Of course.

1. Agree on a price (the hardest part)
2. Write a check and both sign a transfer agreement to put in the company’s board of Director minutes
3. Change the company cap table and ownership name

Of course, this is not always easy, as usually the departing founder wants way more than the shares are worth today.

The more common scenario is when the other founder leaves (early, before the company has any profits or revenue often) the company issues more shares that dilute down the old founder because they should have never vested it all and the founding agreements gave shares without restrictions or vesting. Often additional shares are also granted to everyone else too so that only the founder who is leaving early is diluted. The is necessary as new investors would not like to see “Dead shares” if the company is young, that should be being used to motivate the replacement person or multiple people on the team.

Of course, if the company has...

And beat the odds that only 1 in 6,300 will reach this level of annual sales. The attached diagram shows the skills, systems and experience needed on that team. Each cell would take at least 5 years’ experience to acquire and master that skill area. So, we are looking at 100 years of experience cumulative for the company as a whole.

Most people think they are “ready to scale” as soon as they have some sales. This is never true. In fact, you need at least 4 levels of stuff in 5 business areas, or your odds of success are very low. This can be thought of as the “do, hire/train, manage, plan” levels too. And maps into individual contributor, manager, executive and CEO/board (long-term vision stuff).

It takes many years to acquire the skills needed to build a significant company. Anyone can build and run a small company with ~7 people. After that, the skills required are very different. And you need a senior team (c-suite or...

I'm reposting this image because it is great stuff. We "buy on emotion", more than logic, and remember by stories. Ten million years of evolution created our human ability to remember PERSONALITIES. Good versus bad. 

A brand is just a company personified. And a story is a collection of personalities made memorable.  

But to truly be successful and grow, or scale at 50%+ CAGR, you also need strong innovation and protect ability.  

As The Father of Management said: "A company has two jobs. Innovation and marketing". Only those that do both well will scale to $100M+ which only 1 in 6,300 companies ever achieves.  

Register for a free workshop Want to 2X, 3X or more your valuation? Join me for a free workshop on creating more Sustainable Competitive Advantage at our monthly webinar for growth companies that want to hit $10M, $100M or even $1B in sales eventually.

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I find that pitch decks to investors fail to articulate how they will maintain a market lead and build barriers to entry around their business over time, as more competitors emerge. We teach 17 ways to increase SCA at The CEO Boot Camp and in our scaling consulting work.

I would recommend adding two additional slides to the standard 10-12 most have in their decks. This will impress investors far more than some fancy graphics or massive TAM market claims. Slides to add:

1. Sustainable Competitive Advantage (SCA) - How will you evolve your barriers to entry over time. The "Moat" which can create higher PE ratios. Product roadmap and innovation? IP? Brand? Partnerships? Etc.
2. Market entry strategy, which is not the same as Go to Market strategy. This shows expanding markets, niches and the $1B market opportunity - which NO startup should ever enter initially because then they are competing with giants on day #1. A slow suicide strategy. 

These two additional slides...

A good question, and one most professionals get wrong. Even professional recruiters. Although this can depend on many factors, generally speaking the CEO does not need to come from the industry. 

The existing employees and team should bring the industry and domain expertise. If it is a raw startup with no staff, that is really a co-founder, not a “CEO hire”. And no good CEO is going to work for a founder that has little experience. Most experienced CEOs do not want to take raw startup risk, they come in later when the risk is fleshed out and scaling up is the challenge. The founder better bring large industry experience and/or management experience and a killer business plan, having completed deep market research, competitive intelligence, and other development work. A company is worth zero dollars until this is done.  

It is often better if the CEO is not buried in the industry standard belief systems, as then they can go beyond it. Any company...

The best way to destroy your credibility with investors is to say we are going to attack, and own, a multi-billion dollar market. Although this may intuitively seem to attract investors, in actuality it is a fatal mistake raising capital. Your credibility using $100B or $1 trillion markets is shot to hell. Here is why.  

No startup should be going after a market larger than $1B five years out. An ideal market niche size is between $100M and $250M. Niching down is not optional. It is basically suicide to tackle huge markets. Even better is a series of niches in a portfolio of markets shown below.

I have often done with 100% success a “Portfolio of niches” strategy for market entry. This means laying out and ranking many niches and then prioritizing them by various factors.  And it sets you up to be very agile, too. The product roadmap and target niches expand each year, as shown below. The first chart shows the long-term market potential for a horizontal product...

There are many factors, and it is too complex to offer a standard answer. You need to hire a consultant that is a CEO/Founder with lots of experience to discuss things for 1–2 hours.

One way around this is to set hourly rates for the founders and track time to allocate it according to contribution. Shares are earned with seat equity. A simple spreadsheet with monthly invoices submitted by everyone is easy to do. There are plenty of software solutions for this too, but likely best only when it gets complicated with many founders.

People and Founders are never “equal” in what they bring to the table. So, splitting 2 or 3 ways is not usually an unfair solution.

Factors to consider:

1. Relative time and contribution to sweat equity - some may do little and others may work full-time or more. That is why tracking hours and market rates works well.
2. How much capital will be needed and will Founders contribute? S
• Always separate purchased shares from “Founders...

It continues to amaze me how ANYONE is willing to vote for Donald Trump. Sure, we need to get back to more conservative values (obliterate DEI, quotas and the out of control woke nonsense like pretending transgender people are normal and educating young children that this is okay), fiscal policy and reduce government by maybe 50%, or more at all levels. Do not get me wrong, I am 100% for equality of treatment of people. Just not equal outcomes. It seems our younger generation cannot tell the difference.

Trump is clearly not very bright, is totally unethical, is a prolific criminal and will be going to jail soon too. I doubt anyone ever got indicted for over 100 felonies and got off without a jail sentence. Only corruption in the system would prevent him from getting a long sentence.

How can anyone think voting for him, instead of insisting on better candidates, is a good thing?! It means they are either ignorant of the facts (listed below which are in the news everywhere), dumb or...

Ideas are worthless. And it would be totally legal for them to steal them. Maybe you are confusing patents, copyrights and other intellectual property.

An “idea” has no legal protections. And you can be pretty sure you are not the first one to have any given idea too. And if anyone can steal a single “idea” and replicate your business, it is a very bad business. What you need is lots more including many things like a business model, target market, product/service and hundreds of ideas.

Companies need a team, plan and many protectable ideas. These are protectable intellectual property when kept as trade secrets, patents and copyrights. Almost every company should have some of these and contracts with employees to prevent them from taking them.

Investors do not sign non-competes or non-disclosures because they need to meet too many people.

Frankly, if your “idea” is all you have, you should not be talking to investors as you are...

Here is a short list, but there are many more things which come only from experience and feel interviewing. This is why it is best to have at least 15 years' professional experience before starting a company.

1. Hire the best people you can afford, using stock options to find the ones that really care about the mission and will take submarket salaries to be on the mission.
2. You need 3 key founders: Operator, visionary and sales/marketing head. All with 15 years' experience and long-term commitment. Ideally, willing to put in some cash too.
3. CEO should screen first 100+ employees personally to set the culture well. Maintain a flat organization as long as possible, often until you have 15 employees, to avoid politics and have strong communications. All startups are a learning experience and need to adjust and pivot.
4. We call the ideal culture a Darwinian Meritocracy(TM). It evolves with all inside and outside factors (agile, reorgs) and rewards results, honesty, shared values, hard work...