Amy Buechler and Michael Seibel on Founder Coaching and Having Hard Conversations | Transcription

Note: This transcription is split and grouped by topics and subtopics. You can navigate through the Table of Contents on the left. It's interactive. All paragraphs are timed to the original video. Click on the time (e.g., 01:53) to jump to the specific portion of the video.

Introduction To Coaching

What is coaching? (00:10)

Yeah, that's actually a great question, because what coaching is depends a lot on who the coach is and what their expertise is and what their experience has been. So coaching in its most simple term is a supportive relationship. And it's a supportive relationship that helps people, usually founders or execs, like managers, resolve problems that they're experiencing in their life. So I think some people might be familiar with therapy and maybe have even done it before. How would you differentiate it from coaching?

Role Challenges And Communication Techniques In Coaching

How is coaching different from therapy? (00:40)

Therapy is a relationship that uses that relationship to affect change, whereas coaching is using the coach's own life experience to affect change. They're both really similar. Coaches often use their relationship with the client as information to help them understand the client in order to better serve their needs. But therapy is almost all that. It's all about the client's relationships, the client's marriage, friendships, family, all that stuff, whereas coaching is the client and their work and their eating habits and this, that or the other. That's not all the relationship. Another big difference actually is the credentialing process. So in therapy, for example, I had to go to grad school. I had to get a master's degree and then have 3,000 supervised hours before even being able to apply to take the licensing exam. So that's five years of my life, whereas with coaching, one day I decided, I'm gonna be a coach. And that's really the difference. And you can imagine the different types of people, for example, that would opt into one career path versus the other. - Okay. And so we've kind of outlined a few of the most common problems startups have here. And so I think what could be most helpful to people is, we're just gonna talk about the problems and then we can outline the symptoms, talk about a couple examples and just go from there. Okay, cool. - Yeah.

What are the most common challenges founders in coaching have? (02:00)

- So what is the most common problem you see startups having? - The most common problem, I think, that I see my clients have is an inability to have difficult conversations because their emotions get in the way and or an inability to even pinpoint the actual problem that they're experiencing. Often the real problem that's is like many levels below what they're experiencing as they go about their day. - Okay. And so we've broken a few of those out. So we've called them roles and responsibilities, discussing equity, talking about founder performance, and the last one is talking about runway, how much you have left in the bank. So maybe, I mean, maybe even Michael, you could give an example of one of these from, you know, any of the things you've worked on. - Sure, yeah. So in the early days of Justin TV in Twitch, roles and responsibilities was something that we did a very bad job at.

Challenges with roles and responsibilities at Twitch (02:55)

And like one of the kind of, kind of very clear ways that I know we did a bad job is that every single one of us started another company and did a better job at it. And so like we did a bad job and we realized it and we fixed it. So very specifically, we had four co-founders. We were equal co-founders. And while we each sort of knew what we were supposed to do, it wasn't extremely explicit. Who was responsible for what? It wasn't extremely explicit, who was responsible for product? It wasn't extremely explicit for who was responsible for, well actually, you know, not only thinking about it, it wasn't extremely explicit who was responsible for product. And like maybe that was actually the core issue, 'cause it was explicit who was responsible for the hardware, that was Kyle. It was actually explicit who was doing the software, that was Emmet. It was Justin Shao, who was responsible for filming. And you know, I think it was explicit for me that was responsible for fundraising and customer support and press and so on and so forth. But who was responsible for the product, who was actually unclear? And I know that because we fought about it all the time. And we changed our minds all the time. - So this is interesting. So this is kind of only one degree of separation, right? So you were just like bickering about product in particular? - Yeah. Yeah, and it came across in these absurd ways. Justin and I had a three day debate about what the background color of the website was. Justin wanted black and I wanted wood grain. And our solution, instead of actually deciding who should have product, was to allow the user to select different background colors. - Beautiful. - So such a point. - Which would be black and wood grain. - I think there's some other stuff. - Yeah. - Probably not the best solution. - Yeah, and that's exactly like what a coach would help with because they have laser vision. They can see past all the layers of criticism and arguing and stuff and they would quickly, I would guess within an hour, probably have been able to see that that was the actual problem, which would have saved you how much time. - I mean, we didn't figure it out for six years. - And you didn't even figure out until like this one moment that it was not actually just product. - That it was absolutely just product, yeah. - It wasn't as responsible as it was just product, totally. - But this is tricky though too, because so many things in startups end in life are gray areas. And so you may not have actually known maybe black would be better, maybe would grain would be better. - Well the most important thing is to matter. Like it wasn't a top three, most important thing for our business. So like when you're arguing about something that's not a top three thing, there's probably is a problem. - Right. - Would you say that you were able to argue about that because you didn't have a clear goal in mind? - I think it was because I cared weirdly. You know, like I was the non-technical founder and so there were few things to care about early days pre-launch. And like this was something that I could think about. I couldn't think about how to build our first chat system or our first video camera. But I could think about this. And like what we should have decided is that no Justin's going to think about this and Michael you're gonna think about these other things. And what's interesting when I think back is in areas where the responsibility was extremely clear, we actually did a good job, right? Kyle's responsible was to build a camera. He built a camera. And we built a website. Justin had a show like I actually did do tons of customer support. I actually organized all this press. I actually organized all these sponsorships. And in those areas where there was no debate about responsibility, like we excelled, like we did better than expected. And in areas where there was debate, strangely like we got to the right solution. And the screwy thing is we didn't even debate the important product things, right? The most important product thing about Justin to be in Twitch is videos on the left and chats on the right. Day one, videos on the left, chats on the right. Today, videos on the left, chats on the right. Like we weren't even debating that. We were like debating stupid others. - Well people call this bike shedding, right? - Yeah, we're choosing what color or paint the bike shed. - Yes. - It's like that's the big debate rather than building it. So Amy, if you were Michael's coach in this situation, how would you go about walking through like putting a stake in the ground and saying like, hey, I'm Michael, I'm gonna run product.

