9/17/14


Aug
7
14



The Next Evolution in Search

Today we are excited to announce our investment in Vurb.

Vurb’s enormous potential rests on a breakthrough technology that will make searching the Internet smarter, more consistent, and even seamless across desktop and mobile devices. Imagine being able to plan an evening out without having to jump in and out of apps or going back and forth to the search bar to make a restaurant reservation, find movie times, read reviews, and pick a place to meet for drinks afterward—all using the best of breed services or apps, but in one continuous search. You can even start your search on your desktop and finish it on your smartphone without losing anything.  After you’re done, you can share your collection with your friends or just save interesting places you found along the way for another time.

Vurb breaks down the independent search silos offered by today’s search engines. It knows where you have been, helps take you where you want to go, and integrates the services you want to see…complete with social interactions. It is a completely logical experience that matches how our brains work, not how the structure of browsers or apps work. No more typing a query into a blank search box, clicking on a result, and then going back and forth until an acceptable solution is located.

Surfing for information on smart phones is even worse.  Either you’re using a web browser to access many sites that are not optimized for mobile experiences or, more than likely, you’re using one of the popular single purpose apps downloaded on your phone.  Apps are great when you are trying to do a singular function for which the app was originally designed, but they are terrible at traversing functions and for wandering and discovering.  Surfing apps doesn’t work well at all today.

We believe that the transition from a desktop/laptop web world to a mobile/social world necessitates a different, better approach, particularly for core functions like search and navigation. Vurb, with its small, dedicated and talented team, offers that better approach.


May
13
14



The Case For Censorship In The New Social Age

Intellectuals for centuries have campaigned against censorship. From Ben Franklin to John F. Kennedy to Justice Earl Warren, the argument has been much the same: Censorship is antithetical to democracy. More recently, megastar Jay-Z reiterated the point in his 2011 book, Decoded, writing simply that “we change people through conversation, not through censorship.”

It’s pretty hard to argue with Jay-Z — let alone Franklin, Kennedy and Warren. But I find myself, uncomfortably, thinking more favorably about the concept of censorship as we in Silicon Valley grapple with the emergence of several social networks built around the concept of anonymity. Companies like Whisper and Secret, among several other lesser-knowns, have attracted outsized attention and funding as the next generation of social media platforms. While each has its own unique features, they all allow users to send messages to groups without names attached.

Let me first say that anonymity can be a very good thing. Having the ability to speak freely without fear of repercussions can spark honest discussion about important, delicate or emotionally charged topics. Just being able to share feelings and fears within a supportive network can be a productive mental health exercise and even connect people in meaningful and fun ways. Upstart Secret, for one, has shown strong success in the quality of discourse on its mobile app. It isn’t perfect. I mean, some of it is silly and some of it is a little mean and petty. But overall, it’s much better than I expected. In general, the content is about real emotions, real fears, real aspirations and real desires.

Part of the genuine nature of the conversations on Secret stems from the fact that users are only sharing their personal reflections with people somehow relevant to them, as they come from their personal networks (via phone contacts). Secret is more like going to a masquerade ball with your friends versus being in a completely dark room with a bunch of strangers. You sign on to Secret with a verified identity and then can exchange messages anonymously with other people to whom you are digitally connected to, and who are also on Secret. This is an important distinction and works because the lack of total anonymity on Secret forces users to refrain from sending truly offensive messages they may otherwise send if they were among strangers. Deep down you worry that people might be able to figure out who you are.

I think of Secret as qualified anonymity, and this aspect of a company’s network is hugely important in establishing both credibility and value — and why startups like Secret have a shot at real success. But it is not enough by itself.

Here comes the tough part. As abhorrent as the concept of censorship is to many people who embrace the ideals of anonymity, including me, we need censorship to keep the dimly lit corners of cyberspace safe. It is just too tempting for people under the protection of anonymity to devolve into irresponsible and immoral behavior.

We have all seen how damaging it can be to offer an unbridled platform for the worst kind of human impulses, particularly for teens. Prejudice, bigotry and sheer meanness can easily proliferate, transforming a winning concept into little more than a digital bathroom wall.

