“We’re upping our plan for the year,” “James,” the CEO of a very successful startup I’m working with said to me. It was the second time he’d increased his plan in the past six months.
“Cool,” I said. “You’ve finally entered what I call ‘turn the crank’ mode. The flywheel is turning at a really good pace, so your revenue growth will get easier and easier.”
“Yes, it is,” he said. “I think revenue is going to double to over $20 million this year.”
“That’s fantastic,” I said. “How’s the team feeling?”
“They’re really pumped up,” James said.
“I’ll bet…
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“How much money are you going to try and raise?” I asked “Sarah.”
“I’m thinking we should raise $1.5 million this round,” Sarah said to me.
“How long will the money last?” I asked.
“I’m not sure,” Sarah said. “I’m waiting on my fractional CFO to give me the data.”
You need to know how long your funding will last before you raise money.
I sighed. “Okay,” I said. “Let’s see if we can come up with a reasonable guess. How much money do you think you’re going to burn, after you calculate your revenue and your expenses, each month?”
“I think it will be around $150K per month,” Sarah said.
“All right. Then…
“This is the first time we’ve ever disagreed,” I said to Gill, one of the investors in my company. I had just told him that I wanted to get a loan for my company, and Gill, much to my surprise, was against the idea.
“I know, Brett. I know,” Gill said. “My feeling is that Venture Capital is like jet fuel for a startup.
“A loan is like the exact opposite of jet fuel.
“Besides,” Gill said ominously, “Loans always come due at exactly the wrong time.”
Loans are great for extending your runway.
Two weeks prior to meeting with Gill, I was meeting with Tina, our…
“With this next round of funding, we’re going to valued at $1.5 billion,” “Ray,” a CEO I’m working with, said to me the other day.
“That’s awesome!” I said. “Congratulations. I remember how hard it was at the beginning. You’ve come a long way.”
“I know,” Ray said.
You have to start with a game changing idea.
Working with Ray has been a wild ride.
I met Ray through a mutual friend, Aric. Aric asked me, as a favor to him, to help Ray start his company.
From our first meeting together, it was clear Ray had a game-changing idea. …
I recently wrote an article titled, “Should You Be Friends With Your Co-Founders?” In the article, I focused on the differences between you, the CEO, and your co-founders, the loneliness of being CEO, and how you can’t freely share everything with your co-founders.
My beliefs on co-founder relationships is based my experience as a CEO, and it is based on my experience working with other CEOs. Needless to say, not everyone agreed with my thesis.
For example one reader wrote me, and said:
“I’m of the belief, that with anyone, especially my cofounders, that if we have the same information…
“I want to join your company Brett, but I have conditions,” Greg, one of top ten engineers on the planet in my industry said to me.
I smiled. Then I said, “Okay, what are your conditions?”
“Well, there’s really only one condition I have,” Greg said. “I want to take three to six months off every year to travel. Will that work for you?”
I didn’t hesitate. I immediately said, “Yes, we can make that work. When can you start?”
“I need to wrap up the design I’m working on at Maxim (our larger competitor). Then I can join you.”
…
“I think each of the founders should have a company credit card,” “Randy,” one of my co-founders said during a staff meeting early in our company’s history. “it will ease some of the burden on you.”
“That’s okay,” I said. “I want the burden.”
Randy’s request seems reasonable, doesn’t it? Yet I was dead set against it.
Credit cards give people the ability to spend without approval. That’s a recipe for disaster when you’re just starting out.
Eventually you can loosen the grip on spending, but not now. …
“Man, you’re living a charmed life right now,” I said to “Ray,” the CEO of a very hot startup I’ve been working with.
“Thirty minutes and he’s (an investor) going to give you $75 million!” I shook my head in disbelief.
“It makes up for the problems I had earlier,” Ray said.
When your startup is hot, you can get funded insanely fast.
“I remember,” I said to Ray. “I remember.”
But that wasn’t the situation Ray was in now. His company was hitting on all cylinders.
The company was landing major customers at a very fast clip. They had a huge technical advantage versus the competition. …
“Brett, Tony Hsieh died,” Blossom said to me.
“What?” I was just waking up, and this news wasn’t registering with me.
“Tony Hsieh died. I know you really liked him,” my wife said to me.
“How?” I asked.
“The house he was staying at caught fire, and he died.”
I took a big sigh, and then I said, “He was so young, not even 50 I bet.”
“He was 46,” Blossom said to me.
“That’s so sad,” I said.
I started reflecting on Tony Hsieh, and his impact on me. I never met Tony, but he had a huge affect…
When I was a kid, I used to really like westerns. Maybe it was because my Dad really liked westerns, so I liked westerns too.
There was a rather obscure western that I really liked called, “The Culpepper Cattle Company.” It’s the story of young, wanna be cowboy, named Ben, and his coming of age on a cattle drive.
Even though I haven’t seen the movie in years, there’s a great scene that I still remember. Ben, the young cowboy, is admiring the horse that Luke, an older, weathered, cowboy owns.
Ben looks and Luke and says, “Sure is a…
brett fox
I work with startup CEOs to help them grow their businesses . I built several businesses from $0 to >$100M. Learn more at www.brettjfox.com
