The Challenge Series: Adding inclusive voices to the COVID response

Global pandemics wreak their own special kind of havoc — not just on our health, but on virtually every aspect of our lives. Solving something as massive as a global health emergency takes a coordinated, collaborative effort and requires us to put our best minds forward. That means not just in frontline healthcare and government response, but also in education, recreation, nonprofit, and business. 

In times of crisis, leaders emerge. We’re all looking for answers and guidance. It’s widely understood that diverse teams lead to greater innovation, better outcomes, and more progress, so we cringe every time we see photos and events featuring homogeneous teams and panels in response to today’s challenges. (As it turns out, we’re not the only ones to notice.) The representation has improved recently, with women in leadership roles receiving kudos for how they’re handling their COVID-19 responses in federal governments, local governments, and science. Now we’re ready to add to that list from a business perspective.  

Join us for the Challenge Series

Introducing The Challenge Series, weekly online events designed to connect you with the specific topics and advice you need. Businesses are scrambling to address challenges they couldn’t have imagined just a month ago. As we work to keep our teams and companies going, it’s helpful for all of us to hear how some of today’s respected leaders are navigating similar issues. We’ve assembled an incredible line-up of speakers who are leading their companies through this time — and this first group happens to be all women. How are they shifting their operations, marketing, and finance? How do they lead with empathy and kindness through scary situations? Join us weekly to find out.

Learn how experienced executive leaders at companies like Gusto, Cloudflare, Zoom, Zendesk, Guild Education, TripActions, and Textio are shifting their models, protecting their budgets, and supporting their employees through every stressful moment. Got a question or two for these leaders? Please share with us on Twitter or LinkedIn and we’ll add them to the queue. 

Upcoming Challenge Series Events

  • April 28: How do you shift your operations during a crisis? (REGISTER)
  • May 5: Marketing and messaging in the time of Coronavirus (REGISTER)
  • May 12: How do enterprises manage their spend during a crisis? (REGISTER)
  • May 19: Leading with empathy and kindness in times of uncertainty (REGISTER)

Staying ahead of these situations requires diverse, inclusive voices

Scientists predict additional waves of COVID-19 and a rise in similar viruses in years to come. As we determine what that means for not only healthcare, but businesses, the overall economy, and even day-to-day human life, we ask organizations to prioritize diverse, inclusive voices in their preparations and responses. Put women and underrepresented minorities in leadership roles; listen to their voices. Make them not the exception, but the norm. Excluding these portions of the talent pool limits our collective ability to innovate and respond to the spidering effects of these situations. 

Here at Operator Collective, we’re lucky to have a community packed with talented, experienced leaders, the majority of whom are fearless women. We look forward to sharing their insights with you. Learn more and register for The Challenge Series here

The Challenge Series from Operator Collective

 

We believe culture, diversity, and operational excellence are a key part of building truly great companies. Learn more at www.operatorcollective.com or on Twitter and LinkedIn.

 

3 CFO tips for adapting your finances in a downturn

Market volatility wreaks havoc on companies, especially those early-stage, VC-backed ones. If your company is under financial distress, the first thing to do is reexamine your operating plan. It’s vital to adapt and course-correct now in order to plan for the remainder of 2020 and get ready to scale. Let this be your call to action: The ones who adapt are the ones who survive. 

VC-backed companies run on tight timelines. They’ve got milestones to achieve, customer relationships to build, and products to sell. Given these competing priorities, building a solid annual financial plan may not be top of mind. However — and I can’t emphasize this enough — you must have a solid operating plan to serve as your compass right now. With that in mind, here are three tips to help you adapt your finances in a market downturn. 

1) Engage in scenario planning

As the name suggests, you’ve got to have multiple plans driven by their outlook on the sales forecast. In the B2B SaaS world, revenue forecasting can be done from the bottom-up (rolling up all pipeline customers, your best thoughts on deal size, and timing of closure) or top down (capacity planning based on the time to ramp up and execute against quota and attainment). In fleshing out these forecast, one should keep in mind trigger events:

  • Changes in product demand 
  • Changes in customer situations 
  • Customer up or down shifts
  • Shifts in funding situations

I always caution against putting $0 sales forecasts, even in the darkest of the hours. The downturn guidance for revenue revision is 30-40% from the previously approved operating plan. If you’re starting from scratch, please be sure to add your views and action plans on how to bridge the gap between pre-COVID-19 and post-COVID-19 forecast; it does not need to be precise, but it’s a good way to frame the CEO’s view on the outlook of your product.

Scenario planning gives the team more flexibility to manage expenses, plan for headcount, utilize other financing options, and shift budget modes when trigger events take place. 

2) Move to zero-based budgeting 

Most budgets start with historical expenses and sales forecasts, then take the incremental growth % to execute the top line. In zero-based budgeting, however, companies build their forecasts based on what is absolutely needed to support their sales forecast and drastically rethink their business models. 

Zero-based budgeting works well when a significant investment lies ahead, but the near-term sales forecast is lower than what the original operating plan indicated. This method allows operators to prioritize their spending needs, but not be bound by historical spending. It also gives a drastic view on meeting competing priorities by categorizing expenses as keep, stop, or modify. 

