Stuck In Legal, Responses

Well, I certainly struck a nerve with my Stuck In Legal rant/post last week.  As of now, there are 32 comments on the blog — my typical post generates 0-1 — and I've picked up between 50 and 75 new followers on Twitter, probably mostly because Fred tweeted about the post. 

Most of the comments on the blog were cheering me on; a couple were from lawyers, one well reasoned and another just a counter rant against stupid business people that had one or two good points buried in it.  You can certainly click through the link above if you want to read them.

But two comments didn't get put on the blog, which I thought I'd post here.  Keep the good thoughts coming on this topic.  It's an important one.

First, Jonathan Ezor (a professor of law and technology) posted his response — not a rebuttal — on the Business Week blog here.  He makes some very good points about how both sides, businessperson and counsel, can work better together to eliminate a bunch of the hassles I noted in my original post.

Second, Joe Stanganelli, a lawyer, emailed me the following, which was too long for my Intense Debate comment software to handle:

In defense of my profession…

EXPLANATIONS:

•Why companies' legal departments or outside counsel aren't directed to be as efficient in doing their work as their other departments

How exactly do you mean?  I'm not sure this is true.  Given the average amount of hours our profession works as it is, we *have* to be efficient.

I can tell you, however, that a huge pet peeve of us lawyers is when our clients essentially say (typically when they’re being billed hourly), "Gee, I want an answer to this very complex legal question that will require a lot of research because no statutes or case laws are directly on point, but don't spend a lot of time on it."

This is a bit like saying, “Look, don’t spend a lot of time on this transplant…I’ve got a meeting in an hour, and I’m trying to save money besides."

Also bear in mind that lawyers are not widget-makers or assembly line workers.  We aren’t even (usually) executive decision-makers.  We are in the knowledge and information industry.  We read, we think, and we write.  If you can provide us with some tips as to how to read, think, or write more efficiently, we would be delighted to hear them.

•Why companies insist on using their standard form of agreement if they're going to staff a legal department to review contracts anyway (this clearly wouldn't work if everyone in the world behaved this way)

The standard form of agreement has already (presumably) been determined by the company’s legal department to be the best form for the company's interests as part of the legal department’s careful legal analysis (i.e., the job they are paid to do).  Often, however, other companies, clients, etc. don’t use the standard form, or send their own form, or modify the standard form, or any number of other idiosyncrasies can happen with the execution of a contract.  All of these things have legal ramifications and have been the subject of past litigation.

•Why lawyers insist on answering questions with "because that's how all our contracts are" instead of applying their brains and logic to situations

(I'll try not to take too much offense at that last part.)

This generally happens because the answer “because that’s how all our contracts are” is a lot easier to say than to give the CEO a crash course in contract law.  It’s not fair, but it’s true.

A good lawyer, however, should at least be able to explain to boil it down to a few bullet points without being arrogant about it.

•Why business people seem to have no leverage with their legal departments, especially in larger companies, therefore surrendering the negotiation of business terms and the timing of relationship launches, technology usage, etc. to lawyers

This criticism is, if you’ll forgive me for saying so, a bit mind-blowing.  It’s not a matter of “leverage" at all.

Companies have legal departments as a preventative measure because they recognize that the best time to hire a lawyer is before you actually need one.  Most of law practice, in fact, is this “preventative law” and compliance work.  It saves the client (in this case, the company) time and money down the road by staving off lawsuits and liability.

These lawyers are in the business of protecting their clients from themselves – which the clients willingly pay them for because the clients (usually) recognize that they did not go to law school, pass the Bar Exam, and gain years of experiencing practicing law.

So when a company wants to launch a potentially harmful product via a distribution agreement that allows the distributor to get more money than he should because of a technicality, the legal department has to step in and tell the company, “YOU WILL GET SUED IF YOU DO THIS AND LOSE X AMOUNT OF DOLLARS!!!” or they aren’t doing their jobs.

