The best work question to ask yourself every morning

Edited excerpt from How to Spend the First 10 Minutes of Your Day by Ron Friedman:

Ask yourself this question the moment you sit at your desk: The day is over and I am leaving the office with a tremendous sense of accomplishment. What have I achieved?

This exercise is usually effective at helping people distinguish between tasks that simply feel urgent from those that are truly important. Use it to determine the activities you want to focus your energy on.

Then—and this is important—create a plan of attack by breaking down complex tasks into specific actions.

Notes:
(1) I like this question a lot, because it forces you to be proactive. It’s easier but far less effective to default to reactive, “feel busy” tasks, like replying to email.
(2) See: If you want to get more done, stop doing these things and How to clear time for deep thinking.

Why you should incentivize sales people for customer retention

Edited excerpt from Why This CEO Will Never Hire Another Salesperson by Brian de Haaff:

Here are four reasons why emerging technology companies will not look to commissioned salespeople to drive their business:

1. Relationships. Growing a business is about fostering trust and relationships, not pushing product. The goal is to show the value of the product and build a relationship with the customer. The only thing that matters is the customer’s success.

2. Authenticity. People crave honest suggestions, and can tell when someone is pushing an agenda. They do not want to be cajoled to buy something, especially a product that is a poor fit.

3. Collaboration. It’s much more exciting to collaborate to understand the customer’s needs vs. making a disjointed pitch when there is a bad fit.

4. Information. Today’s buyers have access to endless information and peer feedback like never before. New data on B2B sales shows that 60% of a typical purchase decision is made before talking to suppliers and up to 90% of the buying cycle is done before buyers speak with sales reps. This brings transparency to a process that was previously veiled. They don’t need someone to connect them with products anymore. What they do need is to be engaged, surprised, and delighted on their own terms.

Don’t get me wrong. There will always be people who work with customers, but I doubt that in the most successful companies that their compensation will be tied to the deals they close.

Notes:
(1) Brian’s right that the traditional commission structure for sales people misaligns their interests and their company’s and customers’ interests. But that in itself isn’t an argument against sales people. It’s an argument for fixing their incentive structure.
(2) Sales people are traditionally commissioned on closing a sale. That’s appropriate for businesses where the initial sale is the most important driver of profits. But in an increasing number of businesses, revenue per customer is spread out over a multi-year period, so lifetime customer value is determined more by customer retention than by the value of the initial sale. This isn’t only true of SaaS and subscription businesses, but of any business where growth will come from retaining customers as much as adding new customers.
(3) So how do you incentivize sales people for customer retention? Compensate them disproportionately for renewals vs. the initial sale.

If you have to have group meetings, do them like this

Edited excerpt from The Anti Meeting Culture by James Whittaker:

Get the right attendees and be aggressive about it. Invite people who can contribute and when people sustainably fail to contribute, un-invite them.

Make coming and going kosher. Halfway through a meeting and you realize you can’t contribute or don’t need to be there? Leave. Hold meetings in open areas where coming and going is more natural and fuss-free. Or remove the chairs from the conference room and stand up. You’ve just made the door easier to get to.

Big agendas mean lots of time switching topics. Too many decision points means too much debate. A long list of topics ensures that some people won’t have a stake in some topics and that’s a poor use of those people’s time. Single purpose meetings are the best: this is what we are here to do, now let’s use the meeting time to do it.

Multiple presenters — the more, the less merry. Each one has to do their little warm up and wind down and each must pay the technology tax of switching laptops and dorking around with display settings.

Follow up a scheduled meeting with scheduled work time. If a meeting has a purpose and requires action to be taken (like any good meeting should), schedule time immediately following the meeting to take that action.

Build an anti-meeting culture within your organization. Every meeting is useless until proven otherwise. Meeting organizers need to be put on notice: make this meeting meaningful, it’s your job.

Notes:
(1) A key reason bad meetings persist is that there’s no feedback loop from the attendees to the person running the meeting. Nobody asks the question “Was this meeting a good use of your time?” The solution is to do this.
(2) Re. Get the right attendees and be aggressive about it — cf. The optimal number of people in a meeting is…
(3) Re. Make coming and going kosher – see The antidote to bad meetings.
(4) Re. Meeting organizers need to be put on notice: make this meeting meaningful, it’s your job — cf. How to stop regular meetings from clogging up your time.

Should team leaders in startups write weekly reports?

Edited excerpt from Tips for Startup CEOs by Evan Schumacher, via David Cancel:

Every Friday have all your direct reports submit a “weekly update” one page or less focusing on progress against metrics, key accomplishments for the past week and summary of what’s on deck for the next week. Then, aggregate/consolidate/summarize those updates, add CEO level stuff, and forward to your board on Sunday night.

Why this approach?

— Every team member should spend 30 minutes reflecting on the week. The key is that these updates are shared with other executives who are expected to read them prior to the team Monday morning management meeting (another management tip). That way the meeting is productive, focusing on issues and not “status updates”.

