What is Leadership?

Recently Steve Wulchin (who has also been an investor in our funds at Techstars since the beginning) was asked by two of his nieces to talk to them about leadership. As part of his preparation for the session, Steve polled a number of people that are in leadership positions, including me. These are people that Steve has known for years, and their experiences cover a wide range of leadership roles in a variety of organizations.

The group that Steve polled had experience in startups, Fortune 500 companies, the highest levels in the military (in theatre), running venture funds, teaching at Stanford, running small organizations, and running large ones. Steve asked them 4 simple questions:

  • What are 3 traits of successful / effective leaders?
  • What are 3 traits of ineffective leaders?
  • Why do organizations succeed or fail?
  • What practical advice can you offer to 2 young leaders?

Steve shared the answers with me, and I thought they were interesting and asked if I could share them here on my blog. Those answers are below, largely unedited. Each set of answers is one person’s response. I won’t tell you which sets are my answers, but maybe you can guess.

3 traits of successful / effective leaders:

  1. Not afraid to fail
  2. Think and make decisions (on occasion) “outside the box”
  3. Confident

  1. Provided a vision for the future (doesn’t have to be detailed)
  2. Consistent in decision making – meaning they are quick to make a call, but reserve the right to change their mind later
  3. Provide opportunities for others to lead within the context of the vision

  1. They were quiet, mostly introspective, “coach-like” men with a well-articulated vision (consistent commander’s guidance).
  2. Allowed subordinates leeway and opportunity to succeed, on those occasions where they failed, provided low key counsel and more opportunities.
  3. Knew their men very well to include families and important life events.

  1. Honest
  2. Direct
  3. Clear communicators

  1. Build Trust
  2. Have a Compelling Vision
  3. Drive Results

  1. Have a compelling vision and are effective communicators. They are able to get people to buy into and contribute to their vision.
  2. Bring out the best in their people. They are able to fire people up, to get them to commit themselves, to provide more than they realized they were capable of.
  3. Are broad-minded. They see issues, opportunities and people in all their complexity.
  4. Surround themselves with people who complement their strengths. No human being is fantastic in every way. Business is a team sport. The best leaders find and retain people who possess strengths they do not.

  1. Ability to attract and retain top talent – not threatened, and, in fact, enthused about people who have differing points of views, approaches, and backgrounds.
  2. Willing to take responsibility and make the “tough calls” – in a straightforward and transparent way and realizing that they may not always be the “popular” choices.
  3. A rare mix of visionary ability and executional pragmatism – naturally comfortable, willing, and able to participate, interact, and assist at all levels

  1. Calm under pressure and in great success
  2. Driven by facts but motivated by possibilities
  3. Great story tellers

  1. They find a way to get people excited about what they’re doing, to do the impossible.
  2. They are secure and confident and surround themselves with people smarter than they are.
  3. They are never satisfied.

3 traits of ineffective leaders:

  1. Purely “ass kissers”
  2. Unfamiliar with market competition
  3. Afraid to ask for help from “others”

  1. Aren’t knowledgeable in the area they are trying to lead, but try and hide it
  2. Afraid or reluctant to delegate tasks or leadership
  3. Take credit for wins and blame others for losses

  1. Loud, often profane men who could be counted upon to belittle subordinates both privately and publicly
  2. They were aloof, above the fray
  3. Knew little of what was really happening in their unit

  1. Bossy
  2. Not leading by example
  3. Inconsistent

  1. Lack Humility; i.e. put yourself first
  2. Dishonesty
  3. Poor Listener

  1. Playing politics. My last boss at ABC Corp was one of the worst leaders I ever met.  Any time we had a conversation, the only angle from which he would look at it would be “Politically, how is this going to make me look?”  It got to the point where the only time I ever engaged him was to get my expense account approved.
  2. Disengagement. There is a fine line between letting your people do their job without interference and being disengaged completely. I had a boss at XYZ Corp who crossed that line and never looked back. I used to call him with about various topics and the phone always went to voice mail. I would leave a message, and about 5 minutes later, I would receive a terse, one line e-mail response which was not helpful at all. The guy had no interest in talking to me in person. In 18 months, I think I spoke live to him less than 10 times.
  3. Arrogance or Know it All. The opposite of disengagement. I guess this can also be called closed mindedness. This is the person who follows the 2 Rules of Business. Rule #1 – The boss is always right. Rule #2 – If the boss is wrong, see Rule #1.