  • Keep expenses: These are your vitals, like payroll, hosting fees, utilities, and rent. If possible, revisit the contracts you have with long-term partners to find fair updates.
  • Stop expenses: These are unnecessary costs. Billboard advertising, for instance, is no longer wise given our stay-at-home orders. Unwind these contracts to stop the bleeding.
  • Modify expenses: These are expenses that are still needed, but at a modified capacity. Things like new hires, marketing agency fees, and legal fees fit in this category. 

3) Practice financial discipline  

In early-to-late stage companies, monthly budget execution adds great operational discipline. For instance, Operator Collective sets a monthly budget they need to spend up to for each department, which then resets every month. For this to happen, each department needs to track expenses at the invoice level. 

This may feel like a lot, but once you set the process in motion, it works. This is not only about fiscal discipline and transparency, though — it also provides a venue for people to discuss their plans and adjust as needed.

Bottom line: You’ve got to have a solid budget and operating plan 

In today’s volatile economy, your budget is obsolete the moment it’s complete. So what’s the point of going through these processes? 

Having an Annual Operating Plan serves as the proverbial “line in the sand” for management, employees, and the board. It offers a tangible way to track performance, calibrate, and course-correct. For this reason alone, budgeting is a worthwhile exercise, with the caveat that operators should treat it as a living organism, instead of putting the operating plan on the shelf to gather dust, only to be seen in a quarterly board meeting. 

Once your Annual Operating Plan is in place, it’s wise to break it into mini-milestones and quarterly plans to execute and track against actual. Set up a dedicated, recurring regular meeting to align at a cadence that makes sense for your team. Start with a high frequency, then adjust as people become familiar with the practice. This sounds daunting, but it can be done in a simple Google sheet by listing out high level forecasts vs. actual performance. In doing so, your company will garner insight into the operation and results, and can use the information to plan better for the future and react as unexpected events occur.

We believe culture, diversity, and operational excellence are a key part of building truly great companies. Learn more at www.operatorcollective.com or on Twitter and LinkedIn.

 

20 books to add to your reading list

You’re always wishing you had more time to read, right? The COVID-19 social distancing mandate could be your chance. In case you need a little inspiration, we asked our community to share their favorite books with us. Here we’ve compiled a list of suggested fiction, nonfiction, and memoir selections. Perhaps you’ll start with that best-seller you’ve heard so much about or an easy beach read to take a mental vacation, or maybe even a cult classic you’ve always meant to grab. Enjoy!

FICTION FAVORITES 

The Dutch House by Ann Patchett. When two wealthy siblings are exiled from their home at an early age by their stepmother, they’re thrown into poverty. Relying on each other, they overcome desperate situations, yet never stray far from the orbit and draw of their eccentric childhood home. (Leyla Seka)

Some Love, Some Pain, Sometime by J. California Cooper. This collection of short stories offers up a diverse cast of characters that often struggle to make the right choices and find happiness in a society that often chooses light skin over dark and money over spirit. Each episode inspires, though, bubbling over with laughter, advice, and enjoyment. (Molly Ford)

A Tale for the Time Being by Ruth Ozeki. Nao is a 16-year-old who’s uprooted from her life in California to return to Japan when her father loses his job. To overcome her suicidal thoughts, she decides to research and write the story of her grandmother, a Buddhist nun. Ruth is a novelist on an island off the coast of Canada. When Ruth finds a Hello Kitty lunchbox washed up on shore, she’s thrown into the mystery of Nao’s life. (Jenny Sohn)

The Alchemist by Paulo Coelho. This novel tells the mystical story of Santiago, a shepherd boy who longs for adventure, travel, and wealth. His quest leads him to riches far different and more satisfying than he ever imagined. His journey serves as a grand reminder to seize opportunities, recognize the omens in life, and follow your dreams. (Lolita Taub)

Play It as It Lays by Joan Didion. This classic novel chronicles the Hollywood subcultures of the 1960s via the downward drift of a particular actress. In concise-yet-stunning language, the book captures the ennui of society and remains more than three decades after its original publication a profound read, riveting in its exploration of a woman and a society in crisis. (Erica Schultz)  

The Lymond Chronicles series by Dorothy Dunnett. Romp through history with incredible detail, plotting, maneuvering, travel, costumes, suspense, and hilarity. In 1547, the disgraced Francis Crawford of Lymond embarks on a fantastic journey to redeem his reputation. Follow along as his quest takes him from decadent French Courts to the battlegrounds of Malta to the hidden palaces of the Ottoman Empire and well beyond. (Laura Butler)

Beneath a Scarlet Sky by Mark Sullivan. As an Italian teenager during World War II, Pino Lella was drawn into helping Jews escape over the Italian Alps to Switzerland, then led a double life as driver to a German general and spy for the Allies. If this book were pure fiction, readers might regard it as too far-fetched, but the fact that it recounts actual experiences makes it captivating. (Meagen Eisenberg)

Where the Crawdads Sing by Delia Owens. In the outer banks of North Carolina lives the “Marsh Girl,” Kya Clark, who survived for years alone in the marsh that she calls home, finding friends in the gulls and food in the sand and ocean. When a local boy is found dead, the town immediately suspects Kya, but her mysterious life is not what it seems. (Robin Joy)