How would Amy have coached Michael around roles and responsibilities? (07:15)

Or maybe not. - Or not, yeah, that's sort of something that's on my mind as I'm listening to you. And I'm thinking through a couple sessions I've had this week where you were a team of four founders. You each had your kind of your own world. Although of course they overlapped because it was early days. But you also had your own skill sets as individuals and humans. - Yes. - Hopefully those aligned with what your responsibilities. However, I'm just kind of like imagining you back in the day, Michael, you were, you owned what? Like external partnerships, sales. - Yeah, it was, it was. - Biz Dev. - It was basically business stuff. - Business, business stuff. - Yes. - And you had, I think probably the personality to match up. - I did. - Exactly. - And awkwardly had never built product forever. - Interesting. - Yeah. - No skill set. - Of course. But back in that day, like your skill set and stuff maybe wasn't needed as much. - Yes. - Right? And so like there's almost this rotating set of gears and wheels where you had all this capacity. You had the bandwidth to worry about everything. And so instead of being able to recognize that in the moment and put your skills to use immediately, right? Because you're not really needed until all the hardware and everything like gets into a place where you can sell it or whatever. Like I forget your question, Craig, but as your coach, I would have been able to recognize that and been like, what is the most impactful thing that you with your skill set and your particular piece of the pie can, like how can you impact the bottom line right now today? Knowing that right now, yeah, what you wanna do isn't important and that's fine. And that's good. Like not all cylinders need to be firing at all moments. - It's funny that I think that I certainly didn't realize that in the first go around. And I remember in Socialcam, my second startup, there were moments where I literally was like, the most important thing I can do is be here, but not talk. Like, but shut the fuck up, right?

Not being disruptive as a leader (09:10)

'Cause it's like, we had decided what we're building this week, everyone knew what they were supposed to do. And like the only thing I could do in a conversation with other people was either waste their time or change the plan. - Yeah. - And it was like, just shut up. And like I ended up, I kind of realized it's just TV, but I ended up printing out this thing and it was like, good leadership doesn't require being disruptive. And it was like something I always kept in the back of my mind. It's like, I don't need to disrupt, like at some point you just need to sit there and build something and having someone in your ear is not really helpful for that. - And I'm curious, how did you realize that? - You know, strangely in the second company, our authority roles were different, right? So in the first company, our authority roles were so weird. It was like, Justin and Emmett had done a startup before, but they weren't really business-y. And like Kyle was extremely technical, but he was doing this like hardware thing that none of us had expertise in. And so there was this weirdness, right? With Socialcam, even though we all had equal equity the second time, like I had been the CEO before and they were my, and they'd been employees. And so I think each of us were more, there was already kind of a natural hierarchy. And I think that it was easier for me to give things up, 'cause I didn't feel like I was giving up power or authority. I felt like I was delegating. Whereas like in the early days, it was like, it was almost like there were four CEOs in a real life. - It does kind of sound like it was a free-for-all. - Yeah. - Four, like teams, 'cause I know this is also a common thing where you did have equal equity. You did have equal-ish sounding pie pieces.

Switching roles at Twitch (11:00)

- Yeah. - In a perfect world who would have been able to make the decision and delegate or tell you Michael, like stay in your lane or whatever, you know, like does it just-- - Well, I think it's interesting, right? I think the story of Just To Be a Twitch is kind of, is funny because Justin started as CEO. And so I think there was probably a time in the early days where you would argue it was his responsibility. Post-launch, when we need to start fundraising, we switched, I did this extremely poorly, but we switched and I became CEO and I carried us through for the next kind of five years. And then when we decided to focus on gaming, that was kind of Emmett's expertise and his interest just so then he became the CEO. And so it was like crazy, right? - That is pretty crazy. - It was like we were kind of three embedded CEOs, right? And then Kyle goes and starts Cruz. He used to see you too. So like, so I think that at various times, it was various people's responsibilities. I think by the time we came to Emmett, we were just older and we had seen dysfunctions. Like, man, if you see dysfunctions for long enough and you're reasonably smart, you're gonna be like, okay, dysfunctions is not good, we should fix that. But in the early days, we were just like, we don't know, we never worked in companies, we don't know what good looks like. - Right, plus a little bit less ego at the time. - Yeah, well, three out of four people were in it to Yale. So that also like, I didn't advise that. - You mentioned equity, equity is another interesting one.

