Executive Interview Questions And Answers: Brad Feld
Brad Feld is one of the managing directors at Foundry Group, a venture capital firm that invests in early stage software / Internet companies throughout the United States. He is also the co-founder of TechStars, a mentor-driven accelerator, author of several books and blogs, and a marathon runner.
This condensed interview is from 2007. When we met with Brad, he wore a shirt that simply stated, ‘No one reads my blog.’
With the businesses that you’ve invested in that have succeeded, what has made them get there?
Well, one is people being passionate about what they’re doing. Because you can’t work fifty, sixty, eighty hours a week if you don’t care about the thing you’re trying to create. Real vision and ability to deliver on the vision. People. Ability to build a team. Ability to find other great people who are attracted by your idea that are willing to go out and go after the same idea you’re going after.
Fearlessness about trying to create something. I think really, really good entrepreneurs just keep going. They don’t worry about the setbacks and recognize that if things don’t work, there’s always ups and downs, and you have to keep going after it. But again, going after it with a thoughtful eye. Rather than blindly bashing through a wall no matter what.
So on the opposite end of that question, what about the businesses that have failed? Why have they gone?
Most of the failures come from one of two places. One is the people. They either have a lack of competence. They make bad choices about key people. They have an inability to attract great people. Big blind spots on the part of the entrepreneur with an unwillingness to deal with them. That’s kind of one category.
The other category is, I was going to say execution, but it’s not even execution. It’s ending up in a position where the thing you’re doing is not compelling. It’s not compelling for a variety of reasons. Either the software you build sucks. You can’t get it out the door. You have a mismatch of what customers or the market moves away from what you’re able to provide. And you’re not able to adjust with it. Broadly speaking, it ends up in that bucket of you do something that’s not as interesting as the premise was at the beginning.
Those are the two primary drivers of failure. There’s some others too that are sort of exogenous. When the Internet bubble burst in 2001, capital vanished. So companies that had previously been consuming capital at an incredible rate and were having capital shoved down their throats by public and private market investors all of a sudden couldn’t raise capital. It’s very hard to take something that’s speeding along at a certain pace and radically change it and have it survive. There’s a lot of companies that just went off a cliff or slammed into a wall because of that.
You can say that they should have saw that coming. You can say they should have built a better business. But that’s all hindsight. Because if you were living in that moment of time, you were getting rewarded for more customers without worrying about making money. Build more traffic. You weren’t getting rewarded in terms of more capital and more value for the cash flow you’re generating. So those are some exogenous factors, but they’re linked to others. Because there were plenty of companies who were able to pull through that period, put the brakes on, scale back and then emerge out of that with very successful businesses.
So, in the middle of those two questions that I just asked, have you ever seen an entrepreneur come in here with tons of enthusiasm and drive for their idea, and then lose it along the way?
What’s that process like when they lose it?
I’m thinking of a couple specific examples where the entrepreneur was blinded by their own salesmanship. There’s definitely a category of entrepreneurs that believe that if you can just convince other people how great your idea is, then your idea must be great. And what happens is that you convince some other people how great your idea is, and then you have to start building it. Then you realize it’s not so great, and you lost interest. Or the stakes change and you panic. Or the rules change and you have to build something slightly different and you don’t know how to deal with that.
There are definitely things that cause that perspective to change. But that comes back to the person. Being true to yourself as an entrepreneur in terms of what you want to do is really important. If, as an entrepreneur you find yourself trying to come up with something that looks, feels, smells, taste different, just to convince someone to fund you or to come work with you. If you’re faking yourself out to get to a certain goal, it’s probably not going to be sustainable.
I mean think about the trip you guys are on. If you weren’t really excited about what you’re doing…how many cities have you been to now?
I don’t know. Ten?
Yeah. And you have to get back in the thing on the road again and drive around. If you weren’t doing what you wanted to do, why would you do it? So you have to start there with a vision and execute on the vision. But you got a long way to go if you want to do a book and documentary. You got a ton of work in front of you. Along the way people are going to say this is stupid. Or that interview with Feld was a waste of time. Or ‘Gosh, there’s really not content for a book here. You’re going to have to do a lot of work. You’re going to have to go back and interview those people again because you didn’t ask them the right kinds of questions. Or whatever!
You take that feedback and figure out what you want to do with it, which includes knowing when people are wrong and believing in what you’re doing and keep going. Or adjusting and having to continually reengage. I think that’s a big part of it.
It is a big part. Regaining that drive because you can definitely lose it.
And you let yourself go up and down. Human beings are not constant emotion meters. No matter how upbeat and optimistic a person is, and enthusiastic and passionate a person is, they have bad days. And sometimes you have two bad days in a row. And sometimes you have a bad week. And sometimes something happens.
I love the cliché that life is a fatal disease. Ultimately you die. You have these moments where you realize that this isn’t going to go on forever. When you’re in that mode, you have different emotional ranges. Some people get depressed, some people get sad. Your girlfriend breaks up with you. You get in a fight with your parents. You get in a fight with your business partner. It doesn’t matter. You have to go through those ups and downs. Sometimes the downs sustain longer than you’d like them to. Sometimes they trigger off some self doubt and questioning. That’s all a normal part of entrepreneurship. That’s all a normal part of creating this stuff.
Just powering through isn’t always the right answer. Because it’s not possible to always power through. Time passing usually solves that stuff. But you have to be able to reenergize yourself along the way. Having a fundamental belief and vision of what you want to create, going back to passion is important.
I think that also carries over to careers as well.
Absolutely. Remember what I said. Entrepreneurs I love to work with are guys who’ve had a success and a failure. I don’t care what order. It could be two successes and one failure or two failures and one success. It’s a taste of both sides of the equation.
I’ve had lots of things work, and I’ve had lots of things not work. The lots of things that work, when I remember them, I remember them fondly and happily. I forget all the things in them that didn’t work because they ultimately worked.
The things that didn’t work…some of them I remember not very fondly. I kind of want to ignore that I had that experience. But at the same time, I learned something from it. As long as I took something out of it that I was able to then apply going forward to the new things I’m doing, it was probably some semblance of a useful experience.
In some cases, it was profoundly useful. Because the stuff I learned from the failure was much greater than anything I learned from the success.