Jack Reacher novels by Lee Child. Jack Reacher is a former Major in the United States Army Military Police Corps. Though he has a shady past, he maintains an in-depth sense of what is right. The series follows him as he falls into webs of complications and mysteries. These books are plentiful and not published in a chronological order, which means you can pick and choose as you like. (Elisa Steele)

RIVETING MEMOIRS 

Year of Yes by Shonda Rhimes. She’s the creator and producer of some of the most audacious shows on TV, yet Shonda Rhimes is a classic introvert, avoiding public appearances and suffering panic attacks before interviews. When her sister points out that you never say yes to anything, Shonda chose to make a change, challenging herself to say YES to everything that scared her for one year. (Anita Lynch)

Born a Crime by Trevor Noah. You might know Trevor Noah as the affable host of The Daily Show, but his path to success was everything but easy. Noah was born in apartheid South Africa to a white Swiss father and a black Xhosa mother at a time when such a union was punishable by five years in prison. This is his tale. (Lisa Campbell)

Molly’s Game by Molly Bloom. For a time, Molly Bloom ran the most exclusive poker game in Los Angeles. She staged her games in hotel suites, dined at exclusive restaurants, flew privately, and hobnobbed with celebrities, until it all came crashing down. This is a behind-the-scenes look at Molly’s game, the life she created, the life she lost, and what she learned through it all. (Elena Gomez)

Maybe You Should Talk to Someone by Lori Gottlieb. Thanks to the nature of their work, many therapists see their own counselors. But when an unexpected breakup leaves her reeling, therapist Lori Gottlieb enlists a new counselor to help her work through her issues. Gottlieb is hesitant at first to open up to “Wendell” (a middle-aged, balding man in a cardigan), but his odd methods make an impact. (Erica Dorfman)

Tokyo Vice by Jake Adelstein. An American investigative journalist takes on Japanese organized crime, but when one scoop exposes a scandal that results in a death threat for him and his family, he decides to step down. Here he delivers an open look at Japanese culture and searing memoir about his rise from cub reporter to seasoned journalist with a price on his head. (Nicolas Dessaigne)

Look Alive Out There by Sloane Crosley. This collection of essays is a deep yet humorous take on the catastrophes of everyday life. It’s like “listening to your smartest, funniest friend regale you about their (mis)adventures, be it waging war on a rude neighbor, making an ill-conceived climb up a volcano, or helping a swinger couple pick out a third.” (Ambrosia Vertesi)

GRIPPING NON-FICTION 

Team of Rivals. Award-winning historian Doris Kearns Goodwin shines a light on Abraham Lincoln’s true political genius in this highly engrossing work. Enjoy the research as the one-term congressman and prairie lawyer rises from total obscurity to prevail over three gifted rivals of national reputation to become president. (Anirma Gupta)

Tightrope: Americans Reaching for Hope by Nicholas Kristof and Sheryl WuDunn. This book weaves together eye-opening stories of children growing up today in an “other America.” As a whole, these detailed accounts show how working-class families have been all but forgotten as a result of decades of policy mistakes. (Reshma Saujani)

The Short and Tragic Life of Robert Peace by Jeff Hobbs. When Jeff Hobbs arrived at Yale, he met the man who would be his roommate for four years: Robert Peace. Robert grew up in the crime-ridden streets of Newark in the 1980s. The brilliant Robert studied molecular biochemistry and biophysics, but is unable to fully leave street life behind him. (Ebony Beckwith)

Beginning of Infinity by David Deutsch. Physicist and author Deutsch talks about the unlimited nature of human progress and how we often underestimate our ability to find solutions to problems. He argues that explanations have a fundamental place in the universe—and that improving them is the basic regulating principle of all successful human endeavor. (Nick Mehta)

The Boys in the Boat by Daniel James Brown. This must-read tells the story of the University of Washington’s 1936 crew team on an epic quest for an Olympic gold medal under the watchful eye of Adolf Hitler. The rag-tag team, sons of loggers, shipyard workers, and farmers, remind us that victory is possible when everyone literally pulls together. (Ruthie Miller)

More suggestions to maintain your #PositiveOps

Looking for more fun recommendations to keep things positive while sequestered at home? Here are 30+ at-home activities to keep you physically and mentally fit. And here are 8 podcast recommendations to entertain and distract.

How are you staying positive these days? We’d love to know — Please share your recs with us on Twitter at @OperatorCollect.

We believe culture, diversity, and operational excellence are a key part of building truly great companies. Learn more at www.operatorcollective.com or on Twitter and LinkedIn.

What companies should strive for in a down market

Photo by Christopher Michael

The COVID-19 outbreak leaves today’s markets in flux, and naturally there are two general categories of thought when it comes to how venture capitalists will react. 1) Venture firms will sit out the next few months and not deploy capital as they focus on supporting their existing portfolio, or 2) Venture firms are open for business, knowing that incredible businesses were built during the last economic downcycle (aka: the 2008 financial crisis).

At Floodgate, our investment strategy remains largely unchanged. Our mission is to back founders who have the grit, vision, and courage to not only survive, but actually thrive in an economic environment where there are no guarantees the next funding round is right around the corner. Even over the last few years when it seemed that capital was aplenty and companies without a clear path to profitability were able to raise large rounds of funding, we’ve encouraged founders to be practitioners of Intelligent Growth. (So much so that we teach a class of the same name at Stanford!) 

