By Poornima Vijayashanker

About this podcast   English    United States

Build is a weekly podcast brought to you by Pivotal Tracker hosted by Poornima Vijayashanker, the founder of Femgineer.
In this show, Poornima hosts innovators in tech and together they debunk myths and misconceptions related to building tech products and companies.
April 18, 2018
We began this month with a Build episode where we exposed all the aftershocks of using current product management methodologies to estimate user stories. Then in last week’s episode, we dove into Hiten Shah’s new EAT approach which boils down to doing hourly estimates.   Don’t worry if you thought Hiten was crazy, you aren’t alone!   We received a lot of questions, concerns, and objections, so in today’s episode we’re going to dive into the top 3 we heard again and again:   Objection #1: My team is still healing from our previous approach.   “My team adopted agile five years ago and experienced a number of problems that you talked about in the first episode. So, six months ago we took the plunge and decided on no estimates and, of course you can imagine, we're still recovering from it. The wounds are raw. So, how am I going to get my team to try something new especially since this is going to be another investment in terms of time?" — Product Manager from Palo Alto   Objection #2: This won’t for our customers who want quick fixes!   “I hate to play the blame game, but a big source of our problems is our customers. Many want quick fixes, so we end up at their mercy and boy, do they hate eating their vegetables. How do I get them to come around?" — New Product Manager from NYC   Objection #3: My team is eager to adopt a new process but how will this help them follow through?   "Hiten and Poornima, thanks again for this series. Unlike some of your other audience members, I have the opposite problem. My teammates are eager to adopt a new process, but when they hit a snag they are quick to punt and just do whatever they think they need to do to get the job done. What is the one thing you would advise them to have them stick through when implementing the process and practice of hourly estimates?" — Team Lead from Tulsa   Do any of these sound familiar?   Listen to the episode to hear Hiten's response to each! -- Build is produced as a partnership between Femgineer and Pivotal Tracker. San Francisco video production by StartMotionMEDIA.   Check out these additional resources on estimating stories for your product: Product Habits Why It’s Easier For Product Teams To Cram Features & Bugs Into Each Release Instead of Cutting Back Tech Debt: The Cost of Putting “Quick Fixes” Into Our Software Product Product Debt: What Is Product Debt And Why You Need To Prioritize Paying It Down How Long Does It Take To Get A Startup Company Off The Ground How Much Time And Money It’s Going To Take To Productize Your Idea My Nightmares With Engineering Estimates Story Points, T-shirt Sizing and Time Buckets: How Tech Companies Do Engineering Estimates Deadline That Are Doomed From The Beginning No One Likes A Creep   ## Why Hourly Estimates For User Stories And Technical Tasks May Seem Crazy But You Need To Do Them Anyway Transcript   Poornima Vijayashanker:    Hiten, last week we instigated our audience by telling them your EAT approach on how they're going to get rid of their old methods and instead embrace doing hourly estimates. A lot of them have written in with their questions, their concerns, one even said you're totally crazy. I hope you're ready to deal with this pushback and address our audience's concerns.   Hiten Shah:         Yeah, it's not the first time I've been called crazy. It's because I just want everyone to do better. I've heard everything from “there's no way I'm going to be able to get my team to do this, there's no way I can use this approach,” all the way to, “the approach I'm using today, whatever it is, works just fine.” Yet, those same people say they can't ship on time. Also, “we just can't estimate accurately, we've tried it before, and it's impossible.” I've heard everything.   Poornima Vijayashanker:    Awesome. I hope you're ready. Let's just dive right into it.   Hiten Shah:         Let's do it.   Poornima Vijayashanker:  Welcome to *Build*, brought to you by Pivotal Tracker. I'm your host, Poornima Vijayashanker. In each episode of *Build*, innovators and I debunk a number of myths and misconceptions related to building products, companies, and your career in tech.   Hourly Engineering Estimates Is Crazy                    Over the last couple episodes, we've been talking about estimates, and you'll recall in the last episode we unveiled the EAT method and talked about how this is all about hourly estimates. I'm sure, for those of you out there, you were thinking, "This is crazy, people will never adopt this on my team." In today's episode, we're going to address a number of these concerns. To help us out, I have invited back Hiten Shah who is the founder of multiple products, and his most recent project is called Product Habits.                    Hiten, we put out your EAT approach, your EAT method, and we got a lot of feedback. I want to start by throwing some questions out there from our audience and, hopefully, you'll be able to answer them.   Hiten Shah:         Rock and roll.   Adopting A New Product Management Process Is A Big Investment For A Modern Software Team   Poornima Vijayashanker:    Awesome. Here's the first question, this is from a product manager and they wrote in saying, "Hiten, my team adopted agile five years ago and experienced a number of problems that you talked about in the first episode. So, six months ago we took the plunge and decided on no estimates and, of course you can imagine, we're still recovering from it. The wounds are raw. So, how am I going to get my team to try something new especially since this is going to be another investment in terms of time?" What are your thoughts?   Hiten Shah:         Every time you do a process improvement and it involves product people and engineers, they do like process; if they don't then they're probably working at a really early stage startup and spending a lot of time just probably working 18 hours a day just coding and things like that. That's a whole different story, but in this case it sounds like a larger organization to some extent and a bigger team. In those teams, the best advice I have is don't think it's going to take time. I'm not saying you rush into anything or anything like that, but you can start with the E part of the EAT method and really focus in on understanding how to have your team as engineers and the product team learn to explore and learn to really figure out what the communication differences are between the teams. That technical research outline really helps you do that.                    If you were to implement one piece, start at the top and start with creating that technical outline on the next project you do. This isn't a whole big process improvement, system changes, and take everybody and regroup them, and all this stuff—   Explore: Before You Do Product Estimates Do Your Technical Research   Poornima Vijayashanker:    Call in change management.   Hiten Shah:         Yeah, none of that. No, we don't like that. I don't like that. Anything I suggest wouldn't fall in line with that. Can you just start with starting with the explore aspect of it? Then, playing it out on the next initiative you're going to do, however small or large you think it is? You'll already start seeing improvements.                    Again, seen that happen, heard this objection. Part of it is because of exactly what the person was saying, "I've done this before. It didn't work. The thing we went to is still causing us all these problems, hence why we started with the problems and most of the states people are in." I kept hearing that over and over again. The simple solution is start with this one document and create, what I call, a technical research outline, and use that to communicate with engineers.                    The two main components—again just to repeat this—are the evidence, the reasoning, the customer feedback, anything you have there as to why you're building it so that your engineers and rest of the product team can get close to the customer. My favorite part still is the open questions because you're going to have questions about what you're building that might've never previously been answered in your process. Just that and then having communications while engineering solves this problem, but don't think it's going to take forever.   Customers Want Quick Fixes   Poornima Vijayashanker:    The next question is, "Hiten, I hate to play the blame game, but a big source of our problems is our customers. Many want quick fixes, so we end up at their mercy and boy, do they hate eating their vegetables. How do I get them to come around?"   Hiten Shah:         The good news is you're not asking the customers to eat any vegetable. You want to create that dessert for them, if you want to put it that way, but what you're looking to do is get your team to eat their vegetables. What I would suggest is that you take away this idea that you're ruled by your customers in terms of you have to do what they say and instead start taking a bunch of the items that they're giving you and start going through the whole EAT method process and getting actual estimates because then you'll actually be aligned with them. What they want to see is that you're improving the product based on what their needs are. What you want to do want to do is improve the product based on their needs.   Tell Your Customers What You Can And Can’t Deliver On                    Just by applying the method itself on a high level and starting to go through the process with your team, you can go all the way to the explore aspect and the adjust aspect and you don't have to get to task yet as long as you can have an idea of comparing one thing they want versus another. Then, you can apply the idea that, "Well, we now have an idea that this thing we can do for them is going to take a week, this other thing is going to take a few days," which is probably a process you're not going through right now. Then, you can pick based on that.                    Usually, I pick the thing that's going to happen quickest most of the time just to get all those knocked out and keep customers happy. Over time, you would create a balance of both types of things.   Poornima Vijayashanker:    I'm sensing from this audience person that they probably have some customers that expect things done right away. Maybe like in the next day, week, or month, they have some deadline in their head that they want the team to meet.   You’re Probably Not Delivering A Product Fast Enough For Customer Right Now   Hiten Shah:         This whole process you can add criteria, such as “our goal is to release this by this date,” and then the discussions happen. The whole idea of the process is that you can start setting certain criteria and, to me, what I've done before is put that as an open question. This is the most important thing customers want and we'd like to deliver it within, whatever the criteria is. Then, you get to have the discussions with engineering.                    Here's the funny thing: even though a customer might have demanded it that fast, that doesn't mean today you're delivering it fast enough for them anyway. This is the most common thing. It's like if you have a faulty process or a process that's not delivering it; it's a circular kind of logic. For me, it's being deliberate and actually getting the estimates will help you get to a place where you can deliver something at the speed that your customers want it. Usually, the customers want the communication and they want accuracy just like you want more than they actually care that it's going to be delivered when they want it. If you tell them, "Hey, we can't do it in a day, but we guarantee it'll be done in three," and you get it done in two or you get it done in three they're happy.   How To Get Your Team To Follow Through On Providing Hourly Estimates For User Stories   Poornima Vijayashanker:    Last question for you, "Hiten and Poornima, thanks again for this series. Unlike some of your other audience members, I have the opposite problem. My teammates are eager to adopt a new process, but when they hit a snag they are quick to punt and just do whatever they think they need to do to get the job done. What is the one thing you would advise them to have them stick through when implementing the process and practice of hourly estimates?"   Hiten Shah:         This is great. It's great to have a team that's motivated to try new things. The best thing you can do for a team like that is give them the outlet to communicate at every step about how the process is working because then you can remind them that we're convicted, we need a better process. We're convicted that we want hourly engineering estimates on things, and so we are going to keep doing this process until it works. Thus we're going to include feedback from you, the people who are doing it into the process, and we're going to make improvements over time.                    A technical research outline is created, let's say, and then the engineers work on it, and before you move on to the next step of the EAT method of adjusting, you would take a quick five minutes and let everyone give feedback on the outline itself. Was it effective? Did we miss anything? Are there things that we could've done better? Questions like that.   Collect Feedback From Your Engineering Team                    I think, for me, if you're running a team, your job is to get feedback from them. Even with any kind of process that you want to change or improve, you want to sit there and say, "OK, how can I make sure that the team is aligned on it?" This is what I would call an alignment tool across the board, so that you're getting their inputs as well, and they don't have this fear or this reason to fall back to old practices that screw up the whole process.   Poornima Vijayashanker:    That is the discipline, the getting the feedback and doing the adaptations as you go through.   Hiten Shah:         You can't improve without feedback.   Poornima Vijayashanker:    Yeah, got it. Thank you so much for taking the time to address a number of these concerns and objections that our audience has, Hiten. Any final words for our audience?   Hiten Shah:         Yeah, absolutely. I'm super happy that all of you have watched this. This specific subject was the most controversial subject I've written about, ever in my life. I write about these things on my newsletter, Product Habits, you can sign up at, and I'll be talking more about things like this that are there to help you out all in emails though, no videos, so thank you for having me on video.   Poornima Vijayashanker:    You're welcome. We'll be sure to share the link to Product Habits with our audience.   Hiten Shah:         Thank you.   Poornima Vijayashanker:    That's it for this series and today's episode of *Build*. Be sure to share it with your teammates, your boss, and be sure to subscribe to our YouTube channel to receive the next episode of *Build*. Ciao for now.                    This episode of *Build* is brought to you by our sponsor, Pivotal Tracker.  
April 10, 2018
I don’t know about you but I HATE kale… That stupid leafy green vegetable with the ANDI score of 1000. It’s really hard to chew, and any time I see it on a menu, I skip it! But I get there are a lot of kale converts who go around saying, “Eat your veggies, especially kale!”   OK, I know what you’re thinking, “What does this have to do with building software products and product estimates?”   Everything.   Just like we have to buckle down and eat our veggies (including kale) to stay healthy, there are a number of things we need to do in order to have accurate estimates that will ensure shipping a product consistently.   In the last episode of Build, we mentioned how a number of the current approach fall short. If you were left wondering what to do next, don’t fret, because in, today’s episode, Hiten Shah is back. He’ll be introducing a new approach to coming up with product estimates, and it’s coincidentally called the EAT method.   As you watch the episode you’ll learn:   How to perform each step of the EAT method — Explore, Adjust, and Task What you CANNOT do with this approach How this approach reduces ambiguity, which is the #1 cause of delays and scope creep OK I know what you’re thinking… “Ugh not another approach!” OR, “This is never gonna fly at my company!”   Well that’s why after you’ve watched the episode, we want you to let us know what your concerns are tweet to us: @poornima @hnshah. We’ll be addressing a number of them in next week’s episode! -- Build is produced as a partnership between Femgineer and Pivotal Tracker. San Francisco video production by StartMotionMEDIA. -- Check out these additional resources on estimating stories for your product:   Product Habits Why It’s Easier For Product Teams To Cram Features & Bugs Into Each Release Instead of Cutting Back Tech Debt: The Cost of Putting “Quick Fixes” Into Our Software Product Product Debt: What Is Product Debt And Why You Need To Prioritize Paying It Down How Long Does It Take To Get A Startup Company Off The Ground How Much Time And Money It’s Going To Take To Productize Your Idea My Nightmares With Engineering Estimates Story Points, T-shirt Sizing and Time Buckets: How Tech Companies Do Engineering Estimates Deadline That Are Doomed From The Beginning No One Likes A Creep   ## What We Need To Do To Produce An "Accurate" Ship Date For Our Product   Poornima Vijayashanker:        In the last episode of *Build*, we explored a number of approaches to estimating work, and shared some of the shortfalls when it comes to over-, under-, or just not estimating altogether. If you missed the episode, I've included a link to it below. In today's episode, we're going to suggest an altered approach to estimating that you can adopt and adapt for your team, so stay tuned.                     Welcome to *Build*, brought to you by Pivotal Tracker. I'm your host, Poornima Vijayshanker. In each episode of *Build*, innovators and I debunk a number of myths and misconceptions related to building products, companies, and your career in tech. Now one of the most elusive processes is coming up with estimates for a project or for a task. You'll remember in the last episode, we shared some of the shortfalls of the current approaches. In today's episode, we're going to suggest an alternate approach that you can adopt and adapt to fit your team and your product's needs.                     To help us out in today's episode, Hiten Shah is back. You'll recall he has built a number of products. His most recent project is called Product Habits. Thanks for joining us again, Hiten.   Hiten Shah:         Happy to be here.   Poornima Vijayashanker:        Yeah, so let's go ahead and dive right in. I know we talked about a number of approaches last time, but I'm curious to hear what's your approach for estimates?   Estimating User Stories Is Like Eating Your Veggies   Hiten Shah:         Well first, I have to say it's like eating your veggies.   Poornima Vijayashanker:        OK.   Hiten Shah:         With veggies, everyone knows they should eat them.   Poornima Vijayashanker:        Right.   Hiten Shah:         Many of us are not very good at eating them. We all know the reasons why. It's for health reasons and to prevent certain diseases and things like that. To me, the idea of getting accurate estimates is exactly like that. Nobody really wants to do it, but everyone knows they need to.   Poornima Vijayashanker:        Well some of us need to buckle down and eat our veggies.   What You CANNOT Do With Hiten Shah’s EAT Method   Hiten Shah:         Yeah, of course, but first let me talk about what you can't do with this approach that I'm going to share because what you can't do sometimes is more important than what you can do.   Poornima Vijayashanker:        Sure.   Hiten Shah:         What typically happens is that you have no estimates, or you have agile with points, or you have some kind of waterfall process, or you have some kind of build, measure, learn, lean startup process going on. If you're not actually doing accurate estimates, you end up running into all these issues. My method will make it so that you don't have to run into these issues. The issues are more issues of what I would call interpersonal communications between team members and teams. They involve things like, believe it or not I've seen this, engineers getting yelled at for not doing their job, so to speak, which would be actually creating the software.                     Another example would be we end up sort of like scapegoating and saying that it's this person's fault, or that person's fault, or this team's fault. You can't do that with your engineers if you take this approach. I think partially most importantly of all, if you're actually able to be deliberate and take the approach I'm going to share, you're just going to make it so that you don't have this lack of clarity across the board. I think that's the most important thing. When there's a level of ambiguity on a team about what's going to happen, when it's going to happen, all that kind of stuff, it leads to all these problems of culture, leadership, management. So you're actually preventing a ton of problems if you can do this method.   Poornima Vijayashanker:        OK, so what's the approach?   EAT (Explore, Adjust, and Task) Method For Providing Hourly Estimates   Hiten Shah:         Yeah, so the approach is called the EAT method. The whole idea behind it is to do this three step process. It's an acronym for each of the three steps. The first step is explore, second step is adjust, and third step is task. The thing is, the whole goal behind it, is to get 100% accurate estimates. That means that you're down to 15 minute blocks, or hourly blocks, of estimates from engineers.   Poornima Vijayashanker:        Wow, so people who normally can't estimate are suddenly going to be able to give you an hourly estimate of how long something is going to take?   Hiten Shah:         Yeah, it's like magic.   Poornima Vijayashanker:        Yeah, it sounds like that.   Hiten Shah:         Like eating your veggies over your lifetime right, and being a healthy person.   Poornima Vijayashanker:        Yeah, I think you're going to have a dive in a little deeper.   Explore: Do Technical Research To Uncover What It’s Going To Take To Build A Software Product   Hiten Shah:         OK, sure. The first step is explore. In that step, there's one sort of piece of that step that's most important. What I named it is technical research. The reason for that is product people are used to doing user research, they're used to doing customer research, and so research is a word that they're used to, and it's something that the nonengineers start. What that involves is creating essentially a technical research outline. There's many different ways you can do it, but a high level of it is you're explaining exactly what you want to build, and you're also including the reasons you want to build it. Majority of time, depending on your organization, the reason you want to build something should be because there's a customer need, customer paying, or a business problem you're trying to solve, or a combination of both. Then from there you're actually going all the way down to if you have mock-ups, if you have any kind of sketches, you're putting it together.                     Then my favorite part of it is when at the bottom you would write this whole idea, or this section, called open questions. These are questions you might have. You can already kind of figure out, you might have already figured out some of the things that might be tough or not tough. Then what you're doing is you're not just keeping that to yourself, you're not just keeping that on your team with your close folks who helped you write it, you're actually providing that to your engineers before they build anything, and before they even think too much about the problem ideally. That's their opportunity to evaluate it. So, that's the first step.   Poornima Vijayashanker:        OK.   Adjust: List Out Open Questions That Need To Be Answered   Hiten Shah:         Then the second step, which is sort of the adjust period, involves after they've taken a look at it, made comments, often times they add their own open questions because they have questions for you too, and so it's just a way to get this communication very deliberate instead of making it all happen in conversations that are either not recorded or just not setup in a way where people can look back at it. From the commenting and the open questions, you're able to adjust what you're going to build. This is the critical piece because if that middle piece of adjusting doesn't happen, that's where estimates completely fall down and that's where you run into all the problems we mentioned earlier in the previous episode about scope creep, and padding. All these things are a result of actually not communicating, and not adjusting what you want to build based on what the engineers tell you is going to be difficult, hard, easy hopefully.                     A lot of times even the most seasoned product person and the most seasoned engineers don't generally have an idea of what's easy or hard, what's going to hypothetically take a long time or not, without actually diving into the details. This gets everyone on the same page about that. After that process, sometimes it takes multiple back and forth to get a really good document that outlines a technical research, ideally anyone on the engineering team that could work on this is able to take that and start tasking it. Actually it's engineering tasks in sort of your task management tool, or whatever the tool engineers are using, Pivotal Tracker for example. Then instead of putting points, that's the time when engineers are able to put in minutes and hours. I like 15-minute chunks is what I've found to be most valuable for my teams as part of this process.   Iterate As You Go Along To Avoid Misconceptions And Miscommunications                     This is one of the things that's more of like what we would call a process improvement. When you do process improvement, it takes iterations to get it right. But what I've noticed is when the teams are deliberate and the product people really bought in to sort of wanting to do better and same with the engineers, this process completely reduces all that ambiguity and misconceptions, and miscommunications that happen when people are just assuming things about what to build and how long things are going to take. By then, the engineers are very comfortable providing very detailed estimate on tasks.   Poornima Vijayashanker:        This is pretty novel, and I know that if I'm hearing this for the first time, I sure as heck am going to be opposed to it because I'm thinking I've got to get my whole team to buy in, there's new things I've got to do, all this technical research. I'm not sure I'm going to adopt this in the next week or even month. I think I'm going to have to slowly unveil it. I think our audience is going to have a lot of concerns for the two of us, but I think we should just stop right here.   Hiten Shah:         Yeah, I have good news. I've heard it all before, so I'd love to hear it from them.   Tell Us Your Concerns Or Objections To EAT Method   Poornima Vijayashanker:        Awesome. Well, Hiten and I now want to know what are your concerns with the EAT approach and doing estimates in this 15-minute interval with overall hourly estimates. Let us know what they are in the comments below. That's it for this week's episode. Be sure to subscribe at our YouTube channel to receive next week's episode, where we're going to dive into these concerns and hopefully address a lot of the objections that you're going to get from your teammates and your boss. Ciao for now.                     This episode of *Build* is brought to you by our sponsor, Pivotal Tracker.
