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12019 K. Zolot, MIT
Nuts and Bolts
24-Jan-2019
[email protected]
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2019 K. Zolot, MIT
You’re in great company
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2019 K. Zolot, MIT
Joe + Joost
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2019 K. Zolot, MIT
look around you
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52019 K. Zolot, MIT
Our distinguished guests
• Trang Luu, co-Founder of Encora, course 2 2018, MS class of
2020
• Catherine Zeng and Robert Henning, co-founders of Lambda Tea
and Applihood.com, course 6 class of 2020
• Ashvin Bashyam, co-founder of Indicator, course 6 PhD
student
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2019 K. Zolot, MIT
Teach entrepreneurship to freshmen
• Computer Scientist, coder• MIT Project Athena• Startups•
FinTech, Enterprise IT, Cybersecurity
• Berklee College of Music
My MIT journey
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72019 K. Zolot, MIT
Core ingredients
What is it? (technology)
Who cares?(customer)
Why us?(team)
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82019 K. Zolot, MIT
Drew Houston’s analogy to oil drilling
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92019 K. Zolot, MIT
Does this thing work?
Do these guys know what they’re doing?
Is there any oil down there?
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102019 K. Zolot, MIT
Drew’s analogy to oil drilling
• what kind of drill bit?(product, technology, service)
• over what oil field? (market, customer, “who cares”)
• who is operating the drill? (team and the founder’s
journey)
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2019 K. Zolot, MIT
tool #1: the mirror
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2019 K. Zolot, MIT
are you a nut or a bolt?
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132019 K. Zolot, MIT
The Founder’s Journey
Founder as protagonist, in a quest for joy and meaning
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142019 K. Zolot, MIT
Why are you doing this?
intentionsource of propulsionhigher calling
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“they will in a minute”
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On mythology and numbers
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Joseph Cambell’sHero’s Journey
(from The Hero with a Thousand Faces)
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192019 K. Zolot, MIT
some numbers...
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2019 K. Zolot, MIT
Noam WassermanUniversity of Southern California
Jorge Paulo and Susanna Lemann Chair in Entrepreneurship, and
Founding Director, Founder Central
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2019 K. Zolot, MIT
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2019 K. Zolot, MIT
CAUSES OF FAILURE IN VC-BACKED VENTURES
Courtesy of Noam Wasserman, University of Southern California,
noamwasserman.com
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Product devt. Functional mgmt.
Market probs.
35%65%
PROBLEMS
courtesy of Noam Wasserman, University of Southern California,
noamwasserman.com
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ROLESdivision of labor, titles,skills, decision making
RELATIONSHIPSfound w friends, family, strangers?
TEAM TENSIONS
REWARDSequity,salary, etc
courtesy of Noam Wasserman, University of Southern California,
noamwasserman.com
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2019 K. Zolot, MIT
0.00 0.25 0.50 0.75 1.00
0100
200300
analysis time
flagfndrfrnds = 0flagfndrfrnds = 1
Kaplan-M
eier survival estimates, by flagfndrfrnds
Founding Team Stability
0.000.25
0.500.75
1.00
0 100 200 300analysis time
flagfndrfrnds = 0 flagfndrfrnds = 1
Kaplan-Meier survival estimates, by flagfndrfrndsMore Stable
Data: Wasserman and Marx, “Split Decisions,” AOM 2008 (379 Tech
ventures, 2006 survey)
Friends
Not Friends
Venture age (# of months)
% o
f fou
ndin
g te
ams
fully
inta
ct
0.00
0.25
0.50
0.75
1.00
0 100 200 300analysis time
flagfndrfrnds = 0 flagfndrfrnds = 1
Kaplan-Meier survival estimates, by flagfndrfrnds
0 50 100
0.000.250.500.751.00
010
020
030
0an
aly
sis
tim
e
fla
gfn
drfrn
ds =
0
fla
gfn
drfrn
ds =
1
Ka
pla
n-M
eie
r s
urviv
al e
stim
ate
s, b
y fla
gfn
drfr
nds
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FamilyBest friends Acquaintances Past co-workers
Likelihood of discussing “Elephants”
Damage if relationship
blows up
courtesy of Noam Wasserman, University of Southern California,
noamwasserman.com
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2019 K. Zolot, MIT
math quiz
would you rather have:
a. 100% of $5mb. 5% of $100m
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2019 K. Zolot, MIT
WHY AM I DOING THIS?Motivations: Rich? King?
courtesy of Noam Wasserman, University of Southern California,
noamwasserman.com
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2019 K. Zolot, MIT
I'd rather found a venture worth $100m,
of which I own 5%
I'd rather found a venture worth $5m,
of which I own 100%
57%
43%
courtesy of Noam Wasserman, University of Southern California,
noamwasserman.com
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2019 K. Zolot, MIT
“RICH VS. KING”
RICH
KING
Flop
Rich & Kingcomplete
little
Low HighFINANCIAL GAINS
CON
TRO
L
courtesy of Noam Wasserman, University of Southern California,
noamwasserman.com
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FINANCIAL TRADEOFF
Wasserman, The Founder’s Dilemmas, Figure 11.3.
$0$1$2$3$4$5$6$7$8$9
$10
Kept CEOposition only
Kept Boardcontrol only
Older Company Younger Company
Shar
e of
Com
pany
Val
uatio
n ($
M)
Gave upCEO and Board
control
KeptCEO and Board
control
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2019 K. Zolot, MIT
Founding
When to Found
Building the Team
Beyond the Team
Exit Dilemmas
New-Venture Hiring
CORE DILEMMAS
Y Y Y Y Y
CORE FOUNDER
CO-FOUNDERS
INVESTORS, PARTNERS
ALL OF THE ABOVE
HIRES
courtesy of Noam Wasserman, University of Southern California,
noamwasserman.com
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2019 K. Zolot, MIT
WHICH OPTIONS ARE CONSISTENT WITH MY
MOTIVATIONS?
courtesy of Noam Wasserman, University of Southern California,
noamwasserman.com
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MOTIVATORS: AGES 20-29
1. Power & influence2. Autonomy3. Managing people4.
Financial gain
1. Security2. Prestige3. Financial gain4. Affiliation
1. Autonomy2. Power & influence3. Managing people4.
Altruism
(9. Financial gain)
1. Recognition2. Affiliation3. Security4. Lifestyle(11.
Financial gain)
Entreps.
Non-Entreps.
Men Women
Wasserman, The Founder’s Dilemmas, Ch. 2 (N=27,063, with Dr. Tim
Butler)
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352019 K. Zolot, MIT
Our distinguished guests
• Trang Luu, co-Founder of Encora, course 2 2018, MS class of
2020
• Catherine Zeng and Robert Henning, co-founders of Lambda Tea
and Applihood.com, course 6 class of 2020
• Ashvin Bashyam, co-founder of Indicator, course 6 PhD
student
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362019 K. Zolot, MIT
Discussion topics
• origin of your founding team
• culture, vibe?
• when/how do you agree or argue?
• 3 R’s - relationship- roles- rewards
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2019 K. Zolot, MIT
[q&A]
[email protected]
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