Uneven equity splits (12:15)

So anyway, how does that come out in, what are the symptoms of maybe an uneven or just like a perceived uneven equity split? - Equity is an interesting one. In my experience, the way it comes out is the person who feels as if they have less equity than they deserve is usually the one who calls me. They call me usually at the point at which this conversation is boiled over such that they feel so much resentment towards the person who has more than they deserve or whatever, that they don't know anymore if they can even continue on. - That's how it comes up in my experience. And as you can imagine, when you feel resentment that causes so many other downstream effects. Like you can't, you no longer respect the person, you are short with them, everything they do irritates you. Right, it sort of like pervades you, every part of your waking and sleeping life. Like you have dreams about this person, you know what I mean? You like deeply wanna malign them. And the solution there is just to like, have sort of a come to Jesus moment with yourself and ask yourself, like, should we renegotiate this? Is it worth it? Can I salvage this relationship? Would this person be open to it? Or, and or, is there a price at which I will, you know, can I present a different deal at which point I might walk? Like am I comfortable walking? And or an exploration of the past reasons why it was okay for this person to even find themselves in the situation at hand. And that actually to me is the more interesting, like that exploration is more interesting to me as a coach. Usually the person from the very beginning felt as if something wasn't quite right. Like one stuff with you two. - I didn't say it. - Yeah, and didn't say anything. And it's like, and so like why? Why did you, like silence yourself? What was it about you that didn't allow that, like you to negotiate for your own self? What was it about you that disallowed you from seeing your own value? And those are patterns that often not only affect the relationship with the co-founder, but many, many other relationships and that many other relationships in those, in that person's life. - So it's funny because you talked, we talked to the opposite person.

Distributing and negotiating equity (14:30)

So you talk to the person who feels like they didn't get enough. I talked to the CEO who's usually in the role of distributing. And this was an area where Justin was amazing from day one and kind of set up precedent. I remember that, you know, in Justin TV when he and M had asked me to join up and I was like, hey, I will, but I wanna feel like an equal partner. And he was like, great, you're an equal partner. And I remember being like, oh. Okay. Like, and I remember like that moment I felt like I am all in. - Yeah. - Right? And we were doing an online reality TV show. There was no reasonable reason to be all in, but I was like, well, if I'm an equal partner, I'm all in. - Yeah. - And it was interesting because when Kyle started, he had only 10% equity because he had started as like this like kind of quasi employee, quasi contractor kind of thing. And we were trying to like convince him to join up. And there was a point, I think three or four months in where Kyle was like, I like to be an equal co-founder. And I remember thinking to myself, okay, what's my model for whether you should be? And it was like, well, Justin established it. So I remember thinking like immediately my first reaction was not, you negotiated this. You should stick to what you negotiated or dah, dah, dah. My first reaction was like, well, what am I doing? Justin think, like, they're cool. Right? You know, it was very much like open to that conversation. I think a lot of times when I talk to CEOs, now, you know, the reason why I like to default to equal is it's kind of sheets. It kind of just gets rid of this conversation, right? But it does not have best fit for all circumstances. But when I talk to CEOs now, the number one thing that they say to me is, will we negotiate it? And it's like so funny 'cause I'm like, look, as a CEO, you're thinking about your co-founders motivation today, but also five years from now. And they might not be thinking about that. And so it's not a fair negotiation. Like, victory is not you negotiated. Victory is like, they work really hard the whole time. Like, you can't let them negotiate a deal for themselves that's not gonna make them work really hard. And so it's so funny. I had to come up and be like, hey, look, this isn't some business transaction. This is, you know, when your company gets sold, the company acquires you, basically puts this massive retention, you know, if you do well, puts a big retention bonus that sits out there, it's called Golden Handcuffs. And it's to keep you there. And I often tell CEOs, equity is Golden Handcuffs. Equity is what keeps people there. It's not a reward. It's like, it's a, it's a, it's bondage in a weird way. And so like, do you really want this person to be around? Well, if you don't, then why are there your co-founders? If you do, you should probably give them a lot of equity. - It's so interesting that you say that too. Because often, again, it's so funny. I'm talking to the opposite person. Like the person that feels as if they're being devalued. And it's interesting because I always find I have to tell them how their behavior must be perceived by the CEO. Because this person's been sitting on this thing for years sometimes. And it's like coming out in all these random, passive, aggressive, critical ways. - Yes, the CEO can't imagine this. Like we already decided on this, right? - No, the CEO often doesn't even know where it's coming from at all. And they're like, why has this person being crazy and unreasonable and like horrible to me? And why have they been for years? Like they just sort of are often blindsided because in their mind it's been negotiated. And it's so interesting that, again, like the people that I'm talking to, they're so, they're so like filled with resentment. They can't possibly imagine what's in that other person's mind. And so like again, it just, it pervades their experience. It's something else to say, but I forgot it. - Well, it's weird too, is that I think that in situations where the equity should be unequal, like it's honestly situations where the people with lesser equity are comfortable with that for a long period of time. Like that is a situation, right? Where sometimes your companies were different founders that are bringing different things to the table. And so one founder, with Justin TV, it was like four founders who basically done nothing, right? Like it didn't feel like equal equity felt like it made sense, right? In a situation where like there's a massive power imbalance and someone is bringing like a lot more of the table than someone else, right? Like you can kind of make a case, but the reason why you know there's agreement on that is because the person doesn't blow up, like the person with less equity doesn't get pissed to yours now. And like if that wasn't correctly done. - Mm-hmm, then they will. - Yeah. - Yeah. - So let's say you are in a situation where you might be getting less equity. Do you have like a good model for playing that out in your head? Like in five years, am I okay with that? And like maybe that's just a simple exercise you can do because you're basically like, ideally you would just avoid this entirely, this conversation, right? Five years down the line. I think ideally it requires either founder needs to step up, right? Like the CEO needs to step up and be honest and be like, hey look, I wanna make sure, regardless of what you think you need now, let's talk about what you was gonna make you feel great five or 10 years from now. Let's talk about like, let's imagine we sold this company and I make more money than you. Like let's really talk about that. Like is that gonna feel comfortable? Is it gonna feel comfortable for me to get 10 times money than you? Is it gonna feel comfortable two times? I'm gonna have to, all right, have it. Or I think on the flip side for that, for that, you know, co-founder and it's not the CEO to just be like very explicit about, hey, these are the, these are some of the reasons why I believe you should have more equity and these are some of the reasons why I believe I should have more. I feel like it requires one person to step up and I see a lot of situations where neither step up. - That's absolutely true. The person with the least amount of equity will never be okay with it, you know? So I am always like, this is always going to be a problem until something changes. And so you might as well bite the bullet and change it one way or another and just like-- - We always have the conversation up front. - And get it over with and just have the conversation. The other interesting thing that I'm thinking about as we're talking about this is, again, the reason why some folks sort of enter into this negotiation and then are fine with this, I mean, fine in air quotes. Say they're fine with the equity split, even when they're not, is because they have such a difficult time speaking to their value and saying, I am worth this because I'm amazing and I have all the experience that you need.