April 3, 2018
What’s probably the MOST popular and frustrating question you’ve come across when building a product: “How long do you think it will take to do task X?”   It’s frustrating on so many levels…   First, we need to produce an “accurate” estimate. If it’s off, there goes our ship date!   Next, we need to give a response that seems “realistic”, i.e. is going to meet the expectations or deadlines set by someone else.   Third, we need to be a fortune teller and anticipate things that come up in the course of completing task X.   Finally, we have to do it the moment we’re asked because we’re expected to know how long any task will take.   I don’t know about you, but despite building and launching a number of software products over the past 14 years, I still struggle with estimating how long a task will take to complete.   There are a number of approaches and methodologies that have sprung up over the years such as Waterfall, Agile and Lean whose goal is to provide a framework that helps engineers, designers, and product managers to estimate how long something will take to build and ship. However, as you’ve probably experienced, each one of these misses the mark.   In today’s episode we’ll dive into the aftershocks you may experience when it comes to following one of these approaches and providing product estimates.   Next week we’ll tackle an alternate approach that may seem too good to be true…   To help us out, I’ve invited Hiten Shah, who is the founder of a number of software products such as Crazy Egg, Kissmetrics, and his most recent project is called Product Habits.   As you listen to the episode you’ll learn the following:   Why we suck at estimating even if we’ve been doing it for a while Why we’re surprised each time our product estimates miss the mark What happens if we decide to “pad” our estimates What happens when we get rid of estimating altogether Why a task we think a task is 80% complete but really it’s more like 50% complete Check out these additional resources on estimating stories for your product: Product Habits Why It’s Easier For Product Teams To Cram Features & Bugs Into Each Release Instead of Cutting Back Tech Debt: The Cost of Putting “Quick Fixes” Into Our Software Product Product Debt: What Is Product Debt And Why You Need To Prioritize Paying It Down How Long Does It Take To Get A Startup Company Off The Ground How Much Time And Money It’s Going To Take To Productize Your Idea My Nightmares With Engineering Estimates Story Points, T-shirt Sizing and Time Buckets: How Tech Companies Do Engineering Estimates Deadline That Are Doomed From The Beginning No One Likes A Creep -- Build is produced as a partnership between Femgineer and Pivotal Tracker. San Francisco video production by StartMotionMEDIA. -- ## Why It’s Hard to Provide Accurate Product Estimates Under Most Popular Product Management Methodologies Transcript   Poornima Vijayashanker:        Welcome to *Build*, brought to you by Pivotal Tracker. I'm your host, Poornima Vijayashanker. In each episode of *Build*, innovators and I debunk a number of myths and misconceptions related to building products, companies, and your career in tech. One of the most elusive processes has to be estimating how long a project or a task is going to take. And no matter how many times we do it, we somehow just always miss the mark because things come up. Well, in today's episode, we're going to share some of the aftershocks you may experience despite what approach you take when it comes to estimating. In a future episode, we'll dive into an alternate approach in how your team can adopt and adapt it to fit your needs.                     To help us out in this episode, I've invited Hiten Shah, who is a founder of many products. His most recent project is called Product Habits. Thanks for joining us today, Hiten.   Hiten Shah:           Thanks for having me. Happy to be here.   What Happens When We Don’t Accurately Estimate Stories Or Tasks   Poornima Vijayashanker:        Yeah. You and I have been building products for a number of years. We've built a lot of different ones. And I know myself being an engineer and a product owner, no matter how many years I put in, I just constantly miss the mark no matter what. I either end up underestimating or overestimating. Let's dive right in and talk about what are some of the problems that happen when we don't accurately estimate.   Hiten Shah:           Yeah. I think, when we're building products, we don't generally think about how long it's going to take to build them even though we pretend we do. We end up creating a road map with a bunch of timelines and we don't actually talk amongst the team, because, usually, a product can't be built by a single person. If it could have been built by a single person, then you don't have to worry about it as much because that single person has all the answers. One thing that ends up happening is you end up having surprises that come up that you didn't think of. You're thinking about using a certain technology, let's say such as Twilio or SendGrid or an API and the engineer has never used it before. They get in the weeds of it and they realize it's going to take longer than they think. And then your estimate is blown up and you're off. That's a very common problem.   What Causes Scope Creep In Product Management                     There's a few others, too. One other one that I've seen people hit continuously is this idea of scope creep. We're both product people. You happen to be an engineer. I happen to be more a marketer. But we love product and building them and teaching other people how to do it, too. One of the aspects of that is we might still be learning and doing research as the product is being built, and we all of a sudden have this great idea we want to add. We go in and kind of blow up the whole process and expect that the timeline is not going to change or don't even think about the timeline and say, "Hey, we're going to build this new thing on top of the thing we're doing." Or, "Can you add this little tweak?" And not realizing how disruptive that is to the process of building the product itself.   What Happens When Communication On A Modern Software Team Breaks Down                     Another thing that's very common is that if you aren't communicating very well with your team, especially the engineers when you decide that you're going to build something, what ends up happening is the best thing that they can do if you haven't spent enough time communicating early and often is they end up padding. They end up actually adding a whole day—or worse yet—a week or months to a rough estimate. We call it a rough estimate because it's rough.                     Those are some of the more kind of common problems that come up when you're building something and trying to get estimates and actually think you have the right great estimates, which is the most common thing. And then all of a sudden all these things happen that you are probably are not conscious to about what kind of problems they cause in terms of being able to ship something on time.   Poornima Vijayashanker:        Right. I think two other things I'm curious to hear your take on are large tasks. How do you actually divide them up and then the follow through? You think you're 80% way there and then you discover actually you just finished 50%.   What Causes Scope Creep? Large Tasks That Aren’t Broken Down.   Hiten Shah:           Yeah. I see companies creating, even in my own companies, so much work that is not actually broken down enough. You might think that it's easy to add a button somewhere, so you say, "OK. This is a button." You think it's a small task. Maybe you're not the engineer, because often times you're the product person, or even if you are the engineer. Then the engineer, whether you decided to do it as an engineer or the product person, you get into the task and all of a sudden you're like, "I have to add the button." There's all these other things that need to change whether it's the user interface, or you're missing a certain component, or what that button does is more complicated than you thought. What ends up happening is this seemingly small task is actually a large task. It's usually because you haven't thought through all the things that you need to think through when you add something like that. And I'm talking about a button. Imagine a whole feature. Right? And considering that to be a small task when it really turns into a large one. I think the most common thing I see is that these things you consider small are actually large.   What Causes Scope Creep? Thinking That Tasks Are ‘Simple’ Or ‘Small’                     Another common thing is not realizing that what you're asking for is actually a large task. Right. Like adding a messaging feature or things like that. Even a lot of times, I've had emails come in to me from people who are customers saying, "You can send me SMS as notifications. It will take one hour using Twilio, another two hours through your database and you're done."   Poornima Vijayashanker:        Great. Come on down and write it for us.   Hiten Shah:           You want to do it for me? I'll hold you to the three hours, because it's never as long as people say it is.   Poornima Vijayashanker:        Yeah. There's a lot of different approaches we also like to take when it does come to estimating. Even though we know all these problems, we still continue to take an approach. Right? Let's dive into the approaches.   Well-Intentioned Product Methodologies: Waterfall, Agile, and Lean Startup   Hiten Shah:           Yeah. I think one of the most common approaches that is very still operated by in a lot companies is what we call waterfall, which is one task happens after another task, after another task. A lot of times people are waiting on these things. This is actually the reason another process was invented called agile, which I know both of us are familiar with. Where you're essentially—the way I would describe it is you're trying to do things much more efficiently by basically having more regular meetings and having, I guess, smaller batches of work. What ends up happening there is you create this sort of system that works almost on a weekly basis at best. It means that you have a cadence of following up on all the tasks, we call it agile because you're supposed to be more agile with it and it's more nimble than waterfall and that's completely true, but you lose a lot in the process. Those are the two common ways that I'm most familiar with.                     Then there's a third way, which I think is more inspired by things like *Lean Startup*, which again I like to say that we both probably grew up with that so to speak, around us. That's where you are even more hyper—I would call that more hyper agile than anything else, where you're adding in the component of much more customer feedback in the process, because agile wasn't necessarily invented at a time when customer feedback was a popular thing.   Poornima Vijayashanker:        Right. What are some of the painful after effects of using agile?   How To Estimate Stories In Agile   Hiten Shah:           What ends up happening with agile—one of my favorites, and there's a lot of tools out there that facilitate this—is the idea of adding points to an agile process. What you end up doing is you're officiating time. You're saying that something that would take one to three hours is like one point. Or something that would take three to six hours is two points or three points. And they have all these things like Fibonacci sequences. There's a lot of fanciness around points, when you're really trying to understand time not points. The reason that points exist is because—and not that I think this is necessarily bad, it's better than other methods—but some engineers decided that they wanted a metric that wasn't time.   Poornima Vijayashanker:        Right.   Hiten Shah:           They literally said, "It can't be time, because we cannot estimate."   Poornima Vijayashanker:        Because they basically didn't want somebody to know that something was going to take only 15 minutes or five hours.   Hiten Shah:           Exactly. Your minimum there is an hour at best. Often times it's much more. The thing is every team that I've seen implement agile with points in different ways. Their whole buckets around the number of points something takes is all different. What ends up happening is that engineers now feel great because they have a velocity score. And they can talk about how many more points they're doing every week or how many points they're doing every week as a total. And that's really hiding what I would call the truth, which is how long did something actually take.   Poornima Vijayashanker:        Yeah. I know one of the alternatives is to just get rid of estimates all together, but you've probably experienced what that's like. Talk about what results when you get rid of estimates.   What Happens When You Get Rid of Estimating Stories   Hiten Shah:           Sure. If you get tired of agile for whatever reason—and usually this happens because somebody that's a non-engineer is really not into it, because they don't understand what a point is even though it has timings and stuff. Then estimates are completely removed, which means points are removed and then there's just tasks. Then you run into some of the problems from earlier. Is it a small task? Is it a big task ? What it really boils down to...if you have no ability to understand how long something’s going to take or even how many points, let's say, then you end up not knowing how to prioritize what you work on. If there's just 10 tasks and all of a sudden the engineer's working on one and then you ask the engineer, "Oh. How are you doing?" They're like, "Oh, it's going to take another week." Well, if I had known that task you took was going to take another week or two weeks or whatever, I probably would have told you to work on something different because our customers are waiting for things. Right.                     And that tends to be one of the bigger problems that happens, which is this communication breakdown because nothing is estimated, whether it's points or hours or whatever way people want to do it. And you end up having a massive communication issue and then you have these fiefdoms that get created. You have engineering not against, but against product, against sales, against marketing. And everyone's just waiting for product, everyone's just waiting for things to ship so you can make customers happy.   What Happens When You Pad Your Estimates   Poornima Vijayashanker:        Right. One of the alternatives to both these is to create a buffer. Let's pad the system so that as an engineer I don't look bad and as a product person you feel like, oh, OK, there's some wiggle room. But we know that that has its shortfalls. Let's talk about those.   Hiten Shah:           Yeah. Of course. I think padding is probably one of the worst practices, and you might as well have no estimate or no points or anything like that, because you're essentially saying that whatever estimate I give you, I don't know. I don't know. I'm going to pad it. Then you get in this padding mentality and then you still end up with the same problem that you actually didn't have a real estimate, and things are such a moving target that you failed to ship, you failed to actually do proper planning. You end up having a business where you're actually not getting the product you need in your customers’ hands fast enough so you can actually grow the business. I think padding leads to a whole different set of issues, because what ends up happening in the worst way I can say to you—and I've already said it in pretty aggressive ways—is that everyone's lying to everyone else. That doesn't help with prioritization or getting anything done either.   Poornima Vijayashanker:        Well, thank you for taking the time today to share the shortfalls of these three approaches. I can't wait til next time when you unveil your approach for estimates.   Hiten Shah:           Yeah. Can't help but share solutions with problems.   Poornima Vijayashanker:        Thank you.   How Do You Estimate Stories And Tasks?                     Now, Hiten and I want to know, have you tried one of these three approaches and how have they fell short for you? Let us know in the comments below. And that's it for this week's episode. Be sure to subscribe to our YouTube channel to receive the next episode where Hiten is going to dive into his approach for doing estimates. Ciao for now.                     This episode of *Build* is brought to you by our sponsor, Pivotal Tracker.