What venture firms look for in down markets 

The premise of Intelligent Growth is that a startup needs to hack value before it hacks growth. That’s the key message here: Especially in a downturn, companies must be sure they’ve reached product-market fit before they prioritize growth. Does that feel counter-intuitive?

Over the past few years, when venture funding seemed abundant — more funds were popping up and existing firms were raising larger funds — companies and VCs alike were prioritizing growth, sometimes in the absence of a sound business model and often before product-market fit was clear. Companies started taking a “growth at all cost” approach to reaching triple-digit growth rates — even when the cost of acquiring customers continued to outpace the lifetime value of those customers, margins were deteriorating, or there were other signs that product-market fit had not been achieved.

In fairness to founders, they were often solving for what they thought would get their companies noticed and funded, so the ecosystem started to confuse high growth rates with evidence of product-market fit. But how is a founder to know if product-market fit has been achieved? There are many definitions of product-market fit, but they generally center around creating moments of delight for customers that are so compelling, that instead of the company pushing its products to customers, customers are pulling the products from the company.

“Growth at all costs” leads to fake progress

Unfortunately, what those concepts often fail to take into account, especially in the early days of a business, is whether the unit economics are (or will become) attractive and whether the company can ultimately grow in an efficient manner.

Take the example of an ecommerce company who uses free credits to get customers in the doors, only to have the customers churn once the credits expire because the service itself was not fundamentally valuable. The company may be able to use its own capital to, in effect, buy growth via net-new sign-ups, but without an ability to retain and monetize an active customer base, the growth is clearly not sustainable. So while the company may appear viable from the outside, the inflated growth rate creates an unstable foundation. It is, in effect, fake progress

Finding product-market fit in a down market 

A much more sane approach to building a company is to not only strive for product-market fit, but to also position yourself competitively in your ecosystem with a business model that can evolve to let you be self-sustaining someday — to control your own fate. This does not mean you need to monetize on day one, of course, but rather that you always maintain a sense of what you’re building toward and whether the ecosystem you play in (your customers, suppliers, partners, and competitors) will accommodate your business model. To learn more about how to solve for not just creating a Minimum Viable Product but becoming a Minimum Viable Company, even in the early days, read this blog post by Floodgate co-founder, Ann Miura Ko.

To be clear, growing intelligently does not run counter to growing quickly or blitzscaling. When does a start-up begin to Blitzscale? Entrepreneur Reid Hoffman like to say this happens when “you’ve ironed out the product-market fit, you have some data, and you know what the competitive landscape looks like.”  

Intelligence growth starts with creating value

There’s a time and a place to invest in scaling your company, but that time is not before you’ve attained product-market fit; growth alone is not evidence of that magical moment. Whether we’re in a bull or bear market, you want the fundamentals of your business to be sound so you’re not dependent upon a large next round of funding to buy you more time.

Stay calm and grow intelligently, my friends. 

Image credit: Christopher Michael
We believe culture, diversity, and operational excellence are a key part of building truly great companies. Learn more at www.operatorcollective.com or on Twitter and LinkedIn.

 

8 podcast recommendations to entertain and distract

Piggybacking on yesterday’s post with at-home activity suggestions, here’s a list of podcast recommendations from our Operator Collective LPs. We’ve always loved podcasts to liven up our commutes and gym time, but lately they’ve become a welcome distraction from the news. So grab your ear buds and take a mental break, starting with these eight thoughtful suggestions.

  • Where should we begin? This podcast takes you right into the office of famed couples therapist Esther Perel to listen in as real couples [anonymously] discuss the raw and intimate details of their lives. From infidelity to loss, the stories and advice teach us how to listen and relate to others. (Anita Lynch)

  • Latina to Latina. In episodes that somehow find the perfect combination of funny and meaningful, this podcast discusses the challenges of Latinas face in the business world from career growth to families to persistent systematic inequalities. It’s an insightful and emotional listen. (Lolita Taub)

  • Throwback: How did the U.S. women’s national soccer team become a phenomenon? Listen to the firsthand accounts of superstars like Mia Hamm, Michelle Akers, and Kristine Lilly as they tell the origin story of the team and track its journey to an improbable World Cup victory in 1991. (JJ Ramberg)

  • Running Remote is a timely podcast on how to build and scale remote teams. Listen in as CEOs, managers, and entrepreneurs who’ve build effective businesses through this innovative (and exploding) movement share their strategies and lessons learned. (Jenny Sohn)

  • How I Built This amplifies the growth stories behind some of today’s most popular brands. NPR’s Guy Raz holds casual conversations with innovators and entrepreneurs about how they got their businesses up and running. Each episode covers one business, so it’s fun to pick-and-choose from the ones that spark your interest. (Elena Gomez)

  • Hidden Brain: This NPR podcast combines science with storytelling to explain the unconscious patterns of human behavior. Keep it positive with fascinating episodes on things like the power of imagination or why we love surprises. Or for something more of-the-moment, try this episode on lessons from the 1918 flu pandemic. (Anirma Gupta)

