Boards, Authenticity, & “Customer Mode”: Quick Tips for Enterprise Founders & VCs

Words of wisdom from Yousuf Khan, courtesy of The Desi VC podcast

Ridge Partner Yousuf Khan recently appeared on The Desi VC podcast, hosted by Akash Bhat, an investor and co-founder of Leen. Yousuf, previously a five-time CIO of companies like Pure Storage, Automation Anywhere, and Qualys, tackled a litany of topics related to enterprise startups and venture capital.

From board meeting best practices to channeling “customer mode,” here are some quick tips and observations Yousuf shared on the pod. (You can also check out the full episode below, or listen here!)

The customer is your North Star

In early-stage companies, the best founders are the ones who are able to learn and take those learnings and execute on them. You must also rigorously manage your team, and by that I mean figure out what’s working, what isn’t working, and fix it. Third, and I did a blog post about this, you have to be in customer mode, not “founder mode.” When you put the customer at the very heart of your strategy, like a North Star, everything around it starts to make sense. Delight your customers, who in turn will champion your product, defend it, and represent it in the best possible way.

More on “customer mode”

One of the biggest mistakes founders make is they think, “We’ll just create this product and distribute it and everything will be fine.” That’s OK if your customer signs up with their credit card and never wants to talk to you, but this only works for so long. You must be embedded in the customer experience. What do your customers care about and talk about? What is their daily life like? When you’re in customer mode, everything you do is basically focused on that. It’s not just about understanding the customer; it’s understanding the context of the customer in the industry that they’re in. In enterprise, that’s how you win. When you know the customer and then some, you understand where they are going versus where they’re at, and that makes a world of difference.

The importance of authenticity

Founders should understand that the software industry is fundamentally imperfect, and their product isn’t (and won’t be) perfect either. Put your best foot forward and then figure out what your next foot forward looks like. That’s not to say that I subscribe to the whole “fake it till you make it” business. Authenticity is crucial. Show me a vision that you feel strongly about — that conviction keeps you focused and gives you something to aim for. Ultimately, if you are creating value in a great customer experience, being rigorously focused around that experience, and executing towards it, that’s huge.

How to avoid “bored” meetings

When it comes to running a successful board meeting, the first key is good preparation, and by that I mean, very specifically, send the board deck in advance. Secondly, recognize that the board is not asking to be constantly impressed; they just want the ground truth. Third, and it sounds basic, but start the meeting on time!

Over the course of the meeting, don’t leave things unsaid — be very clear to the board about what your asks are. You should also allow other people to come and present. This is much more engaging than having one person lecture the entire meeting, and it’s a valuable opportunity for your colleagues to be recognized. Board meetings can be blasé for founders, but for team members on the outside this is a big step in their career.

Lastly, focus the discussion on a couple of core areas where the board can help. For example, it may be acquisition offers that are coming into place, or some problems you’re having inside the executive team. At a high level, It’s really about revitalizing strategy and thinking longer term.

Board meetings and feedback

The best boards are the ones that are able to effectively channel feedback. Feedback management is a skill. As a former operator, I’ve managed hundreds of people in my life; a lot of investors have not. I’ve seen interactions in board meetings that, had they taken place in a sidebar, would have been less embarrassing for the founder (and easier on their ego). There’s certainly nothing wrong with direct feedback during a board meeting, but conversations that require more sensitivity can be conducted via a one-on-one follow-up chat.

I’d also recommend including a slide in the meeting deck that allows for self-evaluation. Point out a couple of areas in which you can improve as a founder/CEO, and elicit constructive feedback from your board.

The value of self-awareness in VC

Self-awareness is a skill that I’ve had to develop over time. It’s proven valuable in my VC career. Rather than having an opinion on everything, I know where I can help and where I can’t help. For example, if a founder reaches out to me for advice on positioning, that’s well within my wheelhouse. I spent 20 years buying software, so I can tell them how their messaging will land with customers. I can listen, I can advise on strategy and provide historical data points, etc. However, if they’re struggling in an area I’m not keen on, that’s when I refer them to another board member who’s a better fit.

Lessons learned from raising a venture fund

Fundraising is a huge character-building experience, which I learned firsthand in 2022 when Ridge raised its $180M Fund Five. First of all, you develop a great deal of founder empathy — just like I am assessing early stage teams as a VC, there are institutional investors assessing me. The feedback loop is much longer as well, and some of these relationships take shape over the course of years. Third, you must realize that you are part of the product. Why should these investors entrust your firm with tens of millions of dollars? It really tests your ability to demonstrate trust and your readiness to be an effective steward of capital. And, of course, there’s no shortage of knocking on doors!