That is why any platform leveraging anonymity will have to have some group of moderators that delete inappropriate and dangerous posts in real time — and then banish those posters from the site forever. To be clear, I am only in favor of striking comments that are truly hateful or dangerous. Unpopular or controversial viewpoints that are part of honest discourse should be allowed to flow freely.

Whisper, for one, has already hired dozens of employees whose sole job is to constantly monitor the site for inappropriate content. These are important actions because they ensure consequences for behaviors that deliberately cause harm. To purists, it may inhibit free speech, but to me it’s no different than why we prohibit people from yelling fire in a movie theater when one doesn’t exist.

Neither Franklin nor Jay-Z may like it. But I believe this is the only way these anonymous platforms can survive and thrive. Otherwise they will turn into walls in a New York subway station. And we all know how that will go.

Published on TechCrunch 5/13/14


Dec
23
13



A Look Back at 2013



Launched just 18 months ago by sister-brother duo Adora and Aaron Cheung, Homejoy has quickly emerged as the leader in the on-demand home services market. Read why we invested.


A few months ago, Redpoint backed the CyanogenMod team on their Series A, and Scott Raney explains why we supported their Series B this month.


Founded only a year ago, DraftKings is a leader in the emerging space of real-time fantasy sports, awarding over $50 million in prizes this year in its first full year of operations. Read why we made the investment.



Partner Chris Moore and the Redpoint team were thrilled we had the opportunity to invest in Refresh’s vision for digital dossiers for the people you meet. Check out Chris’ blog on why we backed Refresh.
Check out some of our favorite partner posts and interviews from this year.

Geoff identifies You Tube’s “Bay of Pigs” Moment.
Satish gives his best advice for startups in the WSJ.
Ryan featured on Bloomberg West & talks about becoming a VC.
Chris Moore discussing adtech investing on TechCrunch Ask A VC.
Tomasz explains how much it costs to take a startup public.
Scott discusses trends in Android, Big Data & more.

  • Docker
  • Tapingo
  • Oculus
  • Snapchat
  • Nextdoor
  • Coinbase
Quarterly Workshops for our network to learn from one another: Next up Content Marketing with Scripted & Marketing. After that stay tuned for workshops about everything from building great apps to hiring engineers.
Upcoming Series on Big Data’s Next Iterations
from Scott Raney and John Walecka.
Partners at CES, SXSW
drop us a line – we’d love to see you there.
Dinners with Founders & leading voices in the Valley kicking off in January.

Dec
5
13



Backing Homejoy – the “Get Help” Button for Your Home

 

We’re pleased to announce our investment in Homejoy.  Launched just 18 months ago by sister-brother duo Adora and Aaron Cheung, Homejoy has quickly emerged as the leader in the on-demand home services market.

Initially focused on home cleaning, Homejoy delivers to consumers a hassle-free, quality cleaning service at a fraction of the cost typically seen with traditional maid services. As they grow, Homejoy has the opportunity to become the go-to company for a multitude of services associated with the home Homejoy is a perfect example of a company that has significantly reduced the friction associated with a traditional consumer service by wrapping together provider sourcing, credentials assessment, price negotiation, availability/scheduling, service delivery, payment, and customer service all into a single experience.

We believe that Homejoy is part of a broader trend to on-demand consumer services.  By integrating mobile and web technologies, consumers can get fast and efficient services with a touch of a button from vendors with whom they have a trusted relationship.  Over the years, the consumer services landscape has been shifting from pure listings models (v1.0), to listing + review marketplaces (v2.0), and now to on-demand, branded consumer services delivered directly to the end consumer (v3.0).  Companies like Homejoy will build sustainable brands and customer relationships that can be extended over time to related services.

With presence in over 30 markets, Homejoy is well on its way to transforming the $400B home services market.  We believe in Homejoy’s mission of happy homes and vision of becoming the ‘get-help’ button for your home. We look forward to supporting the team in its global expansion.

Geoff and Pueo

 

 


Nov
6
13



Twitter Is No Leap of Faith

From Wall Street to Silicon Valley, it’s hard not to hear chatter about Twitter, the most highly anticipated initial public offering since Facebook.