March 12, 2018
We’re probably all aware of the famous proverb: “The road to hell is paved with good intentions.”   I think it’s very apropos when it comes to diversity and inclusion efforts. Too many of us think that having a diversity and inclusion initiative within our company will produce the change we want to see in the world.   Yes, it’s a necessary step, but sadly many initiatives and programs have failed to get off the ground and make a mark.   Why?   The first culprit is stopping at intentions and not really thinking through what is needed in terms of budget, resources, and timing.   The second culprit is not being realistic about expectations. Really asking the question what do you expect to see at the end of a year from a program and is that achievable?   Just like we build a business case around running an experience when it comes to our product, process, or policies, the same rigor needs to be applied to diversity and inclusion initiatives.   In today’s Build episode, Melinda Epler and Wayne Sutton, who are the founders of Change Catalyst and Tech Inclusion are back.   We’re going to talk about best practices and what to look for if you are interested in starting a program at your company or participating in one outside.   So if you’re thinking about starting an employee resource group or another program, or want to know how you can improve an existing program, you’ll want to watch this episode to learn:   Why it’s important to start with a business case — just like you would for any product, process or policy change in a company Why you can’t expect immediate results, but it’s OK to celebrate incremental progress What to do when people within your organization say no to your proposal The microchanges you can into practice daily as you lead and work with teams Build is produced as a partnership between Femgineer ( and Pivotal Tracker ( San Francisco video production by StartMotionMEDIA ( --  ## Diversity and Inclusion: Why You Need To Rethink Your Approach to Diversity And Inclusion Transcript   Poornima Vijayashanker:        In the last episode of *Build*, we talked about how diversity and inclusion initiatives are impacting tech, and how to navigate conversations with teammates and peers. If you missed that episode, I've included a link to it below. In today's episode, we're going to dive a little bit deeper and talk about some of the best practices that you can use to kickstart a diversity and inclusion effort at your company, or if you want to go and contribute somewhere else, what to look out for, so stay tuned.   Welcome to *Build*, brought to you by Pivotal Tracker. I'm your host, Poornima Vijayashanker. In each episode of *Build*, innovators and I debunk a number of myths and misconceptions related to building products, companies, and your career in tech.   We're continuing our conversation with Melinda Epler and Wayne Sutton, who are the founders of Change Catalyst and Tech Inclusion. In today's episode, we're going to dive a little bit deeper into some of the best practices that you can use to kickstart a diversity and inclusion effort in your organization, as well as get others to help you out. Wayne and Melinda, thanks for coming back on the show.   Melinda Epler:      Absolutely.   How To Measure Success For Diversity And Inclusion Initiatives   Poornima Vijayashanker:        Before we jump into the best practices, I want to just remind our viewers and our listeners out there how can we measure success before we start to pursue any sort of tech practice?   Melinda Epler:      It gets to our number one—the most important thing to start with is measuring where you are now, really benchmarking where you are now in terms of diversity and inclusion. That means doing—if it hasn't been done already—looking at the demographics from race, ethnicity, gender, sexual orientation, veterans, people with disabilities, people all across diverse backgrounds, and then also looking at engagement, and inclusion, and really measuring those as well. There are some surveys out there that you can take internally in a company to really gauge where you are. Before you start, you need to know where you are.   Poornima Vijayashanker:        Oh, yeah. Of course.   Melinda Epler:      That ranges from obviously looking at the demographics, but also looking at how do people feel? Do they belong? Are they supported? Are they able to really thrive in the company? Are they allowed to rise in the company? Are they supported in growing as a leader in the company? All those things you want to know before you really dive in to programs.   Under-Resourced Diversity And Inclusion Programs Are Rampant   Poornima Vijayashanker:        Yeah. Now, I know one issue that I run into, and you've probably experienced the same, I think we touched upon this on the last episode, is people come with a lot of great intentions, and a lot of times when you come into these internal groups though, they haven't really thought beyond those intentions. When I ask them questions like, "Who's going to be working with me?" or, "What are the meetings going to look like on the calendar? Is there a budget?" Just the basic logistics, it's like, "Oh, I guess there's some more work to be done," right? Because they haven't thought through what's budget, what's a roll out, what sort of opposition. How can we get around that initially, and what's the homework you would recommend after doing what you said about the benchmarking?   Melinda Epler:      Yeah, I think you need...if you're going to start an employee resource group, an ERG, or an affinity group, or something like that in your company, you need to know what are your objectives? What are your goals? What does it look like at the end of the year? What have you accomplished at the end of the year, and how do you design a program that's really going to get to those outcomes, because we see that as well. We see a lot of affinity groups, and it's important to find a safe space for people to get together, and then the next step is how do we go further? How do we do more? How do we start to develop each other as leaders? How do we grow as an organization? How do we help the company change its processes and systems? How do we get to the next level?   Poornima Vijayashanker:        Yeah.   How To Set Expectations Around Diversity And Inclusion Efforts   Wayne Sutton:       Yeah. I believe, also, in setting realistic expectations around what the goals and outcomes could be. Often people come to us like, well, they put resources towards this, they made this type of investment, they hired this person, they did this event, and they expected magic to happen. They expected the doors open where all the other underrepresented categories is gonna come apply to the company. They expect their brand to change. They expect some heat from the press to take off. It's like, "No, you did one thing."   Poornima Vijayashanker:        Right.   Wayne Sutton:       It's like you send one tweet, you don't expect the world to follow you, right?   Poornima Vijayashanker:        Yeah.   Wayne Sutton:       There's certain expectations around diversity and inclusion, as well.   Poornima Vijayashanker:        Yeah. I think a lot of the product analogies apply here, as well. Like you said, you don't do one marketing campaign hoping that you're gonna 10x your revenue, so why would it be any different with a lot of these efforts?   Wayne Sutton:       Exactly.   Melinda Epler:      Yeah, and also you need to use agile design, as well, like really think. If it's not working, change it. If something is not effective, do something different.   Poornima Vijayashanker:        Yeah. Let's get onto the first best practice that you would recommend to our audience out there who wants to kickstart an effort.   Connect Diversity And Inclusion Programs To A Business Case   Wayne Sutton:       Yeah. I'd probably say the first best practice is one where we need to identify who our core audience is, right?   Poornima Vijayashanker:        OK.   Wayne Sutton:       If you are someone in HR, or is in a role of heading diversity inclusion, or even in product, it's like Melinda articulated, you do need a measure, right? You need to start with see where we are. See what our numbers look like. Or, it could be, "Let's talk with executive leadership about how creating inclusive culture, having a focus on diversity and inclusion is connected to our core values and our business goals."   Poornima Vijayashanker:        Yeah, that's great.   Wayne Sutton:       Let's start right there.   Poornima Vijayashanker:        Yep.   Wayne Sutton:       Right? Not “let's just run with it, or we're gonna do diversity and inclusion,” because in a day what we've seen, and what has been happening is people say they're working on diversity and inclusion, they put resources behind it, it's not connected to the business goals, and they haven't set the benchmarks around measuring success.   Poornima Vijayashanker:        Right.   Why Diversity And Inclusion Programs Fail   Wayne Sutton:       It's like end of year, what do you have to show for it, or at the end of a program, what do you have to show for it?   Poornima Vijayashanker:        Yeah, and there's a huge disconnect, and then people feel like, "Oh, nothing's changing."   Wayne Sutton:       Exactly.   Poornima Vijayashanker:        "All these programs are useless. Let's just go back to the way things were." Yeah, yeah.   Wayne Sutton:       Yeah, exactly.   Poornima Vijayashanker:        I like that you mentioned tying it back to business goals, so do you have an example or a case study you can share of either a company that you worked with that was really good at doing this, or even took a first step?   Wayne Sutton:       We have several companies that we worked with, but it goes back to what we were saying earlier. It's like the reason why we pause is because there's not a single company we can point to to say that it's doing it well.   Poornima Vijayashanker:        Sure.   Wayne Sutton:       In doing this work what Melinda and I have learned is that there's also this opportunity of shaming.   Poornima Vijayashanker:        Yeah.   Wayne Sutton:       Right? We can say we work with Asana, right? We work with Reddit, also. We work B Corp. That's just in some of the consulting training or workshops. We also worked with Capital One. We did a workshop for their network of startups on how to create inclusive cultures from the start with. That was about 20 startups from the size of five to 200, and we could name...there's some well-known name companies in that area, as well.                     At the same time, we can say that some of the impact at those companies, we can give an example saying that we worked with them, they completed X, but that's not necessarily an endorsement that those companies have it all figured out.   Poornima Vijayashanker:        OK.   Wayne Sutton:       It's almost I'd like to say a disclaimer on that. We're not saying that, "Oh, here's an example that Asana's doing, or Reddit is doing, and everybody should copy it."   Poornima Vijayashanker:        Right.   Wayne Sutton:       That's not saying that they have everything figured out, not saying that they don't have everything figured out.   Poornima Vijayashanker:        OK.   Wayne Sutton:       It's just the state of the narrative around this industry, and around the conversation about diversity and inclusion. It gets emotional fast.   Why Immediate Results For Diversity And Inclusion Efforts Are Unlikely   Poornima Vijayashanker:        OK, so maybe a best practice is to not expect immediate results, but to say, "OK, you did one thing. Let's see if that's replicable, and then maybe in five or ten months, years, whatever your benchmark for time is, then take a look back."   Wayne Sutton:       Yes, yeah.   Poornima Vijayashanker:        Right, so don't call it an early success until you've really seen a number of dots lining up.   Wayne Sutton:       Yeah, but we have—   Melinda Epler:      Yeah. You can celebrate incremental successes, but it's not fundamentally shifting yet.   Poornima Vijayashanker:        OK. OK. Do you have—   Wayne Sutton:       But one example is we did work with Asana around their recruitment process. Melinda and I, we held a workshop training on mapping out the entire recruitment flow, and identified areas where they can make some improvement on sourcing differently, and how they can do some of their screening and their in-person interviews better, and they implemented some of those changes, and we're also communicating with their head diversity officer around how did that affect their goals around increasing their numbers around diverse employees or underrepresented employees.                     That is one example, but was that a success?   Define What Success Looks Like For Your Company   Poornima Vijayashanker:        Right.   Wayne Sutton:       We know change was made. We know that there was a learning window created. We know that some process was changed, and people grew from that session, but they're still measuring numbers, and there's also these other quantified elements that goes into play when you're talking about success, so yeah. It could've made success from us working with them to help change culture, mindset, and the process, but for the company in itself it is yet to determine in these other variables. Well, if the goal is to hire us to do that to help them increase those numbers, well, what other factors went into play around them increasing their numbers that's outside of our control, and that's where this work we do, we've been doing it now for a long time, and we feel like people need to broaden their mindset, or understand the impact of measuring success on diversity and inclusion. Success could be one thing, or success could be 1% or 2%.   Poornima Vijayashanker:        Right. What's another best practice, then, if we're thinking a little bit more broader?   Melinda Epler:      Yeah, I'm thinking a lot of people come to us who aren't necessarily in a position to go to leadership, or they've gone to leadership and leadership has said, "No." What do you do there?   Poornima Vijayashanker:        Right.   Melinda Epler:      Do you just give up, or do you think about other things that you can do outside of that, and I think one of the big things that you can do regardless is lead with empathy, and whether that's leading teams, that's leading products, that's just being a leader in your life and modeling inclusion and empathy, it starts with listening, and really understanding people for who they are and what they bring to the conversation, understanding the perspectives that people bring, and the unique issues that they're dealing with in their work life. It's also listening to your customers. Really, if you don't have a diverse team, you can't change that, listen to your customers, go out and learn from diverse people who are using your product.                    If you are leading a team, you can change the way you're leading you team. You can change who you bring on in your team, you can change how inclusive that team is. You can change a lot of things about your team, and really make a difference.   Poornima Vijayashanker:        So there's a lot of those micro changes that you can implement, like we were talking about in the last episode, on a daily, weekly, monthly basis, that are eventually gonna add up. Like you said, start with your team, your customers, your leadership, and then go from there, rather than always wanting to enact change top-down.   Wayne Sutton:       Yeah.   Melinda Epler:      Right, exactly. Exactly. There are a lot of things that underrepresented...that you can do as an ally, as well. There are a lot of really amazing things that you can do that make a big difference in somebody's life.   How To Be An Ally For Diversity And Inclusion   Poornima Vijayashanker:        Let's talk about what an ally is first.   Melinda Epler:      Yeah, so an ally can really be anyone. It can be you, it can be me, it can be Wayne. Pretty much anybody can be an ally to someone who has less privilege, or someone who has equal privilege, quite frankly, and really looking at the little things you can do to help support others. If you're in a position of greater power or leadership you can bring others up with you that are underrepresented. You can disrupt little biases and microaggressions that come to play in daily meetings. For example, you see somebody who's consistently, their ideas are being shot down, or taken over, or they're never able to get a word out, then you can do something to disrupt that.                     You can do something to disrupt...I mean, if you see harassment or something like that, there's definitely something you can do about it. It's really hard for an underrepresented person to come out against their own suppression, and so there are lots of things that allies can do, little things that can make a big difference in somebody's life. There's also mentorship, and sponsorship. Mentoring somebody who is underrepresented and really helping them grow their career, giving them advice about how to take the next step and become a leader. Sponsorship is more around, again, that if you're in a position of power, really helping sponsor somebody else to be there, as well.                    It also could be, as an ally, maybe you're a part of a dominant group being asked to speak on a panel, and it's the same group of people. It's all white men, or it's all white women on a panel. Part of ally-ship is actually taking a step back and allowing somebody else to speak, and allowing other perspectives.   Poornima Vijayashanker:        Yeah. Take a break for a while.   Melinda Epler:      Yeah.   Poornima Vijayashanker:        Rest your voice. Let someone else have a turn.   Why It’s Important To Be Proactive When It Comes To Diversity And Inclusion   Wayne Sutton:       When I think about the tech industry, and this conversation around diversity and inclusion, and everything that is bundled up in that, there's been a constant theme that most tech companies and individuals have been reactive instead of proactive, and that is disheartening. It's like, "Let's wait for something bad to happen," someone to leave and write a leaving article, a sexual harassment situation, or some shaming to happen online, then let's talk about diversity and inclusion. I would say that if there's an individual on the inside of an organization, and they're working in tech, and they want to create change, don't wait.                     Don't wait until something negative happened before looking at creating change. That could be, yes, talk with an executive, talk with a manager, talk with the CEO. Set up a meeting, track it, let them know that, "I'm taking note that I had this conversation."   Poornima Vijayashanker:        Right.   Wayne Sutton:       Look at the values of the company and speak up. That's kind of more like, "Hey, go straight to the top. Go to the manager," but it also could be just in meetings, right? Just in meetings say, it could be me saying, "I don't feel like my voice, my opinion was heard," or are you thinking about a program or a product and saying, "Well, are you thinking about black women, are you thinking about LGBTQ community, are you thinking about vets? Are we really looking at a targeted customer base from a global and inclusive scale, or a mindset?"   Melinda Epler:      And also accessibility, really looking at accessibility from the beginning rather than a reaction to, "Oh, wait. It didn't work. We have to do that now."   Poornima Vijayashanker:        People are dropping off, yeah. Why is that?   Wayne Sutton:       If people want to create change, and they want to implement a diversity and inclusion strategy, or just get started, just speak up. Speak up, and there's tons of articles, I mean tons of research. We have a blog, we have plenty of resources online, and some of it is finding the allies Melinda was articulating, and knowing that you're not alone, and speak up.   Melinda Epler:      Yeah, and take some of those daily steps like taking your vitamins every day, eating your veggies.   How You Can Get Involved With Change Catalyst   Poornima Vijayashanker:        Let's end with this note of how can our audience get involved with you two and your company?   Melinda Epler:      Yeah, a few different ways. One thing is as an organization focused on diversity and inclusion, we need funding. We always do, and so if you have the ability in your company to support us, we have sponsorship. We also can do training and consulting with your company, as well. That's one. Another is we always need volunteers, and we cannot do this work without volunteers. They're amazing. They are part of our team, and they really help make our events, in particular, happen, so volunteer. What are some others?   Wayne Sutton:       Yeah. What I say to people who want to get involved is just if you're working on diversity and inclusion, be successful, or often have a conversation with other underrepresented individuals and saying that if you're working in tech, don't forget to open the door for someone else.   Poornima Vijayashanker:        Yeah.   Wayne Sutton:       The tech industry, we know the numbers. We also know the numbers of our growing global population, how diverse it is, and if you can get in the door, we can do the best of our ability to help consult, train organizations to create inclusive culture, but if you get in the door and you need help, we're here to help.   Poornima Vijayashanker:        Yeah.   Melinda Epler:      Yeah, and I just want to end with, I firmly believe that if we change tech, we can change the world, because tech is so much a part of the world, and it's increasingly so. Almost every company is becoming a tech company, and we have the power to really make a difference, whether it's in your startup, whether it's in your team, whether it's in your company, whether it's in tech as a whole, the entire industry. If you can affect change in any one of those areas, even if it's you becoming a successful entrepreneur, that in itself, as an underrepresented entrepreneur, that can make a big difference.                     You have the power to create change. Do it.   Poornima Vijayashanker:        Well, thank you so much for ending on that inspiring note, and to all of you audience out there, thank you for tuning in today. Be sure to share this episode with your teammates and your boss, and be sure to subscribe to our YouTube channel to receive more great episodes like this one. Ciao for now.                     This episode of *Build* is brought to you by our sponsor, Pivotal Tracker.
March 5, 2018
I’m sure you’re aware of the talk and debate around the topic of diversity and inclusion. Maybe it’s left you feeling frustrated, tired, or downright apathetic…   I get it.   Much of the emotional rollercoaster stems from the challenges of navigating conversations with your teammates and peers on top of your day-to-day responsibilities.   Plus you’re probably wondering: Are these programs actually working?   You know how much I love busting myths! So in today’s Build episode, we’re going to talk about the issues specific to tech and provide you with some strategies for navigating those tricky conversations with your teammates and your peers. We’ll also dive into what isn’t working and why.   If you're curious about starting a diversity and inclusion initiative at your company or participating in another organization, then keep an eye out for the next episode where we'll do a deeper dive into a number of best practices.   To help us out I’ve invited Melinda Epler and Wayne Sutton, who are the founders of Change Catalyst and Tech Inclusion.   As you listen to this episode, you’ll learn the following:   Why we may shy away from talking about diversity and inclusion How shaming people and companies doesn’t help the cause Why awareness isn’t enough — how to shift to being more process oriented Why it’s hard to take action individually and how to get support How to know if diversity and inclusion are worth it   Build is produced as a partnership between Femgineer and Pivotal Tracker. San Francisco video production by StartMotionMEDIA.   ## Diversity and Inclusion: How To Navigate Conversations About Diversity And Inclusion in Tech Transcript   Poornima Vijayashanker:           There's been a lot of talk and debate around the topic of diversity and inclusion. And regardless of what side you are on, in today's episode, we're going to talk about the issues pertaining to tech, as well as how to navigate conversations with your teammates and peers. So stay tuned.   Welcome to *Build*, brought to you by Pivotal Tracker. I'm your host, Poornima Vijayashanker. In each episode of *Build*, innovators and I debunk a number of myths and misconceptions related to building products, companies, and your career in tech.   Now, as you can imagine, there are a lot of myths and misconceptions around diversity and inclusion. Conversations can be really hard to navigate. And that's why in today's episode, we're going to talk about the issues that pertain specifically to tech and help you navigate those conversations with teammates and peers. And if you're curious about starting a diversity and inclusion initiative at your company or participating in another organization, then stick around for the next episode where we'll do a deeper dive into those practices.   In today's episode, I invited Melinda Epler and Wayne Sutton, who are the founders of Change Catalyst and Tech Inclusion. Thanks you guys for joining us today.   Melinda Epler:            Thanks. Thanks for having us.   Wayne Sutton:              Thanks for having us.   What does diversity and inclusion mean?   Poornima Vijayashanker:           Yeah. So, let's start by talking about what exactly is diversity and inclusion?   Melinda Epler:            I'd like to say that diversity is about bringing diverse people to the table and inclusion is about inviting them to speak, encouraging them to lead, and supporting them in leadership. Diversity is really about the demographics and inclusion is about how people show up, how people thrive, and how people feel that they belong in their culture.   Poornima Vijayashanker:           Yeah. And how do you think it pertains to tech?   Wayne Sutton:              I like to say diversity includes everything, how it pertains to tech. Tech impacts the world, it impacts everything we do in our daily lives, from the time we wake up to the time we go to sleep. Tech creates wealth. Tech creates innovation. You look at all the products. They got some of the products living on your shelf. We're thinking about the customers. We're thinking about the followers. We're thinking about the equity or the inequity and all the opportunities that is connected to tech. And without diversity, right, you see problems being built by a homogeneous culture. You see solutions not brought to the table because it's being built by one or two mindsets.   You see a lot of disparity gaps in terms of access and wealth. So, without diversity, really, the tech industry is not as thriving as it should be or could be. And the impact is having, in a positive and a negative way, is not where it could be as a whole, as well.   Why Diversity And Inclusion Are Important                    At the same time, if the tech industry were more inclusive, I could imagine more innovative products. I can imagine an industry that is really identifying or being held accountable to its actions as current culture, where we wouldn't have issues that existed in the ‘60s, ‘70s, in terms of not having equal pay, not having women or other representative groups, African Americans in leadership positions, cultural and sexual harassment. If we had inclusion, these negative issues that is in the face of our society right now, in tech, wouldn't exist.   Poornima Vijayashanker:           So, let's talk about what drew you to focus on diversity and inclusion, because you both had different backgrounds before you were working on this.   Melinda Epler:            Yeah. My background actually started back in cultural anthropology and really looking at how individuals create change in societies, how culture changes. Then, I moved into the documentary filmmaking. I was a documentary filmmaker for about 10 years, became a consultant, and then, actually became an executive at an engineering firm. That experience of being a woman, and the only woman, in leadership in that engineering firm was what made me rethink what needs to change in society. I was not thriving in that culture and it was because it wasn't set up for me, it wasn't set up for my success. And so, I actually left that job as an executive to go into diversity and inclusion. I started Change Catalyst and Tech Inclusion programs, really addressing the inequities in our society. My whole life has been focused on creating social and environmental change.                    And I believe, now, that if we don't change leadership, if we don't change who can be a leader and who is leading our countries, who's leading our companies, who's leading our technologies, our stories, then we can't change what's really happening in the world. I am here because I believe that this is the most important thing for me to be working on to create positive social change in the world.   Early Attempts To Foster Diversity And Inclusion In Tech   Poornima Vijayashanker:           What about yourself, Wayne? Your background is also from a different angle.   Wayne Sutton:              Yeah, yeah. I started off doing design, graphic design—I'm showing my age some. Then, got into design UI/UX and computer graphic design. I did IT for about 8 years in North Carolina—Research Triangle Park—then became a tech founder. Had a startup back in 2007 or 8, and didn't realize that in North Carolina that I was one of very few unrepresented tech founders, a black tech founder. And then, experienced the challenges of growing and scaling a company. Then, fast-forward to 2011, the data from CB Insights said that 1% of the tech startups, that raise "angel" or VC are founded by African Americans and Latinos. They actually grouped that data together. So it really was less than 1% Black and Latino that received any angel or venture capital in 2011.   By that time, I knew various colleagues across the country that was also working on startups. I was basically like address the problem. What can we create a solution around? Some other colleagues and I, we decided to move to Mountain View and create the very first incubator and accelerator, focused on underrepresented tech founders. That led to a whole other window of opportunity. Moved to Silicon Valley, then moved to San Francisco. And then went through a period where, after that, I realized that the tech industry did not want to talk about diversity and inclusion, did not want to talk about the disparities of access and inequality for founders to receive capital. The tech industry was priding itself on being a meritocracy. It was like: Anyone can create a tech company, anyone can create a product, it doesn't matter.                     