One of the dynamics that contribute to the success of startups is quality advice from experienced advisors. Access to advisors, processes and the facets involved, are discussed by Mark Heynen, co-founder of Next Billion Advisors, Gokul Rajaram, Business Helper at DoorDash, Bradley Horowitz, VP Product at Google, and Reshma Khilnani, Visiting Partner at Y Combinator. Successes and failures of both investment and advisory projects are shared in the discussion as well as strategies to make sure that advice is evenly distributed across the globe.
Below are a few highlights from this Twitter Space talk:
Bradley Horowitz started his entrepreneurial journey with Virage, a tech startup that built a product too advanced for the time and space that they were operating in (‘YouTube 7.0’ as he referred to it). The team spent years dumbing down their technology until they finally went public on NASDAQ. He went on to work at Google where he started his advisory journey by running the “Google for Startups” program focused on international reach. He has been an angel investor in roughly 100 startups.
Gokul Rajaram is an active investor and advisor. To date, he has advised 50 founders and invested in close to 250 companies. He has worked at Facebook and Google and has also founded his own company, Chai Labs. The company reached a multi-million dollar annual run-rate before being acquired by Facebook in 2010. He actively seeks to invest in people and strongly believes that the ideas will always take care of themselves as long as one has invested in the right people.
Reshma Khilani founded two companies, Droplet (now Kit.com), which created at-home lab kits for industry use, and MedXT, an online radiology viewing system acquired by Box in 2014. She has worked at Facebook as well as Microsoft in her early career. She recently started advising early-stage start-ups as a Visiting Partner at YC. She also strongly believes that team members are vitally important to the success of any startup.
Mark Heynen has worked at Google and Facebook and has founded several companies. His first company took him to London and India where he noticed a big digital divide. He has since worked on several projects positively impacting emerging markets, including rolling out Android which democratized smartphone access. He later co-founded Next Billion Advisors with the aim to provide start-up founders access to knowledge, capital and leadership in emerging markets, where it is still currently lacking.
THE RIGHT ADVISOR: KEY TO STARTUPS’ SUCCESS
The right advisors can do wonders for startups. While founders’ conviction, hard work, and commitment are critical, they cannot substitute the invaluable experience and the network advisors bring to the table. In fact, our Twitter Space guests all vouched that it starts with advisors believing in the founding team itself.
Bradley Horowitz shared an anecdote about his very first investment. He invested in the gaming industry in which he had very little knowledge. It initially did not fare well but after a few years, the business pivoted– today, this business is popularly known as Slack. Bradley is one of its first investors. He recommends advisors and investors to “bet on the person.” Ideas change constantly and great entrepreneurs adapt.
Gokul Rajaram agreed with Bradley and shared a similar story. He advised Poshmark (POSH), a company that went public, though he did not have much knowledge in the fashion industry. Gokul knew about building products, leveraging digital advertising and scaling marketplaces. He provided strategic advice, the people to hire and processes to be improved which contributed to the success of the company. One does not need to have industry knowledge to be a quality advisor.
Reshma Khilani, although being new to the advisory journey, was an advisor for HumanFirst, a startup helping pharmaceutical companies decentralize clinical trials and virtual care. They aspired to be an engineering and product-led company, she helped them set up their first technical infrastructure as well as launch their first app. She found the advisory process to be very rewarding.
The advisor’s experience of having a holistic view of business helps to create strategies that can truly impact a startup’s growth and success.
KNOWING YOUR LIMITATIONS AS AN ADVISOR
Bringing advisors on board is one practical way of filling in the competencies gap that a startup may have. However, it is important to stress that finding an advisor is first and foremost about finding a dedicated ally, with specific skills who can help solve a well-defined problem. Our Twitter Space guests have all experienced scenarios in which their roles were not as profound as they wanted it to be.
Bradley Horowitz invested and advised a company that built a chatbot automation service where, in retrospect, the timing was clearly off. Although there can be an element of timing or macro circumstances, it is important to accept failures. He says the goal is to invest in people and have no regrets regarding the outcome.
Lack of communication and engagement can also be problematic. Gokul Rajaram joined an advisory board in a company where communication was non-existent and the advisory process was not what he had hoped for. Although the company did well regardless, he reminds founders and advisors that engaging together should be useful and effective. A founder often already has the right answer but a good advisor will help him get there with confidence. It should always be a team effort.
Reshma Khilnani admitted not having given the best advice to a company regarding how to engage its first customers. There was a lot of room for mistakes when selling the product and, although they are doing well today, her advice initially resulted in the founders taking a detour. Just like founders, advisors keep learning from their mistakes.
Mark Heynen confesses to also having a few of those stories and voices how important it is to realise and state your limitations as an advisor.
A SPACE WHERE FOUNDERS CAN BE VULNERABLE
There is no specific implementation guide to how a company should handle its affairs. Bradley Horowitz states that advisors are people who sell themselves to help the success of a company through friendly advice rather than a cookie cut guide.
Bradley says he learnt that advising is different from telling or formally instructing. It is a matter of providing different options, outcomes, and paths to take, despite being certain of the answer to a particular question that may be asked. He states that advising should be about providing templates, frameworks, trade-offs and the founder can decide what is relevant to his company and make his own decisions.
Entrepreneurs sometimes feel compelled to present the best possible picture of their companies. Gokul Rajaram expresses that compared to board meetings or accelerator programmes, advisors are a space where one can be vulnerable. He adds “with a good advisor you feel you can share your hopes, your dreams and your fears in a safe setting, a safe environment.”
Not all problems have an obvious answer. Advisors are to provide support, context, perspective and examples of what has been seen or experienced.
HAVING ACCESS TO KNOWLEDGE AND EXPERIENCE AS FOUNDERS
Mark Heynen suggests most advisors and those who benefit from high-quality advisory processes seem to be concentrated in the United States. In emerging markets, the middle class as well as mobile adoption are growing very quickly and founders – similar to their counterparts – are looking to scale. How do we make sure there is equal access to that level of advice?
Online communities have made it such that all can benefit. Bradley Horowitz pointed out that the modern era is an advantageous time where information is at everyone’s fingertips. One can spend time on YouTube researching information on skills and LinkedIn for access to people that they had never thought of before.
The digital space has indeed increased access to advisors. Reshma Khilani re-emphasizes that today a founder can easily approach a successful business advisor or business figure by discussing a specific problem that can be solved through a partnership.
Mark Heynen states that empowering people to be local advisors is another strategy to spread knowledge. He shares how Next Billion Advisors is diving into a Mastermind program that is built of peer-to-peer groups. It is a scalable model that offers real-time advice on business dynamics. (Coming soon! Leave a comment if you’re interested in learning more.)
All Twitter Space guests reach the end of the discussion in agreement that each person is responsible for their brand. Gokul Rajaram says one should build a ‘‘brand in a domain that one is an expert in.’’ This is supported by Reshma Khilani who says ‘‘we are living in a time of quick evolving industries,’’ new content, new strategies and new material. Bradley terms this as a ‘world of information.’ Therefore access to advisors, founders, ideas, creativity, and content, is endless.