I listened to a wildly successful founder give a talk today. He said something that stood out to me: “Don’t take shortcuts to revenue. Stay focused on your vision and don’t sell things that don’t align with that vision.” His startup sells cloud-based solutions, but they did one deal to install their solution at a customer site. The team struggled to complete the project and it took ten times longer than planned. In the end, the revenue wasn’t worth the effort. It was a distraction and the client had a subpar experience.

I approached this in two different ways at CCAW. One worked out well; the other, not so well. At one point, we were overly focused on growing revenue and looked to add products we could easily sell. The problem was that it took a massive amount of effort to retool our systems and processes to sell these items. Our service team wasn’t familiar with the products, so we couldn’t provide the level of service we were known for. And because we weren’t known for selling these items, the added revenue was nice but far from material. We eventually abandoned this product category and were happy we did. It was too far from the core of what we were known for.

Conversely, we listened to our customers repeatedly ask for accessories that complemented our core products. They couldn’t use our products without these accessories and wanted to buy everything in one place. These accessories required some retooling of processes and systems too, but we made the investment. Our service team easily understood these products because they complemented our core products and were sourced from the same suppliers as our core products. These items lifted our revenue and gross margin while making life easier for our customers. We eventually began getting repeat orders from customers looking specifically for these items.

I agree with the founder from today’s talk. Don’t take shortcuts to revenue. It’s usually not worth it. Have a clear vision of what you’re doing and the problem you’re solving for customers. If there are supplemental ways to solve that core problem that align with your vision, consider taking a deeper look. Otherwise, just say no.

It’s often difficult to find the right automotive part at a fair price and get it quickly. That’s the problem we solved at CCAW. One thing we regularly heard customers talk about was installation. Most installs require a professional with specialized tools. We tried to help by recommending installers, but we missed a big opportunity. Customers wanted more than a seamless process for buying the right part—they also wanted a seamless process for getting the part on their vehicle.

Looking back, it’s obvious. So how did we miss it? Easy—we were listening for what we wanted to hear and not what customers were saying. They were clearly telling us about their frustrations with installation, but we didn’t think we were in a position to solve that problem so we didn’t try. It wouldn’t have been easy, but if we had tried, and succeeded, we would have created a massive amount of value for our customers. All we had to do was take a step back and listen to what our customers were telling us.

Customers are the key to any company’s success. Solving their painful problem is how you create value they’re willing to pay for. Founders aiming to build large companies should continually listen to their customers. Understand their pain points. Solve them if you can. If you make this a habit early, your customers will thank you with their wallets and you’ll be on your way to building something big!

My friends and I have been debating how much genetics plays a role in a person’s behavior and decision-making. It’s the nature-versus-nurture debate. We know genetics (nature) determines physical features like height and hair color (with limited exceptions; for example, starvation will affect growth and therefore height). But what about how we think and act? I found myself thinking deeply about this. Naturally, I’m wondering how genetics affects an entrepreneur’s thinking and decision-making.

My friends are evenly split on which has the greater impact. I’ve noticed they agree on one thing, though. None of them think that genetics or environment alone determines how a person’s mind works or how they behave. The combination of the two molds a person, with one having more influence than the other (which one depends on which person you ask).

Bill Gates’s parents were intelligent people, so I assume they passed their smarts on to Bill and his siblings. However, Bill’s early behavior and decision-making were starkly different from those of the rest of the family. He didn’t like to leave his room to engage with the family (or anyone), and he argued heatedly with his mother when she made him participate in family functions such as dinner. Luckily, he and his family were able to work with a therapist, and his behavior changed. He learned to work with others, and he and his mother became very close.

This question is deep and I have no idea whether nature or nurture affects the mental side of us more. However, one thing is clear to me. You can’t control your genetics. But you can (usually) exert some control over your environment. If you’re trying to do something great, surrounding yourself with the right people and the right environments will probably increase your chance of success.

Play the hand you’ve been dealt as best you can by putting yourself in the right environments.

Yesterday, I shared what I learned from Inside Bill’s Brain: Decoding Bill Gates. I don’t watch much TV, but this was an insightful series. Today I’ve been thinking about Bill’s “think weeks.” He regularly spends a week alone in a cabin reading and thinking. The quietude and stillness give him an optimal environment for his best thinking, allowing him to distill things and solve complex problems.

Bill’s intelligence and ability to rapidly comprehend things have been remarkable all his life. (His siblings, coworkers, and wife all confirmed this.) And they’re at their highest level when he reduces his activity level and just thinks.

I started to wonder what environment allows me to do my best thinking. I usually need to get in the zone to think about complex things. Big blocks of time let me do that, and then I can concentrate and make significant progress on a problem. Once I see progress, I get excited and want to keep going. Interruptions or lots of activity around me are disruptive, so I try to be somewhere quiet and still when I need to get in the zone. I’ve also learned that writing helps me make connections and solve complex problems. It forces me to organize and communicate my scattered thoughts in a way others can understand.

