Founder Fridays No. 116
Fatal Founder Sales Mistakes -- Management Myths Killing Scale -- Code Kills
Happy Friday.
Fatal Founder Sales Mistakes
Most founders think hiring a salesperson will magically solve their go-to-market challenges. But bringing on sales talent before establishing product-market fit and a repeatable sales process is like hiring a chef before you have a kitchen. Through 18 months of customer development and product iteration, founders build an irreplaceable understanding of their customers' problems that can't be downloaded to a new hire in a few months. Your best bet is to embrace being your own first salesperson — most prospects would rather talk to a passionate founder than a coin-operated sales rep anyway. And here's the kicker: How can you possibly know what type of salesperson to hire if you've never sold the product yourself? Selling Points (14 minutes)
Management Myths Killing Scale
Every startup leader dreams of building the anti-corporate workplace, yet 65% of ventures fail due to people problems, not product or market fit. Many founders are so allergic to traditional management structures that they create chaos by overcorrecting — blindly rejecting any hierarchy or process as "corporate bureaucracy." But scaling without some structure is like trying to build a skyscraper without steel beams. The reality is that even successful mavericks like Google's Larry Page had to abandon completely flat organizations when hundreds of people started asking the founders about expense reports. Your startup doesn't need soul-crushing bureaucracy, but it does need enough backbone to handle rapid growth, align teams around goals, and resolve the inevitable conflicts that arise between functions like sales and engineering. The key is finding the sweet spot between chaos and control. Harvard Business Review (8 minutes)
Code Kills
Your coding skills could be your startup's biggest liability. While most technical founders obsess over clean code and beautiful design, the harsh truth is that startups rarely fail because of technical issues. The real killers are lack of market validation, insufficient customer development and poor distribution — all things that require stepping away from the keyboard. One founder who built millions in revenue admits having "hideously ugly websites and buggy code." Before writing another line of code, talk to 50 potential customers (yes, 50) and figure out how you'll get 1,000 daily visitors to your site. Because you know what's harder to fix than a bug? A product no one wants. A Smart Bear (4 minutes)
Founder FAQ: What Happens To My Equity When I Leave a Startup?
It’s important to be really clear on your equity before leaving a startup. First, it’s essential to understand whether you have stock grants or stock options — two very different beasts. With stock grants, you get actual shares that vest over time, typically 25% after year one and the rest monthly over three years. Miss that one-year cliff? You walk away empty-handed. But hit your milestones, and those shares are yours forever. Stock options are trickier — they give you the right to buy shares at a set price (say $0.01), but you'll need cash to exercise them. And here's the stressful part: Leave the company, and you usually have just 90 days to buy your vested options or lose them forever. Think carefully before letting potentially valuable equity disappear because you can't come up with the exercise price in time. 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.
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