Building a Culture of Trust with Michele Romanow

Michele Romanow (@micheleromanow) is a public board director, an angel investor, and an invigorating public speaker in the fintech, disruption, and innovation sectors. Famously known for her tenacious role on Dragon’s Den, Michele is a world-renowned technology entrepreneur with an extreme passion for leading, growing, and building successful ventures.

• Serial entrepreneur who started five companies before the age of 33
• A Dragon on CBC’s Dragons’ Den
• Considered one of the “One-Hundred Most Powerful Women in Canada”
• Was listed as the only Canadian on Forbes Magazine’s “Millennial on a Mission” list

How would you change how you approached leadership in the past?

We’ve made so many mistakes and I think I’ve always leaned more to the side of over-trusting people rather than micromanaging them. I think being too trusting early on in my career led to some problems later on so I now use the trust but first verify method. The easiest way to do it is to trust your gut and do some investigating by asking more questions. 80% of the time it’s nothing and 20% of the time you may discover a larger issue. I think you always have to lean towards being a little bit more trusting in a startup environment because you’re working with very few people and you have to move quickly.

Why should people adopt the philosophy of being transparent?

As you scale, it gets harder and harder to be transparent because there are a ton of nuances in data and there are a lot of things that can go wrong which can be very damaging. One of the lines that I always love to use is that “loose lips sink ships” because there are a lot of things that you’re going to be working on that you can’t share. I think for the most part if you’re treating people like responsible adults and giving them access to information, they will generally make good choices and when you don’t give them access to that information it may be hard to explain your decisions which leads to a constant cycle of not being able to trust management or leadership.

We try to be really transparent about our decisions and when we make mistakes so everyone can gain an understanding of the risk factors that are associated with the business. We also try to really instill the idea of radical candor within our teams. We want everyone to come to work and care about their colleagues. If you don’t care about your colleagues or your job then you should find another place to work. 90% of things that happen in the workplace are true miscommunications and the other 10% are real conflicts that you have the opportunity to resolve. One of the things that people don’t talk a lot about in culture is that you can write whatever you want on the walls but the norms that you create will end up being extremely powerful.

How do you know when someone is truly not performing well?

How you get people on your team to talk to you is largely your responsibility and it’s based on your reactions. If you’re going to get really upset or overreact when you hear a bad piece of information it’s going to be very hard for you to be able to get the information you’re looking for internally.

I just want to reiterate that I’m talking about the day-to-day norms, if there are much more serious problems you have to create a structure and a plan to deal with it. We all think we’ve become so efficient by leveraging tools like slack and text messages but we’re losing out on body language and tone. We’re restricting most of our workplace communication to the 20% of words that we say and then we wonder why we’re confused or why we’re miscommunicating with each other.

How do you recognize talent?

Structurally you have a huge advantage in a startup because you’re very close to the founders and we also do this thing in corporate America or Canada where we create structures that are designed around retention. Companies do this thing where they make employees think that they’re not good enough or they make them think that they have to stay in a position for a certain amount of time when in reality it’s just a retention strategy and everyone learns at a different pace.

I believe that outstanding individuals actually have a lot of things that they are really bad at but they have a couple of superpowers that make them incredible and they can take the world by storm with those talents. I would argue that as an individual it’s far more powerful to double down on your strengths instead of trying to eliminate your weaknesses. It’s important to think about how you can build upon your superpowers rather than mitigating your weaknesses.

Do you have any advice for entrepreneurs that have never led a team before?

We built Clearbanc by founders for founders so we can transform the way people from around the world are receiving capital and we thought that the best way to do that would be to hire people that could be empathetic and understand what founders go through. One of our limitations as human beings is only having empathy or a true understanding of things that we’ve personally experienced.

One of the reasons why hiring entrepreneurs worked so well for us is because they could instantly feel empathy and understand what our customers were going through so that became a huge part of our culture. Having a background in entrepreneurship also teaches you really quickly that the world owes you nothing. It doesn’t owe you a sale or a great person or an amazing partnership, you have to go out and fight for it every single day. You can’t build an entrepreneurial culture without entrepreneurs and entrepreneurs have an innate response to be competitive and thrive off of healthy competition which I find to be really helpful. Anything that you can do to help your teams understand your customers on a deeper level will really help in the long run because it makes it possible for your team to be empathetic.

Recommended resources by Michele:

• Little Black Stretchy Pants by Chip Wilson
• The Culture Code by Daniel Coyle
• Principles by Ray Dalio
• Atomic Habits by James Clear