Communicating your own value (20:45)

I also will just say that women often have a harder time being able to do that. And so I just want to make sure that, again, from a coaching perspective, that conversation, I don't feel as if I have value erupts not just in the equity conversation, but in many other instances too, especially for example, with first time managers, especially for example, with managers who are managing really amazing, like the C-suite and they're great, they don't feel as if they're valid enough to coach the other person, say, I'm holding you accountable, you didn't meet my expectation in this way. So again, that piece of, I don't know if I have enough, if I can't see my value, that shows up in so many different ways in my work. - But in my mind, if you're the CEO on this one, I think the buck stops with you. Like I think that either person could step up, but I think the CEO's responsibility is to step up. - That's very big of you, I love that. I think that's the, if this is a problem, like this is a CEO's fault, yeah, like this is kind of core. - So many of these things really just boil down to communication, right? Like simpler or more transparent communication of your intentions and your feelings. - Yes. - Is there a point where there's too much?

Can there be too much communication? (22:20)

- Yes. - Like from a founder, from a CEO's perspective, maybe if you're a CEO who's like, in a funk one day, maybe I shouldn't be communicating today, right? - I don't know, what do you think of? - I mean, my first reaction was like, yes, of course. Too much of anything is not good. Everything needs to be in balance. I think in general, though, people hesitate to communicate about feelings and about difficult topics. And in that world, it's never a bad idea to over-communicate because you can imagine it as exercise. You need to build muscles. You need to communicate and deliver feedback to everybody in a different way, based off of how they receive it, their own life experiences and how they're feeling in that day. And so, especially when you're first starting out, like over-communicate the feedback, over-communicate the difficult messages, give each other feedback on how the feedback is going, you know, like, but develop like a healthy amount of hygiene there. But like, yeah, when you're arguing, when the communication isn't productive and when it's not even coming from a good place, too much of that is certainly not good. - Well, that's, I think you just made it such an amazing point. In general, I don't encounter companies that are over-communicating. That is very rare. - Yeah, absolutely. - But I do encounter situations and I'm thinking back my personal experience with where it's a non-productive communication. Where it's like, we're having a fight, we know we're having a fight, it's not gonna solve anything.

Productive arguments (23:40)

Just stop fighting. - Yeah. - Just don't let it go. - Yeah. - Don't keep on having the fight. And I definitely feel like when I was younger, I somehow thought there was value in winning the fight. And I didn't realize that like, maybe every minute after 20 minutes where you're fighting, you're just reducing the value of your company. Like you're disheartening everything. And so it's just like-- - I love that. - You know, you can't not fight at all, but it's just like there is a diminishing return for your core goals. - Yeah, I know one team who has a limit of, every time they notice they're fighting, they set a timer for two minutes and then they literally stop the conversation and like take a walk around the block and don't revisit it until the next day. And I hated that 'cause I always had, I always worked things out through talking. Like I couldn't work things out only in my head. I had to kind of have a competitive thing and competitive is not the river, but it's kind of true. - But okay. - And I wouldn't catch feelings about it. Like I like fighting, arguing. I like arguing. But it's not productive in many. And if the other person isn't on that same wavelength, you're not helping. - Yeah, that's kind of what I was thinking. It's good and totally fine. Like you need to talk things through and the more different opinions that come at you, the better the output, like the better the final idea. But if I'm coming from a culture or a family in which like strong opinions terrify me and I feel overwhelmed because any conflict makes me feel sweat, like I'm sweaty just thinking about you, Michael and your style. For example, like that won't work for me. And again, like your style isn't bad and my style isn't bad. They both have pros and cons. And again, it's just a matter of like knowing that and being able to talk about it and being like, and yeah, having conversations about it. So you can find a middle ground that works for everybody. - Yeah, and it's hard to, it's funny is that it's, if I were smarter back in the day, I think I would have created no consequence arguing time. Like I would have separated out thinking through things out loud from decision making. And so it never would have felt like those thinking throughout loud moments had much consequence. - Mm-hmm. - Right? 'Cause like when I'm just working through my stuff, like it shouldn't be a consequential conversation. Like I might change my mind. Like, you know, like I'm the kind of person that's like, I strongly, strongly felt but very loosely held opinions. - Mm-hmm. - Right, and so I think later on I kind of learned how to just like separate decision making from conversation. - And I think knowing you Michael, the one thing that you always do really well is you, in the whatever argumentative conversations, just in your style, you always are only talking about the idea. - Mm-hmm. - And so many founding teams, especially when they get into patterns of like bad communication hygiene, are talking about the other person. - Mm-hmm. - And that's like, that's the moment where it's like, okay, I'm gonna pause you right now because I know what you're saying isn't being helpful, but I know what you're trying to say. What you're trying to say is that person be like co-founder. When you do this with this product, my impact of the product is that, or whatever. - Yeah, yeah. - Like redirect the conversation to the actual task and not the person. - I really like that. Yes, 'cause there's certain situations where you're arguing 'cause what you're really saying is like you're not doing your job totally. - Totally. - I had one of those conversations recently and I know it was painful for the other person. - Yeah. - And I know I just didn't have the balls to say, "I don't think you're doing your job." So I had this really awkward, like, where I tried to almost make it so that they would come to that conclusion themselves, which is really stupid. - Right now! - Just avoidance, man. It's really dangerous. Well, but that's the next thing we wanted to talk about. So that's in performance, right? - Yeah. - There you go. - Amazing. - Yeah, so symptoms of feeling that someone's underperforming.