  • Founded and Funded: The partners at Madrona VG launched this podcast to allow founders and entrepreneurs to share their challenges, mistakes, turning points, and “moments of truth.” The podcast offers critically useful information for anyone building a business directly from the people in the trenches themselves. (Laura Butler)

  • Great Women of Business explores groundbreaking women who revolutionized our world (though you may not have realized just how much) like Julia Child, Susan Wojcicki, and Coco Chanel. Each episode weaves their entrepreneurial stories with business principles and the result is 60 minutes of inspiration. (Ruthie Miller)

Need more podcast recommendations? Operator Collective’s own JJ Ramberg just launched Goodpods, a podcast player where you can follow your friends and influencers (ranging from Dan Harris of ABC News to Kim Kardashian) to see what they’re listening to. Check it out and let us know what you find and be sure to share your podcast recs with us on Twitter at @OperatorCollect

We believe culture, diversity, and operational excellence are a key part of building truly great companies. Learn more at www.operatorcollective.com or on Twitter and LinkedIn.

30 at-home activities to keep you connected, full, and fit

As we learn to navigate our shared new reality, it’s important to find worthwhile ways to maintain our mental health and physical well being. It’s easy to get bogged down in the news reports and case maps, so we at Operator Collective try our best to reframe the situation and find positive outlets when possible. Perhaps we can mold our abundant home time into an opportunity to learn and connect in new ways.

To that end, we turned to our own community for suggestions. Here’s how our Operator Collective LPs are staying engaged and active. What activities are you enjoying? We hope you’ll share your recs with us on Twitter at @OperatorCollect

GET COOKING.

Many of us have been flexing our cooking muscles lately. Elena Gomez suggests a comforting chili poblano soup with corn, while Robin Joy has been making slow-cooked dishes like these red-wine braised short ribs and Monique Covington says her family can’t get enough of this Garlic Knot Chicken Alfredo.

If you enjoy celebrity cookbooks, Katy Dormer recommends both of Chrissy Teigen’s, adding that Teigen’s recipe for Cacio e Pepe has become her go-to dish. Ambrosia Vertesi prefers Snoop Dogg’s cookbook (yes really), especially this recipe for Orange (but Really Kinda Burgundy) Chicken.

On the lighter side, JJ Ramberg suggests these vegetarian lettuce wraps, while Ruthie Miller raves about this Power Plates cookbook. And for something totally different, Laura Butler recommends a fondue night: cheese, wine, veggies, and meat in endless combinations. For a treat? Mallun Yen and her daughter have been making bubble tea, dragon fruit smoothies, and amazing scallion pancakes.

CONNECT ACROSS THE MILES.

Had enough of the #QuaranTiki parties? Cathy Polinsky has been staying connected to family and friends by doing remote escape room boxes; participants need only to order the same mystery box and then open them at the same time from their own homes and discuss via Zoom. Nicolas Dessaigne and his family have been using Roll20 to play board games online with family and friends.

MAKE TIME FOR WELLNESS.

Lisa Campbell recommends the Headspace app, which offers exercises and videos on things like meditation, stress, and healthy living. Similarly, JJ Ramberg likes Ten Percent Happier, an app offering guided meditations to help with stress, happiness, and sleep. Molly Ford, on the other hand, says part of her wellness routine focuses on purging and organizing her closets.

If you need something more physical, do as Nick Mehta suggests and try a Peloton bike. And if you can’t get your hands on one, Erica Dorfman has been streaming yoga and meditation classes via the Peloton app — no bike required, and it’s currently free for 90 days.

LISTEN TO MUSIC.

Meagen Eisenberg has been filling her brain with the soothing sounds of The Very Best of Kenny Rogers lately, resurfacing some nostalgia from when she listened to the same album with her parents via 8 track. If that’s not enough, try our Operator Collective #Quarantunes playlist, which is full of positive vibes.

WATCH SOMETHING LIGHT.

Looking for a show to binge? Anirma Gupta recommends The Great British Baking Show on Netflix. And when you’ve watched all those episodes, but still need the soothing tones of British accents, Katy Dormer suggests Repair Shop. If that’s not your style, she also suggests Tiger King (since we are in absolutely crazy times, it’s good to watch a show of a world that might be crazier) and Crip Camp (which offers an incredible reminder of what people are capable of; have a box of Kleenex ready).

Laura Butler recommends Miss Fisher’s Murder Mysteries, a series about a glamorous and rebellious lady detective set in the Roaring Twenties in Australia, while Robin Joy suggests The Morning Show and Stumptown. Molly Ford likes to watch Self Made, Inspired by the Life of Madam C.J. Walker on Netflix, Lolita Taub prefers 100 Humans and Night on Earth, and Reshma Saujani enjoys Hulu’s Hillary series.

Whew! We hope these suggestions add a few positive vibes to your day. What are some activities you’re enjoying at home? Don’t forget to share them with us on Twitter at @OperatorCollect.


We believe culture, diversity, and operational excellence are a key part of building truly great companies. Learn more at
www.operatorcollective.com or on Twitter and LinkedIn.

Operator spotlight: Executive search leader Lynn Carter

Looking for practical help and advice on an operational area that may be outside your realm? Each month we spotlight one of our talented operators, who’ll share their expertise and offer insights and ideas that may help improve your own operations. This month we spoke to Lynn Carter, Head of Executive and Strategic Search at Confluent.