That may be true.   How The “Pattern Of Action” Created A Period Where People Didn’t Talk About Diversity And Inclusion   Poornima Vijayashanker:           But it wasn't happening.   Wayne Sutton:              No. It was not happening. And the data already showed that everyone was not raising angel capital. It wasn't because of lack of talent. It was not because the products were not as good. It was because what the VC industry would call "a pattern of action."   Poornima Vijayashanker:           Right.   Wayne Sutton:              And we went through a period where we’re not talking about diversity or inclusion at all. We're not talking about a lack of funding for underrepresented entrepreneurs. And then the tech industry released a diversity report, that was in 2014. And then email—and I want to say the phone, but more the email and Twitter DMs started come in. It was like, "Hey! We need to talk about diversity. I remember you used to talk about it in the day..." And Dan Blenman and I started collaborating. We met and started collaborating on solutions. We got invited to so many roundtables, kind of private conversations, one-on-one meetings around what can we do to fix this diversity problem.   Melinda Epler:            Yeah, those were from the White House, to the Small Business Administration, to the FTC, the FCC. And then local tech companies and local conversations as well all kind of talking about that.   Wayne Sutton:              That was at the White House during the Obama Administration.   Melinda Epler:            Yes, just so we're clear…   Why There Isn’t A Single Solution To Improving Diversity And Inclusion   Poornima Vijayashanker:           Yes, yes, of course. Well, we know who was in the Administration in 2014. So you already touched upon some of them in your intro, but what were some of the problems specific to tech that you continue to see in this phase and maybe even today?   Wayne Sutton:              I would say that the biggest problem is still that happened then that we see today is still the state of denial that there is an issue. There is also the problem that it's going to be one technology solution or you do one thing that's going to fix everything.                     And then—   Melinda Epler:            One cheap thing.   Poornima Vijayashanker:           Yeah.   Wayne Sutton:              And then one problem is still thinking that companies and individuals can focus on one demographic or one category. I don't want to say category. But one part of the conversation. And use it saying that it's solving all the problems.                     And I would probably say lastly, it's another problem in that I was shocked at how many companies when they started talking about wanting to do work around solutions around diversity and inclusion, they will not even connecting it to their business. Or their customers. Or their direct culture. They were just trying to say, "Hey, we're working on this. Get off our backs! Here's our solution. It's hard." And all those things combined is not really good for the goal we want to achieve.   Melinda Epler:            I think there's a few different reasons that this is happening. And this happened in tech differently than in other industries. It started back when Steve Jobs and some of the big, great tech CEOs became "the" story around tech. And the story revolved around that being the kind of...that is the tech founder: the white male CEO is the tech founder.                     And when those white male tech founders built their companies, they hired their friends. They just didn't think about it. They hired their friends and their friends hired their friends and the tech companies are still set up for referrals mostly. When you have the same people referring their friends, then you're going to have a homogeneous culture. And so the issue is, now that those companies are so big, it's really hard to create change in them.   Poornima Vijayashanker:           Yeah.   How Success Patterns Have Bred The Current Culture In Tech   Wayne Sutton:              That brings up another good point. Because the industry is manipulated by market trends and success patterns, right? So the VCs while they represent the founders, because they hadn't seen any. Or there hadn't been enough for them to say this is a good model, right? But in the culture of the tech industry, you look at your Microsofts, your Intels, your HPs. That's like one era of American business and society, how they grew and scaled companies.                     Then the second wave is the Googles, the Facebooks, the Twitter, the Snaps, the Instagrams, the Salesforce. Those companies basically, like Melinda said, they hired their friends when they started. Larry and Sergei were Stanford grads. And then they got funding from Ron Conway and the network. And there was a lot of luck involved, a lot of sweat, a lot of hard work, they built innovative products, but then because those companies made a lot of money, everybody just replicated that same pattern.                     I'm old enough to remember where it didn't matter what school we went to. You can code, you can build, you can design—it mattered. Let's get to work! Let's build something! But then because it became a new norm of like, "Let's copy Google, let's copy Facebook, let's copy other companies." Then that became the standard like, "We must do this." And if we look at that demographic data…   How to Measure Diversity And Inclusion In Tech   Poornima Vijayashanker:           So, obviously this isn't the first time that people are having this conversation. Like I mentioned in the intro, there have been many, many years that we've been having this. I know even for myself, moving out here in 2004, there were some rumblings, but not a whole lot, to the level it's at today. But obviously people have tried to fix this problem once before, and where have they fallen short? Like, what didn't work?   Melinda Epler:            Part of it is not measuring. And that changed in 2014. That was a big shift for everyone, where they really could see these are the diversity...these are the actual demographics of our companies. "Oh! Whoa! Those are really bad! We need to figure out how to solve them."   Why Measuring And Building Awareness For Diversity And Inclusion Isn’t Enough                     And then, once they said that, they kind of put those numbers out there. It hasn't changed all that much, because the first year was just about measuring. And then starting to hire diversity and inclusion managers and directors, but not putting a lot of money and resources into can't hire one person to change a whole company with very little resources. That's just not possible.   So, as those diversity and inclusion managers have gained traction in their own companies, they're starting to get bigger budgets and things are starting to change a little bit faster in the companies. Now that does not discount the fact that people have been working on diversity and inclusion in some of the tech companies for quite some time. One of the issues is that many of the initiatives around diversity and inclusion in the past have focused on employee resource groups, community groups, and really helping support underrepresented people in the companies. And I think, on the other hand, some work has been done on education and awareness building. And this happens in every kind of major culture shift. It happened in the sustainability movement as well. There's an expectation that if you tell somebody there's something wrong, they'll do something about it.                     But the problem is, you actually have to help them change their behaviors. And really fundamentally think about how to shift culture. How to shift processes and systems that are ingrained and perpetuating the problem.   Why Shaming People And Companies Doesn’t Enact Change   Poornima Vijayashanker:           Yeah, talk is cheap.   Melinda Epler:            Yeah, and it doesn't really change anything. And the third component is really about shaming. There's also a really deep and disturbing trend around shaming people into changing. That doesn't really change people either! So, there's a new and growing movement and at least an understanding—I wouldn't say movement yet—and understanding that it takes more. It takes a bigger effort to really look at your culture. How do you change your culture? How do you change individual behavior? How do you fundamentally look at your recruiting process? And say, "Oh, wow!" From the very beginning. We need to change the way we're doing things. There are biases in the system, but also there are some mismatched systemic problems in the process.   Change Catalyst’s Approach To Helping Companies With Diversity And Inclusion   Poornima Vijayashanker:           So let's talk about Change Catalyst and how do you approach this differently?   Melinda Epler:            We have a few different things that we do. We have events, our Tech Inclusion events. And when we were talking earlier about having those roundtable discussions back in 2014, we started getting pretty frustrated that those roundtable discussions kept talking about the same things over and over. We had the same conversations over and over again. And they were really problems focused, which is important…   Is A Diversity And Inclusion Program Worth It?   Poornima Vijayashanker:           What's an example of that?   Wayne Sutton:              An example would be the question we get asked over and over again. "Who's doing it well?" And the reason why everybody wanted to know...   Poornima Vijayashanker:           Like they're a benchmark.   Wayne Sutton:             ...No, no, not that! The reason everybody wanted to know who's...everybody wanted to know what company was having any type of success around diversity and inclusion. Any type of success.   Poornima Vijayashanker:           Oh! To see if it was worth it.   Wayne Sutton:              They wanted to know if it was worth it, but also wanted to know if they could copy it. They wanted to replicate it. And that was really it. Because everybody wanted one moonshot idea to say, "We're implementing change." That they could say, "We're working on it." And that was a repetitive question across the board.                     At times, really, there wasn't a company that had all the answers or all the ideas or...   Poornima Vijayashanker:           You guys all suck!   Melinda Epler:            Exactly!   Poornima Vijayashanker:           Or it's not making an impact.   Melinda Epler:            I'd say it's still the case. There's no one company that's doing everything right.   Poornima Vijayashanker:           I'd agree!   What Diversity And Inclusion Training Looks Like   Melinda Epler:            Largely because the diversity and inclusion programs are under resourced. But there are gems. There are some people that are doing some really great programs that we can point to.   I think also, in 2014, there was a lot of talk amongst underrepresented people that were feeling disenfranchised. Feeling like the opportunities weren't there for them. Feeling, hearing over and over again that there are barriers, there are barriers, there are barriers. But less about solutions. How do we break down those barriers? What do we do? How do we solve that problem?   So that was one. We really wanted to focus on solutions, and that's what we have done. We've designed it to focus on solutions. The second is we really with our Tech Inclusion's a systemic problem across the tech industry. So, it starts in education, and then there's huge problems in terms of entrepreneurship. Lack of investing. Lack of investors who are underrepresented. And then also lack of investing in underrepresented founders.   And then of course, the workplace. At the time, it was really focused on recruiting. As we talked about, you also have to change the culture. You can't just change recruiting, because you're bringing underrepresented people into a culture that's not creative for them. And they're going to leave! Like I left my position, right?   So workplace, and then policymakers as well. Policy and government agencies, and their power and wealth, and ability to create change in the system. And now we also focus on storytelling, like you do as well, to really help raise the underrepresented voices and perspectives, and have more diverse perspectives out there.   So for our events, that what we really focus across the tech ecosystem, bringing everybody together to focus on solutions.   For our consulting, training, and toolkits, we're also solutions focused. And focused on behavior and culture change, and really going beyond recruiting—recruiting is a part of that, but all the way through creating a culture of belonging.   Change Comes From Multiple Sources   Wayne Sutton:              Yeah, for us, it's that how change comes is different. We're not a "come in and look at one problem or one sector of the goal you want to accomplish around diversity and inclusion." We want to really discover and look at your entire company from a culture and a systematic perspective to help identify opportunities to create real change.                     What we've seen in the past is that a lot of companies contact us after taking unconscious bias training, and saying "We did that, now what? What do we do now? That has had some effectiveness, but we need more." And it's been an opportunity and a challenge aspect is that smaller companies—and even larger companies—they really have to be committed to put their resources in to explore what real change looks like. Whether you implement a new tool to remove names from resumes—that's just one thing. That's just one task you can do to help affect your recruiting process.                     But what about when you have your product team, your design team, your engineering team and there's different negative and positive behaviors in that one team dynamic. A software tool is not necessarily going to fix that. One unconscious bias training is not going to fix that. There needs to be a discovery and a real heart-to-heart conversation around employee behavior with accountability. And we come in and have those harder conversations, put together a report, talk with the executive team, and if they have a head of diversity officer, work with that individual to put together some strategies that can create change.   Poornima Vijayashanker:           Nice! So what's the impact that you've seen so far through your programs and your offerings?   Wayne Sutton:              We see impact across the board. There's impact from the consulting, has been from a company not having any strategy at all from everybody saying like, "Well, we care about this. We want to do something," to now that there is a board level, and executive-level type solution with a plan in place that they can measure and track results over time with some accountability involved, where there's an individual or team saying that, "This is the team that is working on creating inclusive culture." That's been in some of my trainings. A consultant impact.                     The other impact we've seen around our conferences and events that we've done now mostly across the globe. We've been overseas. Across the globe, has been everything from gender-neutral bathrooms to new jobs created.   How To Navigate Conversations About Diversity and Inclusion   Poornima Vijayashanker:           That's a great segue into my next question. I know a lot of people—especially in our audience—care deeply about diversity and inclusion. But they may find it hard to navigate those conversations or to even initiate them with their teams, with their bosses. So how have you kind of facilitated that?   Melinda Epler:            We start by asking everyone in the company, at least a broad set of people across the company, what diversity means to them. What inclusion means to them. Start to develop a company-wide definition of diversity and inclusion. And then, literally we talk to people across the company about the ideas that they have, the experiences that they've had, and really develop a strategy that includes all of those voices. I think you have to do that.                     So that's what we do at the kind of company-wide level, and including the executives all across the executive teams and the board as well. For an individual wanting to create individual change, who may not be an executive in a company, I think that there are some different resources for understanding the language around diversity and inclusion and there are some courses out there around allyship. And some information around allyship that I think can be really beneficial to really...there are so many different things that you can do.   Why It’s Hard To Take Action As An Individual Leading Diversity And Inclusion Initiatives   Poornima Vijayashanker:           Before we dive into that, because I want to talk about that in a future episode, maybe we can talk about why it's been hard for them to take action individually.   Wayne Sutton:              We have been contacted about a lot of individuals saying that they care about diversity and inclusion and they want to implement change in their company. They need help, right? And ultimately we go back and have a one-on-one call or face-to-face, and we say, “Well what does this conversation allow with the company values? What has been done? Have they discovered what has been done in the past?” And then question if they don't feel confident to have a conversation with their manager or someone, a colleague or someone in an executive role around diversity and inclusion, they need to see if this is a place they want to work. Because it can be a difficult conversation.                     I mean, an article just came out today where an individual, he quit a well-known company because his manager or executive said that, "Stop talking about diversity and inclusion!" Right? So this topic is sensitive to a lot of people. They're afraid of it, they don't want to talk about it. It creates a sense of fear and anger and frustration for others. So whenever people come to us and say, "I want to talk about it," a suggestion is approach it with a business case. That’s one. Approach it with an empathy case. Approach it with an idea versus, "Hey, I want to work on diversity and inclusion at my company."   That's how we get asked. It's like “diversity and inclusion” is such a big umbrella word. So for your organization...   #1 Reason That Keeps People For Taking Action   Poornima Vijayashanker:           Loaded   Wayne Sutton:              Loaded, right? Well a lot of emotions with a lot of history. So if you are an individual and you say you work in product and you want to work on diversity and inclusion at your SaaS company, right? So a suggestion would be to identify that you're going to talk to your manager. “I want to reach this audience that we haven't been talking with or connecting with. With this lens, how can we make that happen?”   That's gonna cost them a product. But from a cultural perspective, it could be "Have we measured?" Or "I noticed that I'm the only female or African American, Latino, LGBT. There are some issues to mean that are not being brought up." Or, "How can we have a dialog about it?"   Melinda Epler:            I mean, your question was "What keeps people from taking action?" I think, really. And the #1 thing is fear.   Poornima Vijayashanker:           Yeah. Losing their jobs.   Melinda Epler:            Losing their jobs, but also just fear of making a mistake. It can be hard to navigate. There are definitely people who are good at shaming, publicly shaming. And that doesn't make it easier to create change and to take action. So I think that inherent in what Wayne is saying is that just take the first step. Take one step. Try something new. Talk to someone. Understand basic things. Understand what their experience is. Listen. Those can be really powerful first steps.   Wayne Sutton:              It seems like the tech industry has forgotten that we are humans. We had a conversation as a team talking about...   Melinda Epler:            Human first.   Wayne Sutton:             ...Human first. Right? And just because I'm different. Just because I'm a black male from the South doesn't mean I can't have an intellectual conversation around topics that are passionate to me. That could be black man, STEM products, that could be how can we look at different demographics or location. Why can't we have a real conversation?                     If we can talk about growth. We can talk about APR. We could talk about growth hack and design thinking. Why can't we talk about working together as humans and expanding your mindset, opportunity, and behaviors for all humans? What's the problem?   Why People Are Reluctant To Talk About Diversity And Inclusion   Poornima Vijayashanker:           So maybe you can touch upon that. What's some of the resistance around the conversations?   Wayne Sutton:              It goes back to what Melinda says: Fear! It's fear. But it's also fear because the tech industry traditionally has been a Type A, god-like mentality. Where everybody has all the answers and so if you go to someone and say—talking about diversity and inclusion—you want to have all the answers, so there's it can create a sense of fear. And/or the tech industry we know today, right, is in Silicon Valley, it's in San Francisco, it's in the East Bay some, and the data just in terms of population, in terms of African American in San Francisco is like 6 percent. And if we know the numbers that at Google and at tech roles is average 2 percent within the entire organization. So the culture that these companies traditionally haven't been diverse. So now you want to take an individual, who maybe the one only diverse individual—African American, Latino, women, or Latino or on the team—they want to talk about a cultural topic that is relevant to them, to someone who doesn't have the same experiences, it could be sensing like fear and they don’t have all the answers and not understand why. And that right there creates tension.   Melinda Epler:            There are also studies that show that if a company is talking about diversity, then people within the company think it's changing. That is another aspect of this. That's just psychology involved in all of this. When you start talking about diversity, people think that it's changing.   Poornima Vijayashanker:           Changing for the better? Or like…   Diversity And Inclusion Is Not A Zero Sum Game   Melinda Epler:            Changing for the better. People think if you're talking about it, it's changing for the positive. And then there's also on the fear side, though, there's also a fear that if other people rise up, you'll fall down.   Poornima Vijayashanker:           A zero-sum game.   Melinda Epler:            Exactly. But it's not. This tech industry is growing rapidly. There aren't enough people to fill all the tech jobs. That's absolutely not the case. So we just need to change that perception   Poornima Vijayashanker:           So, in the next episode we're going to talk about best practices, but before we wrap up this one, I want to just address some of the objections that our audience may come across when trying to broach the topic. They might have somebody say, "Oh, we're not going to talk about it all, it's not a priority. Like ship product." Or, "Hey, we had lovely little meetup the other day, with some great female engineers. What's the problem? We're making incremental progress." Or, "Hey, we've got to move really fast and whatever you do, how do I know it's going to be a 10x impact?" Right?                     And that can be overwhelming for the person on the receiving end. So how do we deal with some of those objections?   Wayne Sutton:              Yeah.   First Step Is To Measure Your Diversity And Inclusion Efforts   Melinda Epler:            I think one of the things people in tech react really well to is data. So the first thing is measure. And find out that information. Find out the demographics of the company. Find out—if you can—the engagement metrics as well, because you can start to look at engagement metrics as it relates to race and gender and ethnicity. And that can...and people with disabilities. And you can really see something is not right.   And once you look at the data, then you can say, "Oh, wait! We have a really high turnover rate among women. That's a big..."   Poornima Vijayashanker:           Well, everyone's making babies!   Melinda Epler:            That's a problem! There are lots of data that shows...   Poornima Vijayashanker:           I know...   Melinda Epler:            An important part of society. But that is only one. Most of the women who leave tech just so we’re absolutely clear, most of the women that leave tech go to other industries and become leaders in those industries.   Poornima Vijayashanker:           So we're missing out on opportunities.   Melinda Epler:            We're missing out on opportunities. The cost of turnover is high in a company. You don't want to lose people. That's a huge cost.   Poornima Vijayashanker:           So that's just employment. What about with the product itself? Because you had been touching upon some of that.   Wayne Sutton:              Yeah, I want to say that for individuals who want to create change or they've experienced some—they're in a culture they want to make improvements in, you start with the data like Melinda articulated. But it's also starting documenting examples, right? Like we worked with one company where the CEO had heard some stories but it was coming second and third hand.   Poornima Vijayashanker:            Yeah, that's a challenge.   Document And Show Proof Around The Need For Diversity And Inclusion Efforts   Wayne Sutton:              So if you're an individual, you work on your product team, your engineering team, or you could be a product manager. And you constantly see these examples, these situations happening. Take note that this happened on this day. This was the experience. And therefore you are able to have proof. The opportunity to create change may come under the window or umbrella of diversity and inclusion, but it could be just how can we conduct an inclusive meeting? Just a better meeting? How could we make sure all the voices are heard?                   If you've got a product team, like seven guys, three women, and the women hardly ever speak up or talk, you have a communication and culture problem where the women either don't feel empowered or the men are being assholes. Or both, right?                     And so, it's like that is culture. So the change you want to make may not say…”I want to create diversity and inclusion strategies.” Or, “I want to increase #1 my product team.” Or, “I want to make sure the voices are heard.” Or, “I want to talk about how we can conduct a better meeting that benefits the company, and everyone.”   Poornima Vijayashanker:           So start small. And that makes a big difference compounded over time.   Wayne Sutton:              But track it! Because you've got to have real examples that's relative to the change you want to make.   Melinda Epler:            Yeah, it affects product design in a huge way. And I don't think we talk about it enough. That if you want to grow your customer base, and if that customer base is diverse, your designers and developers need to reflect that customer base. If you're designing for the wrong customer base, you're not going to have a success. And it has huge implications—I mean some really terrible ones out there. Even when the airbags were designed, for example, they were designed by men. And in the first rollout, several women died, children died, because they didn't test it out on women and children. That's just a really basic example.                     Then we see that in the tech industry a lot now, where especially when AI is being developed and things come out on Google search where black people are mislabeled. That is a really dreadful outcome of not having diverse people design your programs.   Diversity And Inclusion Doesn’t Just Impact A Single Group Or Criteria   Wayne Sutton:              I'll probably say here another problem is that—or opportunity—is that when people are talking about diversity and inclusion. You got to remember that if you're going to focus on inclusion, look at it from the perspective of everyone. Right? Think about diversity is beyond just a color of someone's skin.                     We were talking earlier about people who are hidden, invisible disabilities. Think about accessibility. Think about age. Think about class. You have people with different heritage.   Melinda Epler:            Veterans.   Wayne Sutton:              Veterans. It's not just black and white. It's not just gender. It's literally everyone. But the solution that may pertain to a company can be one thing—and that's OK if you're going to focus on, "OK, we're going to focus on STEM youth, kids' pipeline." That's OK.                     But identify, communicate that this is what we're doing as part of a solution, but not "the" solution. Or, “We're going to focus on college students.” That's OK. That's good. We need to do that. But identify and be clear and authentic about where your solution is around college students affects your business and your culture.                     Understand that if you're a person in that culture, say my company's all, "We've got a diversity and inclusion plan. We focus on college students." Yay! Great! But if most of your employees want to focus on a different demographic, want to do something around veterans, then as a team, as a company, depending on what size, you've got to understand why. OK, there's an opportunity and a need to focus on these areas as well.   Poornima Vijayashanker:           Well, thank you both for joining us today. And now for all of you out there in the audience, let us know in the comments below this video if your organization has put in place any diversity and inclusion initiatives. And what's been the impact?                     And be sure to subscribe to our YouTube channel to receive the next episode, where we'll dive a little bit deeper and share some of the best practices if you're thinking about putting in place a diversity and inclusion initiative at your organization, or want to join another one.                     Ciao for now!                     This episode of *Build* is brought to you by our sponsor, Pivotal Tracker.