A lawyer is a counselor – an advisor.  Any leader who totally disregards his advisors is not a good leader.

Again, this is not a matter of not having leverage with legal departments; it is a matter of not being able to change the law.

Please don’t shoot the messenger.

•Why in-house lawyers make the same dumb changes to wording and formatting that lawyers who bill by the hour make

The law is the law is the law; how the lawyer gets paid does not impact what the law is.  Those “dumb changes” are tried and true terminology that mean certain things in the courts and (usually) all the lawyers and judges know what they mean.  If the lawyers left it alone, your document or contract would potentially (perhaps even likely) mean something totally different.

Overall, please recognize that lawyers – at least in the legal department / “preventative law” context that you discuss – are in the risk management and compliance business.  They don’t make the law (at least, not the ones who work for you); they’re simply the guides who are navigating you – the layperson – through the legal system (one that took us years to understand).

After all, if you were blind, and you had a seeing-eye dog, would you get mad at the seeing-eye dog for not letting you cross the street when it’s a green light and a Mack truck is coming down the road?  Would you think that seeing-eye dogs were conspiring against you to not let you cross the street?

I will say this, though: Joshua Baer makes a great point.  A good lawyer should be able to provide you with a list of options, and explain (at least in a rudimentary fashion) the dollars-and-cents consequences of each one.  As J.P. Morgan said, “Well, I don't know as I want a lawyer to tell me what I cannot do. I hire him to tell how to do what I want to do.”

Must Read Post on Entrepreneurship

As usual, I’m a little late to the party, but let me echo Fred’s and Brad’s sentiments and endorse Marc Andreesen’s new blog.  If you’re an entrepreneur or like thinking big entrepreneurial thoughts, this is a gooe blog to add to your blogroll.  My only critique is that some of his postings are really long — but they’re worth it.

His most recent post, which finally prompted me to post this, is a list of reasons why NOT to do a startup (it also includes a good list of reasons TO do a startup).

Just a snippet to pique your interest, but you have to click through to see all of it — the richness is in the details…

Why do one?

The opportunity to be in control of your own destiny

The opportunity to have an impact on the world

Why run for the hills?

A startup puts you on an emotional rollercoaster unlike anything you have ever experienced (I blogged about that here and here)

You get told no — a lot

So a belated welcome to the blogosphere, Marc, and to everyone else, enjoy!

Several years ago, I blogged about the training program we created for entry-level employees at Return Path, including an embedded presentation that we used to use (which I hope still works on the blog after all these years).

My brother Michael, who is an experienced manager and leader in the digital marketing space, recently sent me this email that I thought I’d share along the same lines to colleagues who are new to the working world. Enjoy!

I signed up to give advice on LinkedIn, and had someone just starting her first job reach out to me asking for general advice. I came up with the attached, and thought it might make for a good blog post on Only Once. If you decide not to publish it, I’m totally cool with that, but thought I would share it. After all, you’re only a brand new employee once too 🙂

1) Listen as much as possible. One of my mentors was fond of reminding me, “God gave you two ears and one mouth!” You should listen at least twice as much as you talk. Get to know your environment and the people around you. Take notes. Observe as much as possible. Learn how others are able to provide value to the organization. Start to anticipate little things that need to be done, and then do them before your manager asks you to. Then bit by bit, use your creativity to start to develop bigger hypotheses about how you can provide even greater value. 

2) “In business, the best story wins.” That’s another quote from a former manager of mine that I have found to be universally true. People in business respond to many things: numbers, bullet points, graphs and visualizations. But they respond to all of those things better when they are wrapped in stories. A great book you can read about storytelling is not about business at all. It’s called “Story” by Robert McKee, and it’s about screenwriting. Despite its apparent lack of applicability, I assure you it will help you think about characters, goals, antagonists, drama, obstacles, and structure — all the elements that go into a good story. When you can present your hypotheses in the context of a story, about your business, your customers, what you want to achieve, how you will do it, and why it matters, you will build consensus and show leadership. Another great book you can read here, again, not about business at all, is “Sapiens” by Yuval Noah Harari. It really opened my eyes about how so much of human history and behavior is really just based on stories. 