What are some of the biggest challenges recruiters face today? 

LYNN: Even in the best economic times recruiters should have a narrative around the company, executive team, funding, and the specific role they are presenting. But given where we are today, messaging needs to be particularly compelling, with an understanding that candidates may be more reluctant to consider leaving a role at this time. More communication and context, and more relationship building and engagement will be needed to get candidates to tip forward to consider opportunities. 

It seems like every company is trying to build a diverse and inclusive culture. How can companies increase their applicant pools to attract more candidates from underrepresented backgrounds? 

LYNN:  This is a hard and thorny, but important question to answer. I wish I had a magic answer on the exact steps it takes to be successful in increasing applicant pools and creating more diverse teams. I don’t, but here are some things to consider:

  • Start early. Many candidates from underrepresented backgrounds want to join companies that have employees that look like them. So if you don’t prioritize diversity and inclusion from the start, you risk creating an even bigger problem down the road when you try to attract candidates from underrepresented backgrounds to your company. The good news is that you can get started right away by being intentional about your hiring practices and company culture. 
  • Focus on inclusion first. To not just hire, but also retain diverse talent, it’s important to build a company where employees of every background have the opportunity to thrive. Consider what your company is doing to build an inclusive environment. How are you building your employee resource groups and surfacing meaningful ways to support your employees from underrepresented backgrounds? These things demonstrate your commitment to building an inclusive workplace. Your own employees will be a champion for your company, attracting their network to the company when hiring. 
  • Think about your leadership team. Have you worked hard to diversify this team with good results? If so, encourage these leaders to be involved in outside groups, meetups, and conferences that support underrepresented talent. If you haven’t made headway on diversifying your leadership team, focus there because it is very difficult to think about hiring diverse talent into a company whose leadership team itself is lacking in diversity. 
  • Ensure an equitable hiring process for all candidates. Talk with your hiring managers about unconscious bias, building an objective and consistent interview process, and supporting employees from underrepresented backgrounds after hire. Candidates from underrepresented backgrounds face unconscious biases in the interview process and in the workplace that other candidates don’t, so bringing this to the forefront with your interview and management team is an important step. And for early stage companies that might not be able to invest in unconscious bias training, simply having your team read and discuss some statistics about inequality in hiring, pay and promotion is a good start. Here is one recent article that you can reference that lays this out pretty clearly for gender bias in tech: Women in tech statistics: The hard truths of an uphill battle  
  • Consider different dimensions of diversity. In tech, diversity is frequently associated with gender and race. To be sure, it’s important to prioritize gender diversity and racial/ethnic diversity in your workforce, as well as the intersection between the two. (Women of color, for example, often face different barriers in the workplace than do white women.) But there are other dimensions of diversity to consider: educational and/or work background, socioeconomic status, age, disability, parental status, and more. 

What’s one thing we can do to make it easier for women and URM to get tech jobs?

LYNN: While there has been some progress in women and URM hiring recently in tech we have a long way to go. One simple thing is keeping must-have criteria in a job description to 3-4 bullet points at most. The reason that I say this is that all too often my recruiting team will kick off hiring for a technical position, and the hiring manager will list out 10+ must-have technical skills that the candidate has to have before being interviewed. This means that most of the applicants will not be considered. In addition, oftentimes women and URM candidates opt out of applying to these roles altogether when they don’t feel that they match 100% of the criteria requested. 

What’s your #1 trick for recruiting the best people?

LYNN: The most thoughtful answer I can tell you for finding the best people is to never settle, no matter the sense of urgency you have to fill the role. If you get to the end of the process and you are not excited about the candidate in front of you, remind yourself that someone who ultimately is not a fit for the role and company will have an enormously negative impact. Conversely, working hard to identify and attract a strong candidate pipeline, and sometimes waiting for the right person who will hit it out of the park, is hugely impactful. 

So what’s the one tried-and-true trick to get the right person interested in your company and role? Your network. Tell everyone what you need and why this is so important to your company. You will be amazed that sharing with the world your mission and the impact that this position will have will yield fantastic results and uncover fantastic talent who you may not have considered without the recommendation. 

There are no guarantees when it comes to placement, but are there certain criteria, experience, or traits you look for as indicators of future success? Things that may not appear on a resume, but bode well for a candidate?

LYNN:  It’s an overused term, and can be difficult to assess when reading a resume, but I would say grit. What obstacles has this person overcome in their personal and professional life? This can show up in a variety of ways, including working their way through school, participating in a collegiate sport, living in a number of countries, or changing roles or domains significantly in their careers.  

What’s one piece of advice you’d offer a company looking to improve its hiring process?

LYNN: Hire a great recruiting team. Look for recruiters who dive deep into understanding the products and businesses, and have been a true partner to hiring managers to lay out a strategy to hire great people. They should be extremely curious about people and the businesses they serve, as well as relentless in the pursuit of the best hire.

What’s one amazing insight no one knows about recruiting?

LYNN: It’s the best job in the world. Connecting with amazing people and bringing them together with others to build great businesses is fun and rewarding. Don’t get me wrong — it’s hard work, and it requires a great deal of optimism and energy to bring a company vision and role to the market, as well as to convince people who are already in a successful role to consider making a switch. But it’s a great feeling to help people discover new opportunities and then see them thrive with a new set of people in their professional lives. 

