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Saturday, July 27, 2013

8 Tips to Get More From Your Investors and Board 07-28

8 Tips to Get More From Your Investors and Board

If you don't ask, you won't get, says Mark Suster.

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Rob Bailey is the CEO of Data Sift. He wrote a post this long weekend on how he manages the board of Data Sift.

More importantly if you don't know Data Sift but have the need to process real-time social data or historic data it's worth checking them out. It's valuable to any business for marketing, customer research, product development, market analysis, etc.

In his post, Rob asserts, "You get the VCs you deserve" and the corollary, "You get the performance out of your board that you deserve."
His argument is as follows:
  • Spend time building investor relationship long before you raise money. 
  • By spending more time educating your board on your business you get more valuable advice from them.
  • Your goal should be to turn your VCs into extended members of your team to get real value from them.
  • Understanding where your VC partner sits in their respective fund and where their fund is in the cycle of its investment lifecycle will help you understand your VCs behavior.
What Rob wrote in his post is right.

Rob is one of the most driven and successful CEOs I work with.

In his tenure as CEO of DataSift, we have never missed a monthly revenue figure. He has grown our US operations from one employee (him) to a global organization of 75 employees that will finish the year with 8-digit revenues (90 plus percent recurring) and more than 350 percent year-over-year growth.

Growth like this, this early in a company's lifecycle rarely happens.

In this period (less than two years), he has brought on incredibly talented senior execs in sales, marketing, product management, client services, finance, VP engineering and more. In his spare time, he raised nearly $30 million.

But the thing I am most proud of about Rob is that he has taken a company with a uniquely talented founder and CTO--Nick Halstead--and managed to build a very tight working relationship with Nick where we drive world-class product development without having the usual founder / CEO conflicts. Oh, and did I mention--Rob is in SF and Nick is in the UK. Rob has taken more than 15 trips to England and Nick even more to the US. It is really working.

I point this out partly out of pride. Partly out of the fact that in one week I depart for England to speak at LeWeb, attend our DataSift board meeting and generally make myself available to the DataSift team to meet their customers, partners and employees.

But mostly as I read Rob's post, I didn't think it did justice to the superlative job he has done at managing his rather boisterous board.

It consists of a highly intelligent and opinionated founder--Nick Halstead, a wallflower--yours truly, quiet-as-a-mouse Roger Ehrenberg of IA Ventures, true-to-his-heritage Rory O’Driscoll from Scale Ventures, and then there is the one true gentleman of the bunch--Chris Smart, who is non-exec chairman. In addition to helping manage the board, Chris also helps represent the interests of the angel investors / common stock holders.

Oh, and did I mention:

Roger is in NYC. Rob and Rory are in NorCal. Nick and Chris are in London. And I am in Los Angeles. That in itself is quite a challenge.

So what are Rob's secret hacks that he didn't spill in his blog post? 

Here is what I imagine Rob would say were his most effective tools. Sincerely, he is better at managing his board than any exec I have worked with.

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