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Cubitt

lines on the record: 77
first: 2020-10-27
most recent: 2020-10-27
sittings or episodes: 1
sources: podcast

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“Life richer and more poignant, meaningful is the ultimate happiness that you can get. And you have to look no further than donating to a charity. It's an endorphin rush every time you do it. When you teach a young child to learn to read or something new, there's a huge endorphin rush. And I think if you focus your energy on those give back areas, you're about as happy as you can.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, we do. Yeah, I think my personal philosophy is there's three levels of happiness. And the first level is somewhat simplified by saying it's physical, right? So it's the five senses that we all have. So visual, auditory, et cetera. And I think most people live, with all due respect, I'd say most people live in the five senses world. So they consume food because it tastes good. They watch movies because it's stimulating. They listen to sound. They enjoy good wine and trips and stuff like that. But they're all physical massages and so on. I think the next level up is a little bit more interesting in that it's about learning, right? So the endorphin rush you get when you learn something you didn't know and it clicks and it helps form you. I find that as a key piece of happiness. So you're constantly in pursuit of that. And ultimately, I think that philanthropy and giving and charity and teaching is the ultimate form, right? So giving back what you've learned in life and making someone else's love.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“It is like, how do you even hear anything? Truthfully, it's probably 2x on average. But for me, it's a volume game. And maybe it shouldn't be, but I'm a little bit ADD. And so I don't like the middle sections of books. I'm only looking for four or five nuggets in a book. And the faster I can get to those, the sooner I can get done and get on to the next one. I sort of feel like there's this ocean of knowledge out there. And I've got to swim through as much as I possibly can.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Is for them and why they're living it. But I will say, and I'm quick to say it, I'm a terrible consumer and a terrible retention. We've talked about this in the past. So I listen at high speed.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, my sort of goal with reading and consuming information is twofold. One is for my work, right? So I listen to a lot of podcasts and books around startups, successes, and failures, looking for clues on how companies can fail more than looking for success indicators. And that just helps me in my day-to-day business. The other sort of half of the content that I consume is around two fundamental questions. One is understanding what the meaning of life is and to put it in a broad perspective. So searching for what is happiness, what is truth, what is the point of it all, and by reading fundamentally biographies up and down the line from Marcus Aurelius to Putin to even Trump's biographies written by third parties are interesting in that they give some inkling and some insight into what”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Oh, I love it. I use that in networking. So I'll go into a room and I know there's somebody in that room that I have to meet and my job is to find them and find out something interesting about them. And I use it as a mission. It's great.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“When I talk to people, I look for failure mechanisms that I can avoid. And the lesson I give my kids is if you do less talking and more listening, you can find out what the other person knows and you already know what you know. And so now you've doubled down on your knowledge base and you haven't necessarily given anything up. And of course, conversation should be bidirectional. But the point is learn from everybody around you and don't be afraid of failure because smarter people than you have failed a lot”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“You know, honestly, the best part of this job is interacting with people smarter than me. And if I had to sum it up, I'd say my goal in life is to be the dumbest guy in the room. And I'm not so dumb. So I'll declare that. But the point is entrepreneurs and innovators and change agents are the most interesting people that you'll ever meet. And so it's a privilege to get to work with them and alongside them and back them. You know, I think one of the key lessons I've learned is that I try to pass on is failure is okay. Failure is actually a feedback mechanism to allow you to improve. So I spent a lot of time”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“I'm not saying it's not co-opted. And certainly cryptocurrencies is the first example of blockchain technology in action. I'm not necessarily sure that that'll win the day. There are plenty of other applications of ledgers like supply chain, like identity that are much more applicable. And because you can't mess with the underlying data without being found out inherent in that is a level of trust.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“We don't invest in cryptocurrencies, but we do invest in the underlying technology of cryptocurrencies, which is distributed ledgers, right? So in my view, this is a form of liquid trust that all parties can get behind. And if you think about business transactions at its most fundamental level, it's about trust. And as the world becomes a smaller place, trust is even more important. And so leveraging things like distributed ledgers, like blockchains, enables that to happen.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“In the future. So basically, the software will ask you 10 questions that are salient that the AI figured out to ask. And if you answer yes or no positive negative, it will predict for you whether you will win or lose the case. And the upshot of that is that the judiciary system can focus on cases that are 50-50, which really do need to be added to jurisprudence as opposed to the frivolous cases where you clearly shouldn't win or you clearly should. So that's an application of AI in legal. I think areas that we're quite excited about are where you have this collision between disparate areas of technology and knowledge. So we have another company that uses behavioral psychologists and AI and debt relief as a conglomerate and they provide an incredible solution. But it's really adding multiple disciplines of technology and understanding and bringing that to a product.