Feb. 21, 2018
In the last two episodes of Build we tackled why accessibility needs to be prioritized in product design and the three key tips that are critical and will make a big impact on your product's adoption. This week we’re going to answer two questions that inspired this series from one of our audience members: Jane. We chose these two because we figured they might also be on your mind! Jane wrote: Poornima, Thanks for tackling a wide variety of topics when it comes to building software products. One area that I'm curious about is accessibility. As a user experience designer, I know accessibility is important, but I've struggled when it comes to balancing out accessibility across devices and also making mobile apps interactive and fun without compromising on accessibility. How should I think about web versus mobile and balancing out fun and engaging interactions with accessibility in mobile apps? Sincerely, Jane                     Jane thank you for writing in! Laura Allen who is the Accessibility Program Manager at Google for Chrome and the Chrome operating system is back and together we are going to be answering Jane’s questions in today’s episode. As you listen to today’s episode you’ll learn: What are the similarities and differences when it comes to designing for accessibility on web versus mobile devices How to balance balance out fun and engaging interactions versus accessibility on mobile devices The various types of accessibility testing: manual versus automated and tradeoffs associated with both  Here are links to the resources Laura mentions in the video: Web Content Accessibility Guidelines Android Developers Site  iOS Human Interface Guidelines  Android Accessibility Scanner Lighthouse  -- Build is produced as a partnership between Femgineer and Pivotal Tracker. San Francisco video production by StartMotionMEDIA. -- ## How To Balance Accessibility And Interactivity Across Devices Transcript Poornima Vijayashanker:        In the previous two episodes of *Build*, we talked about the importance of accessibility and we shared three critical strategies that will help make a big impact when it comes to building and designing products. If you missed either of those episodes, I've included links to them below. In today's final episode on accessibility, we're going to talk about what accessibility means across devices for both web as well as mobile. Stay tuned.                     Welcome to *Build*, brought to you by Pivotal Tracker. I'm your host, Poornima Vijayashanker. In each episode, I invite innovators, and together we debunk a number of myths and misconceptions related to building products, companies, and your career in tech.                     We're continuing our conversation on accessibility with Laura Allen, who is the accessibility program manager at Google for Chrome and the Chrome operating system. Thanks again for joining us, Laura.   Laura Allen:        My pleasure. Thank you.   Poornima Vijayashanker:        One of the inspirations for this series on accessibility came from our audience member Jane, so I'm going to start off today's episode by reading the question that Jane posed. Jane wrote, "Poornima, thanks for tackling a wide variety of topics when it comes to building software products. One area that I'm curious about is accessibility. As a user experience designer, I know accessibility is important, but I've struggled when it comes to balancing out accessibility across devices and also making mobile apps interactive and fun without compromising on accessibility. How should I go about thinking about web versus mobile and balancing out fun and engaging interactions with accessibility in mobile apps? Sincerely, Jane."                     Jane, if you're tuning in to this episode, thank you for writing in. Laura, why don't we start by answering Jane's question to begin with. How do we balance out web versus mobile?   Laura Allen:        It's a really great question. When you think about it, a lot of these concepts that we were talking about in previous episodes are actually going to stand true no matter what platform you're actually designing for. Think back to the web content accessibility guidelines, WCAG. They talk about perceivable, operable, understandable, and robust, and those sorts of concepts and principles that go within each of those categories. Just taking one example, color contrast. Color contrast, having really solid contrast between text and its background, that's important no matter what device you're on. It's going to be the same sort of truth for if you're on a mobile phone or if you're on a desktop computer. A lot of these concepts are going to just span across platforms and be really relevant for you to consider.                     One thing that's obviously a little bit different on mobile is that it's clearly more touch oriented for most users. Things like touch targets and the size of your touch targets, that's important to consider. Some people might not have as precise motion or control as they're using their phone or tablet, but honestly, the lines are getting a little bit blurry anyway. Think about all the different devices that are out there now, like laptop computers that also have touch screens or convert and are then used in tablet mode. As designers, we're starting to think about, "How do we just make an app itself accessible on all these different platforms, or a site itself?"   Poornima Vijayashanker:        Let's tackle Jane's second question on how do we balance out fun and engaging interactions versus accessibility.   Laura Allen:        Yeah. That's another really great question. I think something that we should keep in mind when developing for mobile is sometimes we just rely a little bit too heavily on this idea of gestures and touch-based interfaces. I understand why, of course. It's typically being used by using touch. Some users aren't able to actually use touch to operate a phone. There's something called switch access, for example, which basically allows you to pair a one-button, or two-button, or multiple-button switch and control a phone just using those external buttons. That's just one example. Some people might be only using voice to control a device. Some people might be navigating with a screen reader, so as something flashes on the screen, they're not able to actually perceive that and then catch it in time to actually take action. Thinking about what are these things that we're assuming our users can do here, and then offering alternative ways to actually operate.                     For example, if you have an app that you're building where you have cards that you need to swipe away to take action, a swipe can work for some people, but for others, maybe that's not going to be possible. How do we think about things like, "OK. Can we add a hidden close button here so that a screen reader could actually access that and somebody could just simply double tap to activate?" Lots of different things like that. Just, again, removing assumptions about how our users are interacting and then just building to cater to different groups.   Poornima Vijayashanker:        I think your answers are going to be very helpful for Jane and the rest of our audience. Any final words of wisdom that you'd like to share when it comes to accessibility?   Laura Allen:        Sure, yeah, a couple things. First, just thinking again about mobile versus desktop and web and what not, I think it's also really helpful when designing for mobile to be thinking about the platform-specific guidelines. This is like guidelines for more so just the interaction models for that platform. I know there's the Android developers resources and site. iOS has the iOS human interface guidelines. These things obviously go well beyond just the concepts of accessibility, but they're really important to keep in mind because if you think about it. One example of what would be discussed is focus management. When you first open up an app, where is focus meant to go? What is the default? As you think about these concepts that are kind of illustrated through guidelines for each of these platforms, it's really helpful to keep that consistent so that when a user who happens to be using assistive technology interacts with this app, they get a similar experience to what they're used to. It's a similar model for them, and therefore it's an easier ramp-up curve to actually get introduced to your design. That would be one suggestion.                     Another thing to consider, which we haven't really discussed at this point: We talked a lot about auditing and integrating accessibility into your processes, and a lot of what we've talked about so far has been manual testing and the importance of really diving in, trying out the keyboard-only experience, or trying out a screen reader. Absolutely, I think that is so critical. I think honestly...I often get asked about manual versus automated testing, like what can we put in place to run automated tests. There are some great things to do, so there are automated tools, like, for example, there's a tool, there's an Android app called the Android Accessibility Scanner. It's free. It helps to run an audit of your app's accessibility and show you the results for things.   Poornima Vijayashanker:        Oh, great.   Laura Allen:        Yeah. For things like missing labels on a button or color contrast, things like that, which I would imagine to be kind of low-hanging fruit that you look at and hopefully fix rather quickly. There are similar things on the web and desktop. Lighthouse is a great tool, which integrates with the Chrome Developer Tools. There are lots of other types of tools out there that you can leverage to do some automated testing and audits, but in my opinion, automated can only go so far. That's where you use it to kind of see a baseline, track progress over time and your results, but manual is really critical. Again, whether it's you going through or having assistive technology users go through and give you feedback, that's where you're going to capture that more human interface experience. You're going to understand what is the usability of this product, whether on mobile or on desktop. It's just really critical to find that right balance of manual versus automated testing.   Poornima Vijayashanker:        This has been wonderful, Laura, and we'll be sure to include all the resources you mentioned below so that our audience can make sure to get access to them.   Laura Allen:        Great. Thank you so much for having me.   Poornima Vijayashanker:        Yeah, yeah. You're welcome. This has been great.                     That's it for this week's episode of *Build*. Be sure to subscribe to our YouTube channel to receive more episodes like this, and be sure to share this with your friends, your teammates, and your boss. A thank you to our sponsor, Pivotal Tracker, for their help in producing this episode. Ciao for now!                 This episode of *Build* is brought to you by our sponsor, Pivotal Tracker.                   
Feb. 12, 2018
Wasn’t last week’s episode on accessibility in product design enlightening? Well get ready for more! The goal of the last episode was to give you solid understanding of accessibility, and all the things you could think about when designing a product with accessibility in mind. But we understand it might be a lot to tackle, which is why in today’s episode we’re going to boil it down into 3 key tips that are critical and will make a big impact. Laura Allen is back to enlighten us. Laura is the Accessibility Program Manager at Google for Chrome and the Chrome operating system. As you watch today’s episode you’ll learn: Why thinking about accessibility is not just one person’s job, but a team effort How to integrate accessibility into your product development process How to engage users and discover communities that are ready and willing to test products for you!   Here are some additional resources to checkout that Laura mentioned in the video: Web Accessibility Udacity Course A11ycasts with Rob Dodson - YouTube series Build is produced as a partnership between Femgineer and Pivotal Tracker. San Francisco video production by StartMotionMEDIA.   ## 3 Key Tips To Keep In Mind When Designing For Accessibility Transcript Poornima Vijayashanker:        In the previous *Build* episode, we talked about the importance of accessibility. If you missed that episode, I've included it below. Now, in that episode we talked about a number of things that you could do to improve your product. In today's episode, we're going to boil it down to the three main things that you want to think about when you're designing and building your product, so stay tuned.                     Welcome to *Build*, brought to you by Pivotal Tracker. I'm your host, Poornima Vijayashanker. In each episode, I invite innovators, and together we debunk a number of myths and misconceptions related to building products, companies, and your career in tech. We're continuing our conversation today on accessibility with Laura Allen, who is the accessibility program manager at Google for Chrome and Chrome operating system. Thanks again for joining us, Laura.   Laura Allen:        Absolutely. Thank you for having me again.   Poornima Vijayashanker:        Yeah. Last time we talked about a number of things that our audience can do when they're thinking about designing products or revisiting their products and incorporating more accessibility. In today's episode, I want to focus solely on the top three things you think are super critical and will make a big impact in people's products.   Laura Allen:        Great.   Poornima Vijayashanker:        So, let's start with the first.   Laura Allen:        First.   Poornima Vijayashanker:        Yeah.   Laura Allen:        OK, so I would say the first thing to do is to train your team.   Poornima Vijayashanker:        OK.   Laura Allen:        Thinking about accessibility, it's not just one person's job, and that's something really important to keep in mind. This is a full team effort. There are different roles that different people have to play from design to research to development to just release processes, all of those different things. Everyone needs to play their individual part, to be totally honest with you. A lot of teams just will honestly benefit from just going through different trainings, leveraging resources that are out there. There are a lot of great things, like for example, I know a few of my colleagues actually have put together this awesome Udacity course just all about web accessibility. That's a great resource. There are lots of videos out there. There's this great YouTube series called The A11y Casts, it's like A-11-Y, which is an abbreviation for accessibility. If you've seen that before, it's A, 11 characters, Y, mean accessibility. So, lots of different things out there. We can definitely link some resources for sure.   Poornima Vijayashanker:        Yeah.   Laura Allen:        I would say, yes, training the team. Make sure everyone feels comfortable with the concepts of how to start building this in. That will go a really long way.   Poornima Vijayashanker:        Nice. So, it's not just to put the onus on the designers of the team but really your PMs, your engineers.   Laura Allen:        Exactly. Thinking about, for example, like the designers when you're scoping out a project, let's incorporate accessibility into design docs. Think about, "OK, well what should the keyboard model actually look like?” just as one example. "What should contrast? Am I thinking about contrast in my mocks?" So, bringing it in at the design phase, and then basically working with your engineers as you’re developing, testing for accessibility as you're going along, having PMs to help make sure that that process is happening, it's being managed all the way through. I think it's really critical. Basically, having everyone ramped up on this, everyone understand the fundamentals is really key.   Poornima Vijayashanker:        Wonderful. What's tip number two?   Laura Allen:        Yeah, so tip number two would be to integrate accessibility. Honestly, I understand why a lot of people might get to the end, be ready to release a product, maybe even release it, and then say, "Oh, shoot. We forgot about accessibility."   Poornima Vijayashanker:        Yeah.   Laura Allen:        Maybe they'll get bugs filed against them. That's not the situation that you want to be in. It's also just not an inclusive way to be building your products. I think just working hard to integrate into each step of the way, and that's what's helpful to have each different role on your team understand accessibility, of course. So, integrating so that when you're preparing to launch a product, that's at the phase. When you're actually designing and building it, that's when you're working on these concepts and implementing these principles instead of, "OK, we're ready to go. We're going to launch," and then, "Uh-oh."   Poornima Vijayashanker:        Yeah.   Laura Allen:        So, integration.   Poornima Vijayashanker:        What's the third and final most important thing people should consider?   Laura Allen:        Yeah. I would say to engage the users.   Poornima Vijayashanker:        OK.   Laura Allen:        This is something that's really important, again. So, just understanding a list of technology users or just users with any variety of accessibility needs are interacting with your product. One really simple step that I think is, if you're going out and you're conducting user research in the first place, why not add somebody who's an assisted technology user right to that pool? Add someone who's a screen reader user or someone who can only use the keyboard, for example, and can't use a mouse. Try to diversify that pool, and make sure you're collecting that user feedback, and understand how your product is working for a variety of different users.   Poornima Vijayashanker:        Very nice. Yeah, keeping the user in mind. Are there places that you can try to recruit from? A lot of people might use something like user testing and there's a few other services out there, but anything you would recommend to recruit people?   Laura Allen:        Yeah. I mean, one thing that I know we've seen a lot of success with is partnering with organizations. Just as one example, we're here in San Francisco today, the San Francisco Lighthouse for the Blind and Visually Impaired, that's just one example of a fantastic organization where they're more than happy to partner with teams or with individual researchers just to give feedback. They want to be helping. They want to make these products even better and better. There are lots of different types of organizations that are similar to that, which maybe local for people who are not right here in San Francisco, also national organizations, international organizations. So, just thinking about how do you leverage different communities, and you'll find that oftentimes if you just kind of approach different people and say, "Hey, we'd love your feedback on making this better and making it work better for you. Can you help us out?" It helps if you're going to go and have one of those conversations if you've thought through some of these core concepts and some of the things that are mentioned in the WCAG Guidelines, and you're not showing up without having even considered accessibility. Right? It goes a long way to bring real people in, real users in, and just make the products that much better.   Poornima Vijayashanker:        Well, thank you so much, Laura, for boiling these down into three useful tips. I know our audience is going to get a lot of out this.   Laura Allen:        My pleasure. Thank you so much.   Poornima Vijayashanker:        Now, Laura and I want to know, have you tried one of these three tips when it comes to incorporating accessibility into your product, which of these did you try, and what was the impact it made? If you've got others, be sure to include them in the comments below. That's it for this week's episode of *Build*. Be sure to subscribe to our YouTube channel to receive the next episode, where we'll dive into incorporating accessibility into web versus mobile. Special thanks to our sponsor Pivotal Tracker for their help in producing this episode. Ciao for now.                     This episode of *Build *is brought to you by our sponsor, Pivotal Tracker.
