Founder Fridays No. 107
Founder Fridays No. 107
CEO Succession Planning -- SEO In a Zero-Click World -- The HP Way
Happy Friday.
Sorry, I’m a little late in getting this out today.
This week marks a significant milestone: the 10th anniversary of my book Profit & Purpose: How Social Innovation Is Transforming Business for Good.
I fondly recall the book launch party at my favorite bookstore, followed by an unforgettable afterparty. We managed to fit 80+ people into my apartment, with a line stretching down the hall. It was certainly a night to remember. If you're curious, you can find some photos from the event on my Instagram.
While the book itself was a labor of love and not a commercial blockbuster, it's been remarkable to witness how its core ideas have evolved over the past decade. What was once considered fringe thinking has now become mainstream.
Consider these developments: 1) The Business Roundtable redefined the purpose of corporations to serve all stakeholders. 2) Blackrock, the world's largest asset manager, now emphasizes the importance of companies pursuing positive social and environmental impact alongside profitability.
The concept that profit and purpose can coexist has gained broad acceptance. The idea that business can be a force for good in the world is now taken seriously. I believe this trend will only strengthen with each passing generation.
Thank you all for being part of this journey. Here's to continued progress in transforming business for good.
CEO Succession Planning
Is avoiding the CEO succession conversation slowly killing your startup? While founders pour their hearts into building world-changing businesses, the taboo topic of leadership transition often lurks in the shadows. Both founders and investors tend to sidestep this delicate issue — founders out of emotional attachment or fear of seeming uncommitted, and investors to avoid rattling confidence. However, embracing open dialogue about succession can yield surprising benefits. It allows companies to prepare for future needs, ensures smoother transitions when necessary and even empowers founders to make clearer decisions about their own careers. By normalizing these discussions, startups can build resilience and adaptability into their very foundations. Octopus Ventures (7 minutes)
SEO In a Zero-Click World
With Google's recent implementation of artificial intelligence (AI)-generated summaries — sometimes called “zero click” searches — at the top of search results, the importance of SEO for founders has significantly increased. Well-structured, optimized content is now crucial not only for traditional search rankings but also as the foundation for these AI-generated overviews. As AI tools rely heavily on properly formatted and metadata-rich content, investing in robust SEO practices ensures your brand's message is accurately represented in these summaries. Furthermore, with the growing emphasis on visual content, founders must extend their SEO efforts to include optimized images and videos, as these elements are gaining more attention from AI-integrated services like Google. Content Marketing Institute (6 minutes)
The HP Way
In his seminal speech known as The HP Way, David Packard articulated that a company's true purpose extends beyond mere profit-making, focusing instead on collectively accomplishing something worthwhile and making a meaningful contribution to society. Packard explained that for Hewlett-Packard, this meant designing and manufacturing unique electronic measuring instruments that provided better solutions than were previously available. The HP co-founder stressed the importance of solving real problems for customers, rather than simply selling products they neither want nor need. This customer-centric approach, combined with a clear sense of purpose as outlined in The HP Way, formed the foundation of a company philosophy aimed at creating lasting value and impact. Farnam Street (8 minutes)
Founder FAQ: How Much Equity Should I Give Early Employees?
Equity compensation is crucial for startups to attract and retain top talent. Startups typically allocate 10%-20% of authorized shares for an employee pool. Two key rules guide early employee equity allocation: Rule #1 suggests that the first 10 employees should receive about 10% of the company, with the first five hires getting 0.25%–3% and hires six to 10 receiving 0.10%–1%. Rule #2 emphasizes that more equity should be offered when cash compensation is lower, reflecting the higher risk taken by early employees accepting below-market salaries. However, these rules are flexible guidelines, and founders must consider various factors such as the startup's stage, employee roles and market conditions when determining equity allocation. Westaway (5 minutes)
Startup Funding Guides
I’ve put together a series of guides to equip founders to excel at fundraising. These guides break down the deal term by term and give you negotiation tips so that you can speak to investors with confidence.
Convertible Note: Guide / Video
Saving Time and Money on Legal
When we met this Series B startup, they were frustrated with their law firm's slow turnaround and high fees. Contract reviews took 4-6 weeks and they charged $250,000 annually for basic work. The startup wanted to reduce sales cycle times and legal spend. They switched to General Counsel at Westaway. In year one, we 1) saved them about $200,000 in legal fees; 2) shortened their sales cycle by about 4 weeks; and 3) our streamlined processes saved their ops team 8-10 hours per month previously spent managing legal. By switching to Westaway, they expedited deal closures, saved hundreds of thousands in legal bills, and regained 1 day per month in productivity. If you’re curious if we could save you time and money, let’s talk.
Post of the Week