AOC often talks about the skills she picked up as a bartender, and others talk about what they learned working retail. What were some of those formative jobs for you?

LYNN: I’ve had a lot of these! I was fortunate to have parents who emphasized hard work from a young age. My siblings and I all worked as janitors at my dad’s orthodontic office in the evenings in middle school, which made getting my first job in a restaurant my sophomore year of high school seem pretty luxurious. Then I worked for two years in retail selling athletic shoes, which I enjoyed. It was the first job where I had a bonus incentive to learn and sell certain shoes on the floor. I loved that, and realized I was good at talking with people about what they needed and helping them to make decisions. And the best thing? I was made a manager with keys to the store by my senior year, which meant I could get my friends into the mall after hours.

What are some books you’ve enjoyed recently?

LYNN: I’m a crazy reader; it’s one of the things that I most like to do with my free time. I have a range of interests, from tech to biotech to history, so you’ll see me pick up almost anything and get deeply involved (and then tell you all about it). I recently finished Farther Than Any Man: The Rise and Fall of Captain James Cook by Martin Dugard. And now I’m reading The End Is Always Near: Apocalyptic Moments from the Bronze Age Collapse to Nuclear Near Misses by Dan Carlin. Dark, I know, but seemed appropriate for the times. 

What’s something at work that makes you roll your eyes every time you hear it?

LYNN: When someone says that something can’t be done. This just fires me up. I don’t know if I actually roll my eyes, but I instantly go into problem-solving mode to come up with a solution. 

What’s the one condiment you could never live without? 

LYNN: Does salt count? If so, probably that. And don’t worry, I’ve got pretty low blood pressure.

We believe culture, diversity, and operational excellence are a key part of building truly great companies. Learn more at www.operatorcollective.com or by connecting with us on Twitter and LinkedIn.

8 ways our community is fighting COVID-19

As the world works to contain the COVID-19 outbreak, our own community has gone into overdrive. We’re so proud of our Operator Collective LPs for leading this charge. Here are some of the ways they’re using their platforms, tools, and networks to help. 

  • Eric Yuan, Kelly Steckelberg, Janine Pelosi Zoom
    In today’s everything-from-home economy, Zoom has become the de facto tool for communications, virtual meetings, remote work, family chats, and more. But what about our schools? As educational institutions shut down around the world, the Zoom team truly stepped up, offering its video conferencing tool free to any K-12 school.

  • Rachel Carlson Guild Education
    Rachel Carlson has emerged as a persuasive voice in the coronavirus crisis, imploring her fellow business leaders to #StopTheSpread. She co-wrote a letter imploring Americans to take “bold action” to slow the spread of the coronavirus, and then a more direct ask to corporate leaders. By circulating the letter, Carlson hopes business leaders can remove some of the burden from local, state, and federal governments.

  • Kimber Lockhart One Medical
    One Medical is a membership-based primary care practice. In addition to offering same-day appointments, providers offer 24/7 video visits. One Medical has also created a Coronavirus Help Center with resources to help everyone stay up to date with the latest information.

  • Nihal Mehta – Eniac Ventures + Reshma Saujani – Girls Who Code
    Nihal Mehta recently launched Help Main Street, a crowdfunded platform to keep shops, restaurants, and industry workers afloat via gift card sales. Want to help your local favorites? Go to helpmainstreet.com to purchase gift cards to provide critical cash support during the COVID-19 outbreak.

  • Jennifer Tejada – PagerDuty
    PagerDuty is a platform that helps companies manage the full spectrum of their digital operations. As healthcare organizations struggle with demand and stress, they need to stay prepared and “always on.” To that end, Tejada and PagerDuty recently announced an offer for healthcare organizations: 20 PagerDuty licenses free for six months.

  • Christina Kosmowski Slack
    Slack has seen huge increases in paid customers since the coronavirus outbreak, offering plenty of content to facilitate remote working (including this Guide to Working Remotely in Slack). They’ve also announced free upgrades to teams working to solve the crisis.

  • Michelle Zatlyn – Cloudflare
    Cloudflare accelerates Internet properties, helping businesses stay productive from any location. Early in the coronavirus outbreak, Zatlyn and team made their enterprise-grade features available to small businesses at no cost, offering unlimited seats of Cloudflare for Teams through September 1.

  • Lexi Reese – Gusto
    Gusto is an automated platform for payroll, HR, and employee benefits, aimed specifically at small businesses. They’ve recently launched a COVID-19 Resource Hub to offer small businesses the most updated news, information, and advice.
We believe culture, diversity, and operational excellence are a key part of building truly great companies. Learn more at www.operatorcollective.com or by connecting with us on Twitter and LinkedIn.

It’s uncomplicated: Why we’re crazy about DataGrail

The company: DataGrail 

DataGrail is a privacy platform that simplifies compliance with GDPR, CCPA, and similar privacy regulations. In this Age of Privacy, DataGrail is helping companies stay in line with regulators while building trust with their customers by driving new standards of transparency and accountability. 