Talking about performance issues (27:40)

- Yes. I have been thinking about this, actually. So I have come to the conclusion that in my clients who have performance issues of one kind or another, there's actually usually two types of performance problems. One is a real performance problem where their co-founder actually isn't meeting goals and not meeting the deadline, maybe not showing up to work as frequently, like, just sort of they're bowing out. That is a real problem. And so that's one bucket. And then the other bucket are perceived problems of performance where, again, same thing, one person doesn't think that the person is meeting expectations. But it's all imagined. And in the first category, the real performance problems, that is solved with having a conversation and being like, "Hey, I noticed that you're not meeting actual expectation. What's up with that?" That almost always actually is about burnout. It's not about the person's performance. It's about their losing motivation. When it's a perceived problem, that is when things get a little bit trickier because that means that goals haven't been decided, often roles and responsibilities aren't clear. There hasn't been agreement that the expectations and goals are even worth pursuing and usually like, so again, so performance really wide, wide category of issues, in my mind they're one of two, real or perceived. Roles and responsibilities so often are the core of this. Like so often, like, if it's not roles and responsibilities, so much would be fired. Like, because like- Nuclear absolute. Well, it's like in an early stage startup, like, if someone can't actually do the work, right? It's kind of like you kind of need to get the work done. But it's so rare that someone can't do the work, right? Like, it's extremely rare. So many founders interact with this, not they can't do the work.

Goal Management And Addressing Difficult Conversations

Setting clear goals and managing motivation (29:45)

It's like, "We don't know what we're doing. What's the goal? Did we write it down? Totally. Whose job is it to do this?" Oh, we never really talked about it. In what timeline? Yeah, in what timeline? In what timeline? We never really wrote like, "Oh, like, you want to build this feature? Did you write a spec?" No. Do you even agree with the features? No, right? So it's like, "Well, how would you expect someone to build the magical thing in your head and you need to tell them to believe it?" Totally. And so so much of that's roles and responsibilities. And the other thing that I think about with performance that I think is extremely important for CEOs is like, your job is to manage motivation. Like I think a lot of times people talk about like 10x engineers and like, it's almost like if there's this idea that like people's DNA is different and that's the only important factor in their output. And like, I would argue that even more important than their DNA and like how raw smart they are is how motivated they are. And like oftentimes people don't talk about like, you can't change the DNA but you certainly can change the motivation. And like what I've seen, you know, even here in YC is that like, it's amazing what work people will do when they feel good about their workplace. And it's like, it's just like, it's that simple. Like they'll blow you away. They'll do things that you didn't even expect them to do. They'll do things that are even more impressive than you could have hoped for. If you've set up an environment where like people want to buy in. And if you set up a environment where they don't, like they don't even do the simple things. And so like I've seen far more 10x difference based on motivation than I have based on like DNA. And I've worked with some amazing engineers, don't be wrong. Like they're magical. But man, like you put a magical person and they're highly motivated. They're easy and amazing. I think you bring up another interesting topic which is how especially early stage CEOs mostly can keep their team motivated even during the trough of sorrow. Because in my mind, it is a skill. Like there's very few founders who come out of the womb with that, you know, charisma and the vision setting and the power, you know, and it is really hard. And do you have any, I don't know, I guess. I wasn't good at it. I mean, it's interesting advising companies on it because I just am brutally honest. Like I'm just like, it's going to suck. Yeah. Like I don't want to, it's not rosy. Like the fact that we even named the trough of sorrows at YC is like just trying to be brutally honest. It's like half of not feeling bad is expecting it. Yeah. Yeah. And like we've started telling people, you know, oh, when you, when it's not working, it sucks. And then I've just started being like, and once working, it sucks too. Because like I just don't like, I just hate having the conversation with the founders. Like it's taking up. And I just, I feel like every day I'm getting punched in the face. I'm like, oh, that's, that's sorrow. We didn't tell you that. Like, yeah, that's, that's also, you'll always feel punched in the face. And Dalton says something interesting, which is, which I've kind of adopted as well, which is that like you have to enjoy the work, right? Because the emotions are always going to be there. It's always going to be hard to better like what you're doing.

Enjoying the work (32:45)

Because if you're succeeding, you feel like crap. If you're family, you feel like crap. So like you're not going to stick with it. If you don't enjoy what you're doing, or at least the people you're working with, I've noticed there has to be like some tie. It doesn't have to be that you love the product. Doesn't give you love the customer. There's going to be something inherent that's not like we're going to make a lot of money. Most people aren't going to make any money. Right. Something inherent in the work that you like. Even if that thing changes, like this week, I love the team. This week, I feel more aligned with the product and that's what's getting me out of bed. Even if it changes, but it's got to be something anchored. It has to be something. Totally. Regardless of whether you're succeeding or not. Yeah. Well, I think it just spirals either because if you don't, like if you can't add a little levity to these conversations, you're going to suffer. Yeah. It's like constant. All right. Last one is runway. Yes. So what are the symptoms of not having enough money or feeling like you don't have enough money left?