Skeptics abound, questioning the company’s fundamental metrics. Where are the profits? What will the price-to-earnings ratio be? What has this company done so far that could possible justify a projected valuation of $16.5 billion? And, understandably, could Twitter’s offering be a rerun of Facebook’s, a financing blooper that will long be remembered as the Rodney Dangerfield of IPOs?

These would all be reasonable posits if Twitter was just another run-of-the-mill company. But it is not. Twitter is a very rare commodity. For investors, this little tweeting upstart, with its 232 million active users who share thoughts and ideas in just 140 characters at a time, is one of the pure bets on the future of the Internet. More than that, it is a bet on the handful of core platforms that reach, connect and engage billions of people across the globe.

Looking around, fewer than 10 public companies in the world fit that bill and are therefore reliable indicators for anyone mulling Twitter’s valuation prospects. They are Google, Tencent, Alibaba, Baidu, Amazon, Facebook, LinkedIn, eBay and Apple.

These are the primary platforms on which the public depends for Internet and mobile use. The mean market cap for these companies: $160 billion. The median market cap: $100 billion.

You can see where this is going. If Twitter has the potential to be the next Google or Amazon or Tencent, what would you pay for that option value?

The naysayers will argue that the same case could have been made for Facebook when it went public in 2012, only to see its stock price sag 52 percent from its offering price over the subsequent three months. They are right, of course. But the difference now is that Twitter has learned from Facebook’s missteps, and is determined not to repeat them.

For instance, Facebook arguably waited too long to go public because it was already a really big company, thereby making it difficult to predict substantial growth in its future. By contrast, Twitter is still relatively close to the start of its formidable growth curve. Whereas Facebook flooded the market with available shares, driving down demand on its opening day, Twitter is keeping the size of its offering small. And, while Facebook priced its IPO for maximum value, Twitter is keeping its valuation in the modest range, hoping to see a pop in share price when it finally opens for trading.

To be fair, it needs to be said that Facebook’s stock has flourished since its anemic debut. The company’s share price is up 87 percent since the first of the year, and 31 percent above its IPO price. Moreover, Facebook is among the Top 4 best-performing large-cap technology stocks in the U.S. so far this year, according to Morningstar research.

Facebook’s stock surge bodes well for those underwhelmed by Twitter’s current revenue sources or nonexistent profit. History tells us that when any new platform emerges, it takes some time to figure out how best to make money in ways that are endemic to that platform.

Think LinkedIn. Think Amazon. Neither company was profitable when it went public, but I bet you wish you’d have had a piece of them then.

For those who still aren’t convinced, let’s throw in one more bit of information. Twitter’s revenue over the next 12 months is expected to surge some 85 percent, from $535 million to $990 million. When Facebook went public, its projected 12-month revenue growth was a comparatively paltry 36 percent.

Bottom line: Twitter’s growth prospects today dwarf those of Facebook at the time of its IPO.

Twitter simply is not the leap of faith many would have you believe. If you are a portfolio manager with holdings in technology, you need to be betting on the future of the Internet and mobile. If you are betting on the Internet and mobile, you need to own the platforms. If you own Google, Facebook, and Amazon, then you will need to own Twitter, too.

You don’t need 140 characters to understand that.

*Originally posted in AllThingsD, here

Full disclosure: Though not a direct investor in Twitter, Redpoint does own stock in the company thanks to two acquisitions, Bluefin Labs and Posterous.


Oct
1
13



Reinvention at Redpoint

Welcome to Ryan Sarver and Jamie Davidson, and Congrats to Tomasz Tunguz

Today, we’re welcoming two new partners and a senior associate to the Redpoint team. We’re thrilled to promote Tomasz Tunguz to Partner and are excited to bring Ryan Sarver on board as a Partner. Lastly, we’re welcoming Jamie Davidson to the team as a Senior Associate. All three have an invaluable mix of experience in the most important emerging trends in the consumer Internet, and are part of our continued work to evolve to meet the demands of a changed investing landscape.

Since we founded Redpoint in 1999, we have been focused on supporting exceptional founders with industry defining visions. Fourteen years, 375 investments and 120 IPOs & M&As later our approach on zeroing in on the industry’s boldest and brightest founders and supporting them as a team has stayed constant. It’s paid off – companies that defined markets like Netflix, HomeAway, Heroku, Fortinet and Juniper are all part of our history. And we’re proud to back some of the market’s most promising and innovative teams at companies including Sonos, Twilio, Stripe, Infer and Curious today.