This year has been challenging, to say the least. Like everyone, I’m ready for it to be over. In tough situations, I try to look for the silver lining. I believe life is about perspective and there’s always something positive; you just have to look for it. This year is no exception. Less activity and a slower-paced life because of the pandemic have given me more time to think than I’ve ever had. I’ve accomplished things I’ve been putting off for years (like blogging) and worked through some tough problems. Bill Gates does think weeks. I’ve sort of done a think year.

Bill Gates is a brilliant person who made an impact on society through entrepreneurship and is doing it again through philanthropy. I love learning from the experiences of people smarter than me, like Bill. There’s a lot to be said for his practice of taking week-long blocks of time to think. (If someone of his stature continues to prioritize this, there must be something to it!) I don’t have the luxury of doing think weeks, but I’ll work toward being more intentional about taking time to read and think in the right environment.  

I recently read about a documentary that intrigued me, so I watched it. I love learning about visionaries and their journeys. Inside Bill’s Brain: Decoding Bill Gates went beyond the usual biopic. It chronicled the life stages of Bill Gates and provided insights into how Bill’s mind works. Microsoft has had a huge impact on society, so I was curious to learn more about the founder’s mind. Here are some takeaways:

• Early start – Bill began writing computer code in middle school. He wrote code for schools, a local utility company, and others at an early age. By his early twenties, he’d been working with software for a decade. He was hugely successful at an early age, but he’d already put in a decade of work. That’s why he mastered his space earlier than others do.
• Mother – He had an interesting relationship with his mother. They didn’t see eye to eye in his early years and it took therapy for them to improve their relationship. His mother set an example of excellence early on and helped Bill understand the importance of community in the early years of Microsoft. The day his mother passed was the worst day of his life.
• Intensity – His work ethic and personality are intense. He worked crazy long hours, including weekends and holidays, for years. Having a family changed that somewhat. He outworked everyone to keep Microsoft ahead and expected the same from his team, which didn’t always go over well. He memorized license plate numbers so he’d know who was at work.
• Paul Allen – The Microsoft co-founder and Bill met as kids. At Microsoft they were aligned on software but not on other things. Paul had other hobbies and interests, while Bill intensely focused solely on Microsoft. They made a good team in the company’s early days. Their relationship had its ups and downs over the years, but they spoke and patched things up when Bill learned of Paul’s illness. Sadly, they didn’t see each other before Paul died.
• Books – Bill carries around a sack of books everywhere he goes. He’s a voracious reader and processes information rapidly. He reads everything he can that’s about certain subjects or written by certain authors. He’s highly curious.
• Think week – Bill began this habit in the ’90s. He spends a week alone in a small cabin, reading and thinking. He realized that he does his best thinking when he’s in a quiet place. This is when he can distill things and work through complex problems.
• Melinda – Bill and Melinda’s marriage is a partnership. Each brings different perspectives to solving problems. Melinda understands the human element of a problem better than Bill does. Their partnership is powerful and helps drive their foundation.
• Biggest fear – Bill’s biggest fear is that the day will come when his mind stops working.

These are just a few things I picked up on. I learned a lot more. This three-part series goes into detail about the Bill & Melinda Gates Foundation, their work on behalf of causes around the world, and the perspectives of people who know Bill best. I enjoyed this series and see Bill and his wife differently now.

Today marks the end of my thirty-eighth week of working from home (mostly). Here are my takeaways from week thirty-eight:

• Winter – The temperature in Atlanta dropped quickly this week. It was a reminder that winter is upon us. The cold weather, shorter days, and reduced sunshine will make working from home challenging for me.
• 2021 – I was asked today what I think next year will look like. I had a few tentative ideas, but the truth is I have no clue. Everyone is planning for a year that is so uncertain. I’m hopeful that things won’t get drastically worse, but I’ll have a plan just in case.
• More deals – Last week, I reflected on deal and fundraising activity levels. Salesforce’s acquisition of Slack was another huge tech deal. I suspect we’ll see more big deals announced before the end of the year. I’m starting to think about all the variables driving the flurry of deals.

Week thirty-eight was the first week of winter for me. I don’t like cold weather, but I’m starting to adjust to the reality of the next few months. I’m already thinking about spring sunshine.

I’ll continue to learn from this unique situation, adjust as necessary, and share my experience.

In the early days of CCAW, I often found myself distracted. I call it founder squirrel syndrome. It’s common—maybe, I’d argue, the norm. I poured tons of my energy into things that wouldn’t get me closer to my next milestone. I distinctly remember spending a great deal of time improving our order fulfillment process—which wouldn’t keep the lights on. We needed to get to a certain revenue threshold to be at the cash flow break-even point. We needed paying customers. I should have focused on landing new customers, not making things pleasant for our few existing ones. Over time I learned, albeit in a painful way, and it all worked out.

Early founders have so much coming at them that it’s hard to focus on, or sometimes even identify, what matters most. The early startup days are chaotic. Everything is all over the place. Nothing goes as planned. Constantly calling audibles. Reacting to new information. In the midst of all this, tending to what matters most can be the difference between success and failure because resources are precious. There are only so many hours in the day and dollars in the bank. Use them wisely. Less critical things can be dealt with later.