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Let me reframe the question to what I think is interesting as an investment area. Our view is that we invest in technology, but not for technology's sake, technology that enables application of technology. So, for example, AI, a lot of people talk about AI being a sector. AI is not a sector. AI is math. AI is an algorithm that's enabled by very fast processors with new ways of thinking about how to analyze big sets of data and now smaller and smaller sets. But AI in and of itself is not that useful. But AI combined with a subject matter as a collision is really interesting. So we've invested, for example, in a company called Blue Jay Legal that does AI meets case law.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Well, I think it's certainly an opportunity. And I think there's a wave of diversity and inclusion that's happening that we will all benefit from and it's irreversible at this point. So I think, yeah, I think it bodes well for the future.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Well, I think it also speaks to a broader concept of diversity in general, right? So people who have lived tougher lives tend to be a little bit more flexible. So that's why in general, foreigners are better entrepreneurs, in my opinion. And I don't want to overstate it. But they're willing to leave their country, their city, their place of growing up for new frontiers, maybe a new language, new culture, certainly. That alone is a strong indicator of their ability to adapt and thrive in an unknown world.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“I remember you talking about that, and I think what's important there though is the fact that he realized that change was permanent. And so the adaptation process around work from home was going to be permanent. And that recognition drove some of those decisions as opposed to if it's temporary, then I'm going to go back to the status quo. So that's a visionary CEO.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, no, it's a really good point. And one of the problems with the thesis is there's a survivor bias, right? So the ones that did go against the grain and were successful can claim victory, right? There's lots of people who you predicted 9-11 and they predicted, you know, the pandemic and they were right. But the 99% who say the sky is falling every day are wrong. So it's okay to be contrarian and thoughtful about being contrarian, but it doesn't necessarily always win the day.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Drastic, decisive, and correct in the end. And there was a no regret move because, worst case, you know, everybody comes back to the office. It's a non event, but should the worst come to pass, which it did, you know, was the right decision. The opposite is a CEO who at the end of April said, do you think we should do something about this? Should we go remote? And that's a time lapse difference in the two CEOs.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“And you were in the correct camp, absolutely. And, you know, within about two or three weeks, before the, well, before the end of March, he was remote, that CEO, he was in a cabin, full Wi-Fi, directing things on a fully remote team. And his view was, I simply can't get sick and I don't want to get anybody else sick. And so that's the action he took, which was very strong.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Employees, I bought a bunch of PPE gear and they have protocols in place. And I was dumbfounded, right? You know, it was in my mind, it was a non-event at that point.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“An ACEO is an executive who sees change coming six, nine, 12 months ahead of everybody else and has the ability to change course in the face of opposition from everybody else who is happy with the status quo. And so that's a good rubric for thinking about COVID and March, right? So we went through this because we obviously have dozens of companies. We have dozens of experiences with different CEOs and how they dealt with the crisis. I'm happy to say that across the board our companies are doing well, mostly because we invest in enterprise software. And so again, the utility of what they provide provides value. Having said that, there is a difference between the reaction of different CEOs in that time. The best CEOs I can think of, I have one specific in mind. We spoke in early March and he said, you know, I'm really worried about this COVID thing. Have you heard about it? I'm thinking about going remote with my”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, there's a question buried in there, which is what's the difference between when a really good CEO and kind of a mediocre CEO? And in my view and experience, and actually even some research to back this up, that the most successful companies are highly correlated with timing, first of all. So are you in a bear market or a bull market? That's the number one correlation between success and failure in business. Number two, correlating a success factor is the market that you're in. So if you're in healthcare, if you're in IT, if you're in primary industries, each have their cyclical time of success and failure. So again, that kind of comes back to timing.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“So we've invested in 29 companies in total in Mistral. And I want to think that there's about 20 left running. And so we've had a number of exits and failures, couple of failures so far.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“I've always been comfortable with failure so long as that I face it with integrity and work hard to do the best I can. And then I am comfortable with it. I think, you know, ironically, my personal portfolio is quite conservative. I have a lot of real estate investments and I do ETFs. I don't day trade. I invest in my funds, of course, which is investing in myself. But outside of venture capital, I'm quite risk-adverse, which is ironic.