Tag Archives: Time

Doing less rather than rushing

When you’re giving a presentation in a predetermined time slot and you realize that, if you continue at your current pace, your presentation isn’t going to end on time, you have two options. You can either speed up your pace by talking faster or cover less content by focusing only on the most important remaining content.

The former approach creates stress, and that stress impacts not only your ability to communicate your thoughts but also your audience’s ability to understand your message due to simultaneously thinking about your frenetic body language.

The latter approach means that you don’t cover some content. However, by skipping the content that isn’t a priority, you can get the key elements of your message across, thereby retaining your calm and increasing the likelihood that your audience understands your message.

The reasoning outlined above regarding what to do when you’re pressed for time when presenting can be generalized to other contexts. Specifically, when you’re pressed for time, it’s better to do less by prioritizing the important things than to do the same amount by rushing through it all.

Distance = speed * time

What you achieve in life can be thought of as the distance that you progress. Distance, in turn, is speed times time.

Speed is how fast you’re progressing, and time is how much time you put in.

This is why you’ll make more progress if you’re working on something that you’re naturally good at, by working with a capable team rather than alone, and by raising external funding rather than relying on internally generated profits. These are examples of ways to increase your speed.

It’s also why you’ll make more progress if you’re spending the majority of your time on one goal rather than pursuing multiple goals at once.

Creativity and performing predefined tasks

Work can be broken down into two different activities. The first is deciding what to do and the second is doing it.

The former requires creativity while the latter requires putting in the time to perform an activity with relatively less brain power.

Since the latter requires less brain power, it’s possible to spend extended periods of time, which I define as more than 12 hours a day, doing it.

Creativity, on the other hand, comes in short bursts. You can’t be creative for 12 hours a day. My creative periods last for 4 to 5 hours a day at best.

As a result, creative roles spend less time working than roles focused on carrying out a predefined task. However, this does not mean that creative roles produce less output as correct decision making is a higher leverage activity than task execution.

In roles that require both creativity and performing predefined tasks, it’s useful to set your daily schedule to allow enough time for your high value creative bursts to occur in the environments and the times of the day when they’re most likely to surface, while spending the remaining time on performing predefined tasks.

Taking the time to observe a founder’s ability to get things done

In an earlier post, I wrote that integrity, intelligence, personal energy, the ability to draw out collective energy, and salesmanship are the five key traits of great founders. The last three of these traits manifest themselves in a single outcome, which is getting things done.

Getting things done, in turn, takes time. It takes anywhere from a few weeks to a few months to see if a founder is someone who gets things done.

That’s why, as an investor, before investing in a founder, it’s useful to take this time to observe the extent to which the founder is someone who gets things done. It isn’t possible to observe this in a single meeting.

Sometimes competitive bidding processes result in having to decide faster than this. One approach is to sit out of such processes altogether. The other is to adjust your investment amount to reflect the extent to which you’ve been able to observe the founder’s ability to get things done. This leaves you the option to invest more in a future round after you’ve had more time to observe the founder’s ability to get things done.

Slowing down time

Sometimes you feel like life is passing by at a very fast pace and you want to slow it down. There are two ways to slow down time. More accurately, since time doesn’t actually objectively slow down, there are two ways to slow down your subjective perception of the passage of time.

The first is to do less. When you do less, you have more free time in which to think about the passage of time. This makes time pass more slowly.

While this approach works, it can lead to boredom and a feeling of missing out. Since we’re alive for a limited amount of time, most of us want to put that time to good use by being active rather than not doing much.

This is why I prefer the second approach. This consists of doing new activities that break the repetitive cycles of your daily life.

When you repeat the same activities over and over again each day, you get used to performing the activities without much active thought. You’re on autopilot and, as a result, time passes by quickly.

If instead you do new activities, or at least variations of your existing activities, you can’t do them on autopilot because you haven’t done them before. You need to actively think about what you’re doing. This immersion in the new activity slows down your perception of the passage of time.