  1. Display arrogance or lack of respect. People do not perform well if they feel undervalued.
  2. Stifle dissent. Leaders who cannot hear opposing points of view are bound to be unpleasantly surprised when reality contradicts their expectations.
  3. Feel threatened by people who are smarter or more effective than they are. A’s hire A’s. B’s hire C’s.
  4. Are lazy. They don’t make the effort to learn, to understand other points of view, to make the tough choices, to make sure the team is effectively executing.

  1. Self-absorbed – obviously “in the game” purely for their own personal gains at whatever costs.
  2. Aloof and irreproachable – convinced they “know it all” and actively avoid/suppress any dissension or questioning of approach.
  3. Unwilling to personally accept responsibility and unable to actively seek resolution to failures/problems.

  1. Too focused on numbers vs. quality product
  2. Recluse – don’t lead by example
  3. Fearful of competition

  1. All about them
  2. Talk the talk but don’t walk the walk
  3. Insecure, they do the opposite of surrounding themselves with good people

Why organizations succeed or fail:

  • Poor vs. good financial preparations
  • Good vs. bad business plans (or being inflexible when that plan needs to be modified)
  • Ego at multiple levels of the business

  • Fail – Aren’t close enough to the customer and/or market to understand it fully
  • Succeed – Focus on the 1 or 2 things that make them special (don’t get distracted with side projects)
  • Succeed – Hire the right people with the skillset and work ethic to accomplish the mission (across functions)

Success:

  • Clear vision
  • Resource to accomplish
  • Leader involvement
  • Reward subordinates who contribute. counsel those who do not
  • Eliminate those who, after efforts to teach and coach, still don’t contribute

Failure:

  • All about the “leader”
  • Little about those down the tape
  • No clear vision
  • No leader involvement
  • Lead by threatening “leaders”
  • No achievable goals

Success:

  • Clear shared purpose and vision of the future (common goal)
  • Clear values that are never compromised
  • They continually re-invent themselves, completely understand their customers, and treat their employees and other stakeholders fairly and with respect.

Why organizations fail:  The three C’s creep in–they become Complacent, Conservative and Conceited (know more than their customers).

  • NIH – Not Invented Here
  • Provincialism.  This is the same as closed mindedness and is the hesitation or refusal to consider new stuff.  We’ve been doing it that way for years!  Why should we change?
  • Punishment of Failure.  If people are afraid of reprisal, they won’t try new things.

Success:

  • Empower their people – People perform much better when they feel they feel valued and respected, and have the ability to take initiative to accomplish their goals.
  • Promulgate a culture of action and accountability – Organizations that do not move fast enough or allow “dropped balls” will get killed by those who do not.
  • Embrace challenges and change – Change is a part of the human condition. An organization’s ability to identify where, when and what to change is critical. Its reaction to changes in the market, industry and society will determine its ability to survive and thrive.

Success:

  • Recruitment, motivation, and retention of a strong and diverse Team – if you have that, you can pretty much do anything.
  • A vibrant culture of always internally challenging and proactively questioning one’s assumptions, approaches, and directions.
  • Willingness to pivot and course-correct as necessary–accelerate through change.

Failure:

  • lack of funding [Note: I strongly disagree with this one! I think that’s a symptom of another problem.]
  • wrong product for the market
  • product designed for the ego of the founders vs. the market needs

Success:

  • Have the right team
  • Have a plan
  • Ruthless focus on execution

Failure:

  • They execute poorly
  • They don’t hold people accountable

Practical advice for leaders:

  • Make your bed every morning.
  • Pray regularly.
  • Know your competition.
  • Don’t be afraid to change your business plan. Adapt.
  • Make time for yourself and loved ones outside of work.

  • Be straight with your people – good or bad, give them the truth in a timely manner.
  • Invite others to be part of the team…give team members the opportunity to succeed or fail.
  • Find out what makes the company special and repeat, repeat, repeat.
  • Get through the decision making process as quickly as possible (without sacrificing good quality data) and move to execution – you can always tweak the approach later.