This is one of the hardest concepts for early founders to grasp and also one of the most impactful. If you’ve founded a company or are considering it, learn to set a few milestones and focus your efforts on activities that help you reach them. If you don’t know how to go about doing this, reach out. Ask for help. Learning this skill early can be a game changer!

Finding a cofounder is difficult, especially for nontechnical solo founders building tech companies. The pandemic has made the task even harder. Hearing so many founders struggle with this has kept it top of mind for me. Here are a few resources I’ve recently heard founders mention when they describe how they found technical cofounders:

• AngelList – A community focused specifically on startups. There’s area place to post jobs. The site’s focus on startups should help in reaching people who want to work with an early-stage company.
• GitHub – A development platform that helps technical teams with collaboration, version control, and a host of other things. A community forum mostly counts developers as members.
• Slack – This is specific to Atlanta (kinda). There’s a workspace for the Atlanta tech community called "tech404." Many developers are in the workspace, and there’s a channel specifically for jobs and another for gigs. I’ve encountered people who are part of the workspace but don’t live in Atlanta. I assume these kinds of workspaces exist in other major cities or regions too.
• Network blast – I’ve heard of founders sending out descriptions of the type of experience they were looking for via emails or texts. Potential cofounders were often suggested by people the founder would least expect to be helpful. You never know who someone else knows.
• Virtual events – This is harder, but I’ve heard of founders attending startup or technical events that offer virtual networking. Events that use platforms like Hopin can give you the chance to network one-on-one with people you might not otherwise meet.

I’m always surprised by the creative ways people connect with cofounders. I thought it might be helpful to share some of these. I can’t say if these will work for everyone, but I do know one thing for sure. If you don’t take action, you won’t find a cofounder. Be action-oriented and creative and you just might end up finding a technical cofounder who complements you.

This problem won’t go away, so I’ll update and share this list periodically. I hope it’s helpful.

Today Salesforce announced the acquisition of Slack for $27.7 billion. The deal was leaked last week, but now Salesforce has officially confirmed it, along with the deal price. The sale is for cash and Salesforce stock. The is the biggest acquisition to date by Salesforce and a huge win for Slack employees and investors. A few quick thoughts on this deal:

• Hot market – There’s been lots of M&A activity in tech over the last few months. I’ve noticed it at a local level with private tech companies at various stages. This deal is at an enterprise level and involves two publicly traded companies.
• Majority cash – Notably, Slack is getting a considerable percentage of the purchase price in cash. It will receive stock too, but more cash.
• Growth strategy – Salesforce has acquired a number of companies over the years, including Tableau for over $15 billion last year and Mulesoft for over $6 billion in 2019. Growth through acquisition is a serious part of its strategy.
• Integration – I’m curious about how Salesforce will digest and integrate such a big deal. It clearly has experience integrating companies it acquires.
• Valuation – Slack didn’t benefit from the pandemic as much as some other publicly traded tech companies that facilitated working from home, such as Zoom. From a valuation perspective, Slack may have seemed less expensive in the current landscape.
• Public – Slack went public in the summer of 2019 and had a valuation of $24 billion after the first day of trading on the stock market. Today’s deal price is 15% higher. Slack was a public company for about a year and a half before this deal was announced.

I’m very familiar with both companies. I used Salesforce heavily in the past and currently use Slack every day to communicate. This is a huge deal, and it will be interesting to see if other big tech players announce acquisitions of their own.

Growth is top of mind for most entrepreneurs. When you’re growing quickly, expenses are often incurred ahead of revenue growth. Hiring, special projects, building a product . . . all these things happen before you see additional revenue from customers. For this and other reasons, a high-growth company may be unprofitable. You’ll often hear unprofitability described as investing in growth, and investors may give such a company an attractive valuation.

Here are a few things I’ve learned about growth over the years:

• Messiness – Chaos reigns when you’re growing rapidly. A company growing at a breakneck pace isn’t a well-oiled machine. I like to think of it as a land grab. When growth slows, hone the efficiency of your processes. But while the opportunity’s in front of you, grab as much land as you can as fast as you can.
• Valuation – If you’ve achieved product–market fit, investors will overlook losses for a high growth rate. One hundred percent or more annually—which means you’re doubling every year—is great. When growth is minimal or negative, the valuation will be affected and investors will ask lots of tough questions.
• Source – Understand what’s driving your growth and double down on it if you can. If you don’t know the origins of your growth, you could inadvertently make decisions that hinder it or be caught off guard when it slows down for reasons you don’t understand and haven’t planned for.
• Alignment – When growth is expected to slow or begins to slow, consider adjusting expenses. If you’re no longer getting an ROI on a spend, reduce the spend or transition the resources to something that could provide a higher ROI.
• Expectations – High-growth companies can be caught in a situation where they’re penalized by investors or the stock market if their growth rate slows even slightly. Managing external expectations can become a critical part of managing growth.
• Channel partners – Growth through channel partners is a fine strategy, but I’m a fan of most of your revenue deriving from a direct relationship with customers. You’ll better understand your customers’ needs and a change in a third party’s priorities won’t be as likely to affect your growth.

All entrepreneurs aim for growth, but we’re not always prepared to manage it. These points are just a few things I’ve learned along the way that I hope will help as you think about growth.