Over the past few years, the business we’re in has changed. The markets have become broader, successful founders are discovered in new and unexpected places (and are often first timers), and the pace of innovation is faster than ever. All of this means the old way we invested, with a small, proven team applying decades of experience and a tight-knit network isn’t all it takes to discover the next set of revolutionary companies. We need more coverage, more direct experience with the latest trends and more perspectives.

This is the reason that as we continue investing with our latest early stage fund, Redpoint V, it’s come time for us to grow our Partner team again. By combining our established Partners — who have done hundreds of deals and learned the lessons only decades of experience can provide — with a new set of Partners that bring direct experience at some of the industry’s most influential technology trends today, we can bring startup founders a unique mix of investment insights with an understanding of what it takes to go from bold startup to successful exit.

Our new partners

We apply the same diligence to bringing new members on board that we do in reviewing potential investments – and we’re confident that Ryan and Tomasz will be successful new members of our team. Ryan joins us after running Twitter’s platform and Tomasz has been a Principal at Redpoint for three years – proving himself as an advisor to recent investments like Looker, ERPLY, Electric Imp and Axial Market. Both Ryan and Tomasz will bolster Redpoint’s work to identify and support standout founders and startups working in the rapidly evolving landscape of mobile services and social platforms. In addition to Tomasz and Ryan, we’re also bringing Jamie Davidson (formerly VP Product at Hotel Tonight) on board as a Senior Associate.

Tomasz, Ryan and Jamie will focus on investments along the following categories:

* Sarver: social applications and platforms, SaaS

* Tunguz: marketplaces, SaaS, analytics

* Davidson: mobile-first applications

As we continue to grow and evolve Redpoint, we’re looking forward to supporting the next generation of founders and are excited to promote Tomasz and welcome Ryan and Jamie to the team.


Aug
2
13



CEO Playbook for Early Stage Board Meetings

Generally, board meetings of early stage companies tend to resemble staff meetings. There are too many people in the room (try someone from every function?) and much of the discussion is around operational issues — from signing a new lease to branding and logo discussions.

Sure, many companies have limited staff during the first year, and I’d say they have a free pass for the first 6-7 months, max. After this period, critical mass is established and it’s time for the CEO and the company to evolve. Board meetings shouldn’t be operational, rather they should focus on the overall strategic direction of the company.

Seems obvious, right? While every founder and CEO of an early stage company starts with the best intentions of moving forward, sometimes they get into the early stage company slump and never evolve the meetings they way they should.

Let’s start with the functions the board serves: corporate governance, strategic counsel to the CEO, an outside perspective on strategy and direction, and responsibility for the hiring and firing of the CEO.

When you have the board’s attention, it’s important to keep the meetings focused and strategic.

Here’s my playbook for early stage board meetings:

Frequency of Meetings

For the first year or two, board meetings should be once per month. After this initial phase, they should occur every six weeks, and eventually work towards 5-6 meetings per year.

Length of Meetings

Meetings should be a minimum of 2 hours and a maximum of 3 hours. If you need more time, it’s best to check in with board members separately before the meeting, or have a pre-meeting the day before.  In my experience, people can’t concentrate more than 3 hours.

Board Size

I like a minimum of three people and a maximum of five. Two is too few, while three is only getting to critical mass. When the number climbs above five, the meeting looses its effectiveness. Additionally, there should be no more than two from the company present at the meeting; otherwise can turn into a staff meeting (which is a waste of everyone’s time). 

Meeting Flow

  • The CEO should begin with a closed session to preview the meeting and key issues with the board.
  • Review of key performance indicators that define the health of the business.
  • General review of the various aspects of the business focusing on the most important (typically sales, development, strategic partnerships).
  • Deep dive on one particular functional area or issue (e.g. competition, marketing and positioning, operations, etc.)
  • Financial review
  • Closed session to discuss board business or meeting review with the CEO. At this point the CEO should review what the 3-4 key issues facing the business are (i.e. what keeps him/her up at night). This is also a good time for the CEO to review the upcoming period and goals until the next board meeting.
  • Finally, a private session for the outside directors to discuss any outstanding issues and decide upon what feedback they should provide the CEO. A spokesperson should be chosen to deliver the feedback following the closed meeting.