  • Know your team, key leaders, followers and worker bees.
  • Have a clearly stated vision/mission/objectives.
  • Provide the resources to accomplish the mission.
  • Be involved….care!
  • Follow up and reward success.

  • Lead by example, not by marching orders.
  • Communicate clearly and consistently.
  • Set the culture and enforce it. (Fire high performers that are not culturally aligned.)
  • Make sure you don’t run out of money.
  • Hire great people.

  • Great leaders do the following:  They build trust in their followers by being Competent and Credible, by always being Reliable so they can be counted upon, and by having high Integrity (consistently honest in their words and actions). But most importantly they build trust by putting everyone else before themselves. These leaders also seem to have a passionate and compelling vision as to where they want the organization to go in the future and are able to articulate this vision clearly and simply. Finally, they have a track record for getting RESULTS.
  • Never underestimate the importance of establishing the right corporate culture and ensuring it is aligned with your strategy! This is key to success!

  • Do not surround yourself with yes men or yes women. The best atmosphere to create is one in which the subordinates, no matter how junior, are not afraid to tell the boss he is full of shit.
  • Lead by example. You shouldn’t ask any of your subordinates to do anything that you wouldn’t do.
  • Hold your people accountable. Any time I set a deadline or let one of my people set their own deadline (or a target), I let them know that I was writing that down and that I would be holding them accountable to deliver. People respect what the boss inspects.
  • Make people get out of their comfort zone. This is especially true with salespeople. The best way to grow and learn is to be a little afraid (or a lot). The same old thing will probably deliver the same old results.

  • Think broadly and ahead. Always be looking over the next hill. Seek to be informed about the broader environment. Anticipate and make realistic judgments about opportunities and threats.
  • Focus, focus, focus. Flying in the face of my previous comment a bit, focus where you can win. “Boiling the ocean” is a plan for disaster.
  • Communicate, communicate, communicate. You can never communicate with your people enough, and by “communicate,” I mean both ways – imparting information and listening.
  • Always look for help, and offer it. No one does it alone. No major accomplishment happens through the efforts of a single individual. Actively cultivate a community of people who can offer you advice and support, and to whom you can offer the same.
  • Execute. A mediocre plan executed flawlessly will trump a brilliant plan executed poorly every time.
  • Always be learning, always be questioning. What you do not know will kill you.

  • Be honest and transparent (as much as practically possible). Customers, partners, peers, employees, investors, etc will always respect this, even if they don’t like the actual news/situation.
  • Be willing to accept that you can never “know it all” and constantly challenge your own thinking and biases.
  • Listen to all advice, criticism, inputs, etc from whatever sources — but then make your own decisions and ultimately own the responsibility of the outcomes involved.
  • Be a constant learner/student for your entire life – stretch/challenge yourself into new areas both vocationally and avocationally to broaden your perspectives in all that you do.
  • Make sure you are actually having fun and enjoying what you do. If you are not genuinely enthused, people will know it and will not follow you, support you, or be inspired to perform in the way that you desire. Also, you will eventually burn out.

  • Lead by example – be the best employee of your company.
  • Be passionate about your customer experience.
  • Believe in yourself.
  • Surround yourself with people truly smarter than you.
  • Seek mentors. You can’t be a leader without the sage support of others who have been there before you.

  • Learn what your individual strengths are as a leader. Play to those strengths, and build a team to address the weaknesses. Beyond that:
    • Build the team
    • Set the plan
    • Execute

Thanks to Steve for sharing the input he received from so many great people!

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Thank you Upfront Summit

Last week, I attended my first Upfront Summit. I’m not a conference person – in fact, I generally try to stay away from them. 

However, this one was incredibly valuable and relevant to me. The curation of the people was incredible. 

I’m writing this post to just give a quick shout out to the entire Upfront team (and their sponsors) for putting this event on. And more importantly, a sincere thank you. It truly helped me and I know that’s true of many others. It’s obvious that you all put a ton of energy (and money) into this event. I just want you to know it certainly shows and we’re grateful that it exists.

And, LA, wow. You are crushing it. So many great companies, so much energy. What an amazing visit.

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The story of Matt

As you might imagine, I get hundreds of random inbound emails each week. Many of them are seeking funding for their startup. Recently I got one such email from Matt, and as I often do I responded by directing him to learn more about the Techstars accelerators.

