Losing and finding your mojo as a founder

This article is the fourteenth in the Startup Series on FirstPost’s Tech2 section and first appeared on April the 21st, 2017.

The journey of a founder can be exhausting. Those in solid founder teams too don’t just have a collective experience; they also have their own, personal experiences of the founding journey. It is not always easy to be in sync with others on the team, or their level of focus or motivation. Decisions are not always easy to make or consensual. Role cleavage is not simple or trivial, and yet without it, things may start to slow down. Given all this, it shouldn’t surprise us to know that founders often lose their mojo.

An entrepreneur I advise has had several such phases through the years. Helping him work through them has been a lesson in human resilience and the purposiveness that drives founders. Crucially, he has come out of each such phase with renewed vigour and focus. That should give hope to other founders in the same situation.

Building a venture is hard work but also strangely exhilarating. Even the tiredness is satisfying because you know you are building your dream and you cannot wait for the morning to come so another day could dawn and you get on with it. Intrinsically rewarding activities can be quite motivating for founders and others.

But what when you start finding all that work fills you with negative feelings instead of the exhilaration you expect? It is time to ask tough questions, to answer them honestly and to take appropriate action.

One of the more business-related, less soul-searching type, questions to ask is about founder-product or founder-market fit, which is more crucial than product-market fit to the success of a startup, especially for first time founders. This fit could come from the founder’s or founders’ core values, or their commitment to a cause, or their deep interest in the product category. Is it a lack of this fit that is dragging on you? If so, what can you do to change that?

It is also worth thinking about the specific things about your work that take the wind out of your sails and the things that energise you. The founder I mentioned earlier found the CEO responsibilities difficult to balance with the creative aspect of the work he wanted to do. There were also other activities that needed developing and executing but neither did he enjoy doing those nor were they the best use of his time or skills. With some introspection, he identified the need to expand his team to bring in skills that he did not have, and the skills that could be hired in and scaled without needing him to be involved in managing. He also realised he had to get really good at planning and time management so he could fulfill both the roles he wanted to.

Crucially, it is worth delving deeper. If the venture does not really excite you as much as you anticipated at the very beginning, why are you still here, working your socks off? Is it your ego at work? Do you feel beholden to commitments made to others? Do you fear failure? Is it a sense of deontology at work? Are you indulging in sunk cost fallacy? Something else? The founder I mentioned earlier has an overarching commitment to practising and defending certain values with vigour. When he has bad days, we talk over the issues separating the operational niggles from the strategic challenges. The exercise helps him not be overwhelmed and instead focus back with renewed vigour on what matters most to him and the startup.

Last but not the least, building a startup venture is like any long term relationship. There will be good days and there will be bad days. Good days are easy, uplifting, energising. However if you cannot hack the bad days, the relationship will feel toxic and draining. But if the bad days are too numerous and frequent, and overwhelm the good days, it may be advisable to consider quitting altogether.

What happens next?

Most people who quit a really bad relationship don’t “fall in love again” without a shed load of hard work either by themselves or in therapy. Founders who quit because the bad overwhelms the good may need some time with themselves to understand how to avoid the same fate the next time around. Knowing what sort of person you are is a good and essential first step.

Leadership and the importance of changing one’s mind

Martin McGuinness, former deputy first minister of Northern Ireland and also former IRA commander, died today. I was shocked to learn he was only 66. Shocked because I have known his name since I was a child growing up in India, and had always thought he was much older.

But he wasn’t. In that short life, McGuinness, as many obituaries are reminding us, went from being “the butcher of Bogside” to “brave statesman”. In other words, he changed his approach to finding an acceptable settlement and peace. And he did it in the glare of the public eye.

Changing one’s mind, one’s opinion, one’s approach is an important trait for good leaders. It shows their ability to take on board new information as well as their ability to admit mistakes and course-correct. Not only are these traits indicators of an open mind, they also enable people around the leader to speak truth to power, for the consequences of silence can be many and unwelcome.

Yet we — the press, the analysts writing about companies, the electorate — find it difficult to forgive anyone, especially a politician, who changes his or her mind on an issue.

Not changing one’s mind is seen as a virtue, immortalised by Mrs Thatcher’s punny soundbite “You turn if you want to; the lady is not for turning”, before Mr Blair even tried his hand on the politics of soundbites.

Even the liberal press finds it hard to resist the chance to take a dig when it discusses a change in the direction of travel, a “u-turn“. See, for instance, the Guardian insist Philip Hammond digs in on his u-turn on national insurance for the self-employed.

This bald criticism creates pressure on leaders to be perfect, in-control, and always-right. It is unfair and wrong. And sad, because it demonstrates the rigidity of the electorate and the press pundits, who expect a leader to remain rigid, regardless of circumstances and possible outcomes of the original course.

An open mind is not cynical; an open mind is sceptical, inquiring and searching.

An open-minded voter or commentator does not distrust a change in stance as a knee-jerk reaction. What s/he does or must do is question the reason for the change, without sarcasm or without expecting an abject apology.

Is the change really just political expediency?