DataGrail was built on the principles of diversity and inclusion from the very beginning. About 40% of the company is female (a percentage which has never been below 30%), 50% of the board members are female, and 11% of employees identify as LGBT+ or gender non-binary. Read more about DataGrail’s commitment to supporting workplace diversity in their recent blog post.

Why you should pay attention 

The rapid-fire expansion in privacy regulations combined with the dramatic explosion in data collection is creating major turbulence for businesses. The average enterprise has 88 different systems that could contain personal data, and Gartner predicts that by 2023, 63% of the planet’s population will have GDPR-like personal data protection (up from 10% today). Yet DataGrail’s recent consumer survey shows 83% of Americans expect to have control of how businesses manage their data. Companies clearly need help navigating this landscape, and DataGrail is leading the way.

The details 

The issue is clear: privacy is a fundamental human right and essential to democracy. So in 2018, Daniel Barber, Earl Hathaway, and Ignacio Zendejas launched a business built on this covenant of trust. With 200+ pre-built connectors, the DataGrail Privacy Platform gives a 360-degree, real-time view of the applications a business uses, then maps personal data associated with each of those systems. Customers can manage their privacy request workflows and email preferences across applications.

Building trust through transparency. Taking complicated out of compliance. DataGrail is changing the game.  

How it works

At the core of the solution is DataGrail’s Live Data Map, which provides a continually refreshed blueprint of where data lives in the organization. Any changes made to the systems are reflected automatically. Privacy requests are streamlined, eliminating human errors and reducing risk. And DataGrail’s hundreds of pre-built integrations (Salesforce, Adobe, Oracle, AWS, and more) streamline the onboarding process, making data discovery almost instantaneous. This makes sure companies not only achieve compliance, but are continuously compliant over time as regulations change externally, and business systems, fields, and owners change internally.

Why were obsessed 

Today trust is a currency, and DataGrail is here to help companies grow and manage this business-critical resource. DataGrail clients like Overstock.com, Restoration Hardware, Revolve, Databricks, and more rave about how the company helps them manage data privacy risk and compliance (simplicity, automation, and real-time insights are the common refrains). By taking on the complexity of the continually shifting regulatory landscape, DataGrail is simplifying compliance and helping its clients stay ahead of the curve. 

Get involved

Ready to supercharge your company’s privacy disciplines? Let DataGrail handle your compliance needs. Get started here now. 

We believe culture, diversity, and operational excellence are a key part of building truly great companies. Learn more at www.operatorcollective.com or by connecting with us on Twitter and LinkedIn.

Steady on: Downturn advice from a seasoned investor

There’s an old English political saying that says the Conservative Party never panics, except in crisis. That feels especially true these days. Perhaps you’ve never really experienced an economic downturn, but I’ve been through at least two: In 2000 (when I was in the eye of the storm at Cisco) and again in 2008 (when the crisis hit hardest outside the tech world). Each brought with it a set of lessons that I’m happy to share as we navigate this latest challenge. 

1) Turn off financial media.

At this point, the story is the market decline, which the financial media will cover in all its gory detail. Just as financial media over-rotates to bullish commentators during good times, they will over-rotate to the bearish folks now. At some point in the cycle, we’ll see folks predicting the end of capitalism and democracy… But we have withstood greater challenges than this. Warren Buffett, who in many ways is the sage of market downturns, has a wonderful saying: Be fearful when others are greedy, and be greedy when others are fearful.

2) The cloud is still the greatest opportunity for tech investors. 

For those of us in tech, I believe the big thesis on the move to cloud not only does not change, but actually may accelerate. We’d been in a magic period where both existing companies and startups were ready to adopt new technology at a breakneck pace. Tech companies will need to wait and see if startups are still spending, but I believe enterprises will continue to spend. The new world is much cheaper than the old one, and folks may need to be aggressive in fixing old cost structures.

3) This is a great time to have dry powder. 

We’re still early in the economic downturn (where VC Twitter proclaims boldness in the face of risk). That’s going to change. Soon we’ll find out which companies have been overspending, and which VCs are willing to bet that those companies can improve. My personal feeling is that bad and even mediocre business models will feel a lot of pain.

The flip side is that funds like Operator Collective (which has a clear majority of its funds unspent) will have opportunities to invest in great companies at excellent valuations. Unlike most other VCs, Mallun Yen and Leyla Seka do not have a large legacy portfolio to triage, and instead have the chance to wait, watch, and act as valuations decline and markets become clearer. Rather than compete in overpriced rounds, Operator Collective will have the time and resources to cherry pick the best opportunities. 

4) Cash is still king. 

If you’re operating a company, that particular golden rule still applies today: Do not run out of money. Be ruthless in analyzing your cost structure. If you can adjust your business model to have your cash last longer, you have a greater chance of being able to raise again when the market comes back. The faster you adjust to this new reality and the faster you take cautionary action, the better prepared you are for the inevitable recovery. 

Separating fact from fiction 

In up markets, every VC looks like a genius – but markets like these let us know who’s the real deal. I hope all of you remain upbeat and look for the opportunities that will certainly be there in and amongst the damage. Steady on, friends. 

We believe culture, diversity, and operational excellence are a key part of building truly great companies. Learn more at www.operatorcollective.com or by connecting with us on Twitter and LinkedIn.