A fellow investor told me about one of his better-performing portfolio companies. It’s executing well, hiring amazing people, and seeing a path for scaling if things go well. One area of uncertainty right now is the customer relationship. The company generates revenue by performing work on behalf of other companies. Translation: it doesn’t know or own the customer. The other company has a direct relationship with the customer. This investor believes that to unlock exponential growth, this portfolio company must develop a strategy to own the customer relationship.

Acquiring a direct customer can be hard and expensive for start-ups in some industries. Partnering with a larger company that has an established customer base and can funnel those customers to you is attractive in the early stages of going from zero to one. The cost to acquire them is usually low (if not zero), and the customers can be plentiful if you solve a pain point.

However, this usually isn’t a reliable long-term strategy. It can have lots of downsides. A major one is lack of feedback. You need feedback to make your product better, which you must do to achieve product–market fit—but it’s difficult to get feedback from customers you don’t know. Most companies don’t provide you with their customer contact information (email address or phone number), so it’s hard to reach out after the transaction is completed. You never really know what the customer loves or hates about your solution.

Another downside is concentration. You’re at the mercy of someone else to acquire customers, and they can make a change that severely and negatively affects your business without warning. You could see your business evaporate overnight and not be able to do anything about it. Conversely, if you’re ready to scale, the bigger company can limit your growth if it chooses to not play nice.

Customer relationships are key, and there should be a plan to have direct relationships. It’s OK to have partnerships and other go-to-market strategies, but the core strategy should be a direct relationship.

Today I chatted with an early founder. His business creates video content for automotive enthusiasts. He’s been at it for a few years and has built an audience of over 2 million followers on a single social media platform. With this following, he’s been able to develop several revenue streams. He’s a solopreneur who’s looking to expand his business and team.

We discussed his business high-level. He faces two challenges. The first is seasonality. His revenue streams are good but variable based on the time of year. The second is bandwidth. He has ideas that will provide more consistent cash flow, but he doesn’t always have the time to execute consistently on them. He works on them during slow periods, which prolongs getting those initiatives off the ground.

I get it. It’s the all-too-familiar story of the bootstrapping entrepreneur. I’d imagine he isn’t the only small creator experiencing these challenges—but he’s different because he’s proven he knows how to build a large audience and create content they enjoy. He just needs capital (and mentoring) to scale his business and make it a big one. I’m not familiar with the content-creation world, but I imagine that providing growth capital to proven early founders with aspirations of creating large content businesses is a good opportunity.

I’m a big fan of YouTube. It’s an amazing educational tool for users and a powerful distribution method for smaller content creators.

I watched an episode of The Pivot where a professional athlete announced his retirement from the NFL. It was evident that he isn’t planning on slowing down anytime soon. He’s in his early thirties and has been building a variety of businesses in anticipation of his retirement. He’s planning now to build these businesses at full throttle and also spend more time with his family. He’s not thinking about winding down. The participants pointed this out and agreed that retirement isn’t the right word for his announcement. They decided to describe his announcement as a “career change” instead. This really stuck with me.

I have a few entrepreneurial friends who’ve been blessed to achieve financial freedom. They can do what they want, when they want. They joke that they’re retired, but that couldn’t be further from the truth. They’ve all started putting their time and energy into their next thing, whatever it is. They’re all doing something. None of them are idle.

Most entrepreneurs have a fire that burns inside them that can’t be extinguished. They focus that fire on what matters, and it’s often building companies. They aren’t the kind to retire and do nothing. Instead, they refocus their fire and change careers.

A few days ago, I posted about bad days. They’re inevitable—part of the founder journey (and life in general). After revisiting that post with someone, I realized I didn’t say anything about how to cope with bad days.

I’ve found that talking through bad days can be a tremendous help. Peers (early-stage founders) who can relate or people who’ve taken your journey are most helpful. They understand exactly what you’re going through and have valuable perspectives. When I tried to have these kinds of conversations with others in my circle, it just fell flat. They wanted to help but couldn’t understand what I was going through.

If you’re having a bad day, consider talking it out with a peer or someone credible. And if you know someone who’s having a bad day, can you lend an ear? Your roles might flip tomorrow.

I previously shared my thoughts on how more people are taking control of educating themselves and how future generations’ education will be radically different. Information is more readily available and distributed than ever before. Credible people can now talk directly to the people who want to consume their teachings. While democratization of information is positive, it does present a new challenge: how do you find the information that will be valuable to you?

I regularly listen to podcasts and watch YouTube videos. Many are up to an hour long. I often don’t have the time to consume the entire episode in one sitting; it takes two or three. Many times, I’m not interested in significant parts of the conversation. Some of the YouTube channels I subscribe to include a table of contents, so I can jump to the exact minute/second mark of the interview that has the information I want to hear. Most don’t, though, and I end up listening to lots of content I could have done without. It’s also hard to go back and find the relevant information unless I take a detailed note of the exact minute/second mark in my personal notes.

Today I listened to a founder who’s trying to solve this problem. He’s helping people find relevant information on long-form content platforms faster.

This is a great next step and could transform how people learn. If more people can find the information they care about and consume it faster, the speed at which people are able to self-educate could drastically increase. People learning faster could have broad implications for society and help close some historical gaps.