3) Be lean. There is another book you should read, called “The Lean Startup”, by Eric Ries. This one is actually about business :). As you think about your hypotheses, think of them in the context of how you can get to market quickly and inexpensively. How you can easily perform experiments that will test your hypotheses. Some of your experiments will not achieve your desired result, but it’s not a failure if you can learn something that helps you pivot towards success. Learnings enable you to adjust and refine your hypotheses as you try to find more value for your organization. 

4) “Objections are requirements” and a corollary “ask questions, don’t make statements.” These two gems are from that first mentor in item number one. Even if you can tell great stories, and even if you can devise and execute lean experiments that achieve business results or provide validated learnings, sometimes “haters gonna hate.” There will always be inhibitors to your bold ideas, with reasons not to proceed with your experiments. Inertia is part of human nature. But don’t fear! When an inhibitor comes along, the first thing you do is start to ask questions. “Why do you object to x?” “Oh,” they’ll say, “because of y and z.” Then ask another question “So if we can resolve y and z, then can we proceed with x?” Rather than repeating yourself and making more statements, by asking questions you’ve just turned their objections into requirements. That inhibitor no longer has their reasons not to proceed with your bold idea. You’ve turned them from antagonists into allies. This kind of creative problem solving is critical to getting your experiments into market, and building consensus and showing your leadership without alienating anyone. 

5) Ok I know I said four, but this one is optional (albeit important). Have fun! Do not take yourself or your role too seriously. Show your personality. Be yourself. That sort of general approach to work and life will draw people to you. They will be relaxed and comfortable around you. They will look forward to meetings with you. You will be successful if you are a good listener, a creative thinker with bold ideas, a fantastic storyteller, an agile experiment developer, and a leader who can build consensus and drive value. But if you are all those things, and you’re fun to be around? Then you will be unstoppable.

Thank you, Michael, for the contribution!

How to Wow Your Employees

Here at Return Path we like to promote a culture of WOW and a culture of hospitality.  Some of you may be asking, Why Wow your employees?   The answer is, there is nothing more inspirational than showing an employee that you care about him or her as an individual.  The impact a WOW has is tremendous.  Being a manger is like being in a fishbowl.  Everything you do is scrutinized by your team.  You lead by example whether you want to or not and showing your own vulnerability/humanity has an amazing bonding effect.

Why do you want to foster Wow moments with your team?  High performing teams have a lot of Wow going on.  If all members of a team see Wow regularly, they are all inspired to do more sooner and better.

Here are 15 ways to Wow your employees

1. Take them or her to lunch/breakfast/drinks/dinner quarterly individually, one nice one per year
2. Learn their hobbies and special interests; when you have a spiff to give, give one that is in line with these
3. Remember the names of their spouse/significant other/kids/pets
4. Share your development plan with them and ask for input against it at least quarterly
5. Respond to every email from your staff by the end of the day; sooner if you are on the TO line
6. Ask them what they think of a piece of work you’re doing
7. Ask them what they think of the direction the company is going, or a specific project
8. Periodically take something off each one’s plate, even if it’s clearly theirs to do
9. Periodically tell them to take a day off to recharge, ideally around something important in their lives
10. End every meaningful interaction by asking how they are doing and feeling about work
11. End every interaction by asking what you can be doing to help them do a better job and advance their career
12. Read all job openings and highlight ones that match their interests for future positions
13. Read the weekly award list and call out those FROM and TO your team in staff meetings
14. Send a handwritten note to their home when you have a moment of appreciation for them
15. (If your employee has a team he/she manages) Ask for input before every skip-level interaction and summarize each one after the fact in an email or in person

I try to have Wow moments regularly with people at all levels in the organization.  Here’s one that sticks with me.  At the Colorado summer party several years ago, I went up to someone who was a few layers down in the organization and said hi to her husband and dog by name.  I had met them before, and I work at remembering these things.  The husband was blown away – I hadn’t talked to him in probably two years.  In front of the employee, he gushed – “this is exactly why my wife loves working here – we are totally committed to being part of the RP family.”