Is the change informed by new information?

Is the change driven by a new understanding of historicity, and how one might have been on the wrong side of history due to any number of reasons?

These questions hold good in both hierarchical societies as well as those who see themselves as more egalitarian.

Further, we need to remember that hindsight really is 20/20, and our understanding and memory of history both short and imperfect.

A friend and I were once discussing the leadership of Nelson Mandela. He is often cited in the same breath as Gandhi, who too had his flaws but steadfastly refused to support or choose violence. Mandela however categorically refused to denounce violence as a weapon in the pursuit of his cause. At the time the UK government under Mrs Thatcher was fighting another nationalist cause, which used terrorism and violence as its tools, namely the IRA. The policy of branding both the IRA and Mandela/ ANC terrorists was consistent with the thinking at the time.

As the President of South Africa, Mandela has been on record speaking in favour of luminaries, such as Colonel Gaddafi , the common cause being Africa and their shared identity as Africans. General Suharto was another one accorded high state honours by Mandela while he was a serving President.

Yet over time, the former “terrorist” Mandela came to be hailed as a hero. This shift took more than just one change of heart or mind.

In the United States, the Democrat Bill Clinton, the “first black president of the United States” did nothing to remove Mandela from the US Terrorism Watch list, while the Republican President George Bush signed a bill to change that in 2008. In the United Kingdom, where then-PM, David Cameron, who had once worked under the Thatcher government as a young whippersnapper, publicly noted in 2006 that the Thatcherite policy to brand the anti-apartheid movement terrorist was wrong. Predictably, the latter lead to many wondering aloud if Cameron was a Conservative at all — making one wonder if an extreme form of white supremacism is an essential quality to one being a Conservative in the UK!

But here is the rub. Post Robben Island, in his writings and speeches, Mandela was brutally honest in admitting his errors of judgment, mistakes, and shortcomings.

In other words, Mandela changed his mind too.

As leadership — and indeed, statesmanship — go, there are lessons in here for us all.

Especially in these times, when it is increasingly in vogue to dig in and refuse to consider the damage hard, inflexible stances can do.

Preferably before it is too late.

Brand leadership has to change

A few years ago, shortly after the 2008 crash, American Express in the United States paid many of its less profitable customers to close their accounts and go away. The move garnered much attention and analysis then. It was seen as a de-leveraging move. Whatever hubbub surrounded the brand then has since died down and in an unscientific survey of my business-savvy friends, few remember that this happened at all.

It was a story of a brand choosing its customers, rather than the dominant narrative that conventionally goes the other way round. The latter powers the nascent GrabYourWallet movement.  Another campaign, Sleeping Giants, is similarly holding brands and companies to account if they continue to advertise on extremist websites.

These are interesting times, as the Chinese curse goes.

As consumers, we profess to love brands that are “authentic“, never mind that in many cases, contrived authenticity, not rooted in values embedded into the business’s value chain, is all we are getting excited about.

What happens when “authentic brands” meet programmatic advertising? Unfortunate, inadvertent outcomes, that is what. Brands are left scrambling to do damage control.

What happens when “authentic brands” take a stand that is vastly unpopular? What happens when the brand’s CEO tells a customer she is free to leave if she does not like their philosophy? Isn’t that just the brand being authentic?

What when all signs point to the emergent challenges being bigger than the more popular political bugbear of the time?

Is authenticity malleable? Should it be?

What if a brand never had cause to reveal some of its stances before and is now choosing to do it in a way that consumers find abhorrent?

And when that comes to pass, should consumers force the brand to comply with their idea of authenticity, or choose to walk away with their wallets?* After all, wisdom says, when facts change, changing our minds is no bad thing.

These growing disagreements and schisms are why, more than ever before, brands need values at their foundation, in their DNA, embedded in their value chain.

Real, defensible, explicit values that the brand is willing to stand up for.

Not convenient values that change with the times or fads du jour.

It is then that brand managers will truly be able to use programmatic advertising as a tool to help them rather be helplessly enslaved by it, while they operate in a haze, whether it be about their brand values or technology.

It is then that “customer choice” will come to mean both that the customer chooses, or rejects, the brand and that the brand chooses, or rejects, the customer.

[* Switching costs for small businesses on a shopping cart platform are not negligible but then that is an economic argument, not one about values.]

 

Building your startup’s culture

This article is the ninth in the Startup Series on FirstPost’s Tech2 section and first appeared on January the 9th, 2017.

To be fair, building organisational culture is usually not on many founders’ radars in the early days, when much must be done in very little time. However as I have written in earlier columns, it is wise to consider building the scaffold of your startup for blazing success. Because while failure gives time to ponder, success rarely spares the time to do things over.

How can one go about laying the right foundations for a startup’s culture?

Culture is a catch-all term applied to business practices, processes, interactions and behaviours that make up the work environment in an organisation. Culture in a startup is how founders’ values manifest in practice. Particular business practices and behaviours may also be shaped by the founders’ personal pain points that they may be addressing with their startup.