Matt responded as follows.

Your accelerator programs aren’t an option for [me]. Thank you for responding and your time.

My response:

No problem. if your’e game to provide feedback on why they’re not an option in your case, we’d love to learn from it.

I suppose I was expecting an immigration problem, or that he wasn’t able to temporarily relocate, or that perhaps he thought his company was too far along for an accelerator (a common misconception).

Here’s part of what Matt said next:

To be honest, I am disabled. Mobility is an issue. …Making it to your location on a regular basis would be difficult. If participating in your.accelerator programs without being on-site very much or at all is permissible/possible I will reconsider applying.

I wondered if this might be possible. Perhaps Matt could be some kind of virtual attendee of an accelerator program? I asked my team to dig into it and see what might be possible.

A week or so later, I got this note from one of my teammates at Techstars, Karina Costa.

David thank you for introducing us to Matt. [We] talked to him last week. This was an unexpectedly hard experience for me. Matt is disabled and he also doesn’t speak, [we] asked him questions and he answered slowly over the chat.

As I was listening to the silence of this call I started feeling small. there are so many resources and opportunities available to build or work for a tech company today but I couldn’t think of one single way in or outside Techstars that could truly make a difference for a person like Matt. it’s ironic because working in tech is probably one of the best options for Matt.

I don’t have anything actionable in mind but maybe there are actually organizations that can help disabled people in tech and we can get involved through the Techstars Foundation? Or a start could be a Startup Weekend.

This made me become aware so I wanted to share.

This prompted us to do some more research on groups or services that might help Matt be successful as an entrepreneur. We were surprised to find only a few things such as Kaleidoscope Investments and The Abilities Fund. We shared these with Matt and asked him if he was aware of more. He wasn’t.

One reason for writing this blog post is to ask you for your ideas on how we might assist Matt. Are there other resources or ideas you have?

Another reason I wanted to share it was to get you thinking about how your company, product, or service can help others that might be in the same boat as Matt.

I’d welcome your thoughts in the comments.

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A few thoughts on inclusive hiring

BeVisible, Techstars, and Foundry Group hosted a wonderful event recently on the topic of diversity and inclusion. We were fortunate to have Mandela Schumacher-Hodge join us from Kapor Capital. About 50 Boulder area startup executives joined for a round table discussion on the topic. 

First, we talked about why we should care about inclusion. There are now numerous studies and enormous amounts of proof that more diverse teams make better decisions and generally perform better financially. Many attendees said they were focused on inclusion for that reason – better business performance. Some attendees talked about how they were doing it because it was the right thing to do. I think both are good reasons, and they can work in concert. But if you only believe one, it’s still obviously worth your energy.

Here’s a few things I took away from the discussion that I thought might be helpful to others.

Stop using the phrase “culture fit.”  Your hiring managers and employees tend to hear this as “hire people like us.” Instead, a simple fix is to use the term “culture add.”  Language matters, and I think this is a brilliantly simple change that I’m adopting in my language.

Limit “required experiences” in job descriptions.  I was reminded of the things that really matter when hiring employees. Skills matter. Motivation matters more. Experiences matter the least. One of my personal mentors, Walt Winshall, once shared with me the quote “Hire and promote first on the basis of integrity; second, motivation; third: capacity; fourth: understanding; fifth: knowledge; and last and least, experience.  Without integrity, motivation is dangerous. Without motivation, capacity is impotent. Without capacity, understanding is limited. Without understanding, knowledge is meaningless. Without knowledge, experience is blind. Experience is easy to provide and quickly put to good use by people with all the other qualities.”    I’m scrubbing my job descriptions to take out experiences that one needs in favor of skills and values that align with our company.

Interview at least two candidates from under-represented groups.  Stefanie Johnson at the University of Colorado has done some amazing work to help show that if you interview 3 white men and 1 woman, it’s not enough.  The “Rooney rule” is the idea of interviewing at least one minority or under-represented candidate before making any hire. It’s a simple idea, but it’s not as effective as interviewing two. Using men and women as the example, interviewing 3 white men and 1 woman will trigger statements like “should we hire the woman?”  The one person who is different is noticeably different, and this has an effect on decision making. If there are two women, it’s no longer a choice about hiring a woman as there are multiple candidates of each gender.  Stefanie has found that having two candidates from the under-represented group meaningfully impacts the result, as compared to having one. So, the takeaway here is to consider not making a hire until you have at least two final candidates to interview from the under-represnted population.  Also, it turns out that if you interview three white men, one woman, and one African American man, the results don’t improve as much as if there were three white men, two women, and two African American men. It turns out that having two people tends to eliminate the unconscious bias of what’s “different” in the candidate pool.