Feb. 6, 2018
It’s a new month and with it a brand new theme for our upcoming Build episodes! When designing products we often think about usability: how easy to use a product is. But we often overlook another aspect of product design: accessibility. So all this month we’re going to dive into accessibility. One reason accessibility gets overlooked is because we think it’s a challenge to prioritize it given a company’s size and resources. We may think accessibility makes sense for a big company, but a startup that is getting off the ground just doesn’t have the resources to incorporate it. Well, actually that’s not true... In fact, accessibility maybe just the differentiator you need when it comes to product design that is going to give your product a competitive advantage and increase adoption! And in today’s episode, we’re going to explore what accessibility is, why it’s important for any size company to incorporate, and show you how to do an accessibility audit for your product. To help us out, I've invited Laura Allen, who is the Accessibility Program Manager at Google for Chrome and the Chrome operating system. You’ll learn: What accessibility is and how it’s different from usability How accessibility influences user adoption of products How companies will benefit by incorporating accessibility into product development process, priorities, and core values Examples of common accessibility issues that impact all of us at various moments in our lives How to do an accessibility audit for your product and the 4 important principles to consider each time Here are some additional resources to checkout that Laura mentions in the episode: Web Content Accessibility Guidelines: Vox Media Accessibility Checklist: Build is produced as a partnership between Femgineer and Pivotal Tracker. San Francisco video production by StartMotionMEDIA. ## Product Design: Why Accessibility Needs To Be Prioritized In Product Design Transcript   Poornima Vijayashanker:    We often think about usability when we're designing products, but not accessibility. In today's *Build* episode, we're going to talk about the importance of accessibility and how to prioritize it regardless of being a startup or a big company, so stay tuned.                    Welcome to *Build*, brought to you by Pivotal Tracker, I'm your host, Poornima Vijayashanker. In each episode of *Build*, I host innovators and together we debunk a number of myths and misconceptions related to building products, companies, and your career in tech. Now, one often overlooked aspect of building products is accessibility. In today's *Build* episode, we're going to talk about what accessibility is, why it's important, and how you can do an accessibility audit for your product. To help us out, I've invited Laura Allen, who is a accessibility program manager at Google for Chrome and the Chrome operating system.                     Thanks for joining us today, Laura.   Laura Allen:        Absolutely. Thank you so much for having me.   Poornima Vijayashanker:    Sure. I know that a lot of times people think about usability when they're building products but they don't often think about accessibility. Let's talk about what is accessibility and how is it different from usability.   Laura Allen:        Accessibility is the design of products, services, devices, and environments for people with disabilities. I always like to take that one step further and think about accessibility as really empowering users with disabilities to be productive, to be socially engaged, and to be independent. This is super closely aligned with the concept of usability and also even just universal design and inclusive design. You think about universal design being this idea of building products that are going to be usable by the widest range of people and the widest range of situations. It's so closely aligned with this, that absolutely includes designing for people with disabilities.                     This whole concept of usability, yes it's critical to be thinking about all the time, of course, but we can make products functionally accessible, we can go through checklists, we can incorporate design principles and what not to make things technically work, but if you don't think about how is this actually going to be used, what is the experience for someone with assistive technology—like a screen reader, for example—if you don't think about that experience and usability of that experience it might not be productive or efficient at all. All these things are really closely linked together and they all help to move towards building an inclusive product.   Poornima Vijayashanker:    Why is this even important? I think a lot of people would say, "Oh, we have a really niche customers customer base, we don't think anybody has accessibility concerns so why even bother?"   Laura Allen:        Accessibility is something that impacts everyone at some phase or at some point in their life. Fifteen percent of the global population has some form of disability—that's a huge number, that's over a billion people. We tend to think about a few different distinct groups when we're thinking about design. We might be thinking about people who are low vision or blind, people who are deaf or hard of hearing, people who have motor or dexterity challenges. Then people who are, what we consider to be, neurologically diverse that can be anything ranging from dyslexia, to perhaps being on the autism spectrum, to any forms of intellectual disabilities.                     When you think about these different groups of people, people might be developing disabilities at different phases of their life, different severity levels, different combinations of disabilities, and then you start to think about, what about temporary impairments? Like what if you break your arm and all of a sudden you can't type on your computer for a few months? Situational impairments, like what if you're at a loud restaurant or a loud bar and there’s something on the TV that you want to be listening to, it's too loud to hear and you have to actually rely on those captions that were there specifically for the deaf population but they're helpful to everyone. Then, you take it one step further, and you think about this growing aging population, which thanks to increasing life expectancy, which is great, the aging population of people over 60 is growing, and growing, and growing, and the World Health Organization estimates that by 2050 it'll be over 2 billion people that are over the age of 60.   Poornima Vijayashanker:    Wow, so it's like doubling. Hopefully not, but yeah.   Laura Allen:        As we all age, at any point in our lives, we may experience some slight deteriorations in vision, or of hearing, or of dexterity, so these concepts are really, really critical to be building in, in general.   Poornima Vijayashanker:    That makes sense. Now, some would say that this makes sense for really big companies with hundreds of millions of users, but does it really make sense for our tiny little startup that's just getting started?   Laura Allen:        I would honestly say, accessibility is something that is critical for all companies, at all stages, all phases. To be totally honest with you, it's actually easier to build this in four startup-sized companies, smaller teams, smaller processes. Of course, it's completely doable at large companies as well that have established processes, but at a startup, you're building from the ground up, you're defining what you want your product processes to look like, and it's so much better just to be able to integrate accessibility in at that level, get people understanding what these concepts are, make this just a core part of inclusive design from the very beginning, and it'll be that much easier as you grow, and grow, and grow.                     Another thing to think about here is accessibility because it impacts such a large number of people this presents, honestly, a growth opportunity in many cases. It just opens doors for a lot more business, a lot of growth potentially. One thing that I like to think about, especially for startups and just hiring in general, if companies are focused on actually making their own products accessible then it opens the doors as well for being able to hire a more diverse and inclusive workforce. You can hire assistive technology users and have them come in and be able to use your products and that opens the door.                     A lot of us, obviously, at the companies we're thinking about how do we further diversify? How do we get people in the room who have a diverse set of perspectives? This whole idea of diversity a lot of times we are thinking about race, and ethnicity, and gender, sexual orientation, but disability is a huge part of this. It is a very, very big part of this group and we need a voice.   Poornima Vijayashanker:    Making it into your process, your priorities, your core values can really open doors for you in terms of your customer base and make things, hopefully, easier as you grow.   Laura Allen:        Absolutely. I will say, too, for a lot of people, like I mentioned before, accessibility will touch everybody at some point and in many cases it'll make the experience better, and more usable for many, many users. For someone like me, I happen to be low vision myself—   Poornima Vijayashanker:    What does that mean, “low vision?”   Laura Allen:        Really good question, because it can mean a lot of different things. For me, I basically have a central vision disorder, so if you can imagine all in my peripheral vision is still intact, it's still clear, but anything I'm looking directly at is this blend of flashing lights, and distortion, and blurring, and whatnot. This all happened for me when I was about 14, happened really quickly, really rare condition. I basically went from having typical 20/20 vision to being what's considered legally blind within about a week when I was 14. At that point, it was like I'm getting ready for high school, and all of a sudden I'm going to be moving to a bigger school, and then what happens? I couldn't read a book at that point. I couldn't see a blackboard. I couldn't recognize faces in the hallway. It was a huge period of transition for me, and for my family.                    For a few years there, it was one of those things where if materials weren't actually accessible in formats that I could listen to, for example, instead of visually read, I was stuck. I had to literally come home from school and my parents and my brother would read to me. That, to me, was the definition of dependence and I really, really hated it. I was so fortunate to have a family that was able to help me that way. It was just unbelievable the amount of effort they went through to get me through to the point where then I was able to regain my independence through discovering assistive technology like text-to-speech software, or magnification, or a larger mouse cursor, things like that.                    It was that period of my life that really propelled me into this world of accessibility and usability, because I saw the huge potential of what technology can do for someone's life and I just want to help to make that better for the rest of the world.   Poornima Vijayashanker:    It's great to hear you have a personal stake and it inspires everybody out there, but it also inspires you to realize and relate to people who might also be having these recognitions so that's wonderful to hear.                     For people in our audience out there who are building products, how can they get started? How can they prioritize this and gain the benefits?   Laura Allen:        That's a great question. There are a lot of different things to be considering. One thing that I would recommend is doing an audit, understanding where is your product right now, what's the level? This may vary. If you haven't really been thinking about accessibility yet, that's OK. It's a good opportunity to look at the holistic picture and see what's going on, and what bugs you may have. I would recommend just going through and leveraging a lot of the different resources that are out there and using those to create your own audit, however that works for you.                     For example, there is a great resource out there from the web content accessibility guidelines and we abbreviate that to WCAG. This is a W3C standard guidelines for accessibility. They've been really widely adopted by a lot of designers, engineers, companies, and they're wonderful. They outline different steps and different things to be considering.                     For example, they break it down into four different categories: perceivable, operable, understandable, and robust. Each of these things has a lot of different checkpoints, but just as a brief example, when we think about “perceivable,” what assumptions are you making about your users basically? What are we assuming that they can perceive? Are we assuming they have perfect sight or sight at all? Are we assuming that they can hear? Thinking about how they're perceiving the product and then different design guidelines that go hand-in-hand with that.                     “Operable,” similarly, is what are we assuming about the users, how they're actually operating with the product? Are we assuming they have really fine motor skills? That they can use a mouse, that they can use a keyboard? Are we assuming that they are able to use really quick reaction times, things like that?                     “Understandable,” what is the general understandability of the product? Are you assuming really high language skills to be able to navigate? Or the ability to just remember really complex sequences, all kinds of things like that? Then, “robust” is a little bit different in that it talks about how is your product working with assistive technology? Like a screen reader, for example, which would be leveraged by someone who's blind to be able to listen to the product, listen to the phone, or the computer, whatever it may be, and get that audio output instead of the visual.   Poornima Vijayashanker:    Nice.   Laura Allen:        The WCAG is a great resource. I tend to think when I'm thinking about checklists and working with designers and whatnot, I break down into a few key groups as well. The first around keyboard and focus, just really taking a quick poll of—let's say you've got a site, how does it work with just the keyboard, no mouse whatsoever? It's a great thing for engineers and designers to be able to try that out themselves as well. Just try using the keyboard only and as you're navigating through, can you get to everything that you need to? Can you also see visual focus indication? If you don't see that and you're just tabbing through, you don't know what you can actually take action on. Have you thought about that in the design process, basically?                     Then, I start to think about semantics. How do we actually make it more clear for screen reader users what the page is actually all about or what the app's all about? For example, do we have labels in place for buttons so that as you navigate with a screen reader, you don't just hear, "Button," or, "Unlabeled button," which is not helpful at all. Thinking about how do we just convey that experience and make sure that it's clear for a screen reader.                     Then a third bucket, which I like to call think about in my audits, is just this idea of flexible interface. That can be anything from color contrast—so WCAG actually says we should have a minimum color contrast ratio of 4.5:1 for text against its background color. That's super helpful because for anyone, like me, with a low vision or just anyone who doesn't have the perfect 20/20 vision, it can be really hard to actually distinguish those colors, or a low contrast text, so that's a really helpful usability improvement for a lot of people.                     In this same group of flexible UI, you think about things like how does this interface look with magnification at a 200% zoom level, for example? Or are we using just color, or just sound to convey information? Just color, one example there, is if you have an input field and you type an error and all of a sudden maybe just the text will appear red. In that case, people who can't distinguish color will miss that information, screen reader users, or braille readers will completely miss that information as well. Thinking about how do you go one step further and convey that and make sure there's also error messaging. You can still use the color red and all, that's fine but it can't be the only way that you're identifying that information.                     I like to think through questions like that using the WCAG guidelines and other things that help there—like I know Vox Media has a really great checklist—and just get a sense of where's the current level? From that point, you may have a lot of different bugs, you may have different things that you want to be able to address, and the next step is naturally to work on, “How do we triage this? How do you prioritize?” I think one really helpful thing to do there is just to think about each of these bugs, what is the typical user impact? How critical is this? Would this bug stop somebody from being able to actually interact or take action on your site and your core purpose of your site or your app? I like to think about that, and help to prioritize, and just go from there.   Poornima Vijayashanker:    Wonderful. We'll be also sure to include the resources you mentioned below in the show notes.                     You've mentioned a number of things that happen during the audit. What happens after the audit?   Laura Allen:        I think the next natural step, of course, is going through that triage and prioritization process. Then as you're solving these problems, as you're fixing bugs, continuing to go through and help to honestly integrate accessibility into each step of the process. I think that's the really critical step. One holistic audit is not going to take you all the way. We have to start bringing this into our development process and building it from the ground up. Then, honestly, getting out there and working with users, understanding what the feedback is. I think that's a really critical component to understanding how to improve.   Poornima Vijayashanker:    I know in the next episode we're going to be going into a little bit more detail and boiling it down for viewers out there. Thank you so much today for joining us Laura.   Laura Allen:        Thank you.   Poornima Vijayashanker:    Now, Laura and I want to know: how does your company handle accessibility? Let us know in the comments below.                     That's it for this week's episode. Be sure to subscribe to our YouTube channel to receive the next episode where we'll dive in a little bit deeper and share three key tips that you want to think about when designing for accessibility. Thanks so much to our sponsor Pivotal Tracker for their help in producing this episode. Ciao for now.                    This episode of *Build* is brought to you by our sponsor, Pivotal Tracker.
Jan. 30, 2018
All this month we’ve been exploring how startup fundraising is changing and why it’s going to continue to change in 2018.   We started off by talking about why you don’t want to reach out to an investor when you just have an idea, how to evaluate if seeking investment make sense for your business, and in the last episode why no matter how great your idea or business is you’re still going to receive a lot of NOs.   After what might seem like endless reality checks, I’ve saved the best episode for last, we’re going to be talking about what it’s going to take to get a yes from an investor. Ooshma Garg and Danielle Morrill are back. Ooshma is the CEO and Founder of Gobble, and Danielle is the CEO and Founder of Mattermark. They've both recently become investment partners at XFactor Ventures, an investment firm that's focused on investing in female founders and mixed-gender teams.   You’ll learn:   Some of the uncomfortable activities you’re going to have to do find that first investor How to approach the topic of check size How to leverage that first check and attract additional investors who may have been on the fence What the investment partners at XFactor Ventures are looking for and the types of startups they have already invested in   Finally, if you are a female founder or are on a mixed-gender founding team and want to pitch your startup to the partners are XFactor you can check out their website here and follow up with them via email: [email protected]   Build is produced as a partnership between Femgineer and Pivotal Tracker. San Francisco video production by StartMotionMEDIA.   ## What It’s Going To Take To Get That First Check From An Investor Transcript   Poornima:         In the last *Build* episode, we explored all the reasons an investor may say “no” to your big idea. If you missed the episode, I've included a link to it below this video. In today's episode, we're gonna dive into what it's gonna take to get that yes from an investor. So stay tuned.   Welcome to *Build*, brought to you by Pivotal Tracker. I'm your host, Poornima Vijayashanker. In each episode, innovators and I debunk a number of myths and misconceptions related to building products, companies, and your career in tech. Now, it can be very disheartening to hear no after no from investors, and make you wonder whether you're eventually gonna hear a yes. But it is possible, and in today's episode we'll talk about what it's gonna take to get that yes. Today we're back with Ooshma Garg, who is the CEO and Founder of Gobble, and Danielle Morrill, who is the CEO and Founder of Mattermark. And they are both investment partners at XFactor, a new investment firm focused on funding female founders and mixed-gender teams.               So thanks for coming back, ladies. I know last time we talked about all the many reasons that we've received a no. This time let's turn it around and talk about what it's gonna take to get a yes and let's start by reveling in that moment where we each got our first yes. Danielle, when was the first time you got a yes? Danielle:            I got my first yes from Dave McClure. We were sitting on the curb in front of their new office they had just opened in Mountain View. It was my birthday and it was the “you can quit your job now” check.   Poornima:         Awesome.   Danielle:            So it was extremely exciting to kind of put that milestone.   Poornima:         Yeah. What about for you, Ooshma?   Ooshma:            I got my first yes from Ben Ling and Keith Rabois. I remember going to get a physical check from Ben. He was at Google at the time. Now he's a partner at Khosla Ventures. And so we had been meeting and going back and forth and then I showed up there and he just wrote this check that was more money than I had ever seen in my entire life. He's like, "Here you go." I felt like I was this I needed an armored truck. I felt like anybody who looked at me could see that I was carrying tens of thousands of dollars in my hand. It was really funny. I remember just being so excited, but also funny enough, just so careful and so nervous carrying that check literally all the way to the bank.   Poornima:         Nice. You weren't like Serena Williams, who just hopped into the ATM and tried to put it in the machine or something like that? She did a drive-by with one of her first—   Ooshma:            Oh yeah?   Poornima:         Yeah. With one of her first grand slam winnings. It was like—   Danielle:            I didn't even have a bank account.   Poornima:         There you go.   Danielle:            That sounds awesome.   Poornima:         That's awesome. All right. And then what did you do right after you got that first yes...after you deposited the money in the bank?   Danielle:            I don't think I deposited it for a while. There's all this stuff that has to happen actually, so we also incorporated on that day, just luck of timing. But yeah, I think it's really weird. You get this check and it's like this life-changing thing and then you have to go back to your crappy one bedroom apartment with no windows in San Francisco and it's like, "Get back to work."   Poornima:         Yeah.   Ooshma:            Yes.   Danielle:            Keep coding, so it's bizarre and this thing happens and you wanna shout from the rooftops, like, "Ah!"   Ooshma:            Yes.   Danielle:            But on some level you feel like, "Oh shit, this is real."   Ooshma:            Yes.   Danielle:            Does that resonate for you?   Ooshma:            Absolutely. I think with every great success there's just great responsibility. And so now you have this amazing check and certainly it's time to crack a bottle of champagne and celebrate for a moment.   Danielle:            Yes.   Ooshma:            But with that comes everything that you were planning to do when you told the person you would do with it. And not only that. It's just the first check. Typically you're raising some kind of round and it takes 10 to 15 angel investors to get it all together. So it's a huge milestone that I think people can take a sigh of relief, but still have to carry it to the finish line.   Poornima:         Now, one of my first investors was somebody who understood my niche market. I know we talked about this in the last episode, but once I found him, actually fundraising became super easy because he went out and kind of rallied the other folks who were kind of on the fence, right? It was, "I believe in this market, I believe in this founder, I believe in this idea, I'm gonna write this check and you all would be stupid to not follow." Have you had that experience as well?   Danielle:            Yeah, I think different investors take different approaches. Sometimes they go and create the syndicate and sometimes you do and then they come back you up by adding a voice. But I think they're pretty networked so most investors here talk to each other or they're only one degree of separation away.   Ooshma:            Yes.   Danielle:            So you almost feel like when you're beginning to fundraise, you can kind of feel the Valley talking about your company. There's no trace of it on the internet, but they definitely are asking each other questions and saying, "Have you looked at the deal? What do you think of the price? What do you think of this person? Do you know anything about them? Have you heard anything negative?" Just all those questions. Because there is no diligence tool, and I'm laughing because Mattermark is part of that story—   Poornima:         Right.   Danielle:            —but when we were really early stage, it's really a reputational thing.   Ooshma:            Yes.   Danielle:            And so I think part of it is going out and beating the drum for you and part of it is also they're fielding questions. So as soon as you say, as soon as I said, "Hey, Dave invested in us." Then I should expect Dave is gonna get hit up with people saying, "What do you think of Danielle? Why did you invest?" etc., etc.   Ooshma:            Yeah.   Poornima:         Right.   Ooshma:            But I do think it's important to make sure that when you get some of those first checks that you ask the person who else they would recommend join the round. That would be leaving a lot of value in introductions and referrals on the table if you didn't do that. Because this person has just expressed huge conviction in your vision. And so they'll typically or should be able to bring along at least a handful of introductions.   