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“It's the nature of the game, right? I mean, if you're afraid of failure, you shouldn't be a VC. That's for sure. This is probably the highest risk asset class in private equity that there is. And so by its very nature, half of your companies are going to fail. And if you're not comfortable with that, then it's probably not for you. And so the real question is, how do you deal with it when you start to see the ship going sideways? And there's lots of tools for that. For a VC, we can advise the company or coach them to sell the business early, try and recover some capital. We can make a change at the CEO level on occasion, not my favorite thing to do because I think it rarely turns out well. But there are things we can do to write the ship. And, you know, if all else fails and the company goes under, that's the nature of the game.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“The economics of that provide us with a 50 or 100 of AUM payback. And what I mean by that is let's say you have a $100 million fund and you have a company that you've put $10 million in and if you walk away, maybe you get $2 or $3 million back. But if you help them, maybe you get full $10 million back. So we think we can preserve probably half of the fund by putting in the extra time. Now, the trade-off, of course, is that it is extra time and it is a lot of energy. And so it's not for everybody. But part of our ethos is that we enjoy working with entrepreneurs. We want to roll up our sleeves. We have a lot of experience and we want to bring that to bear.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“That's it. And so in our last fund, our cap was $500,000. And it's a very small percentage of the overall fund, to call it one or two percent for each deal. And so you don't lose any sleep by walking away from those deals. And to be clear, we make those expectations super clear up front with the founder. So we say, look, we're not writing a bridge note. We're not following on unless we meet these milestones that the market basically decides whether you exist or not. And they're comfortable with that. So that's the structural way that we do it. Having said that, there's always cases where company is doing fairly well, not super gangbusters, but they're doing well enough to warrant a follow-on investment. And so now we're in it. And that's really the hard questions happen. So then it starts to go sideways or the market speeds up and goes past them, et cetera. Our view is that we're partners with the entrepreneur through thick and thin. And so all the way to the end, we work very hard, even with the companies that aren't going to be gangbuster successes. And we think that.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, there's a number of different models, but some VCs that I know, I won't name names, believe in cutting bait early. So they will invest in a company. And if it's not tracking, they simply walk away, whether they sell their position or resign from the board and let the company fend for itself is their strategy. Our view is twofold. One is because we invest a small amount up front, we have a structural sort of gate at the series A before we invest a significant amount of capital. We have a much more clean decision, thorough diligence process. And that means that we can walk away from our early bets with minimal capital deployed and chalk it up to a learning experience.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“And this is what separates really good entrepreneurs from the rest of the pack is they have that vision. They have that crystal ball that they can see and more importantly, they have the ability to articulate it and convince not only co-founders and employees to join, but also investors and customers to see that vision with them.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“I think I'll answer it bottoms up the balance of the team, the C level team and the rest of the employees are evaluated on a matrix basis, right? So your CFO, do they have the credentials and experience that makes them suitable for that role? And that's the same for engineering, et cetera. Do they have the right tools that we think are necessary to get the business past this stage? Because it's not always necessarily the team that starts doesn't necessarily finish. In fact, that's most appropriate. But it really comes down to the narrative of the CEO. It really does. And it's their vision of the future that doesn't exist today that you want to buy into, that you want to fall in love with and get excited about and then play a role in. And so it really does always come back to that vision.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I mean, that problem is age old, right? The quintessential business school example is VHS versus Betamax, right? One was better technology. It was smaller, denser, et cetera, and it still failed. They were out executed. And so no question that marketing and sales trump ideas and technology all day long.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“It's much easier as an engineer to build things with lots of bells and whistles and features than it is to go and talk to a customer because they're big and scary and they say no. But the opposite is actually the best path. Go talk to customers first and then solve their problem second.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I've made this mistake so many times. I want to see fall in love with technology. Yeah, I mean, you fall in love with technology as a focus group of one, which is mistake number one, right? So I'm a terrible focus group, for example, but I'm a technologist. So I love the GWiz disruptive technology. The problem is that the world may not. The world is a fickle place and doesn't necessarily think the way I do. A stolid mistake that founders can make is relying on the better mousetrap to solve the day. So the better approach is to do a lot more customer exploration and find out where the real pain is in the market and customize your product to suit that. And I can tell you that”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“So that's the seed stage. Going into the series A, you have to have enough momentum and some early economic ratios, LTV to CAC, for example, to prove that there's a market for your product. And so the Series A investors want to talk to a lot more customers and validate that this thing starts to scale. The Series A investment dollars is really around adding that scale, adding salespeople, refining that box that I mentioned, and understanding clearly the business economics, the unit economics of what you're selling, what your cost to acquire a customer is, and then at the Series B, it's all about scale. So we have a machine, we know it works, we pour gas in the tank, it's just going to go even faster.