Assess someone on “distance traveled” rather than “experience.”Distance traveled is the idea of how far a candidate has come and how many obstacles they’ve had to overcome.  The example that really resonated with me here was how a woman who had a great career, then had a child, and went back to the workforce successfully and had an impact has a very large “distance traveled.” They’ve basically succeeded in 3 different careers!  Or someone who has come from a challenging socioeconomic background who got into a great college and performed well may have a larger distance traveled than others with the same degree. Evaluate resumes and people based on distance traveled, not just experiences. You might just end up with more resilient and determined employees.

Extend your networks consciously. We tend to hire people that are “like us.” Our networks are full of people that are similar to us. You’ve got to show up and participate in other networks if you want to widen your talent funnel. This doesn’t just happen, you have to work on it. Think about groups that would love to hear you speak to them or participate in their events that you can engage.

Focus on inclusion early.  The larger you get, the harder it is to fix hiring practices. Focus on this early and build it into company DNA. Otherwise, the mere presence of so many people that are like each other is a deterrent to others who will feel “different” as you grow.  I realized from this discussion that Techstars is not doing enough to bring this topic up during our accelerator programs. We’re going to add some early content to help founders understand why this matters and how they can extend their natural networks, and hopefully it will have an impact. 

There were many more interesting ideas from the discussion, and I’m thankful to Andrea and the team at BeVisible for making it happen! 

Find more resources on improving diversity and inclusion at http://diversity.techstars.com/bealeader.

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A week in Australia

I’m writing this on my way back from Australia. Brad Feld and I just visited several cities on this trip to learn more about the great startup communities there. Techstars recently launched our first Techstars program in Adelaide focused on the defense industry and related applications such as robotics, security, IoT, etc. (applications are open!). It was really exciting to be able to spend quality time in Adelaide on this trip.  We met with a group of founders who were all successfully building startups there. Some were running brand new companies, some had already been acquired, and others had scaled up to $100M+ in revenue.  Not surprisingly, they all love their city (it’s a little bit bigger than Denver) and were all anxious to figure out how to help by mentoring in the Techstars program and helping us recruit more companies to come there to get started and to leverage the resources of the community. It was clear that there is great stuff going on in Adelaide and we felt incredibly welcomed. We even had a chance to sit down with the Lord Mayor (an entrepreneur himself) and the innovation minister. I can’t say enough about the job our team on the ground has done there to get this program off on the right foot. It’s going to rock! It was also fun to catch up with Voxon Photonics, a Techstars alum that relocated to Adelaide some time ago which is building holographic display technology and boy has it come a long way. I saw many similar “deep tech” companies in Adelaide and it was fun to hang with Terry Gold and Jana Matthews who are now based there doing great work in the startup community.

Photo: @iccunisa


We also spent some time in Sydney. It will probably not be a big surprise to you to know that there is already vibrant startup activity there, as well as some strong venture capital funds. We met with some of the gang at AirTree VC and learned quite a bit about some of the challenges and opportunities of investing in Australia from them. We spoke at a luncheon (thanks BDO!) and engaged with the community on the topic of how big companies interact with startups. Much of what I heard reminded me of anyplace else in the world, but it was clear that the community was actively trying to figure it out and make progress. We talked about the short and long term thinking of larger companies, and how that played in the Sydney ecosystem. And of course, we met several successful startups and investors doing some amazing stuff. 