— By sending a report to board members on Sunday nights, you’re on top of their inbox when they are catching up on their weekend emails so there’s a chance they’ll read it. Then they’ll be up to speed on your business during their Monday internal meetings, which makes them look good (and thus, you as CEO look good).

Notes:
(1) In Seeking Alpha, we standardized on monthly reports. Some team leaders and their team members also chose to write weekly reports, while others found them too onerous. Wonder what the wider experience of this is.
(2) Re. That way the meeting is productive, focusing on issues and not “status updates”: We find that providing written materials before meetings eliminates the need for updates during meetings, and therefore makes the meetings far more effective. We follow Amazon’s practice in allotting time at the beginning of meetings for people to read the written materials.
(3) Cf. How to write a monthly report for your investors or manager.

How to interview a VP SaaS Sales — questions to ask

Edited excerpt from Jason Lemkin in 10 Great Questions to Ask a VP Sales During an Interview:

1. How big a team do you think we need right now, given what you know? (If he/she can’t answer — right or wrong — pass).

2. What deal sizes have you sold to, on average and range? (If it’s not a similar fit to you, pass. If he/she can’t answer fluidly, pass).

3. Tell me about the teams you’ve directly managed, and how you built them. (If he/she can’t describe how they built a team — pass).

4. What sales tools have you used and what works for you? What hasn’t worked well? (If they don’t understand sales tools, they aren’t a real VP Sales).

5. Who do you know right now that would join you on our sales team? (All good candidates should have a few in mind). Tell me about them, by background if not name.

6. How should sales and client success/management work together? (This will ferret out how well he/she understands the true customer lifecycle).

7. Tell me about deals you’ve lost to competitors. What’s going to be key in our space about winning vs. competitors?

8. How do you deal with FUD in the marketplace? (This will ferret out if they know how to compete — or not).

9. Do you work with sales engineers and sales support? If so, what role do they need to play at this stage when capital is finite? (This will ferret out if he/she can play at an early-stage SaaS start-up successfully — and if he knows how to scale once you scale).

10. What will my revenues look like 120 days after I hire you? (Have him/her explain to you what will happen. There’s no correct answer. But there are many wrong answers).

11. How should sales and marketing work together at our phase? (This will ferret out if he understands lead generation and how to work a lead funnel. Believe it or not, most candidates don’t understand this unless they were really a VP Sales before).

Three simple rules to ensure your product team is goal-driven

Edited excerpt from How to say “No” to your CEO’s random product ideas by Brian de Haaf, CEO of Aha!:

As the lead product manager, you hear about the “great new idea” on a daily basis from every team. Each person making suggestions seems to have good reasons why you should add their idea to the product roadmap. Here’s how to say “no”:

1. Goal first. Set your product strategy and then be proactive about communicating it within the rest of the organization. Define your vision and make sure everyone understands it, then your strategy can say, “No” for you.

2. Score ideas. You should rank features and prioritize the ones that will have the greatest impact on the product and the company.

3. Share your roadmap. Our product team shares our roadmap regularly with the entire organization. This ensures that we are all on the same page and working towards the same goals and initiatives.

Notes:
(1) There’s some valuable advice here, but the mindset of the article — how to say “no” — seems wrong to me. Instead, consider Sam Altman’s advice for product managers to “listen to everyone, then make your own decision”, and Seth Godin’s approach in When you’re given advice, here’s how to listen with an open mind.
(2) I’m a skeptic of product roadmaps. At Seeking Alpha, we find that long roadmaps make little sense. It you have a product roadmap stretching out six months, for example, that’s the same as saying “No feedback from customers or the market, and no results of any tests will impact what we do for the next six months.” That’s obviously crazy.
(3) Instead, a better approach is to have only your top three or five ideas ready for testing or launching. You can revise the list right up until the last moment before development. All your other ideas should be kept in a list — and you can score them there, as Brian de Haaf suggests. So I’d change his third suggestion to “Share your idea list”.
(4) Cf. The best growth teams maximize the velocity of tests and Why another new feature won’t get people to use your product.

How to write a monthly report for your investors or manager

Edited excerpt from Why communicate more with your existing investors (and how to do it efficiently) by Armandi Biondi:

There are two key benefits to sending your investors a monthly recap: a) you’ll give them a broad-enough but meaningful-enough perspective on what’s happening, b) you’ll give yourself a forcing function to generate relevant results in a reasonable amount of time. Here’s how:

  • Short & sweet always win.
  • Be numbers-oriented. How did your key metrics perform compared to the last month figure and the overall total? Where do you expect to go a month and a quarter from now? Those are the only things that matter.
  • Think actionable. Write about what you did and how it generated impact on the company, and what you’re going to focus on in the next 4 weeks.
  • Design matters. Use bullet points, divide the topics by area (I use five: product/tech, sales/clients, funds/corporate, press/pr, team/hr), leave some space, order things by priority.
  • Attach some multimedia content. Examples: the screenshot of the Monthly Numbers on your real-time dashboard, mockups of the UI upgrade, videos of the team at the latest relevant event. Let them be part of the excitement.
  • Include cash position and burn-rate. How much money is in the bank, how much did you burn this month,  how long are you covered for?
  • Trigger their attention. Use the subject “IMPORTANT > Monthly Investors Recap”: it will stand out. And open your email with two lines of “TL;DR” underlining the three most important things you want them to know and remember.
  • Ask for what you need right away. Consider them a resource to tap into. Put it on top and write “The single most important thing that we need is…”.