Conversations about runway (33:30)

That's an interesting question. For some reason, where my, so this one, like as a coach, I don't get a lot of folks whose runway is less than four or five months because coaching is effing expensive. And so like right out of the bat, it's unfortunate actually. It's a problem in therapy too, where the people who have the most need are those who can't afford the solution. And I have not yet been able to solve that problem somewhere in my career. I hope I will. But weirdly where my brain went was in fact the founders who, whose companies nearly died, like were two, one to two months away from dying. And they like white knuckled their company out from the grave in order to like live for another year or two and yet still live every day with that like fear baked into every cell of their being. So, and so it's sort of like runway for me, the clients that I see and that I speak with most are those who are so tired of living in fear. And yet whose like systems have not yet awakened to the idea that they can have a different life and choose not like make options not from that stance of fear, but rather from the stance of, oh, I can do this. I can now. Now I have the runway. Now I have the growth. Now I have the team. The world is bright and shiny again, but for some reason, I don't, I don't believe it yet. Yeah. The ones I see are a little different. I never, I, yeah, it's weird. I like, I probably see three problems. I see the problem that's most so correlated with runway is it's going to die and I feel bad and I feel like I've let down my employees and my investors and we kind of have a hard conversation with the founder. We're like, look, your job was to try not to succeed. No one in this setup thought this was a hundred percent. Um, the other problem that I see is founders who don't realize that runway is a problem. Right. That's extremely common. It's like, we have six months left, but everything's great. Like we, you know, we've got 25 people. We don't have product market favor burning all the money in the world, but everything's great. And you're just like, dude, are you, did you, is really? Like, this is sound great. Yeah. Um, and then the other kind of folks I see, um, I see more of are the people who got their company out of the grave. Those folks. And that was just a TV experience. Those folks, I more see them being really good. Like, I more see them being like, well, if we can get through this, we can do anything. And like to me, those are the folks who are exciting is like, those are the folks where they're now fearless. They now finally feel in control. I think as a founder, you often feel like investors control your fate. Can I raise this round or not? The second that you get your company profitable, you, I think it's for the first time you feel like a business owner.

Digging your company out of the grave and continuing (36:20)

Like my decisions affect the success of my company, um, as opposed to like, well, only the day if I don't convince this dude with a bunch of money, we don't succeed. And like to me, that was amazing. I, I actually don't think we clearly and strategically thought about our business for six years because we were constantly changing fundraising. I think the second we got profitable, we were like, it was like clear minded. And we're like, okay, what's the opportunity here? And it's not a coincidence that like social cam and Twitch both happened after we got broke even. Yeah. Like before that, it was just, so that's where I see that. Like, there's so many things I'm thinking about. What you just said, one of them is yes, like the founders who can dig their company that are the grave, like absolutely the best and are awesome in, in my work. Then there also becomes a question of can't do I still have the energy given, given what it took me to save my company? Can I still keep going? Yeah. Right? Yeah. So like there's a real sort of question of, is this possible still given everything that's changed for me in the last couple of years? That's true. Yeah. Yeah. And we felt that too. We definitely felt that too. Yeah. Yeah. How did you solve for it? I don't think we did. I mean, it's not a, it's, it's, I don't think we did. I mean, you just kept going. One of the major factors in us, in me deciding to sell social cam was like, it's been eight years of struggle. Like someone's gave me some money. Like, yeah. Yeah. Yeah. And there were definitely points in Justin to be before we had product market fit, before we figured out tuition that whole thing, before we got profitable, like we were going to sell to IAC, we were going to sell to Google. Like we, I think we were just like, Hey, can we get a win on the board? And it sucks because man, I talk to founders now who say that. And like my friend thinking back, like I always tell them, it's like, those wins aren't important. What are you talking about? Right? But like when you're in the trenches, anyone feels better. Right? Anyone give me five bucks and call an acquisition. I'll take it. It's better than getting punched in the face every day. And so I probably should be a little bit more sensitive to that feeling. Yeah. Yeah. I think that's interesting. And that's something that's floated through my mind this whole time was how easy it is to see from the outside. Like, Oh, of course. Like, yeah, your life is horrible, but it can all be solved because you have roles and responsibilities and you'd be clarified. You know, like it's so easy from an outside perspective to know what is going on and to pattern match and to be like, this is where you, you know, you should head and all this stuff. And in when you're in the moment, when everything is on fire and nothing is working, it's so hard to step outside of it and look at it through like through a different line. But that's just wisdom broadly, right? It's the same thing as like scarcity mindset, abundance mindset. Like only when you're 35 years old and have some cash, can you be like, dude, when I was 18, man, I could have done anything. Yeah. When you're 50, you say, Oh man, when I was 35, man, I could have. And shameless plug only because it's organic and natural here. That's exactly why coaching is helpful. Yeah. Is because there's someone who knows you almost better than you know yourself and can ideally pattern match based off of their own experiences and everything they've observed and be able to tell you in the moment. So you don't have to look back, but you know, 20 years later, you know, it's funny because, you know, when you and I started talking about coaching and this topic in general, I was against it completely. I was just like, you know, this right?

