Jul 21 2009

Be Careful How You Redline

Category: Startup, Thoughtsschoenrock @ 9:53 am

speedometer.jpgI originally posted this at my personal blog on June 5, 2007.  I thought it was worthy of a repost.  Leave a comment and let me know if you agree.  - Kendall

Startups are stressful. By nature, they remove many of the safety nets that larger companies can afford. Distractions are deadly and losing focus for a small amount of time can be devastating. Finding the right people to fill the correct positions while balancing their needs with the companies needs is a difficult task and one that many entrepreneurs and CEOs struggle with, regardless of their history. There will be moments of anger and frustration and it is important to be aware of how you redline, no matter what position you fill.

Let me tell you a personal story of my days at TurnTide, a situation that pushed me to the redline and how I handled it. TurnTide was an anti-spam company that was a spin out of a privacy and consulting firm I was working for right out of college. I knew we had some awesome technology and I was fortunate enough to be included in the initial round of investment that allowed TurnTide to become a stand alone company. I was young, only 22, green beyond belief, but I knew we had something great and my intuition was right on. Only six months after founding TurnTide, Symantec purchased the company for $28,000,000. Here I was, a young buck, thrown into a multi-million dollar deal and it is safe to say I was in over my head. I learned so much from this deal, words cannot describe.logo_turntide.gif

There was a moment before the deal, however, that I was very angry. Very angry is putting it gently. I was a sales guy working hard trying to close deals and sign up internet service providers to adopt our revolutionary technology. At the same time I was an employee, I was also an investor. In my mind, I was a key investor, although I was not, I was just a piece of a much larger puzzle that I was too naive at the time to see. During every company meeting I was focused on this “big deal.” I knew something was brewing and the rumors were flying about who would buy us and for how much. The CEO, who did an amazing job in nearly all aspects, quickly thwarted any questions about the acquisition and at a few points highly stressed her fear of the “distraction factor.” She wanted us to keep running and not worry about a deal that may or may not happen. The more we worried about the deal the worse of we could be in the future if a deal never materialized. She was dead right.

Are you kidding me? I thought to myself that I would be less distracted if someone would just tell me the numbers so I could calculate how rich I would become off of my first rockstar investment! What a foolish boy I was.

During the time of the acquisition, I didn’t really understand why I was unable to get the full scoop on the deal, but it is clear to me now. The moment I lifted my head up out of my cube to find out what was going on in the possible acquisition, I was not doing my job - I was not making sales. Making sales was the exact thing that I should have been focused on in order to increase the value of the company and to allow us more flexibility in the future, in case the deal fell apart. And let us not overlook that so many “big deals” like this do fall apart.

So here I was, totally pissed off, I was in past my redline and it started to show. I was snippy at work, I felt snubbed by the experienced investors that had previously pulled together larger deals and it was almost as if I was a freshman again and there was a really cool party in the other room and I was not invited. I was unhappy in my job, frustrated with the investment check I wrote, bloating my own ego about the value of my contribution to the company and nearly in a mode of self destruction. I was totally pissed off and ready to snap. What did I do? I called my dad.

My dad is an amazing businessman. He is very successful in all walks of life and his business intuition is unbelievable. He is a true source of inspiration for me and in this situation he smacked me pretty hard.

He asked me if I trusted the leaders of the company. I did. He asked me if they owned shares of the same company that I did. They did. He asked me why I thought I should be included in the high level talks with the acquiring company and I gave him an excellent canned response about my importance as an early investor and my great job at selling the product. He smacked me right in the face with the cold hard facts that I was not qualified to bring anything to the talks. Yet again, he was dead on. I had less than a year of real work experience and had no clue about large acquisitions. He also pointed out that the beauty of our situation was that all our interests were aligned. If they won, I won. “Stop freaking out,” he advised “if it is meant to be, it will be.”Kendall & Dad skiing

My family was my support. My father eased my pain. I think we all have our counterbalance in this world and it is important to identify it early and embrace it often. Be aware of how you treat your counterbalance as well. If you’ve made it this far in this long post, thank you, but now I want you to do me a personal favor. Think about your support person and recall the last time you bitched to them about a problem at work. Go ahead, do this now. The next time you talk to that person, thank them. Thank them for being there to support you during your moments of crisis. Be conscious of how important they are to keep you from possibly self destructing. We all have them in our worlds, show some appreciation. Do it now. Thank you dad!

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7 Responses to “Be Careful How You Redline”

  1. LTLprints says:

    Have you ever seen someone freak out at work? Be Careful How You Redline. http://twurl.nl/gqodjh

    This comment was originally posted on Twitter

  2. Schoenrock says:

    Have you ever seen someone freak out at work? Be Careful How You Redline. http://twurl.nl/gqodjh

    This comment was originally posted on Twitter

  3. Twitted by chriscera says:

    [...] This post was Twitted by chriscera [...]

  4. Chris Cera says:

    Sage advice and good reminder to myself for when I get off track. Trust is everything, and if you can’t get past trust then you should probably focus on that first.

  5. Lucinda says:

    Great to hear this perspective in retrospect - and glad to know that you trusted us, it wasn’t so clear at the time. ;-)

  6. schoenrock says:

    There are some solid take-away’s for me in the deal. No doubt I could have handled the situation better. I’m confident that I’m not the only one who could or should say that. Thanks Lu. Keep hustling.

  7. schoenrock says:

    I think startups can run into trouble when there is mistrust within the founders or exec team. Setting up a structure that keeps everyone honest, balanced and focused on the same prize is a challenge.

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