Notes:
(1) In Seeking Alpha, every team leader and “metric owner” writes a monthly report.
(2) We fulfilled much of the advice here with a standard template. The Seeking Alpha manager’s monthly report is a Google doc shared with the whole company. It must not exceed one page. It contains four sections: (i) Key Metrics (ii) Candidly, How Successful Was I This Month? (iii) Top Things To Figure Out (iv) Goals For Next Month.
(3) When Seeking Alpha was a fresh startup, I sent a monthly report to investors. After a while I only shared our quarterly board packet. Question: How frequently should companies update their investors, and does that depend on the stage?

Is your startup a zombie? These metrics and behaviors will tell you

Edited excerpt from Zombie Startups by Danielle Morrill:

How do you know if your startup is a zombie? Here are some hints:

  • You don’t want to get out of bed in the morning
  • You don’t want to go out in public for fear you’ll have to explain what you do
  • You haven’t hit 10% week-over-week growth on any meaningful metric (revenue, active users, etc) at some point like launch or some other PR event.
  • You’re working on the same idea after 12+ months and still haven’t launched
  • You’ve launched a consumer service and have less than 2% week-over-week growth in signups
  • You’ve launched an enterprise service and have less than 2% week-over-week growth in revenue pipeline
  • You are the CEO and hole yourself up in the offices so you don’t have to talk to employees
  • You’ve hired consultants to figure out revenue, culture, or product in a company of less than 10 people

Does any of this sound familiar? If so, don’t panic – you can fix this. Acknowledge the reality of your situation. Then figure out what to do next because you don’t want to waste a single moment of your life in denial, in deadlock, in zombie mode waiting for something you can’t control to change or expecting magic to happen.

Does this make someone a troll?

Edited excerpt from points I made in a discussion about the Iran debate:

One of the things we learned from building Seeking Alpha’s successful comment community was which behaviors hindered productive debate and caused animosity. One of the most common is: Ascribing negative motives to someone you disagree with.

When you ascribe negative motives to your opponent, what you mean is: “You’re only saying this because you’re biased, not because you really believe it. So if I can reveal your motives to everyone engaged in this debate, I don’t need to address any of the substantive points you made.”

That, of course, is wrong: even if someone is biased, their reasoning might be right. Ascribing motives is therefore a cowardly way to avoid having to address the points your opponent made.

The ascription of motives to an opponent is also, in most cases, highly questionable, because it’s usually impossible to verify someone’s motives unless they state them explicitly. Once people start ascribing motives to their opponents, the debate becomes an unwinnable mud-slinging match, where each side throws allegations about motives at the other side which can’t be proved or disproved. That’s a sure recipe for acrimony and polarization. Even more troll-like is to ascribe motives to someone which contradict what they themselves have explicitly stated are their motives.

Ascribing motives to people in a debate is therefore a polarizing distraction from the real issues. So if you care about an issue, and you’re discussing it with other people, you should avoid ascribing motives to people you disagree with, or responding to comments by other people who ascribe motives to those they disagree with.

Notes:
(1) Question for moderators of comment communities: Is ascribing motives to other people sufficiently troll-like to warrant blocking those who do it consistently?
(2) Cf. Should websites shut down comments?

The strongest reason why you should locate your office to minimize business travel

Edited excerpt from The sad, sick life of the business traveller by A.W. of The Economist:

Researchers at the University of Surrey, in Britain, and Linnaeus University, in Sweden, have published a new study highlighting what they call “a darker side of hypermobility”. The “hypermobile”—largely but not exclusively business travellers— suffer from three types of consequence:

1. Physiological effects: Jet lag, whose direr, if rarer, potential effects, include speeding ageing or increasing the risk of heart attack and stroke; danger of deep-vein thrombosis, exposure to germs and radiation; less exercise and less healthy eating than people who stay in place.

2. Psychological and emotional effects: “travel disorientation” from changing places and time zones; mounting stress, given that “time spent travelling will rarely be offset through a reduced workload; isolation and lonliness due to the absence from family and friends.

3. Social effects: Marriages suffer from the time apart, as does children’s behaviour; relationships tend to become more unequal, as the partner who stays at home is forced to take on more domestic duties; friendships fray, as business travellers often “sacrifice local collective activities and instead prioritise their immediate families when returning from trips”.

Notes:
(1) Thank you William Gadea, founder of IdeaRocket, for the tip.
(2) These costs suggest that companies should locate their offices to minimize the need for employees to travel frequently.
(3) Cf. The pros and cons of locating your startup outside Silicon Valley.
(4) When business travel is necessary, what are the ways to minimize its negative consequences?