Introduction
About two years ago my son, Kevin, recommended that I read a blog post on the website Medium about a son whose father left him a box of letters. The father was terminally ill—though the son never knew that until he passed away—and the letters were filled with advice on how to navigate the various rites of passage the boy would face throughout his lifetime. It’s a poignant and powerful piece. It also turns out that it was fiction.
Still, Kevin urged me to write my own letters—missives of advice to the founders of our portfolio companies to help guide them as they faced issues throughout the life cycles of their companies. He thought I could help them with the gnarly everyday problems of running a business: when they got in a fight with their co-founder, or when their board was driving them crazy, or when they were afraid their idea wasn’t working.
It was a good suggestion. I was routinely offering this kind of advice to the more than eighty-five founders in our investment portfolio at the Webb Investment Network (WIN) and it was hard to find the time to have so many 1:1s. Because so many of our founders faced the same issues—and because they had nowhere else to turn—it made sense to try to codify the advice so we could share it more broadly than in an individual meetings. I got to work on a project we called Letters to a Founder.
Our original intent was to write letters to offer guidance and coaching for our founders in the moments that mattered most. I wrote each letter with a specific founder and situation in mind, but since so many of our founders face similar challenges I discovered that the advice and anecdotes were usually relevant for other founders, too. I began to send out letters and requests for new letters poured in.
There were so many topics to cover. What do you do when you miss your quarter? How do you focus on what’s most important? What do you do when a key hire leaves? When a topic was outside my area of expertise, we looked to the directors at WIN to contribute advice. But we didn’t stop there. The most special part of WIN is that it is a network of affiliates—more than eighty amazing individuals, most of whom I’ve worked with extensively in the past—who now co-invest alongside me, offering money and also advice to startups. These people have started companies that have gone public, run entire departments at fast-growing companies, and have decades of management and industry experience. We asked these affiliates to contribute letters in their areas of expertise and they wrote invaluable pieces covering situations such as what to do when your startup gets sued, when to structure sales commissions, and how to deal with a competitor that enters your space, among others.
Once we had a few dozen letters, we organized them into a book as a gift for our founders. We worked with a small bookbinder in San Francisco and printed several hundred copies—and in no time at all we ran out of books. Founders wanted to share the letters with their friends and asked how they could get more copies to give to their team or as holiday gifts. I kept on getting in trouble with my team for giving books away. They confiscated my stash. We created a downloadable private copy, but that became outdated quickly. There were always new challenges that came up and I was always writing letters to address them.
While I originally wrote the letters and the book for our founders, I knew that the advice would be applicable to an entire universe of founders I didn’t know. There were so many people who faced the same struggles, and I would never have the chance to meet or work with most of them. I get to connect with some of these people through my LinkedIn feature, Ask Maynard, but I wanted to do more.
I also realized that the audience for these letters was much wider than I originally anticipated. While my work is mostly with founders who are involved in technology and seeking venture capital money, and eventually looking to go public, there were entrepreneurs in every field, with all sized businesses, who found the advice useful. I shared a book with my physical therapist who said it helped him understand the challenges he was facing in starting his business. His wife was his co-founder and he begged her to read it so that they could learn together. There was just such a vast audience of individuals who were running small businesses—there are 26.8 million small businesses in the United States alone, and more than 600,000 new businesses are started every year here, according to the Small Business Administration—and facing some of the same challenges.
What surprised me more was that there turned out to be people who needed this advice who were not even founders. From Fortune 500 executives to millennials entering the workforce, having a founder’s mindset is now seen as an invaluable asset.
Additionally, I’ve discovered that what founders often need is not just advice about how to raise a seed round or how to pick out the best board members, but also coaching on how to deal with people. They need to know how to manage others and they need to know how to act like leaders themselves. Therefore, many of the letters in this book focus on management and leadership. Because I was an operating executive for Fortune 500 companies (IBM, Quantum, Gateway, Bay Networks, eBay) for much of my career, much of my wisdom is gained from working with big companies. Additionally, in my role as a board director I advise many business leaders who are not founders. Many of these letters address challenges they face and were written with them in mind—but they are also relevant to many others.
I wrote this book as a way to scale beyond my network. We only work with about eighty-plus companies, but there are so many more people who think like a founder and need this advice. Maybe you are an entrepreneur eyeing a move to Silicon Valley, or maybe you are a small business owner with a shop in town, or maybe you were just promoted to be a manager at your company. In any case, there’s something in this book for you.
This book is intended to be a guide, and the letters are written to offer guidance when you encounter turbulence. Topics are outlined to offer advice at the defining moment you need it most. Just jump to the letter you need when you miss your quarter, when you receive negative publicity, or when you need inspiration. It’s not necessary to read this book from start to finish, although of course you may, and many people do, as they may be curious for another perspective about what they might have already conquered or wish to see what lies ahead. The book follows the trajectory of a company’s life cycle. I’ve been inspired as the companies we work with have grown and organized the book to follow the process: getting started, getting to relevance, getting to scale, and getting to legacy. Of course it must be stated that this process is ridiculously hard.
Right now we are in the midst of a Golden Age of entrepreneurship that is fueled by all segments of the population. College students are signing up for entrepreneurial courses in record numbers. Individuals over the age of sixty-five are creating more companies every year. Record numbers of downsized professionals are starting their own ventures. Of those individuals who have not yet taken a leap into entrepreneurship, research reveals that many of them are actively dreaming about it.
Success, though, is hard to achieve. With each phase of company development, the success stories become fewer and fewer. While a massive number of companies get started, only about 30% of them will go on to raise a Series A round of funding, and from there only 50% them will get to a Series B. That number will continue to halve with every additional step.1 A very small number of companies will go public, and even fewer will leave a legacy.
Writing these letters and compiling them into a book for you has been a labor of love, and I hope these letters help make you better and help your teams achieve their dreams. Unlike the fictional father who inspired this project, these letters are not meant to be the last word we have on these subjects (or any subjects). If you need guidance on topics that are not here, please reach out to us at maynardwebb.com where my network and I will continue to post new letters and answer your questions.
Wishing you luck and cheering you on.
Copyright © 2018 by Maynard Webb
Foreword copyright © by Howard Schultz
