The Twenty Minute VC (20VC): Venture Capital | Startup Funding | The Pitch
00:02:54 · Harry Stebbings, S1, Nik Storonsky
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00:03:59 · Harry Stebbings, Nik Storonsky, S1
[00:03:59] S2: of the most KPI led companies. And so I just wanted to start with, how do you approach KPI based leadership, and what does that actually mean? [00:04:07] S0: Well, basically, it's the whole goal setting. Right? So we set up the goals for the company. So usually, we have five, six goals a year, and then we quantify these goals. So what does it mean to achieve certain goal? Then we cascade these goals on the department level, then on the team level, and then on individual. So every single effective team department and on the company, we have metrics describing, the performance. And then, all people go through performance review process, every quarter. Then they're judged based on the metrics that they delivered, their skills, and then, cultural values. [00:04:42] S1: In terms of the management when you get the metrics, how do you think about distributed management? I spoke to a lot of your team and you have a lot of direct reports. Yeah. How many direct reports do you have and how do you
00:04:42 · S1, Nik Storonsky
[00:04:42] S1: In terms of the management when you get the metrics, how do you think about distributed management? I spoke to a lot of your team and you have a lot of direct reports. Yeah. How many direct reports do you have and how do you [00:04:52] S0: think about distributed management? So we've got 40 plus reports. And I mean, to be honest, you are... I built a team already for the last five years. So generally because I don't really work with people who are not excellent. Another way I define, people who are excellent, strong, average, or below average is pretty simple. So they should be like a self guided missile. Right? So excellent people, they select the goal themselves, and they press the button, and they reach the goal themselves. Strong people, you need to show them the goal and they reach the goal themselves without you iterating with them. Average people, you need to, on a weekly basis, iterate to reach the goal. And then below average people, I mean, you iterate with them, but, you know, sometimes very often they don't reach the goal. So the key is to select all your direct reports, either strong or excellent, so they're able to reach the goals themselves without you kind of directing them. [00:05:44] S1: Will they be excellent on day one, and how long do you give them to get
00:05:44 · S1, Nik Storonsky, Harry Stebbings
[00:05:44] S1: Will they be excellent on day one, and how long do you give them to get [00:05:48] S0: good enough? Well, majority of people, you see them performing strong or excellent after three, four weeks, right? So they hit the ground running on week three. Majority of them, they actually are probably on week one. So generally, if you see a person who's not performing for one, two months, most likely they will not perform... Performing for for for the next year. So I don't really believe in kind of, you know, needing some time to adapt, to speed up. So if the person is not delivering within the first three months, most likely they will not. [00:06:18] S1: What are the most common ways you find them not delivering in the first three months? Like, what are the most obvious signs? [00:06:23] S0: Well, you just give them the goals. Right? And then you have some weekly or biweekly catch ups, and then they show you what they produced. And then, you just observe what they produced for two, three weeks, how small they are, how deep they go with their analysis. It's just based on what they show you. [00:06:37] S1: Do you agree with when there's doubt, there's no doubt? [00:06:39] S0: 100%. I mean, as soon as they start doubting, I mean, there's no love. [00:06:42] S2: In terms of the different people, I I love
00:06:42 · Harry Stebbings, S1, Nik Storonsky
[00:06:42] S2: In terms of the different people, I I love [00:06:44] S1: that kind of spectrum from, like, you know, excellent to strong to average. I chatted to... I mean, you were... Are you Alan Changs of the world, but so many who worked with you and have worked with you. And they said that what you look for in people has changed a lot over the years. You used to, like, not like the management consultants and the investment bankers, and now you've got a lot more professional management. How do you think about that, and is that fair? [00:07:06] S0: Other things fair, right, because I was always looking for people who can deliver. Right? So I was always execution oriented rather than talk oriented. Because if you look at all these management consultants, they come to you with a nice presentation, explain you how to get things done. Red tier is when you start hiring management consultants to help you run the company. That means your employees are not competent in what they do. Right? And for me, it's it's a bad sign. [00:07:33] S1: Can I ask, when you look back at the growth of the team in particular, what was the most painful scaling bit, and what did you learn from that?
00:07:33 · S1, Nik Storonsky, Harry Stebbings
[00:07:33] S1: Can I ask, when you look back at the growth of the team in particular, what was the most painful scaling bit, and what did you learn from that? [00:07:40] S0: I I made all the mistakes scaling team member. I think the most painful mistake was believing... Well, I I never believed it, but I was forced to believe that, you know, in order to scale the company to hire experienced professional managers. That's a dead end. I think I hired, like, you know, 55 through executive recruiters. Paid, like, you know, 2,000,000 in fees. I ended up, you know, firing 49 or 50 of them. So it's not such a waste of money. [00:08:04] S2: How did you change as [00:08:06] S1: a leader? I mean this in the nicest way. You also got a lot more friendly. [00:08:09] S0: I was always friendly. You're always friendly? Yeah. I You feel more comfortable with media? Well, yeah, probably because, you know, by now, have a lot of experience speaking on media, but I was always, you know, holding people accountable to deliver, right? You know, sometimes I was communicating more in a harsh way or sometimes, you know, in a softer way, but I was always, you know, forcing people to to deliver. [00:08:31] S1: What do you think when you look forward now you most need to work on in your own leadership style? Where are you like, I'm still not great, and I'd like