The 4th box within our Blq Box approach to how we hands-on work with our portfolio companies is Team. Team can on the surface sound like it’s pretty straightforward – have great people in place and then you’re done. But for us, Team includes so much more. It is the compass, the engine, and the steering of the company, on top of the great people.
Put simply, at Blq:
Team = Strategy + Execution + Organisation
“Strategy” is one of the words that we’ve noticed instills a certain feeling with founders. They all know where they want to go and what steps they want to take (otherwise we wouldn’t invest). But translating that to a coherent, written strategy that the entire company can relate to is a different matter. Speaking with a founder of one of our portfolio companies early in our collaboration, he said “Yes I know we should have a clear strategy, and I do in my head – but as soon as I go to write it down, it becomes a much bigger task and I don’t know where to start or how to structure it”.
So one of the most important exercises we go through with the companies in the beginning of our investment is setting a coherent strategy. This structure is fairly straightforward and includes the following components: Mission, Vision, Northstar goal, Values, Strategy Overview, and Strategic Bets. It aims to combine the long and short term – otherwise people tend to focus on just one or the other. The result becomes one of the core artifacts for the company and is referenced continuously. Because that is the other challenge of a strategy – how do you go from it being just nice words on a piece of paper, to something that guides the company and makes it crystal clear for every colleague what we’re doing and why? That’s where execution comes in.
Execution ability is one of the most important factors we aim to evaluate during our Due Diligence process, and later help our portfolio companies implement. So what is execution? Sam Altman (founder of Y-Combinator) puts it very simply: “Can you figure out what to do, and can you get it done?” Getting it done entails having focus and intensity.
Focus comes mostly from being laser focused on what you are spending your time and money on – what are the 2 or 3 most important things? This hopefully should be crystal clear from your Strategy, and translates into company steering. You need to turn your strategy into clear goals for the company, and then have each team translate these goals into what it means for their department, ideally per quarter. Then set up a way to measure these goals (outcome, not input!), and finally communicate, communicate, communicate regarding the goals.
Intensity is straightforward – you need to create speed in the organisation and decision-making process. Indecisiveness is a killer. A lot of this comes from the CEO creating a bias towards action, to not get stuck on grand plans but rather ensure continuous action, and having teams and people that know how to execute.
And that finally brings us to the organisation – the people and how they’re structured. Most companies we invest in understandably still have fairly young organisations. They usually have some imbalances (more of a focus on product vs commercialisation or vice versa), gaps in core positions that might not be needed now but will be necessary to scale, and often CEOs that are responsible for way too many areas. After a long and short term strategy has been set, we then help the companies map out how to scale the organisation to be able to deliver on these goals, and then support them in the recruitment process to add the talent they need.
But organisation is also about taking care of the people you already have onboard. Start with the basics – actually implement the values or culture that for most organisations remain as words on a paper, not daily ways you and the team act. Then add a layer of clarity and professional development to the team members. Give everyone clear expectations on their role, set clear processes to provide feedback and development areas, and create clarity on how people can advance.
These are initial steps we use to help our portfolio companies create a machinery when it comes to company building. It’s an important part in them transitioning from start-up to scale-up, and hopefully lays the groundwork for all parts of the company to quicken their growth.