Danielle:            And also, I've gotta add, I did not know to do that when I first started out. And I think it's because you think you're inconveniencing this person who's just written you a check.   Ooshma:            Yeah.   Danielle:            But actually they just wrote you a check because they wanna make you successful. And so you should ask and ask and ask. They will tell you if you've crossed the line, but you probably never will cross the line. And it's really easy, as an investor now, to just move on to the next thing and get busy. And it's not that I don't want to help, but I kind of assume if you're not asking, you're all right.   Poornima:         Right.   Danielle:            So ask. Because I think it's totally true. And I think I did leave a lot of that on the table and probably made it harder on myself than it had to be at first.   Ooshma:            Yup.   Poornima:         Yeah. They're also protecting their investment by getting their fellow investors to invest, right?   Ooshma:            Yes.   Poornima:         Yeah. So last time we talked a little bit about the stage that investors are at and oftentimes that makes a difference. And Ooshma, you sort of alluded to this. Now there's a lot of different types of investors out there in the market today. There's VC's, angels, super angels, micro funds, and so on. So let's talk through what makes sense at each stage, and let's start with accelerators because both of you have been involved with YC. So when does it make sense to approach an accelerator before or maybe after funding, and what did it take to get in?   Ooshma:            Wow. You know, one secret that a lot of people don't discuss is that many folks that got into something like a YC got in on their third or fourth try. So I did not know that until I started talking to a lot of founders. And YC might've given them feedback, maybe they kept working on their idea and they got to a certain stage. So I think that you might apply but you shouldn't just quit based on getting a no that we talked about. Even getting in to accelerators at an early stage sometimes takes a few tries.   Poornima:         And why would you even recommend people apply? Why does it make sense to do that?   Danielle:            So I think it really comes down to helping you set up the company for success down the road. So what an accelerator or incubator program is gonna do is help you with your go to market, and that doesn't just mean your product go to market. It's also the marketplace they create for financing your company.   So they're gonna help you validate that you've got a venture-backable business and they're gonna help set you up with the relationships and the communication pattern that you need to have in order to be a viable option for those investors. And that's really valuable, especially if you're coming to the Bay Area from somewhere else and you can't really build that network in a few weeks.   Poornima:         Sure.   Danielle:            You really need to be here. And so you're gonna be able to get a lot of time back. Of course, they take equity for this. But I think it's probably one of the best trades you're gonna make because in the beginning it's just so binary. You're either gonna raise that round or your company's probably not going to exist and so early on that's probably one of the best ways to de-risk financing and then you can focus on the product.   Poornima:         So you mentioned that marketplace pulling in intros for you. For the two of you, how did YC facilitate those intros to angels or super angels?   Ooshma:            Well, in my case we were very unconventional. I started the company without YC and I just wanted to build this idea and I felt that there was a problem that needed a solution. So I started prototyping it, I asked my friends for introductions. I was luckily already here for three years after college building a network. So I could just start my own process and seed round and ask for introductions, start raising money, and we didn't need Y Combinator for the first couple years of the company.   Then, it takes a while. First your company has to get funded so you can explore it, all right? And then you have to find product-market fit and you get to a stage of scale. So it took us a while to find product-market fit and I did YC in the middle of our company's story, at a time when we were changing models. Solving the same problem, but with different solutions, and when the fundraising environment was really tough.   So I had to make the decision of, “If it's worth working on, I'm gonna take what I can get.” And at the time that was joining an accelerator. So I think that that's a good example because it shows that you might've been working on something for five years and if YC can help you, or an accelerator can help you, you should still apply and use that as a catalyst for whatever next funding round or whatever growth metric you're—or awareness you're really looking for. But I would also say that you can't let anything like that stop you from building your company.   Poornima:         Right.   Ooshma:            So any investor saying “no” or any accelerator saying “no,” you should be building something because you see a way for the world to be better with something. And you have to decide to just do that and do it anyway, regardless of how you get there.   Poornima:         So let's talk about the mechanics behind this now. So there's obviously angels, there's super angels, there's micro funds, there's VCs. Walk us through what the check size is or who makes sense at what stage.   Danielle:            Right, so, there's a lot of flavors. Generally, if you're talking pre-VC, then there's very few private individuals who are gonna write more than a $50,000 to $100,000 check. Generally, if you think about someone's net worth, they've got some chunk of their net worth set aside for investing, and it's probably like 5% or 10%, so you can kind of begin to understand what's going on there.   But the easiest thing for anyone who's not a VC is just to ask them. What's your check size and how much risk do you wanna take? Will you invest pre-product or no, is question one. And then post-product, it's like what do you need to see from me to invest? There's so many investors now in that pre-Series A stage that I think it would be hard to give a blanket answer. But the most important thing is to just ask them, "Tell me about the last two or three deals you did. How big were they and what stage?" And I would try to not worry about getting them to do something exceptional. People kind of have their comfort zone with their personal money. And what they're doing is probably gonna continue to be the same because they're anchored on their last check.   Poornima:         Yeah. Danielle:            So if they've been writing a lot of $10K checks, that's probably the check size that they're writing unless they come into a huge amount of money and it changes their world.   Ooshma:            Right.   Danielle:            And then the other thing is you're gonna have these weird institutional investors who will invest before Series A. I guess this is super common now. When I started fundraising this was a lot less the case. So these are kind of these super angels, micro VCs, I don't really know what they're called today. Pre...what is it, pre-seed?   Poornima:         Pre-Series A.   Danielle:            They call it all these different things.   Poornima:         Yeah.   Danielle:            But fundamentally no, those check sizes could be anywhere up to, let's say, $500,000. They're generally not leading or pricing a round. No one has to lead a round if you don't have a equity round, so that's—a big part of it is just, again, what size check are you normally writing, do you need control in some way, do you add a board seat, all those things. The good news is once you get to Series A, it's a lot more standardized in terms of ownership. So there's some rules of thumb and I'm gonna say these and then you tell me if you think they're different because I feel like maybe they're not all the same. One big piece of advice is don't sell more than 25% of your company before your Series A. So fully diluted, when you run your own cap table out. You don't wanna be in a position where you've already sold half your company, because what happens is a Series A investor probably needs to have 20% ownership just for them when they come in. So if you've already sold half your company, on top of that, it starts to be pretty demotivating. That can be a little higher or lower, just depending on what's going on with your business. And then you of course have your other investors that might come in. So maybe you sell 25% to 30% of your company total in that round.   And then the B and C and so on. The way to think about it is the better you're doing, the more leverage you have.   Poornima:         Sure.   Danielle:            People generally sell 15% to 20% of their company in the B. And then at the C, D, and onward, it's kind of a sliding scale downwards from there in terms of ownership percentage. And you might be thinking, "Well, doesn't this add up to more than 100%?" And the thing is that you're diluting everybody else as you go. So you're selling a chunk of the whole company at that moment in time. So these investors, it's generally gonna come down size will line up with check size. And they're gonna say something like, "We raised $150 million fund, we're planning to write $5 million to $10 million checks, and then we're holding on to $5 million to $10 million per company for follow-on." Something like that, and you can just do the math.   Poornima:         Right.   Ooshma:            Or like, in our case with Xfactor, we have a $3 million fund and we're putting $100K in 30 companies. And that's the rubric. So I think to Danielle's point, it's your job to understand everyone's rubrics and appetites so that you are not wasting your time and not wasting their time. And at each stage—and let's take the seed stage for example, because it's one of the only stages where there's so many investors involved—fitting all those puzzle pieces together to get to how much money you need for the next 18 months and a specific material milestone. So I think you start out with calculating that money and you get your friends or blogs or whatever advisors to help you. And then look for people in that stage and then fit those pieces together and ask them to make introductions until you fill the amount.   Poornima:         Yeah, so let's talk about that. How do you actually get these intros? If I'm outside of Silicon Valley, I'm coming in, or even if I'm here and I've been an engineer all my life or a designer or something and then I recently made the switch to a founder, I might not have that network. How do I get those intros?   Danielle:            So, the truth is you're just gonna have to get out there and talk to people.   Ooshma:            Yeah.   Danielle:            And I think the thing is you probably know people who can help you that you might not realize. It's pretty rare, if you live here, even if you just moved here, not to know somebody who works at a startup. So you just have to start asking. And the truth is you're gonna have to give away information to get information.   Poornima:         Sure.   Danielle:            "Hey, I have a startup." OK, everybody has a startup.   Poornima:         Yeah.   Danielle:            "Hey, we're raising." OK, "It's really hard."   Poornima:         Right.   Danielle:            A lot of people immediately are like, "Oh, OK, interesting." "Do you know anybody who invests in startups?" And the thing is you're gonna have to do this at scale. So you're gonna need to go to events.   Poornima:         Right.   Danielle:            You're gonna need to ask the people that you worked with in the past and you're gonna need to do things that you might not enjoy doing, like going on LinkedIn and just doing a ton of research. Nothing is better than a warm intro. So even though this feels really weird and painful to ask, these are gonna generate the introductions that are gonna be the best possible. The next thing is cold after that.   Poornima:         Right.   Danielle:            So anything you can do to get something warm, even if it's many degrees of separation, is gonna help you more. And so that might also mean cold outbounding someone that you wanna then get an intro through.   Poornima:         Yeah.   Danielle:            So portfolio founders are probably the best people to cold outbound rather than the VC themself or the investor themself. So if someone cold contacts me and says, "Hey, I'd love to get to know you and Mattermark, yadda yadda," and maybe their plan is that they'd like to get introduced to Brad Feld, the reality is if they can tell that we didn't click, they're not gonna ask for that intro. And that sounds really, I dunno.   Poornima:         Transactional?   Danielle:            Mercenary? Transactional?   Poornima:         Yeah, yeah.   Danielle:            But it's business, so that's what business networking is.   Poornima:         Of course.   Danielle:            And I think the truth is I wanna send Brad great companies.   Poornima:         Yeah.   Ooshma:            Yeah.   Danielle:            So if you're an interesting company and you pitch me and I get excited, one, I might angel invest in you, which is the absolute best way for me to introduce you to one of my investors.   Ooshma:            Yeah. Danielle:            But the other thing is we all got helped in the same way.   Poornima:         Yeah.   Danielle:            So it sounds transactional, but it's also just kind of how it works.   Poornima:         Yeah.   Ooshma:            It's the culture of paying it forward.   Poornima:         Right.   Ooshma:            Everyone does that. And if they can't...they'll be honest. If they can't give you that introduction and you do click, maybe they'll give you some advice. And then we go back to that whole idea of listening and staying in touch and sending people updates. But I would say leave no stone unturned. If you just landed here, there's Techstars or 500 or Founder Institute or Y Combinator or TechCrunch Disrupt or Golden Seeds or who knows. There's all these things you can apply to. And of course, if you are an island and you don't know anyone, you have to start out cold. But cold will soon become warm.   Poornima:         Yeah.   Ooshma:            And you have to play the numbers game in the beginning.   Poornima:         Sure.   Ooshma:            And so just go to all the meetups, email everybody, send links and product demos. Just be creative. Oh! One hack that I had which actually led to me meeting you is that I would go to talks and sit in the front and come up with really good questions. And I'd strategically go to talks where I really wanted to meet the person and I knew they'd be a great investor or advisor. I would wait until the very end. They would give a talk and then all these people would be crowding around someone like Reid Hoffman. In this case it was Aaron Patzer from Mint. And so people were talking to him for 30 minutes. And I waited until the very end and he was like, "Oh my gosh. Who's this person waiting?" I said, "Hey, I'll just walk you to your car. I have a quick question." And then he became a very early on startup advisor and advocate for me. So there's all these unconventional things I think that you can do to get out there. And they might be uncomfortable but that's how we all did it.   Poornima:         Yeah. It's funny. I actually mentioned this hack to a bunch of people whenever they want my time. I tell them I'm gonna be at this event speaking. Some people take me up, some people don't. Some people have gone so far as to say, "I'll pick you up from the airport." I love those people. Because I'm like, "Great! I don't have to worry about how I'm gonna get from Point A to Point B," right? Or "I'll buy you dinner" or whatever, but yeah, I think it's definitely going out of your way to get that interest and build that network. So let's talk about what you guys are working on now. You are working on XFactor. So let's dive into that. Why did you even think this was important? Ooshma, you just rattled off 10 seed opportunities. So why XFactor?   Ooshma:            Yeah.   Poornima:         Why do you want to put another one in there?   Ooshma:            You know, there was not one female investor in our seed round. And I think...I firmly believe that diversity creates innovation, diversity of thought. And America in and of itself is this diverse nation and considered to be the best in the world. And it's because of all the different perspectives and kinds of people that we have here.   I like to emulate that in the company and I would like that in our investors. I don't think that one perspective is gonna make us this breakout, worldwide innovative company.   So, I think that XFactor is unique and necessary because it's brought together a partnership of nine people and it's all women and we are all operators, founders, CEOs, and active companies. We're not retired. We're extremely current. All these things...fundraising, hiring, strategy, growth, it's all on top of mind. We can add so much value to early stage companies. And we're just approaching it in this very kind of operators helping operators, allowing for bad-ass women to help other women in a space where there just aren't as many.   Poornima:         Yeah.   Ooshma:            And really just adding some more diversity to both the founder pool and the investor pool to build more breakout companies.   Poornima:         So you mentioned you were able to raise capital without having a woman founder. So why is that...why do you think that's important? Right? You did it, you proved it. You did it, you proved it. And I know I' my last company I raised from all men, so why is that important?   Danielle:            I think that it's important because it's hard and the reality is we want these products to exist in the world. It's not really that these companies can't get funded. It is harder, but the best ones get funded. And it's just what are we missing?   Poornima:         Yeah.   Danielle:            What are we missing out on in the world that could exist tomorrow?   Ooshma:            Yup. Danielle:            There's so many creative, amazing people who are not getting funded for reasons that have nothing to do with what the company is about. And the bad thing is that this kind of poisons the well too, so there's people who aren't even trying.   Poornima:         Yeah.   Danielle:            And so I think we wanna send this message that, "Look, we shouldn't have to exist." XFactor shouldn't need to exist and if we do a really good job and we make a bunch of money, people are gonna realize that investing in women, investing in men, we wanna invest in the best no matter what. So down the road, hopefully we can't exist.   Poornima:         Nice. Yeah.   Danielle:            But until that happens I think we need to...the only way to change it is to actually create competition.   Ooshma:            Yup.   Poornima:         Yeah.   Danielle:            So we are in competitive deals and we are sending this deal flow, we're creating market for each of these founders because we're gonna need to see a lot more female role models at the top. Ooshma's company is progressing, Mattermark is progressing, but we're still very early stage and there's not a ton of examples of huge exits run by women.   Poornima:         Right.   Danielle:            So I think we're really great examples here, but it's very early days and the best chance we have of seeing those results at the end is to put as much as possible at the top of the funnel. And I wanna say I also think it's just an incredible investment opportunity because it's under-invested so dramatically. Frankly, we should be able to see incredible returns partly because there's just so many opportunities that haven't been taken.   Poornima:         Yeah.   Danielle:            So I feel like not only is it awesome for founders, and I'm so stoked about them, it's awesome for our LPs and it’s gonna prove to LPs that female fund managers can return awesome results as well. And you know what? There's more asymmetrical opportunities like this to take. There's room to create tons more funds focused on women. You can create the exact approach with any minority group.   Poornima:         Yeah. Danielle:            So it' shouldn't have to exist, but while it does, we should try to create wealth for all the people involved and then long term, I think create competition in the market.   Poornima:         Yeah.   Ooshma:            And it's so...this is not a not-for-profit.   Poornima:         Yeah.   Ooshma:            It is not a charity. We are looking at people who are the grittiest of entrepreneurs and are in it for the long haul and ready to build multibillion dollar companies, and can answer all the hard questions. And we've got—   Poornima:         So what are some of those?   Ooshma:            Yeah. Well, first of all, we've gotten hundreds of pitches.   Poornima:         Yeah.   Ooshma:            And we've only made about nine or so investments.   Poornima:         OK.   Ooshma:            Since July. So in just the last three months we've looked at so many companies, and I think people assume, "Oh my gosh, there's a female investor, she's gonna invest in a woman." But I think it's out of respect to founders that you...that investors ensure that they are looking for and helping you build huge companies and use your time in the best way possible.   Poornima:         OK. So what are you guys looking for in your...and what's kind said that your check size is $100K, so we're looking at early deals. And what else are you looking for? What's it gonna take to get a yes?   Danielle:            Well, the first thing is that we are definitely looking for a return that's pretty impressive. So even at the early stage if we invest, let's say $100,000 in a $1-million round, I would say the average post-money valuation is $8 million to $10 million.   Ooshma:            Yup.   Danielle:            So right away, to get to a 10x outcome, we need to see a company with really meaningful revenue. The good news is we don't technically need to find the billion-dollar companies to have a really successful fund, but I think the reality is we wanna find those outliers. Poornima:         Sure.   Danielle:            So we're just like any other venture firm at the early stage looking for the most impressive opportunities to deploy their capital. We've got 30 bullets in the gun. So we're also thinking, "OK, we're gonna invest this money over the next two or three years. Is this the best deal that I can do this year for each partner?" Each partner is thinking about this constantly. So you're looking at the entire field and you're saying, "Of all the possible ways to deploy this money, what do we think can get the best return?"   Ooshma:            Right.   Danielle:            And that's what we're focused on.   Ooshma:            And the partners hold each other to a very high bar. We're all CEOs of our own companies and we hotly debate every deal.   Poornima:         OK.   Ooshma:            And it's incredibly smart, active people around the table. So it helps us make great investments. And it helps us keep the bar high because we have a lot to prove to each other and I think we have a lot to prove as a fund. And that we want to. Because this's about the great returns, but it's also, like Danielle said, about setting an example and about proving a point and hopefully making ourselves obsolete.   Danielle:            So I think we should give some specific things for the viewers in terms of what we wanna see because, people listening, we want you to pitch us. So, you gotta have a product. You pretty much have to have revenue I would say for our group, although we would still talk to you, help you get there, stay in touch. We wanna some amount of revenue or customers. I would like to see high margin businesses. I'm looking for software scale. I don't think that that's true for all of my partners, but I struggle because I think we're looking for companies that take advantage of innovations to get the advantage in the market.   Ooshma:            Yes.   Danielle:            I'm looking for people who have some special passion. Ooshma talked about being mission driven. It's really hard. I think we really wanna find founders who are in it for the long haul, so if they're just an arbitrage deal, I don't know that we're quite as excited about that.   Poornima:         Right.   Danielle:            Again, I don't wanna speak for all my partners, but I personally would prefer to talk to somebody who's like, "This is the only thing I wanna do."   Poornima:         Yeah.   Danielle:            I'm looking for patents and technology innovation. I'm looking for stuff that solves problems in the enterprise space and software space for developers, just because I actually think there are a lot of women in those fields and I think there's more bias for women pitching those ideas than any other idea, and I think they—I wanna give them that check so they have the confidence to go do all the rest of the pitches.   Poornima:         OK.   Danielle:            I wanna write the quit-your-job check. That's the number one thing. So if you're watching this video and you're like, "I would have to quit my job and work on this full-time and I need $100,000," we wanna talk to you.   Poornima:         Yeah.   Danielle:            Because the quit-your-job check for me was life-changing. I think we would like to write that, so, sorry I'll let you tell them what you want.   Ooshma:            I mean, man. Yeah, Danielle really covered a lot of it. And I think just the founder DNA and passion and willingness, of course plays a huge role. But the interesting thing is that our partnership is so diverse that we have folks coming at it from retail, from consumer, from enterprise, from hardware. We've assembled this...and from the finance companies and healthcare, finance, SAS, etc., so it's really neat because no matter what your company is doing, there's probably an expert in our partnership that can talk with you, consider the deal, and at least give you feedback, if not invest.   So I think that we are looking for breakout companies in all of those industries. But your...yeah, we—   Danielle:            Our portfolio already has quite a range.   Ooshma:            It has quite a range. I mean, we've invested in fashion, in hardware, in AI—   Danielle:            Developer tools and machine learning and ag tech—   Ooshma:            Yes.   Danielle:            Huge range already.   Poornima:         Well I can't wait to hear when they come out. Ooshma:            Yes.   Poornima:         So, for our audience out there who's eager to get their idea out in front of you, how can they get in touch with you?   Danielle:            An email to [email protected] is perfect. is the domain.   Ooshma:            Yes.   Poornima:         OK, what should they send you?   Danielle:            You can send us a pitch or you can send us a hello and we can set up a phone call. Either one is great.   Poornima:         Cool.   Ooshma:            Yup.   Poornima:         All right, well, be sure to take them up on their opportunity.   Ooshma:            Looking forward to it.   Poornima:         That's it for this episode of*Build*. Be sure to subscribe to our YouTube channel to receive many more episodes like today's and great *Build* tips. Ciao for now.   Announcer:      This episode of *Build* is brought to you by our sponsor, Pivotal Tracker.