I’m excited about what this founder is building and can’t wait to watch his journey.

Part of being a founder is having some rough days. Nothing will be going right. Just when you think it can’t get any worse . . . it does. It can feel like you’re being kicked while you’re down. The reality is that this is par for the course. You can’t eliminate bad days—that’s out of your control. What you can do is change how you react to them and minimize the mental toll they take on you.

I listened to a seasoned founder describe how he thinks about bad days. He said that everybody’s bad-day survival rate is 100%. He believes eventually you get out of your bad day—as long as you wake up the next day. It’s an interesting way of saying that this too shall pass.

I totally agree with this founder. When you have a bad day, keep in mind it’s just that. A bad day. You’ve had many good days, and you’ll have them again. Don’t dwell on the bad day or let it throw you off mentally. Tomorrow is a new day and a fresh start.

Entrepreneurs are often considered creative people because they think of solutions others haven’t. I recently listened to someone share an interesting perspective on creative people. He thinks of creativity as the ability to connect dots. He doesn’t believe creative people are creating ideas out of thin air. They’ve had more life experiences, talked to more people, consumed more knowledge. They have more nodes that can be connected. They’re able to come up with things people with fewer nodes can’t.

I’ve been thinking about this today, and I’m undecided about whether I agree. It’s an interesting way to think about creativity. If it’s accurate, it implies that creativity isn’t something people are born with. People can enhance their creativity by intentionally amassing more nodes. Understanding this could be enough to inspire people to believe in themselves and put in the work to become creative people. That change in mindset could be powerful and lead to significant change.

I’ll think about it more and get others’ perspectives.

A founder shared his fund-raising journey with me today. In the last two weeks, he’s gone from zero traction to conversations with multiple firms and a likely path to getting his round closed. Anything could happen between now and funds being wired, but I was curious about what changed in the last two weeks, so I asked. The founder said he’s been more intentional about expanding his network. He volunteered to speak at NOEW because he knew lots of investors would attend. He met with folks leading up to the event and during it. As his network expanded, the possible paths to getting his round done proliferated.

Networks and relationships can have a big impact on the trajectory of a company (not just on fund-raising). Knowing the right person, or the right person knowing that you exist, can lead to doors being opened that were previously closed and to amazing opportunities. Building external relationships isn’t the focus of a CEO, but it’s something they should be mindful of and intentional about. Especially if they’re fund-raising.

If you’re a founder looking to build something great, try to build a network before you need it—or build strong bonds with a few key people who have large networks. As your network expands, your company’s possible paths to success will multiply.

Today I had the pleasure of attending a NOEW session where Evan Spiegel and Michael Lynton participated in a panel discussion. Evan is the cofounder and CEO of the parent company of Snapchat, and Michael is chairman of the board of directors. Evan has taken Snapchat from an idea during his product design class in college to a publicly traded company with a market capitalization of around $58 billion. A few big takeaways from his chat:

• Mentorship – Mentors are enablers of founders’ visions. Be clear on where you want to be, and mentorship will help you figure out how to get there.
• Indecision – Not deciding can be worse than making the wrong decision. Snapchat went back and forth on relocating from Los Angeles to San Francisco. The indecision kept everyone in limbo and made things like recruiting difficult because people couldn’t plan. Once the decision was made to stay put, everyone could plan and execute around it (even if they didn’t like it).
• Visual communication – Evan saw the potential of visual communication as a richer and more expressive form of communication in 2011.
• Rejecting takeover – Evan was approached by Meta (parent company of Facebook) to acquire Snapchat. He didn’t want to sell because he was confident that more value could be created by executing his plan. But he had to convince the board, which wasn’t an easy task. The company was very young, and a multibillion-dollar exit would have been a massive return for the venture capital firms that backed it (and had a board seat). He ultimately convinced the board to reject the offer, and the rest is history.
• Quick to fire – Snapchat experienced a period of turnover at the leadership level before it found the right people. Michael praised Evan’s ability to quickly pull the plug when someone wasn’t working out. It was painful and the optics weren’t good, but it allowed them to find the right people sooner.

Evan is an impressive and visionary founder. I enjoyed listening to him share his wisdom and look forward to following his entrepreneurial journey.

Today I spent time listening to a local angel group host a panel discussion. The purpose of the discussion was to demystify the process of getting investment from the group. The audience was primarily early founders.

This angel group’s members are mostly current and former entrepreneurs, so they have a wealth of start-up knowledge. They’re also civic-minded. They want to see their community prosper and believe entrepreneurship can have a material impact. The group evaluates deals across the country but emphasized that local entrepreneurs who meet their criteria get preference. And they made the point that they’re not a charity—they seek to get a return on the capital they invest.

This angel group (like many others) has a profile that makes them vital to the local entrepreneurial ecosystem. They seek to do good (help founders) while doing well (making money). Given their backgrounds, they’re uncommonly qualified to help with something most people have never attempted and can share invaluable experiences. You may get one or two of these qualities in the profile of another sort of investor, but probably not all three.

Today reinforced my belief that operators turned angel investors are essential ingredients in a successful start-up ecosystem.