There are as many ways to be a great manager and WOW your employees as there are stars in the sky…hopefully these ideas give you a framework to make these your own!

I’ve written a lot about Boards this past year related to Bolster’s work in helping founders/CEOs build great boards:

• The New Way to Scale a Board of Directors
• My New Startup Board Mantra – 1:1:1
• The Startup Ecosystem Needs More Independent Board Members – That’s the Clearest Path to Having Better and More Diverse Boards
• Startup Boards eBook: How to Build Your Board
• Startup Boards eBook: How to Succeed in Your First Board Role

But more recently, I’ve been thinking a lot about Board effectiveness, as I’ve been working with Brad Feld and Mahendra Ramsinghani on a second edition of Startup Boards, which will be published in mid-2022. And in the middle of our feverish writing and editing, Reid Hoffman sent Brad a great document which I want to amplify here:

Some of these rituals are more important than others (or at least more widely applicable), but they’re all worth reading. I am definitely going to start incorporating some version of the “Dory and Pulse” ritual into my meetings to make sure we’re covering everything that each director wants to cover in meetings (or answer smaller things ahead of time).

Thanks to Reid for this great contribution to the world of Startup Boards.

This is the second post in the series…. the first one When to hire your first Chief People Officer is here).

While all CXOs are important to a company, the Chief People Officer is the one role you don’t want to get wrong because People Ops impacts every facet of a company. If you hire the wrong people—even one wrong person—you’ll regret it, and so will everyone else in your company. If you short-change the onboarding process you’ll create tons of work for others in the company to answer questions, teach people the systems, and help them get up to speed quickly—not to mention the frustration of the new hire. And of course, if you or your employees do anything illegal, discriminatory, or harassing, you’ll end up in legal trouble and you’ll lose—big time. So, it’s not enough, if you’re expanding rapidly, to “just get a Chief People Officer,” you need to hire a great Chief People Officer and I have found that great Chief People Officers do three things particularly well:

The most important characteristic or attribute of a great Chief People Officer is that they believe their function is strategic. In Startup CXO Chief People Officer Cathy Hawtrey wrote about the ways in which HR/People can be a strategic function and not just a tactical corporate function.  It’s true of most functions, but for whatever reason, (likely past experience), HR leaders frequently don’t view themselves or their functions as strategic, which is not only a huge missed opportunity but maybe says something more important about the confidence level of the Chief People Officer.  If that’s their frame of reference, then they will likely be tactical managers, they’ll keep the trains running on time, but you won’t be able to anticipate the changing talent landscape, much less be strategic about it.  If they believe they can move the needle on the business by improving engagement and productivity and efficiency, if they believe they can make the executive team more effective by helping you with team facilitation and coaching…they can do anything.

A second important characteristic of the Chief People Officer is courage—they have the courage to call you (you, the CEO) out on things directly and firmly when they see you doing or saying anything that is a bit off. It could be around language, inclusion, values, authenticity, or anything else, but they don’t let it slide or ignore it. The CPO, along with you, are the principal stewards of the company’s values and culture.  Even the best CEOs benefit from having a watchdog from time to time.

A third critical trait of a great Chief People Officer is that they think about investment in People in terms of ROI.  It’s one thing to run a killer recruiting function and fill seats efficiently, with high quality, as asked.  It’s an entirely different thing to start the recruiting process by asking if the role is needed, at that level and compensation band, or whether there are other people, fractional people, contractors, or shifts in lower value activities that could be put to work instead.  Only heads of People with deep understandings of the business can transform the function from a gatekeeper/”no” role into a business accelerator.