You might be wondering, how am I really supposed to cover everything I need? How am I supposed to share everything that is happening in the business? Well, you’re not. The board and these meetings should be viewed as a resource for you, the CEO. These meetings will provide valuable insight from outsiders and will help drive the strategic direction of the company, not the day-to-day decisions that must be made.

If you do need more time, it’s not only appropriate but it’s encouraged that you check in with your board outside of the meeting to give them a heads up on what will be covered or topics of concern.

Remember, the board is there to help you and by focusing on the strategic direction of the company, you’ll only help yourself.

 

*Follow Geoff and view this post on LinkedIn here.


May
23
13



Class of 2013: Write Your Eulogy, Then Live the Life You Want

There’s always so much encouragement for graduating classes. “You are the generation.” “You will change the world.” I’m sure you are and you will, but how? How will you make a difference? I’m not going to tell you how to change the world; that’s up to you.

What I am going to give you is my advice on what will help guide you to make that difference. In my 30-year post-grad career, these are the words of wisdom that helped guide me—both personally and professionally:

Life is short. As you embark on the rest of your life, consider what you want it to be like and what you want to accomplish. Pretend for a moment that rather than graduating, starting your career, and moving on toward the rest of your life, you are at the end of it. How would people remember you, as both a person and a professional? Write your eulogy now. Think about how you want to be remembered by your family, friends, and colleagues. Let this shape you.

Do something you’d do even if you didn’t get paid to do it. If you don’t, then life will end up a chore. My dad was a chemical engineer who designed large-scale process plants. I remember seeing him get up every morning and go to work, and I don’t think he passionately loved what he did. He did it because he felt it was his responsibility. Life will be more fulfilling if you do what you love.

When I was finishing my MBA, the highest paid jobs were in investment banking and consulting. They were also the jobs with the highest prestige because they tended to attract the best and the brightest. Because of this, they were alluring for many graduates—when you have been out of the job market for a couple of years racking up student loans, working for a top-tier company with a solid paycheck made sense. I knew that neither of these routes was right for me. My choice to go a different direction ended up serving me well in the long run. I’m lucky enough to have found something I love doing. Not to say that it’s not work and it’s not tiring. It is. However, I constantly think about how lucky I am to do what I do—and get paid to do it.

It’s OK to be impatient, but don’t rush things. There’s a fine line between chasing your dreams and not being willing to lay a long-term foundation for success. When I finished graduate school, I saw a few people in my class who wanted a shortcut to success. They suffered from the “get rich quick” syndrome. Early on, they took risky bets with second-rate companies in hopes of accelerating success. With very few exceptions, that strategy did not work. Unfortunately, when they wanted to return to the mainstream, they didn’t have the foundation of success upon which to build.

Take risks with smart people. It’s fine to take calculated risks with your career, but when you do, make sure you understand the risks along with the reward. Make sure you take risks with the best people you can find. It will make all the difference in the end. If you want to start a company, recognize the risks you’re taking and do a gut check about how much you believe in what you’re doing. If you passionately believe in it, then do it with your eyes wide open and surround yourself with the smartest people you can find.

There is always next year, but at some point you start running out of next years. As you move forward in your career and in life, you’ll find yourself putting things off until next year. But there are only so many next years in your life. I’ve generally never passed off an opportunity to have a great life experience—be it travel, learning how to fly or play piano, or taking courses that weren’t directly relevant to the path I was on. The more you can do to round out your life outside of work, the more fulfilled you will feel in the end.

Don’t be one-dimensional. Life is more than your career. Life is about being a responsible, interesting person, and in my opinion, one of the greatest gifts in life is having close friends. As you move forward on your journey, you’ll find good friends are few and far between. I am fond of saying that I don’t need more friends, I just need more time to spend with the friends I already have.

Best of luck in your journey—and don’t forget: The journey is its own reward.

 Photo: Blue~Canoe/Flickr