As ever, starting with the basics is a good first step. If you are lucky, you and your cofounders are on the same page as to the values that matter to you and that set the tone — both for the organisation you wish to build with your cofounders and for your cofounder relationship.

The cofounder duo behind PostFold, whom I advise, created their fashion startup after noting that affordable fashion was often poor quality in materials and craftsmanship, or failed to understand the structure of modern life where one can seamlessly go from one’s desk at work to an evening do without an opportunity to change clothes. Their research also showed that regardless of poor quality, the markups on fashion labels were high but this did not necessarily mean that the master tailor and the machinists got paid decent wages. This, they noted, was a significant factor in poor retention of tailoring talent, which is crucial to the survival and success of a fashion business.

Their shared values were quite simple but firm. They set out to deliver a high quality of materials and craftsmanship affordably to their customers, while delivering a superior customer experience. This was the idea at the centre of their business design. They also wanted to create an atmosphere of trust and respect in the workplace, which shaped how people interact with one another in the business. This idea is in line with their belief that happy employees ensure that customers are served well. Remarkably — and this may not be feasible for all startups — the organisational values are also their core brand values.

In turn, these values shaped how they designed their business processes e.g. how customer complaints and returns are to be handled, how employees may be able to purchase the company’s products at a discount or borrow samples for occasional use, or how employees could choose work-from-home while delivering on deadlines and ensuring their collaborative projects did not get derailed.

Further, the clearly articulated brand values have shaped their brand communication strategy. If something does not increase their brand’s prominence or does not better the customer experience they aim to deliver, they choose simply not to do it. Avoiding bandwagons allows them to focus on building the excellence in serving their customers and keeping their employees motivated and engaged.

To recap, values guide our sense of what is important and what is right. Culture is how our values manifest in practice. Our daily decisions and behaviours align to our values. Processes and incentives can create reinforcement of the values on a day to day basis.

A media entrepreneur I advise has found a creative way of reinforcing the organisational values and culture within the team. He has created rituals and shared experiences to enhance the sense of belonging and the belief in their shared values. These shared rituals and experiences allow the team to speak freely, raise concerns, thrash out things and return to work with a renewed sense of commitment to their work and its purpose.

Like much else involving people and their interactions, the culture of an organisation evolves too, especially with growth and scaling. For instance, while the entire, currently small, team at the media startup I mentioned earlier can go on a shared experience, it will become harder even at twice the size.

Similarly, nearly all startups learn quickly that the formality of communications and the accessibility of the founders both change as the team size grows. This subtle change in culture can upset early employees and founders alike. At least as founders, you may find it helpful to make peace with that possibility early on.

In the next column, we shall talk about a specific aspect of building culture crucial to building a sustainable and well-run organisation.

The governance we need: a reflection

I have had both shared and personal reasons to have spent much of the last year reflecting on the nature of governance around us.

It was a year marked by sharp separation between opposing factions. This cleavage had long been in the making. The divide between the haves and the have-nots was growing with an empathy deficit. The difference between correct and manufactured reportage was lost. The political outcomes of both the EU referendum and the US presidential elections are being seen as a revolt against the soi disant elites, disconnected from the reality of the lives of many.

This is however not just an issue of national politics. A friend of mine informed me that today, January the 4th, the second working day of 2017, is “Fat Cat Wednesday.” Today the FTSE 100 CEO has apparently already earned the average annual salary of an average UK worker, a sum of £28,200.  The UK is one of the most unequal countries in the developed world. Even though the link between CEO pay and performance is “negligible” according to research, with 80% rise in pay delivering only 1% improvement in performance, the pay gap persists and is demotivating to over half the workforce. If we have learnt anything from the political seismic shocks of the year that just turned, we know this is an unsustainable state of affairs.

We are at an historical inflection point whichever way we look.

If governance is all about building stable organisations – whether national entities, for-profit businesses or non-profits, educational institutions or anything else – it is self-evident that we need a different kind of governance.

We need governance that reaches across the aisles and engages, to heal and possibly to collaborate – whether it is Hillary Clinton gracefully attending Donald Trump’s inauguration despite the bitter and personal campaign both fought, or business people such as PepsiCo CEO Indra Nooyi agreeing to serve on the economic advisory council in the Trump administration despite her criticism of the language used for women and minorities.

We need governance to listen and to understand one another’s concerns, which may necessitate learning how the other side uses the same words in the same language to mean different things.

We need governance that may seek efficiency but not at the cost of efficacy, because organisations are not dumb legal entities but living breathing ones, working within the ambit of their wider societal contracts.

We need governance to be anti-fragile, both in its intentions and its recognition of consequentiality of various choices, over time and not just in the immediate quarter that follows.

We need governance that is true, inclusive, collaborative stewardship for all.

If the last line reminds you of Edmund Burke’s view of social contracts, let’s not forget his words which may as well be about the governance we now need: “All that is necessary for evil to succeed is that good men do nothing.”

(Disclaimer: These are my own views and do not reflect the views of the boards of either JP Morgan US Smaller Co.s Investment Trust or BeyondMe, where I serve as a non-exec director.)