Investing time

When you invest money in a startup, you actually invest a lot more than that. You embark on a journey which will likely take at least 18 months and maybe longer than 10 years.

18 months is the shortest path to a successful exit that I’ve seen. It’s also how much runway most funding rounds offer in the event of failure.

And if you catch on to a big winner you’ll likely want to see it play out for as long as possible so this may mean a journey longer than 10 years.

So, in addition to money, you also invest your time in a startup. You spend time strategizing with the founders, helping the startup recruit, pitching the startup to other investors, solving founder problems, but also problems among investors and between founders and investors.

And while money is replaceable, time is not. If you invest in the wrong startup, you spend the precious moments of a finite resource on a business that gets less and less likely to succeed each day. The feeling of lost time hurts a lot more than the feeling of lost money.

As a result, when I’m evaluating whether to invest in a company, I’m not simply deciding whether to invest money in the company. I’m deciding whether it’s worth investing time in the company.

This forces me to hold potential investments to a higher standard. And more importantly, it makes me spend a finite resource in the way that I believe will create the greatest value.

The long arc of time

Seth Godin recently wrote a great post on how our perception of time influences whether we see things changing or not.

Sometimes our perception doesn’t let us notice that things are changing even though they actually are.

Just like a tree that’s growing, most things worth doing take a long time to happen. Perceiving the long arc of time keeps you going.

You can read the full post here.

Punching above your weight when recruiting

I was recently speaking with another investor about how successful our companies are at recruiting.

At the surface, one might expect a company’s recruiting success to be tied to the strength of their brand and the financial offer they make to candidates. Traction is a pretty good proxy for the former and the combination of profitability (or a lower net burn rate) and funding are good proxies for the latter. And this is indeed broadly the case. Companies with more traction and a better net funding position are more successful at recruiting.

However, during our talk we also identified several outliers in our portfolios. Specifically, some companies were punching well above their weight by attracting a level of talent that’s difficult to justify by looking only at their traction and net funding position. So there must be at least one, or perhaps more, variables that we’re missing. I think there are two.

The first is the founder’s ability to inspire others to join them in the pursuit of a shared vision. This comes from being authentic, being able to clearly communicate your vision, and caring about the people you work with.

The second is how much time the founder spends recruiting. All else equal, the more time you spend meeting candidates the more likely you are to hire the right people. Together with setting the company’s vision and keeping it funded, recruiting is one of the three most important responsibilities of a startup founder. And some founders have internalized this more than others.

Your traction and net funding position determine your weight when recruiting. Your ability to communicate your vision in a way that inspires others and the time that you dedicate to recruiting let you punch above your weight.

The cost of raising too much capital

Most startups believe that raising more money is better. Startups are already undercapitalized relative to the incumbents that they’re trying to displace, so the more capital they have to close this gap the better.

While this is partially true, it comes with a very important caveat. And this is that the relationship only holds up to a specific point.

Having some money is almost always better than having no money. It lets you hire people, build a product, and hopefully get people to use that product.

However, raising money also carries a cost. Specifically, it sets a valuation for your company. And a valuation sets expectations.

Startup valuations reflect future expectations for the company, not its current performance. The company needs to use the capital it has raised to fill in the expectations set by its valuation. And the more you raise, the more difficult this becomes.

We can see that this is the case by thinking about the edge case of raising infinite capital. If a startup raised infinite capital, there would be a point beyond which it cannot put that capital to efficient use. Even if we ignore all other constraints, a startup is constrained by its market size and the time that it needs to spend to execute on projects so as to grow into that market. Taken together these factors create an upper limit for the amount of capital that a startup can effectively put to use in a given market during a given period of time.

When funding is readily available, you might be able to raise more than this upper limit. But just because you can doesn’t mean you should.

Beyond a certain point, the shoes you’re trying to walk in will just be too big. Your feet won’t grow fast enough, you’ll end up with blisters on them, and you’ll be forced to buy smaller shoes.

And that’s where this analogy breaks down. It’s easier to find smaller shoes than to structure funding at a lower valuation.