This year has presented challenges beyond the regular struggles of launching and growing a business, which is a feat all its own. However, amidst the ups and downs of 2020, it is easy to forget one of the most significant aspects of your role—keeping your investors, customers and employees in the know about what’s happening with your company. This is a critical component of stewardship, and frankly, one that founders often underestimate in importance.
As a steward, you are responsible for managing something entrusted to your care. That’s the dictionary definition. For founders, much of this boils down to ensuring company stakeholders are engaged with your business and generally aware of the situation (aka situational awareness). At my last corporate job, the CEO implemented a No Surprise Rule; he didn’t want anyone to surprise him with information, good or bad.
The secret to no surprises is over-communication. I raise the topic because consistently updating stakeholders is an easy task to push off when it seems like there are more pressing issues—it can be exhausting and time-dilutive. But it is more critical now than ever before. When new obstacles arise, you may need guidance, support, counsel, action, and funding. As you lean on your Board, for instance, with these requests they need to be operating off the same information you have. That’s the only way they can provide meaningful advice.
Stakeholder communication is not a one-and-done activity. You can’t reserve it only for when you’re raising a capital round, signing a customer contract, or during the first few weeks of a new hire. Instead, you need to proactively communicate about company performance, challenges, and needs. Be methodical about your communication cadence, from sending regular updates to ad-hoc notes and highlights regarding specific issues
As a founder you should track your interactions, much like how your sales team does. Understand with whom you have corresponded, what you have discussed, and where you need to reconnect. The concept is essential for managing not just Board members and investors, but also employees and even your first or largest customers. Bring them along with you on your startup journey, ask for their feedback, and incorporate their input. You’ll transform early adopters into strong advocates for you and your company.
As I write this, I can hear founders thinking that this sounds like a heavy lift, and at a moment when extra time is exceedingly scarce. And yes, I have made plenty of mistakes in helping too much or not providing the right advice as a Board member. However, the effort you put into proactive communication will pay back in ways you may not anticipate and in support that you may not expect. For example, a Board member may spot a gap in a plan, provide a critical connection to a new deal, or offer a game-changing piece of advice.
We learned in the military, situational awareness and alignment (vertical and horizontal) can lead to extraordinary outcomes. It takes extra work to sustain under duress, but it’s always time and energy well spent.