A great Chief People Officer is all of these things—strategic, courageous, and financially astute. Above all, great Chief people Officers know that they are the role model within a company and that their behavior, their language, their inclusiveness is setting the tone and providing a template for others to follow. 

(You can find this post on the Bolster Blog here)

I wrote a colorfully-named post years ago called Onboarding vs. Waterboarding, which detailed out some of the general principles around onboarding new employees that our companies have used over the years. A few weeks back, one of our clients and fellow CEOs of a Series C Ed:Tech company asked me for tips on onboarding senior executives, and some of what I said varied from or built on that earlier post.

Here are a few of the themes we riffed on:

1. Treat the new hire onboarding like you would a merger integration. Why? Well, because adding a new exec to your company is kind of like…a merger integration. Make a long checklist. Assign each item an owner and participating parties. Have a weekly meeting with all key stakeholders specifically to review the onboarding plan. In other words, don’t just leave it up to you, the new exec, and a Day 1 overview meeting with “business as usual” check-ins. Make it its own thing.
   
2. Take great care to communicate expectations and changes internally when the new exec starts. Any new exec, but especially one in a newly-created or upgraded role, will carry a new role description which by definition changes expectations and responsibilities both of the new exec’s role and of other execs’ roles (and possibly your own role or Level-2 team members’ roles). Make it super clear to the organization both in a meeting and in writing what those changes are. If people used to go to you for X, and now they have to go to New Exec for X, don’t leave that to the guesswork and imagination of your team.
   
3. Get out in front of the fact that your exec team has changed. As I always say, any time you change one person on a team (add or subtract), you have…a new team. Treat a new exec onboarding as such, though this will take time. Team dynamics will change, and you need to drive that process. You also need to make sure any shared language and tools on the team take a beat and include the new person. Did you run a DISC or use Myers-Briggs two years ago with your exec team? Great, do it again with the new team. Did you do a major trust/vulnerability exercise at an exec offsite last year? Better do a new one from scratch. This may sound like extra overhead, but it’s worth it. You don’t want the new person to always feel like the new person who is missing an inside joke. Plus, those kinds of things are always good hygiene for exec teams.
   
4. Begin with the end in mind. On Day 1, your new exec won’t know where the bathroom is, unless you are an all-remote company of course. Your objective is for the new exec to be just as autonomous as all other execs ASAP. So, work backwards from 90 or 180 or some other number of days on the question of autonomy. Build this into your integration checklist and weekly integration check-ins (see above), but note this is also a mental evolution both you and the new exec (and the rest of your exec team and the new person’s direct reports) need to go through. Some areas will be more logical for the new exec to be autonomous on Day 1 or at least Month 1. Some will take longer. Be explicit about defining those things.

Special thanks to my friend Amir for inspiring this post!

Why I Love My Board, Part III

My prophesy is starting to come true.  In Part I of this series four years ago, I asserted that

Fred may be the only one of my directors who has done something this dorky, this publicly, but quite frankly, I could see any of us in the same position.

Now, Brad Feld is no shrinking violet.  As far as I’m concerned, he made his film debut in the memorable “Munch on Your Bones” video (short, worth a watch if you’re a Feld groupie) something like 6 or 7 years ago for an all-hands meeting I ran.  But his newest short feature film, “I’m a VC,” made with his three partners, Jason, Ryan, and Seth, is a must-see for anyone in the entrepreneur-VC set and puts him up there with Fred in the pantheon of “this dorky, this publicly.”

Are You As Versatile As Running?

Today was my first day back in the city after two weeks working and playing at our house in the mountains.  And a beautiful day it was — 46 and sunny!  I went for a great run, reflecting on how incredibly versatile running is.  Less than 48 hours before, I had also been running, but bundled up, in a 17 degree snowfall, wearing my new Icebugs (thanks for the tip, Brad), up and down the hills of a quiet country road at 6500 feet in Idaho.  Today — sea level, flat, urban, sunny and crisp out, wearing shorts (I’ll let you guess which was easier).  How versatile can a sport be?