Next, we were off to Melbourne. It’s close to the same size as Sydney at around four million people. Because it happened to have the benefit of the Australian Open (yep – we saw both Williams sisters and Federer win on one epic day), we spent a little more time there. Outside of the tennis, one group that is really on their game is Startup Victoria. What really struck me was their resolve to make Melbourne better for startups every day. And it’s paying off. We did a big public event at inspire9 which is an awesome co-working space there and learned that several startups I knew were based there or in the same building, including Rome to Rio and 99 Designs. Instead of having a fixed idea of what we’re going to talk about at events like this, it’s more fun to just react to questions and this time a good chunk of that talk was dedicated to work life balance. Brad, always the book salesman, was able to talk about a bit about Startup Life. We also talked about the natural rivalry between cities in Australia and related that back to our own experiences with Boulder (vs Denver, vs Silicon Valley, vs the world). In another event that day we hosted a more private/intimate gathering for “scale-ups” (startups that were already funded and working) and made great new friends at Square Peg Capital who hosted this. We also have them to thank for our tennis tickets to the Australian Open (ok – the trip wasn’t a total coincidence!).

Photo: @__pw__

Lunch in Melbourne hosted by PWC. Photo: @brandanyell

 

Thanks to @squarepegcap – we got see Federer and Serena and Venus win!


I hadn’t been back to Australia since my first startup company (Pinpoint Technologies) installed RescueNet in Brisbane many years ago (check out the old school images below).  I remember loving that city and meeting a few other startups there during my visit. I wondered back then how it would evolve over time. Now Brisbane and many other cities in Australia are hubs of activity and the ecosystems are really evolving nicely. It’s a pretty amazing transformation.

Queensland Ambulance Dispatch Center, running our software, circa 2000

Queensland ambulance – circa 2000

There is absolutely no way we could have managed this trip without the team at Innovation in the Wild. They and so many others are working their asses off to make Australia a great new place for startups. Gang, I have news for you – it’s working.  One of the things Brad kept talking about on this trip was how when you’re on a geometric curve, it’s hard to observe. The progress feels small. Then one day you look up and you’ve come so far. As an outside observer spending time in Australia more occasionally, I can see that curve more clearly and it’s quite steep.

With the amazing crew at Innovation in the Wild

We hope that someday soon Techstars can become a part of Australian startup culture more broadly across the country, and we’re thrilled to be getting off to a great start with this trip! We hope adding the #givefirst attitude there can help make a difference over time. If you’re in Australia or have friends there, please let them know that Techstars is off and running!

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Rethinking corporate innovation at Techstars

At Techstars, we’re building the best global ecosystem for founders to bring new technologies to market. One of the impacts that I think we’ll have long term is to change the way that corporations engage with startups. We want to help make those engagements effective and efficient for both parties. We do this in a few different ways.

First, we have an internal team of five people that focus on corporate relationships. They’re the folks who do amazing things like BizDevDay at Foundercon where there were 1500 meetings in a single day between big companies and our portfolio. They also work on M&A when necessary, and we recently completed our 100th M&A transaction out of the Techstars portfolio. They have deep relationships with most of the important large corporations in our space, and are constantly making connections to Techstars companies. From the large corporations perspective, they might think of this activity as corporate development or “corpdev.” We think of it as leveraging our scale to assist our portfolio of amazing startups.

Second, we partner with large corporations to build accelerators, like Techstars Music, Techstars Mobility, or Techstars IoT.  In working with so many large corporate partners, we’ve learned that some of them engage with these accelerators with a short term view, and some with a long term view. Let me explain.

When a corporate engages with an accelerator or with startups in , their short term view might entail them thinking about which one or two of these companies could “move the needle” for their stock, or fill some current strategic gap. They engage with the accelerator as if their job is to cherrypick. That’s all well and fine and it produces near term results in many cases, but it’s also short term thinking.

Other partners engage with a long term view. They lean in, and #givefirst which may at first feel somewhat alien to them. In this mode, the partner is thinking about how this could impact their business in 5, 10, or 20 years. They’re thinking about the startup ecosystem they are building around their own company, technology, and areas of interest. They’re trying to grow more cherries to pick later. The long term thinkers understand that current opportunities are only a small part of their role in growing an ecosystem around themselves. They lean in long term.

Startups are a long game, not a short one. As our partners actively re-think what corporate innovation means, they’re learning that it’s about both long and short term focus. They’re learning that they need corpdev programs that move the needle now, but they also need to grow the right ecosystems around themselves. And that times time, and patience. It takes good and helpful behavior around startups with a 20 year view. They are learning to be consistent in their approach to #givefirst. They are learning to leverage startups for innovation. And when they get it, when they start thinking long term in the context of startups… it’s pure magic.

 

 

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