Michael being against coaching initially (39:50)

I was just like, what you do as a fan or as you suck it up, like your job is to suck up the pain, right? Like Michael Jordan doesn't complain when he has to shoot a thousand shots every day. He goes and does his job. Right. And what's interesting is I think that I've realized what I actually meant. I think I didn't realize the power and kind of the insight that PG and Jessica had was putting companies into batches because in reality, my coaches were my batch mates and the other people in YC. And like in reality, when I needed outside perspective, I wanted support. That was my like support system. And like even today, right? Like those are my friends, but like, you know, Steve from Madden or Emmett from Twitch or Justin, right? Like I can go to these people and at various different times, they've had various different experiences, level of experience, right? They've been ahead me behind me. And so that kind of built this group of people that I could have kind of coaching conversations with and their friends. So they know you over time, right? Totally. And it's, it's, it's funny that I'm only realizing it now. So I basically was like, Oh yeah, that coaching is bullshit because I kind of have five coaches right? And I, and I do think most founders, I mean, most founders don't do YC. Most founders don't have a lot of friends doing startups. Like most founders don't have people they know who are further along than them and dah, dah, dah, dah. And so like in a weird way, there are some situations where like you just don't have access to that. I think that's true. And I think also many founders, so I see only YC founders in my practice and even that they have that community, they have you guys as partners to rely on, but they often don't have the language to even talk about like what they're experiencing. And they like, there's just sort of like, so again, sort of coaching as a supportive relationship, but it's also you learning to have a relationship with yourself. So in your own mind, you can get clear about how I'm feeling and what my goal is for today and what my schedule looks like and how do I treat myself today. And that's sort of like there's a foundational level of the work too that's important. I think we were in this before we end to not talk about like what are some of the tools to have these conversations because I feel as though like once you understand you should have them, there's still an advantage to like having a game plan.

How to have hard conversations (42:00)

Yeah. Mm hmm. You're really good at giving people that game time. Thank you, Michael. Yeah. Like in terms, so you're saying sort of like say there's a tough conversation that responsibilities. Yeah, yeah, totally. Conversation with team of three people. You know, how do we do it? How do we make a productive? Yeah, we've talked about this a little bit in this podcast. Like one is a certain amount of removal and objectivity. Like take a step outside of your life for a hot moment and be like, this is what the company needs. Like what are the roles that are needed? What are the tasks that each role needs to be done? Like what is what are ideally for this company and where we're at and how much money we have, this is what one might do. And then you sort of like plug yourself in. So essentially it's like you build a map based off of what's needed in the moment. And in terms of actually having the conversation, stick to the task. Talk about the task. Talk about your co-founder and what his breath smells like and how he totally failed at last week and how much you hate him. Sweaty hands. Don't talk to your mother, sweaty hands. But you talk about again, the task, the project, the idea, all that stuff. And then also speak only as much as possible, only from your own experience. So use I statement, say I think I value, I believe, I've noticed and your own feelings if necessary and do not assume anything from your co-founder. Like ask them questions like what do you think? What is your observation? Or what is your experience been considering you've done this for five months or whatever? How do you approach it when you think that maybe part of this conversation is removing a responsibility from someone?

Role Responsibilities Revisited

Removing a responsibility from someone (43:45)

