5 Contrarian Lessons From 2 Decades in Tech
I gave one of the keynotes at Capital on Stage London a few weeks ago and someone asked me to write it up and post so I cleaned it up and here you go. Note that the audience was comprised of startup founders and VCs.
Preamble: It’s hard to believe that I’ve been in tech nearly 20 years, starting with a course in High Tech Entrepreneurship taught by the legendary Ed Zschau that opened my eyes to the possibilities of a career in tech. Incidentally Ed inspired none other than Tim Ferriss in a subsequent class. Told you he’s a legend.
Having been through 2.5 business cycles (halfway through the 3rd one now, starting with the ’08 crisis/Great Recession), I’ve been exposed to a variety of contexts:
- Size. Company sizes have ranged from 3 people in a room with an idea to rapid growth of several hundred to eventually being part of a 550 person subsidiary of a 40,000 employee multi-national.
- Funding. The companies I’ve been involved in have been primarily VC funded but with angel, family office, PE and public market investors as well.
- Outcomes. This has spanned the gamut from total failure/shutdown/selling of assets to ‘zombiehood’ to acquisition to IPO.
- Verticals. My full time and investor/advisory involvement have exposed me to industries in and around digital media and marketing/advertising as well as ecommerce and IoT, with both b2b and b2c models.
- Location. The companies I’ve been involved with have been primarily located in Seattle, Silicon Valley, Boston, NYC, London and India, although I’ve done business in the rest of Europe and other parts of Asia.
So with the above context in mind and inspired by Tod’s brilliant post on non-obvious lessons, below are some hard-earned lessons that I hope you’ll find useful as you go about fundraising and building your venture.

Don’t Raise VC $. [This was obviously somewhat tongue in cheek since many in the room were VCs and the whole point of the day was for VCs to pitch founders.]

Fundamentally, funding is simply a tool to enable a company to reach its mission but we too often see it as the destination rather than an enabler. Fundraise amounts and valuations are essentially vanity metrics that we use to stroke our egos and keep score with others.
I’ve seen a founder raise for the sake of raising or try to justify the raise and uses of cash afterwards. Once you raise, you are on the treadmill and the expectations only ratchet up. So be sure you’re honest with yourself as to why you’re raising the amount you are right now. What proof points will this amount of capital enable you to prove out? What are the risk factors?
There is no shame in not raising VC. Many businesses are not meant for VC funding and yet have great outcomes. I was part of a couple of transactions that were instructive: Company A was bought for more than 2.5x that of Company B and yet the founders of B walked away with more than 2x the $ as they hadn’t been diluted over several rounds of institutional funding.
There’s also a lot to be said for entrepreneurs that bootstrap and grow their companies via revenue. They retain a lot more control and can then decide to raise later on their own terms — my friends Brad @ Grammarly and Rafat @ Skift are doing just this and very much an inspiration. Or check out Indie.vc’s list of companies that have scaled via revenue.
That said, obviously VCs play a crucial role in tech. I’ve seen firsthand as to how VCs and growth equity can be appropriate in many situations and add long term value in a variety of ways, which brings me to the corollary.
Corollary: If you need to raise VC, don’t optimize for valuation. Again, valuation is a vanity metric. It’s a reflection of what a willing buyer has valued your business at a point in time. This will fluctuate. You want a fair deal that compensates investors for the risk they’re taking and value they’re adding, and a clean cap table. Something Tod echoed in his post as well. I’ve seen a couple of companies in adtech get bogged down by a complicated cap table and messy liquidation preferences where they had optimized for valuation in earlier rounds. Optimize for the set of terms and, especially, the people that will help your company reach its mission over the long term. The valuation will take care of itself.
Embrace Emotion. I studied engineering in university and then went into management consulting so I tend to approach problems in a highly analytical, data-driven way. That would seem to be the best approach — to not let emotion get in the way and instead, dispassionately weigh the pros & cons before then making a decision. But the world doesn’t work that way. Humans are social animals that make decisions based on emotion that we then rationalize afterwards. As Yuval Harari eloquently wrote in Homo Deus, emotions are essentially algorithms we’ve developed over time to make quick decisions.

So pay attention to emotion. The bad decisions I’ve made have been when I went with my head and not my gut. And pay attention to not just your own emotions but those of your investors, your customers, your team. Numbers and stats are helpful but remember that they are proxies for fundamentals, for the essence of your proposition. So you will miss valuable signals if you only look at the numbers. For instance, if sales aren’t coming in, you can look at metrics like leads, conversion rates, pipeline size, et al. But what’s the mood of the sales force? How do they feel about coming into work every day? Are they confident and pumped up or going through the motions? What is the body language of a customer during a QBR or an investor at a board meeting? That can often tell you a lot more than the numbers.
I’ll always remember how the importance of emotion came into play when launching a new product at Videoplaza. We presented the plan to our founder, Sorosh, one of the most intuitive people I’ve ever worked with from whom I learned so much about emotion. So there we were with all of the numbers and stats but he just wasn’t ‘feeling it’. This was incredibly frustrating but also rewarding as it forced us to figure out where the doubts were and how to go about addressing them. Several iterations later, we got there and everyone was excited. But it drove home to me the importance of confidence and ‘feeling it’. As always, strike a balance between paying attention to emotion but not letting yourself get caught up in it.
Get to No. We very much tend to focus on Getting to Yes (a much recommended book btw). Earlier in my career, I used to do everything in my power to avoid saying and hearing “No”. It’s natural and has to do with protecting your ego. But hearing No and the reasons behind it is often a more meaningful signal than Yes. When someone says No to you, it’s not their fault, it’s yours. Instead of brushing it aside and protecting your ego, look it in the eye. Reflect on what led to the No. Was it a poorly qualified lead, not the right pitch or proposition or something else? Own the No and it will eventually turn to Yes.

By the same token, don’t be afraid to say No to people wanting something from you when it’s not appropriate or the right time. They should appreciate the feedback and it will free up mental and temporal bandwidth for you both.
It’s Not All About the People, Especially You and Your Co-founders. Mission comes first. We tend to lionize founders who can do no wrong until they do lots of wrong. But what should be prioritized above all is the Company’s mission with everyone in service to it. Start with that and work backwards to figure out the people and roles that make the most sense at the time. This point was inspired by my friend Ben who thinks founders should be prepared to fire themselves or their co-founders every year. What he means is that every year there should be some honest reflection and discussion as to what the right role is for each founder. It’s great if you’re still the best person to be in your role but don’t take it for granted and be prepared to get out of the way if need be for the higher cause.

Don’t Focus On Just One Thing. Again, conventional wisdom has it that you should only focus on one big thing and not let yourself get distracted. Your functional leads can and should be maniacally focused on one thing but, as a CEO, you will by definition need to juggle multiple priorities and should have multiple ‘pipelines’ going for recruiting, fundraising, corp dev, biz dev, etc. You could go into your bunker and only focus on shipping a product. But then you’ll have a cold start when it comes to lighting up relationships with potential partners, investors and others. I‘ve seen a company miss an acquisition window because the founder hadn’t formed or maintained the right relationships in the quarters leading up to it, focusing instead on product and growth. There’s obviously a balance to strike here but being high bandwidth is important to hedge risk.

Hope this has been useful at least as some food for thought. Regardless, best of luck with your fundraising and ventures!