Are you as versatile at work?  Can you be that go-to person for your manager, the all-weather team member who gets called on to take on any kind of project as needed?  I don’t care how specialized your job is or how big your company is.  That’s the kind of employee you want to be, trust me.

But, you say, what about me?  Don’t I get a say in things?  Can’t I have my own career ambitions and interests and steer the kind of work that I do?

You can!  You should!  I tell people at Return Path that all the time.  And the best part about is that while the two above statements may seem at odds with each other — be able to do anything (with a smile) and do what you want to do — they’re actually not.  The very best employees who I’ve worked with or who have worked for me over the years do both and mix them together to their advantage.

Work your career path with your manager, your mentor, your HR leader, your CEO.  Understand what’s possible long term at the company.  Figure out what you’re good at and what interests you (read, among other things, Now, Discover Your Strengths to get there).  Learn what it takes to earn a promotion to the next level.  Get yourself generally in line to rise through the ranks the way YOU want to.  Obviously, to get to that next level, you’ll need to work your butt off, harder than others around you, with better results and higher quality.

But you also have to be a utility infielder, to mix sports metaphors.  If your company or your team needs you to do something a little different from what you’re doing today, the difference between doing it well with a smile on your face and doing it merely satisfactorily with a grimace could be the difference between that next promotion and not.  And it’s really both those things — doing it well, and having a great attitude about it. 

I love running, because I can do it at any place, at any time, as long as have my running shoes.  Our best employees are similarly versatile, because they are self-directed and work hard and do things right, but also because they do what needs to be done when it needs to be done, even if it’s outside the scope of their day-to-day or not explicitly in the critical path of their next promotion.

What’s in store?

Whether you’re a tech enthusiast, a math geek, or a student of humanity, Union Square Ventures’ Brad Burnham has a great post this week on the USV blog about data storage and how much we as a human race can consume.

It’s quick, worth a read, and it uses math terms that I’m pretty sure even my wife, dad, and Board members who went to MIT don’t know off the top of their heads (of course, having said that, I’m sure one of them will shortly email me to prove me wrong with their command of 10-to-the-21st power).

Brad’s conclusion is great…once the battle shifts away from storage, where will it go next?

As most of you know by now, I wrote a book that was published last fall called Startup CEO:  A Field Guide to Scaling Up Your Business.  I’m excited to announce that, starting on January 20th, the book has now been turned into Kauffman Fellows Academy (KFA) online course called Startup CEO.  Similarly, Brad Feld and Jason Mendelson’s highly successful Venture Deals is also going to launch as Venture Deals KFA online course on February 24th. Both will be offered initially on the NovoEd platform.

The parties involved in getting it off the ground (besides me) were the team at Kauffman Fellows Academy and NovoEd.  Clint Korver, a serial entrepreneur and Stanford adjunct professor, spearheaded the project, and between filming the course and now, he switched jobs from KFA to be the COO at NovoEd, so he has been on all sides of this.   NovoEd is a very unique online educational platform that gives students the ability internationally to work together in teams and collaborate on assignments and peer review one another’s work.  So far over 1,300 people have signed up for Startup CEO from countries as far-flung as the China, Brasil, Iran, the U.K., Australia and, of course, Silicon valley..  This is an exciting extension of the book for me to watch unfold.

The class itself is a very unique format, a bit of “the entrepreneur’s studio” model.  For each chapter of the book (there are 48), I filmed a 5-10 minute Q&A with Clint in front of a live audience of a dozen startup CEOs in New York.  This was a serious production – much more than I expected – with a three-person former CNN production team of Kevin Rockwell, Chuck Afflerbach, and led by former Emmy Award winning CNN Correspondent Rusty Dornin.  Preparing for the class this way was fun and gave me a good opportunity to further crystallize the main point or theme of each chapter.  Having a live audience was super helpful to see what worked and what didn’t work.