Very short post today:
I came across this really funny startup video this morning, which is a true parody. Check it out here. It is only about 3.5 minutes and gave me a good chuckle.
And the important reminder: StartFast is holding its Demo Day on Thursday, August 16th in Syracuse. Register (free) here. We are trying to get a big crowd to help fuel the upstate NY entrepreneurial community. Join us!
Have a great weekend.
It has been a while since my last post on June 11th, which I wrote as I was heading over to Poland to watch Euros soccer. The soccer trip was great. I did not manage to stick with my “delete all email” plan. I had my wife’s iPad with me, and could not resist the urge to keep up on a few matters. And it was not really possible to only see those “few” matters on email. But, that consumed not more than about an hour a day, and having the iPad allowed me to easily talk with my family. So, I guess I failed my own test, but the trade off of seeing my kids and wife was worth it.
The trip was great. The best “fan base” award goes to the Irish fans who are completely nuts – they know their team is not good so their expectations of winning are low. Instead they dress up in their country’s colors and endlessly party. Fun all around.
This has been my first full week back. On the way to the dentist this morning (starting to feel like a Brad Feld wannabe with sharing too much personal information), I thought about what a crazy week it has been. Then I realized it was completely typical. Highlights:
1. Met with 5 new companies/entrepreneurs to talk about their companies. Some meetings in person, some on the phone. All interesting and I have no good idea yet if any will be worth follow up.
2. Dealt with some mind numbing details surrounding the winding down of a portfolio company that was just sold in a stock for stock transaction. The issues dealt mostly with managing tax payments to the government on income deemed earned by management team members on receipt of the buyer’s stock. That is never a fun exercise – receiving non-liquid stock and having to pay tax in real dollars based on the value of the stock. I want to stress that being able to deal with lots of boring details is a skill set that a good CEO needs. It is not a process to embrace, but a necessity.
3. Spent a day at a board meeting for Launch NY, a non-profit initiative. Launch NY hopes to bring the JumpStart model (northeast Ohio) to upstate NY.
4. Been working feverishly to get a new investment deal closed. Documents flying back and forth, lawyers working hard, etc.
5. Had a great call with the founders of a company (in which we have not invested) and a potential new board member for that company. I was lucky enough to be able to make this introduction; this call was part of our due diligence process and also a way to really help out the founders, both of whom I like a lot. Hope this goes somewhere and we get more involved.
6. Met with the head of eLab, a student incubator here at Cornell. I am chairman of eLab, and we are moving it to the next level of service. Lots of politics to navigate.
7. Dealt with (and continue to deal with) a sticky business situation that I cannot share details about, but it has consumed many hours of time.
8. Had a weekly call for one of the CVF companies. The CEO holds these calls every Friday and opens them to every board member and COO. Really a fabulous and pretty painless communication tool. Not for every company, but good to consider.
9. I am on the boards of 5 CVF portfolio companies, and have communicated with every CEO multiple times this week. 3 on both phone and email and all 5 on email. Lots of time, lots of issues, lots of successes and lots of problems to solve.
I know that I have left stuff out. My point though for sharing all this is only to illustrate the incredible variety of issues/highlights/problems that VCs deal with day to day, every day. Call us lucky. Call us crazy. Both exciting and tiring.
Have a great weekend.
I am leaving for a vacation tomorrow for 8 days. Heading to Poland to watch soccer with some good friends (Euro Championships). Should be a blast. I will have extremely limited email access (not bringing my laptop) and no phone. I think I will just delete all emails received while I am away without reading them (and my out of office message will say that). Likewise I am going to turn off my voice mail on my cell phone so no one can leave me messages. Should be an interesting experiment.
Got me thinking about vacation and, in particular, holiday policies at startups. I recently asked a friend of mine who is an employment lawyer about the rules. Here is a run down:
1. There is no obligation to pay anything extra to an employee for working on a holiday (unless, of course, the holiday work, plus other hours worked during that week, causes an “hourly” employee to work more than 40 hours in that week). Paying extra for holidays is a typical policy in companies in which it is difficult to staff a holiday shift, but this is up to the company.
2. There is no obligation to pay employees on designated holidays. The holiday means only that the organization is not open on that day, and that there is no obligation to come to work. Most companies do pay employees on designated holidays because it feels punitive to the employee to earn less in a pay period merely because there was a holiday. And, of course, not having paid holidays is a recruitment disadvantage in many markets. But, these are business reasons, not legal obligations.
3. It is entirely within an employer’s discretion whether or not to have any holidays; which or how many holidays to observe; and what to pay for hours worked (or not worked) on a holiday — except, of course, that employees must earn at least minimum wage for all hours worked.
4. It is entirely within the employer’s discretion whether to offer vacation days; how many vacation days to offer; whether to pay for vacation days or not; whether and how employees accrue vacation; whether or not employees can receive an advance against yet-to-be-accrued vacation; and/or whether to pay employees for accrued but unused vacation when they leave the company.
5. However, if you do offer paid vacation, and you don’t want employees to be able to carryover vacation days from one year to the next and/or you don’t want employees to be paid for accrued but unused vacation when they leave you, then you MUST state that in a written policy that you can prove the employees received.
These are just some good holiday/vacation policy nuggets to keep in mind. There are more. As usual, consult a good lawyer!
My VC partners (one in particular) make fun of me for being extremely literal. If you don’t phrase a question or statement the right way or with clarity, I have a tendency to get confused and ask questions. I actually think this comes from my years of practicing corporate law. After all, if your lawyer cannot state things clearly, you have problems. I guess I just like overly clear communication. I also like overly open communication. While I think that most people like clear communication, some are more open to open communication than others.
This might seem a bit petty and obvious, but trying to be very clear with communication is good practice. But I am convinced that some purposely practice unclear communication.
Here is an example that made me laugh yesterday. My partner and I were emailing back and forth about how to characterize an exit transaction where we received stock of a private company for shares in our portfolio company (often called a private to private transaction). My partner wrote “Show the comparative exchange rate then……” And I wrote back “What is a comparative exchange rate?” Showing return multiples in a private to private transaction can be challenging. We ended up simply writing “CVF received $XXX,XXX of Company ABC stock on $YYY,YYY dollars invested.” To me, that is clearly showing the return based on the current value of Company ABC stock. I still don’t know what a comparative return multiple is. Moral of the story: use simple straight forward language whenever possible.
One more tip for clear communication: when emailing a bunch of thoughts on a topic, try listing them out with numbers (1., 2., 3., etc.). It makes it way easier to read and way easier for the reader to actually respond as they can just respond inline in the original email. People who email with me often see numbered lists. I get some grief about it sometimes like “you are being too direct”. Well, better direct than misunderstood.
If you have some tips on clear communication, pass them along.
It is no secret that many VCs have a hard time saying “no”. They string out their “look”, ask many many many questions even after interest has waned, etc. I try very hard not to fall into that trap.
My partner at CVF sent me this hilarious video the other day. I offer it up to anyone needing to say “no” to a business idea or company. I am still laughing…..enjoy your weekend. And most importantly, use it!
ithaca VC 