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Right. No, it's a great question. And it comes down in my mind to a business is a machine in a box. And what you're looking to do is put money in one side of the box and have more money come out the other side of the box in a very simplistic way. At the seed stage where we play, rarely do we know we have product market fit. So it's a lot of customer exploration, a lot of talking to customers some early customer trials, some indications that the product does what it says it's going to do. And we explore that with our companies. Now there's an overarching thesis around what they're doing and the utility function, which is a function of the value that you're providing to the customer. So we think a lot about the value proposition. In other words, if I give you this product for $100,000, does it save you a million dollars rough economics 10x? And therefore you're going to buy it. So we have that thesis and we have some early customer exploration and customers that we can talk to. And that's the beginning of the relationship.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Dollars in and get reasonable ownership out at the same time, the founding team needs to have enough equity to make it worth their while. And I think some VCs have it upside down where they say, well, we're going to own all this business, but then you've lost alignment of your founder. And if you lose your founding team, then you're in a lot of trouble. Similarly, employees, the option pool has to be sufficient and interesting enough to attract the right kind of talent. So we think about all of those dynamics when we come up with a term sheet and the valuation so that we're best prepared for the long term.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Completely arbitrary. Yeah. No. No, there's some rubric. So, you know, they're in SaaS based businesses because they're very data driven SaaS. There are obvious statistics like the cost of acquisition of a customer, the CAC, the lifetime value LTV. There's ratios. There's different dynamics that you can pull from other companies that are successful and you can apply them to your company. And then you can raise and lower generally it's a price to sales multiple. You can raise and lower your multiple based on the dynamics, right? So if I have very high churn, you're going to get a lower multiple if I have very high margin, let's say in the high 90s, you're going to get a higher multiple. But at its core, it's a function of a couple of other things that are somewhat different. One is the investor syndicate needs to own enough to make it worth their while, right? So a lot of ECs will say, I need to own 20 or 30 percent. We won't get involved otherwise. Angel investors may simply want to put”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Definitely not cashing out entrepreneurs at the seed stage, right? And I think it's probably wrong to assume that you're going to get a secondary seed stage. Every once in a while, at a Series A or Series B, typically a Series B, and I think it's prudent for an entrepreneur to take some cash off the table, generally good entrepreneurs aren't necessarily cashed out millionaires. And so the stress that it puts on them and their family can be alleviated a little bit by taking a secondary at the Series B. But we want full alignment early on because we know how hard it is. we need everybody rowing in the same direction.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“But we can figure that out whether there's enough to go forward in that first meeting. And then the team itself, again, it's a relationship building exercise. It's multiple meetings over multiple days and a rapport gets built up. Then if we agree that we want to move forward with the deal, we'll start doing diligence. So ideally, we're talking to customers. We're talking to personal references. We're getting to know the team even better, understanding the business model, challenging it, going through it, establishing all of those check marks. And then we'll have a conversation around valuation and structure and how much we're going to invest and what expectations are on both sides. And if everybody agrees on that, then we have an agreement in principle. So we'll draft a term sheet. Entrepreneur will react to the term sheet. Some negotiation happens back and forth there. And once that's done, we make sure that we have a full syndicate. We do definitive docs, which is the legal process. And just for early stage entrepreneurs who are listening, it's probably $20,000 or $30,000.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“A bit more of a long winded answer. The process for us can take anywhere from, I'm going to say, two months to a year, and actually in multiple deals, it's several years for whatever reason. We're tracking companies. But it starts with that initial meeting. So we'll be introduced to a company through a reputable source, one of our limited partners, another VC, an accountant, you know, a lawyer, et cetera. We'll have that meeting and we'll decide whether we're interested at all right out of the gate. And so that comes from three things, three core questions. Do we like the team? Do we like the technology? And do we like the market? So we have a general rubric of what we invest in, which is enterprise software. And we're looking at the intersection of technology and enterprise function. So does it meet that market segment? Is it big enough? Is it growing? Is it interesting? And we'll be able to assess that fairly quickly. The technology itself takes a little bit more digging and probing.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Without question, I mean, I couldn't have said it better myself. The board meeting is a time to reflect. It's a time to prepare for. It's accountability, right? We all know that the gym conundrum, you only go to the gym because your coach is there and you don't want to show up late and that forces you to work out and become a better you. So it's the same thing with board meetings. So it's the preparation process that is really where the value lies. And in that quiet contemplation that the CEO goes through that's out of the weeds, out of the day-to-day.