Or to find the responsibilities in a way that you know someone's going to be angry about? So how to have that really tough conversation? And you're thinking like as the CEO, like CEO needs to have a tough conversation. In my experience, the CEO initiates this conversation a little bit. Really should. Yeah, totally. I mean, this is what I would suggest. Like Craig, I'm removing the podcast from your job description. I would like be really thoughtful about how you might take that knowing that you're probably going to have feelings. So I think about everything that I know about Craig and what your life is like. I would like be quite explicit in terms of setting up the meeting. So I would like, you know, say, Craig, I'd like to talk to you about this and this and literally put it on your calendar. That is different than me just catching you in the middle of our workspace and saying it for example, which I definitely have clients who have done stuff like that. So again, like- Hang on a second, Craig. Yeah, I know, totally. So like being explicit and intentional about having this conversation and then doing a little bit of prep and like sitting down and literally even writing out a script for myself, if necessary, where it's like, Craig, I know you've been blah, blah, blah, something, something podcast, podcast, and unfortunately, like we're going in a different direction. And so I need you more here or, you know, like I'd redirect your energy toward this, but then also explicitly say starting at this date, we're no longer going to have the podcast. And so like, again, I would, I would not say I'm taking this away from you. I'd say I've been thinking and I think your energy is best suited in this direction and it'd be specific again, like put projects or whatever on your plate. And then I would be explicit and say as of date, which I would say in advance, podcast is dead, but say that in much nicer words. So then- So weirdly that structure is a little bit more CEO to employee. Yeah. How does it change when it's co-founder to co-founder and maybe, you know, there are certain CEO to co-founder relationships that are hierarchical. Yeah. And there's certain that are kind like we see a lot of like- So interesting. Right. Right. And it's like co-founders and someone has a CEO title. Yeah. But like they, I don't really- You tell me like in my mind, I don't know if I'd give very different advice and I'll tell you, I'll tell you what, like I'm assuming it say we're co-founders. Say we're co-founders. Okay. In my mind, the conversation is quite similar, but I would assume that there's a level of trust and goodwill between us. It's foundational such that if I were to have a difficult conversation and say, you know, my opinion is that we should move away from the podcast in order to do something else. You would not take offense and you would want to ask me some questions to clarify. And then again, assuming trust and goodwill, like you would be okay with this experiment, assuming that it, you know, it's just an experiment, but it doesn't degrade our relationship. You just got a great point as why the podcast should continue to exist. You know what I mean? Like in that situation where it's like, I think like I've had those conversations where the person has kind of gotten it, right? Like you kind of make the case and the person, you know, sometimes like having the conversation is like thinking about the conversations where people aren't having it. Definitely. And the person on their side is like, yeah, the podcast hasn't been going well. Yeah. Well, they've been avoiding it too. Exactly. What are you doing? Sure. But there are other situations where like Craig would say, well, no, the podcast has 10,000 listeners every week. Like this is important part of our brand is part of our strategy. Like, you know, there are other situations where it's actually more of a question. So yeah, like my response to that is ideally you would already have roles and responsibilities outlined, you know, which I would think that would solve whatever this hypothetical question is where like Craig would get to decide what the social like what we're doing socially and like would have probably cleared that in advance. You know, we're all in alignment because it because it's directly linked to whatever our company goal is. Yeah. And that's really good point. Yeah. To me, it kind of sounds like it's possible the metric changed or if you didn't have a metric in the beginning, then you messed up. Exactly, right. Right. Right. But if it was neither, and then it's just a matter of taste, then it gets really tricky. Yeah. For sure. And to me, like if you've assigned roles and responsibilities, you shouldn't, right? Like if the role responsibility is like Craig is figuring out the social media strategy, right? Then like, either you trust him to do it. And then it's his test that runs the show or you don't and you're moving the role, your room and responsibility. That's exactly right. Yeah. Because you're in before you realize this, you would be micromanaging Craig. And of course, Craig wouldn't take well to that. Exactly. But it's not your place to be doing that anyway. That's a really good point. And this is that I actually see that dynamic all of the time. The other thing I would say in regards to something you said a while back is say you do whatever remove podcast from Craig's. So sorry about your life, Craig. But you can tell that Craig has weird crinkly feelings about it, but he's not saying anything. Always ask like, how are you feeling? Like how is it? I know how much time and effort you spent on the podcast. I know it was like near and dear to your heart. Like I don't want to be the back. But like tell me, you know, tell me what's up. You know, so you kind of like put your friend and colleague hat back on you, check in with them personally and give them an opportunity to share however they felt about how you were. Yeah. Right. So you can see crawlies out of the closet and you can like smash them together and then you can like walk out of the door and you know, and apologize, whatever, take care of the feelings and get back to work. It's funny because even in this example, we kind of illustrate what happens in a startup where it's like, we almost pre assumed there weren't roles or responsibilities.

Returning to roles and responsibilities (49:20)

Yeah. And it's like, yeah, like the solution was being played by that upfront. I feel like that conversation isn't more collaborative conversation. What our roles responsibilities are, isn't more collaborative found or conversation. Right. And again, ideally each person's role and responsibility is linked back to that company-wide metric and the goal like and their skills and their skills. Exactly. So it's kind of much more of a, like you said before, it's a dispassionate like resource skill matching as opposed to like a power distribution. Right. And also knowing that maybe every six to eight months that conversation needs to be re-hat again, just given, especially in the early days, probably before seed is things change. Yeah. No, it's good not to surprise people.

Key Advice For Founders

Jeanie McCallister asks - What’s the single most important piece of advice you can give a founder? (50:10)

So I think that was the one you wanted to get to, right? Oh, yeah. Yeah. Yeah. So there's one question from a Gene McAllister. Right. Gene McAllister asks, what's the single most important piece of advice you can give a founder? My single most important piece of advice that I would give to any founders is to be brave. And that means to start having difficult conversations if they're on your mind and you know you need to have them. And that also could mean being brave by getting into therapy and like learning to sit with yourself and the creepy crawlies of your own mind and your own feeling space actually takes a lot of courage and not enough people do it. Also, Gene McAllister is my mom. So thank you, mom, for the question. You know, mine is one that originally comes from PG and Trevor to the founders of YC, where they would call us every week and say, launch. And it was funny because I was the single non-technical founder at Justin TV. And I was just like, I can't, there's, I can't press the button until I don't even know where the button is. And they would just call me. And like, why haven't you launched yet? And it's so funny because there's so much, there's so much you can talk about and bullshit about and argue about pre-launch that just like after you've launched, it's like a, it's completely unimportant. Yeah. And like the longer you spend in that pre-launch and if you are dysfunctional, the longer you spend in the pre-launch, like the more like it's a perfect environment for dysfunction to grow. Yeah. Whereas like once you're launched and you have constant reselling at you, it's a lot more clarifying like of what you should be talking about, what you shouldn't be talking about. We didn't talk about the background on Justin TV ever again after we launched. So yeah, like it, it some ways, what's so funny is that like you don't have to do any of these things to be successful. Like a lot of the successful companies we know are in various degrees broken. Absolutely. Yeah. There's just a, these are kind of hints and tricks that help me grease the skins a little. But the reality is like the bigger thing is like, did you launch a product? Do you care about the problem? Is the product solving the problem, the customer? And like I hate this. The best quotes on culture I've ever heard and it's just, it's sucky from like a intellectual place, but it's really true is that like it's all easier to have great culture when the product's working and the company's succeeding. Yeah. Like you just start in, instead of starting at a D and having to work your up, you're starting at a B plus. That gives us a lot easier. Mm hmm. Cool. All right. Well, thanks so much guys. Thanks guys. Thanks for having me. Go to www.beadaholique.com to purchase beading supplies and to get design ideas!