It has been a great 3 months for reading. I've been using reading to transport me as far away from London as is humanly possible and to quickly learn everything I need to know to effectively run a business. There were three books I have not stopped thinking about since I put them down.
Noam Wasserman: The Founder's Dilemmas
This is the most extensive single work I have read on starting a company. Wasserman is an American academic specialising in entrepreneurship and through quantitative and qualitative research (in 496 pages no less) he explains to us that "if entrepreneurship is a battle, most casualties stem from friendly fire or self-inflicted wounds." According to VCs, 65% of failures within their portfolio companies derive from problems within the startup’s management team.
The "founding dilemmas" are the first challenges that startups face, which fall into the "3 Rs"
- Relationships (who you found with)
- Roles (who works on what and with which fancy job title)
- Rewards (at the start, there's merely equity)
The first challenge arises when considering whether to build a company alone or with others. If you decide to build a founding team, then who to work with? Friends, family, acquaintances or former colleagues. All of these options have significant tradeoffs that aren't immediately obvious at the outset.
Roles is another area of contention. Do job titles even make sense when it's not even clear what you're building yet? Who should take on the all-encompassing role of CEO and prestige that comes with it, is often fraught with potential resentments. The decision is made through a short conversation that doesn't consider the wide-ranging responsibilities the role entails. Herein lies one of the most difficult parts of building team cohesion: how you deal with conflict together? Similarly without clearly defined roles, it's easy for a really important part of the business to be neglected and ignored.
Prior to that elusive seed round that most startups don't reach, rewards come in the form of equity. Equity is a promise of a future payoff in the form of a percentage of shares in the business. Instinctively, it seems fairest to split equity equally, however this does not account for the different contributions the founding team can make. This topic really requires an entire blog post, if I'm honest.
As Wasserman aptly states:
"The founding process is often chaotic and nonlinear, with founders improvising rather than following a script to build their startups."
There is no script for starting a company from scratch and that's why it's such a messy process.
One of the most interesting passages of this book, relates to founder motivations. Wasserman emphasises that the "two most common motivations are (a) building wealth and (b) driving and controlling the growth of their startups." In most other arenas of life, wealth and control are two sides of the same coin, however when it comes to founding a business the two forces are in active conflict. Founders face decision after decision where they must choose between increasing their wealth and maintaining control.
Here are a couple of examples where maintaining control comes at the expense of wealth. Exhibit A: wanting to retain the majority of shares in the business comes at the expense of taking external investment, which comes at the expense of growth. Exhibit B: wanting to found a business solo, comes at the expense of sharing responsibilities and growing quicker with other founders.
The Founder's Dilemmas emphasises that there is one-size fits all path for founding your own business and there's never a "right time." The likelihood of founding a startup does not increase with age or years of work experience and actually "waiting to found introduces its own challenges." The more you work, the more mental models you accummulate. These are the prisms through which you view the world and make sense of information. Over time, these can either be complimentary to bringing new ideas to the world or they can entrench you into a cookie-cutter path. Wasserman states that "working for many years can strengthen the handcuffs tying the potential founder to his or her employer." Money, security and familial ties can keep you from taking the leap and becoming a founder.
I cannot recommend this book highly enough to anyone interested in understanding the minutia that goes into founding a business.
Clayton M. Christensen: How Will You Measure Your Life
I came to this book, as I had to completely reconfigure my life after my long COVID diagnosis. So much of my identity had been tied to career and fitness. Fitness was no longer in the mix and given that both mental and physical exertion can cause me to deteriorate, when it comes to work I have to pace myself and work smart rather than hard. I was recently asked by a healthcare professional, "what is meaningful to you apart from fitness and work?" Safe to say that I was stumped.
So I did what I tend to do when I'm trying to work something out, I read. How Will You Measure Your Life is written by a world-renowned innovation expert, Clayton M. Christensen and inspired by a speech he gave to the Harvard Business School's graduating class. It is based on the premise that the older we get, the more we are likely to compromise on what matters to us and 'for many of us, as the years go by, we allow our dreams to be peeled away [...] We begin to accept that it's not realistic to do something we truly love for a living.'
Christensen emphasises that we 'when we find ourselves stuck in unhappy careers- and even unhappy lives, it is often the result of a misunderstanding of what really motivates us.' When it comes to our work, we often focus on hygiene factors. Status, compensation, job security, work conditions (to name a few). Instead we should be looking more deeply at motivation factors instead. Challenging work, recognition and making a difference. We should be asking ourselves the following questions:
- Will I learn new things in this role?
- Will I be recognised for the work I do?
- Am I going to be given responsibility and ownership?
We often hear how important it is to create a good culture in business. Christensen highlights that it's common to describe culture as the visible elements of a working environment: casual Fridays, free sodas in the cafeteria or bringing your dog into the office. However, these are merely artefacts of the culture and really "a culture is the unique combination of processes and priorities within an organisation." Culture happens, whether you want it to or not, but what's important is how hard you are going to try to influence it. Particularly in the early days of founding a startup, the team is the culture and that's why the first few hires are so important.
The prevailing message from How Will You Measure Your Life, is how often we (as humans) make small compromises in life that veer us further away from ourselves and what we consider to be meaningful work. Or more importantly, a meaningful life. None of the small compromises we make day-to-day feel like a life-changing decision, but taken together they can veer us further from what we stand for.
Maya Angelou: A Letter to My Daughter
Last but certainly not least, this book is Maya Angelou's letter to the daughter she never had. In short, astute vignettes, Angelou tackles a wide-range of topics including an abusive relationship, her relationship with her mother and her illustrious career.
It was my first foray into Angelou's work and I was not disappointed. The sentence structures and flow of the writing is so poetic and she captures the complexities of human emotion so beautifully.
Here are a few passages that really resonated with me
On Impostor Syndrome:
"When I decide to write anything, I get caught up in my insecurity despite the prior accolades. I think, uh, uh, now they will know I am a charlatan that I really cannot write and write really well. I am almost undone, then I pull out a new yellow pad and as I approach the clean page, I think of how blessed I am."
After being sneered at by a potential business partner:
'No, I do not, but let us speak about the business which brought us together. Your corporation wanted my permission to explore my short story as a vehicle for television. I must tell you "No," I will not agree.'
She said, 'We have not even made our offer to you.'
I told her, 'That does not matter. I know very well that you would not furnish me a peaceful or pleasant environment in which to work. That is not how you work, so I am obliged to refuse any offer you might make.'
I thought I could added, 'I promise you, you do not want me as your adversary because, once I feel myself under threat, I fight to win, and in that case I will forget that I am thirty years older than you, with a reputation for being passionat. Then after the fray, if I see I have vanquished you I would be embarrassed that I have brought all of the pain, brought all the joy, brought all the fear, and the glory that I have lived through, to triumph over a single woman who did not know that she should be careful of who she calls out and I would not like myself very much. And if you bested me I would be devastated and might start to throw things.'
The way that Angelou enraptures you into her world. I ordered I Know Why the Caged Bird Sings immediately after finishing this novel. Cannot wait to read more of her work. Finding an author with a body of work as rich as Angelou is like meeting a friend you didn't know you needed.
I have to also give honorable mention to James Clear's Atomic Habits, Kazuo Ishiguro's Never Let Me Go, Hafsa Zayyan's We Are All Birds of Uganda, Akwaeke Emezi's The Death of Vivek Oji, Hisham Matar's The Return and Gabriel Weinberg and Justin Mares's Traction: A Startup Guide to Getting Customers, which I discuss here.
Catch you next quarter with another round up of my favourite reads! Happy reading.