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I think of it as several tiers of advisors, right? So as an investor, we generally get the right to be a board member or an observer in their board. And that's really fundamentally so that we have information that we can report to our bosses, which are our limited partners. So that's contractual right. So there's some board members that are filled by the investor base. And then there's usually one or two independents that we shoot as high as we can. We get experts from those industries that have a pension for early stage companies and want to help out. We're all about finding the very best talent that's available.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Means that you're observing and advising and reacting, but you're not managing. You're not necessarily creating dictums for the company to follow. Because the reality is that the company and their team are in the business to 3,000 hours a year as a board member, several dozen hours a year. You're certainly not qualified. And if you are, you should be in the company, right? You're not qualified to run that business. And so it's a different dynamic at that point. I think board meetings then are a lot more about governance, later stage, conflicts of interest, you know, public market facing type dynamics that are very different than an early stage company.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Yeah, I think at some level, later stage companies, it's a very different dynamic. So I'm on a bunch of, or I'm on at least a couple of formal large $100 million plus company boards. And it's a lot more formal. It's a little bit more nose-in fingers out. Actually, it's a lot more nose-in fingers out to use that cliche. What is that?”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Business, that's the entrepreneur's perspective. From a board member's perspective, I think you have to show up with some humility and empathy for what the entrepreneur is going through, the other 160 or 180 hours before you met them last or after you met them last. And so I generally think of early stage board meetings as really brainstorm meetings, not board meetings. The board meeting part, the formal part of the governance is five or ten minutes, right? It's stock option allocation, it's strategy around syndicate investors follow-ons and so on. But the vast majority of the meeting should be on the whiteboard talking about core strategic decisions for the company, which markets to go after next, who to hire, how quickly to spend the money, what's our fundraising strategy, you know, deep, deep important questions like that.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Think what I'll maybe try and do is reframe the question what is a board meaning for early stage companies. So we kind of bind it there. What we tell our entrepreneurs is that they're not really board meetings. They're a moment for you to get out of the weeds and riff with a bunch of sympathetic aligned partners on where to take the business and out of a sort of day-to-day tactical decision making mode into a strategic decision making mode. So that has implications on both parties. So from the entrepreneur's perspective, there's a spectrum of, oh, I hate I have to report to the board and I've got to spend three days crafting all these slides and then I'm going to go in and they're going to tear it apart. The other extreme is I'm using internal documents that I'm using to run my business and that's what I'm presenting to the board and I have thought about it and I have three or four key strategic questions that I want to discuss with the board and get their perspective and then come away with a slight adjustment or realignment of this.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Not necessarily. I mean, board dynamics is a whole other subject, but I think it's a variety of perspectives, board meetings in general are a venue for everybody to say what's on their mind and get educated and put it all on the table and then hopefully the best decisions come out of that meeting, not necessarily unanimous.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Talk to me about some of them. You know, I often say, and this is a bit tongue in cheek, but it's the entrepreneur's job to lie to me until I cut them a check. And it's my job to pick the best liar. And so, you know, integrity, notwithstanding, which is, of course, critical here. But when you challenge an entrepreneur with a tough question and you challenge their assumptions, you know, they can react in a myriad different ways, right? So they can obviously be really I'm qualified to advise and be a mentor, but I'm not qualified to run their business.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Both pre and both. I mean, certainly you do your best pre, but once you invest money in a company, you have skin in the game, it's a different dynamic altogether.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“Well, it does, and at its core coachability is sort of a willingness to be introspective and a willingness to respect feedback, whether it's from the market, from your employees, from your customers, from your investing partners. And so the entrepreneur who dismisses all of that and sort of their ego precedes their rationalness, they end up failing, in my experience. And so coachability is critical. And you test that very quickly by challenging them in initial meetings and saying, you know, I don't agree with that. That's the wrong approach and just see how they react. And sometimes I'll be a little bit provocative just to test it.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT
“It depends. It depends on how coachable the entrepreneurs are. And I don't say that with any sort of arrogance, but a good entrepreneur is a good listener as well, right? They don't necessarily follow your advice because that's not necessarily a good thing, but they'll listen to ideas and perspectives and then they may write the ship. So I've been in situations where an husband and wife team, they decide, yeah, you're probably right and we're already feeling the strain at home. And so therefore one of them is going to go off and she's going to continue to run the business as an example. But if they dig in their heels and say, you know, it's not going to be an issue. I guarantee it. I know that we're different than everybody else and we probably walk away.”
2020-10-27 · The Knowledge Project with Shane Parrish · #95 Code Cubitt: Coachability Is Critical · IDENTIFIED FROM THE TRANSCRIPT