Jan. 24, 2018
Think you’re onto something BIG, and surprised you’re receiving so many NO’s from investors? It can really make you second guess yourself, and shake your confidence... … but it shouldn’t! Receiving a LOT of NO’s is natural. You may be tempted to listen to the feedback after receiving some NO’s and think you just need to launch your product, change your business model, or grow your customer base, and then you’ll be more attractive to investors. Guess again. The reason you receive for the NO and the feedback you get may not be aligned. Why? Because at the end of the day, investors are human. They don’t want to hurt the feeling of a first time founder, and don’t want to seem rude in case they want to invest later. Yes they just might invest later. So how can you tell what is really going on? Well that’s what we’re going to debunk in today’s episode of Build! To help us out I’ve invited Ooshma Garg who is the CEO and Founder of Gobble, and Danielle Morrill who is the CEO and Founder of Mattermark. They've both recently become investment partners at XFactor Ventures, an investment firm that's focused on investing in female founders and mixed-gender teams. We’re going to help get comfortable with receiving NOs and deciphering what they really mean. You’ll learn: How Danielle and Ooshma learned to keep their spirits up despite all the NOs they received How to be politely persistent with investors who won’t bother taking a meeting with you The various tests investors put first time founder through How to maintain a relationship with an investors even after they say NO -- Build is produced as a partnership between Femgineer and Pivotal Tracker. San Francisco video production by StartMotionMEDIA. -- ## Why Investors Keep Saying NO To Your BIG Idea Transcript   Poornima Vijayashanker: In the previous two episodes of *Build*, we talked about why, even if you have an idea, you might not get investment from it, and it needs to be a big idea in order to even attract interest. But even if it's a big idea, chances are investors aren't going to say “yes.” In today's *Build* episode, we're gonna uncover all the reasons an investor may say “no” to your big idea, so stay tuned.   Welcome to *Build*, brought to you by Pivotal Tracker. I'm your host, Poornima Vijayashanker. In each episode, innovators and I debunk a number of myths and misconceptions related to building products, companies, and your career in tech. Now, one misconception that a lot of first-time founders fall prey to is if they have a big idea, some investor's gonna want to put capital and fund it.   The truth is that a lot of funders face nos, and just because they face nos doesn't mean that someone won't eventually invest in them. In today's *Build* episode, we're gonna explore all the reasons that investors may say “no” to your big idea. And to help us out, I've invited both Ooshma Garg and Danielle Morrill.   Ooshma is CEO and Founder of Gobble, and Danielle is CEO and Founder of Mattermark. They've both recently become investment partners at XFactor, an investment firm that's focused on investing in female founders and mixed-gender teams. Thanks a lot for joining me today.   Danielle Morrill: Absolutely.   Ooshma Garg: Thanks for having us.   Poornima Vijayashanker: We've come a lot way since that first South by Southwest where we all shared a hotel room in 2010, and all of us have gone out and fundraised a number of times. I want to start by asking the two of you, what was that first no like that you got from an investor?   Danielle Morrill: I was bummed. I mean, I think the first 10 investment meetings were just nos back to back. First, you're like, "I guess that it would happen. I would get a no," but I'm like, kind of the straight-A's type kid. I keep thinking, “Of course I would get a yes every time," and then after you get them over and over, you're like, "Oh, maybe this just happens. Maybe this is true that you get way more nos than yeses." What do you think?   Ooshma Garg: Man, you know, your company is like your baby. It's a reflection of yourself, so the first no, and even ongoing nos, they're always so personal. I think you get a little bit used to it because you just build some armor and build some strength every day and every year as an entrepreneur, but especially in the very beginning, it's kind of like a survival-of-the-fittest process. You have to be able to psychologically get through the nos, take some feedback, and develop that never-quit attitude early on if you're going to be successful ultimately.   How To Get Over Rejection When Fundraising And Keep Going   Poornima Vijayashanker: Yeah. So, how did you get over that? How do you even know that you should just take the feedback, deal with the rejection, and keep going?   Danielle Morrill: I made a fundraising playlist on Spotify.   Poornima Vijayashanker: OK.   Danielle Morrill: I think it's Jay-Z who says, "On to the next one." I used to blast that song, like after every pitch, actually after the good ones, too. But honestly, you kind of just have to keep living, and I think part of it is just putting it in context with the rest of your life. Having a playlist for me was sort of a reminder of, “Oh, life just kind of goes on.” It's fun with your team too, I think, to just be...I guess not everyone does this, but with my team at the very early stage, it's not like you can hide the fact you got turned down.   Later on when you're raising, maybe you don't tell everybody that you're raising a series A, but when you're raising early stage money, you get your team to cheer you up. They buy you beers. You do silly things. You kind of have to let life keep happening so that it doesn't get too serious.   Ooshma Garg: Yeah, I agree. What's funny is my fundraising song is "Survivor," by Destiny's Child.   Danielle Morrill: How many people do you think have a fundraiser song?   Ooshma Garg: I don't know. This is the first time we're talking—   Danielle Morrill: We need to make a playlist.   Ooshma Garg: We need to make a playlist.   Danielle Morrill: That's a good idea.   Ooshma Garg: We need to make a playlist for our portfolio.   Poornima Vijayashanker: We'll link with the playlist to you guys. So, do you ever go back to the people that said “no?” Because you guys have done multiple rounds now, where you might have had to go back to those early investors who said “no” and ask for more.   Ooshma Garg: Absolutely. In our case, even our first check as a seed investment, it took me three different introductions, multiple follow-ups, to even get in the door before the no. After someone says “no,” it feels very final, but I think that the big secret is that you have to go back and that you should keep following up. Time and time again, I hear friends talk about series As, series Bs, and so on, where they got a no. They were...they kind of welcomed it and took all the feedback. They updated different investors every week for two months, three months, sometimes six months, and then they close that same investor. They might be a Sequoia, or Andreessen Horowitz, or what have you.   All those funds are looking for stamina and looking for breakout businesses. A breakout business has to have someone that's willing to listen, iterate, and improve. So, the funny thing is, you should see that as just the beginning of your relationship. For our venture financings, we had multiple failed fundraising attempts and then ultimately successful ones. Our funds that invest in us now, Andreessen Horowitz, Trinity Ventures, etc., absolutely said “no” once or twice before. But I maintained that relationship.   Poornima Vijayashanker: Yeah. What about—   Why It’s Valuable To Reconnect With People Who Said NO   Danielle Morrill: You have to think about it like sales. Like, would you have never contacted a lead again because they didn't convert at the end of the trial? No. If you are in my database, I am going to be talking to you for the rest of your life. If you're in this business, there's a certain set of investors that you really wanna work with. Frankly, they're looking for the people who don't take it so hard that they never come back, to your point about stamina.   I think also, once you go back to people a few times and kind have that feeling of like, “This feels like it's against the rules to go back.” Then you realize that it's actually respected, and so it's a self-fulfilling thing, and you start to find yourself going back more and more.   How To Push For Specific Feedback   Poornima Vijayashanker: Well, it's great that you got feedback, but I think a lot of times, you get this generic feedback, where it's like, "I wanna see more traction," and you're like, "I'm already at, you know, 10k in monthly recurring revenue," or, "I'm already at, like, a million-dollar run rate," like, "How much more traction do you want to see," right? So, how can you kind of push an investor to give you more directed feedback in that note?   Danielle Morrill: Well, I mean, I think...We sit on both sides of the table now, so I think sometimes it's laziness that causes people to ask for these things. So, for example, the "I wanna see more traction." It's kind of like going into Macy's and being like, "Why isn't this a Dior dress?" It's like, OK, if you want a Dior dress, maybe you should go buy one. If you wanna find a company that has, like, $5 million a year of revenue, and you're at seed stage, sorry, this is what we have, and this is what I'm selling, and if it's not what you're interested in, it's fine for you to turn me down, but I'm not...this is not a buffet where you can come back anytime between 10 and 1. I'm trying to raise a round.   You kind of have to, at least inside, hold a certain amount of entitlement over your time. It's not that you need to be entitled to their money, but you're running a process, and I think that that is really important. So, for a lot of these unclear feedbacks, I think it's more important to say, like, "What do you think of what I'm selling now? And if it's not clear what I'm selling, let me remind you and redirect." Honestly, you have just as much a right to claim your time as they do.   Ooshma Garg: Absolutely. And you have to kind of draft or pick your draft, in a way, with your investors. There are ones that I really wanna follow up with, and I would love to work with, and it's not just from my side of the table. I think, just like with employees or anyone else, or with a relationship, you want it to be good with both sides. So, you might see something that they don't, but they've only known you for 30 minutes. You've done all your homework. You know what they've invested in. You know the other founders.   So, you don't just follow up with everyone. You hear the nos. Sometimes, it's not even worth following up. Sometimes it was an introduction, and you didn't really connect. A no is OK. Other times, it comes with something that says, "Our fund requires x, y, or z. Someone at this stage. We need this much ownership." It's important to know what's a BS no and what's actually a valid no. took me a long time to learn that funds vary drastically in size, and that actually has a huge impact on who can invest in you at different times in your lifecycle. So, timing is important.   Poornima Vijayashanker: Yeah, hold that thought. We're gonna come back to that in a little bit, the whole fund size, and what makes sense and what doesn't. So, but let's go on to some of the more easy things that you hear and might get rejected. So, I don't know if either of you have faced this, but the whole, "You don't have a technical co-founder." And somehow that's like a gating factor to even get a dollar out of this investor, right? You hear things like this where you're just not meeting a certain checkbox. What's been your response to that sort of stuff?   Danielle Morrill: It depends on the checkbox. Basically, what I would say for technical co-founder or a lot of these is, they're like risk boxes. So, each's almost like if it was a survey, and you added up enough points, then there's too much risk here. It's probably no one reason that's gonna knock you out, but they're trying to figure out where you fit. So, technical co-founder is not necessarily a problem if you nail everything else, but if you don't have a product, and there's no one to build it, then of course, that's gonna be expensive.   So, I think it's—sometimes the way it seems to be coming across to the investor is like it's a checkbox thing, but they're really trying to ask a bigger question. So, I think one thing I've found is that it's good to say, like, "Tell me more about why you're worried about that," rather than just answering the question, making them elucidate more. Cause I've been surprised by some of the answers that I get. The technical co-founder question, I think the assumption is, who's gonna build the product? And they might just be thinking, "Dang, we're gonna need to go raise a big round because you need to hire two or three engineers instead of building it yourself."   They're not actually worried about you not being technical. They don't care that you're not technical. They're more like, "OK, so now I have to assess fundraising risk cause this person's gonna need to go build a team." So, it's easy to think it's about you, and, "Oh, you can't code." And then you kinda like lock down and feel guilty, but I think that's not always the case. A lot of these things are not actually what they seem on the surface.   Poornima Vijayashanker: Right. Yeah, I think another one along those lines is also, "Why are you working on this idea?" Right? So it's, what puts you in that unique position to kind of own domain expertise? Have you guys ever gotten that question, like, "Why this? Why Gobble, Ooshma? Why help people with cooking at the end of their day?"   Ooshma Garg: Right. Well, Gobble is a lucky one for me because it's a mission-driven company, and it started out of my family. What we do is we help people cook home-cooked food in 15 minutes in one pan, and we bring this tradition, and ritual, and love of a household into the modern, busy life. That's something that's very near and dear to me. So, because of that, it shows that I'm just gonna give it my all and not quit.   I think some folks stumble on an opportunity sometimes. You're just a inventor, and you want to tinker around, and you try finding what's gonna fit in today's zeitgeist. Just like founders come in different flavors, I think investors come in different flavors, too. There are investors who are great at investing in arbitrage opportunities. There's investors who really wanna back founders, or social good, or mission-drive folks. Or they wanna back moon-shoots. Or some people wanna back things that have a linear, direct, immediate path to growth.   So, I think having that context when you assess someone's response to you is really important because you kinda, just like with your friends, you have to find your tribe with your investors, as well.   Is The Market For Your Product Big Enough?   Poornima Vijayashanker: Yeah. So, there's definitely this sizing-up thing, and I think one of the early signals is, they don't feel like your market is big enough, maybe because they're not aware of that market, or maybe they don't get the space. Have either of you had that situation where you come in, you've already got traction, you've got the go-to market team, products in the hand of customers, and they're just kind of scratching their head, like, "Oh, is people eat dinner still these days? Is that still a thing?" How do you deal—   Danielle Morrill: Oh my gosh. I actually don't think it's worthwhile to continue to have the conversation, and I have to shout out to Hunter Walk, who wrote an excellent post about this, I don't know if you guys saw, around a woman who was pitching, and someone said like, "Convince me this market's big enough." And she just said, "Look, I don't wanna work that hard. I've already got traction, people eat dinner, right?" I think there are times when you're looking at this investor, and you have to consider, if they don't get it at this point, especially if you're doing something where you have traction, and it's fairly obvious that the market is big...   I mean, most of us...if you're building breakthrough tech, you might find a situation where markets are unclear in terms of size, like Blockchain, for example. But in most cases, these are professional investors, and they may be testing you, and they might wanna know what you know, so it's worthwhile to at least give them a rough answer, but I would take it as serious data, if they need to be convinced that the market's big enough.   The other side is that, not all markets need to be big to be interesting. It's more about if you can create something that can grow. Obviously creating a market that doesn't exist is a really valuable thing. So, again, I think it goes back to flipping the script a little bit in terms of trying to make sure you understand what they're really getting at. Like, do they not know? Are they testing you? Are they gonna be a huge waste of your time?   How To Get To The Real Question They Are Asking   Poornima Vijayashanker: How can you kind of suss that out? Are there questions or techniques?   Danielle Morrill: I would just start getting curious, like, "How much do you know about the market? Have you invested in this space? Obviously you're interested in us. What do you think?" And it doesn't have to become combative. It's much more of just, like, how does this become a dialogue instead of playing 20 questions, where you're doing all the talking? I think about it kinda like a job interview, I think, in both parties are confused about who's interviewing who, and you really wanna make sure that you find a balance where it's not you, as the founder, talking 80% of the time.   Ooshma Garg: The framing is so important. So, if you're getting some feedback repetitively that, "I don't understand your market," or, "I don't understand your path forward, or your path to revenue, or how you're gonna hire," then you do have to take that feedback and try to iterate and improve your pitch itself. I think that every's very hard that you meet a perfect de-risked company at an early stage. They all have some mini risks, and often times, one big risk. So, sometimes it's, "Wow, there isn't a market for this, but we see that being the future."   Other times, there's a really big market, but maybe it's crowded. So, the question is, how are you gonna be, for example, defensible in the food space? Other times, it' have something defensible and proprietary. It's a huge market, but no one's willing to pay for it. So, people aren't willing to pay for music, or TV, or whatever. So, how are you even gonna make money for something that everybody's using?   Whether it's revenue, market, defensibility, IP, every business typically gets stuck, I find, on one big discussion. The better you can hone your slide and your couple lines to make sure that your message is getting across properly, and that resonates, it's just to your advantage cause people have such limited time with you and attention span. You know what is gonna be the hot button in your pitch, so identifying that early and practicing that part the most would probably do you well.   How To Get At An Investors Hot Buttons   Poornima Vijayashanker: So, we previously had Marie Perruchet on the show, and she talked about taking your pitch and then seeing how other people reformulate it, or what are the pieces that they extract? That usually becomes these hot-buttons, or the thing that is most memorable that maybe you need to dive into. Are there other ways that you guys have found to extract that information?   Danielle Morrill: I think...reformulating, literally having someone pitch it back to you, is that what you mean?   Poornima Vijayashanker: Yeah. As one technique to, like...what's sticky, what is impactful, but then there's the other case of, yeah, what is the hot button that people are probably gonna step away from?   Danielle Morrill: I mean, I think one of the things that is really interesting is whenever you're opening the conversation with an investor, at the very beginning. If you can get them to tell you, like, "Hey, what do you know about my company?" Because that actually is gonna tell you a ton about what they've already decided you're doing, and it's sometimes really wrong, or it's know, there's a lot there, and then you can kind of work from there. If you notice that, pretty consistently, people are having the wrong idea, I mean, kinda to your point about feedback, it's another way of getting—   The reality is, people act like you setup your pitch, and then you go out. But you actually create your pitch, start to go out, and then you're continuously iterating on the pitch. So, you have so many opportunities to make the pitch better. I actually look at the first 10 pitches or so. I kind of set up pitches with targets where I would be interested in working with them, but they're not my top picks, so that I'm actually running the pitch against those folks. That way, if the first three or four say that their first impression of you is different, then you can realize, “Oh, the market already knows who I am.” Very rarely do you get to just go pitch, and no one knows who you are. That's another tactic that I think can be really helpful.   Finding Investors Who Are a Fit   Poornima Vijayashanker: So, coming back to kind of Ooshma's point around finding investors who fit into one of many opportunities, like arbitrage, moon shots, love the space, etc., there's also people who really get beholden to certain stages, right? They're like, "Oh, come back and talk to me once you've figured out your customer acquisition cost, or your lifetime value," right? Are there ways in which you've been able to address that, even if you don't have those metrics yet?   Ooshma Garg: One concept I keep running back to is that MVP concept, or minimum viable product, or even like a prototype. So, with my first company, the vision was to make this recruiting platform for universities all around the country. I made...I started by making wireframes, and envisioning the product, and keeping it simple, but thinking through those wireframes. But then, an advisor kind of looked at that, told me to scrap the whole thing, and said, "Why can't you just start with a mailing list? You're making a recruiting platform. Why don't we just see if there's people interested in your concept, and can you get 10,000 people, or 50,000 people, or how ever many students on your mailing list?"   At first, I was offended because I thought, "Oh my gosh, a mailing list is not a tech company." But often times, you can think about some scrappy proxy or prototype to prove what the person is asking, even if you don't have that exact number or the software or resources to get what exactly they want.   Poornima Vijayashanker: So, what's an example...yeah, if somebody throws out, like, "Ooshma, early days, three years ago, what was your LTV?" And you're like, "I don't have an LTV because I don't know," what would your response be to that?   Ooshma Garg: You know, I probably do two things. So one is, I would look at comparables in the market, and so, just doing studies of the general food industry, in my case, like how often people order takeout, or how often...what are people paying for SAS for these particular products each day, or whatever's relevant to your market. I mean, I'm assuming that you're...that you have some prototype. Very few companies pitch pre-product, so whatever data you have for three months or six months, there has to be something there, some monthly active users, how many times people are logging in, how many purchases people have made.   So, you just have to...I mean, our seed round was raised off of two to three months of early prototype data. I think that's all you need. It's just some prototype that shows some user willingness to pay or engage for three months, and then you can extrapolate that into your vision.   How To Handle Disagreements   Poornima Vijayashanker: Now, there's obviously times where people may disagree, right? They may say something like, "You know what, Danielle, I don't like your distribution strategy. I really just don't think it's gonna work. So, you know, cause I think it's gonna be expensive. Come back when you've figured out something that's a little bit cheaper. Then let's have the conversation. But, for now, no."   Danielle Morrill: It seems like an opportunity for them to prove their value-add as an investor. You know, I think that's valid for people to challenge strategy, but I think, what I would wanna know in that situation is, "If you were my investor, what would you suggest that I do? I totally hear your concerns." Make sure to show them that you're listening, but I think that's their opportunity to step up and actually offer something constructive. I think if they're gonna be in an investor where they're gonna be critical without being constructive, that's actually data for you.   The truth is that strategy's tough. Strategy often breaks down, and we change strategy all the time in startups. That's a huge part of what you're testing. So, I think being gracious and not taking it personally is important, but also making sure that you're asking them to demonstrate their value. I actually think that's gonna make them want to work with you. If that goes well, that's actually gonna be a way to test out, what would this working relationship be? So, I think that's...see it as an opportunity.   Poornima Vijayashanker: I like that.   Ooshma Garg: Yeah. And most people kind of...they send you that no via email, and I'm sure that the large majority don't even ask further questions. Some may not even respond, and others might respond and say, "Thanks for your time. I'll move on." But some small percentage are asking follow-up questions, and I think that's just making them stand out and starting that relationship that we said is so important.   I think that if you really did like someone, and their no isn't tactical or directional enough for you, to ask for a 10-minute phone call just to get a little bit more detail or their advice on strategy towards de-risking that investor's concern, I think can go a really long way. So, I think folks should just practice embracing the no and getting that 10-minute call and feedback as much as possible because that will help give them building blocks for another three months, if they can, and not just sort of wander aimlessly, wondering what someone was saying, or worse, completely ignoring it.   Danielle Morrill: Right. If you're gonna go and worry a bunch about the feedback but not ask for the follow-up, go round and round in circles over three glasses of wine, it would be much less painful to just have that awkward 10-minute call and just know where you stand. I think I've seen founders go in circles over this stuff. Literally years later, they'll tell these stories. It's just not worth the energy. The investor's also probably super uncomfortable giving the rejection. We're gonna talk a little bit about saying no on the other side. So, they're kinda beholden to you to give you that 10 minutes, honestly, so you should take it.   How To Know When An Investor Isn’t A Fit   Poornima Vijayashanker: Now, there's a lot of times where it's very obvious, you know, they tell you, "Here's the no," but...aside from some of the ambiguous feedback around the traction, there are times, though, where they may see a signal. Maybe it's something that happened in a meeting between you and your co-founder, or something else. Maybe they did some back-channeling, right? How do you handle those situations where they might feel like, “Oh, there's no chemistry,” or “I'm not sure where this is going?”   Danielle Morrill: It's tough cause they usually don't tell you.   Ooshma Garg: Yeah, they usually don't tell you. I think that's quite rare, as well. I think the way...the best way to handle that or avoid that is actually to construct your own back-channeling. So, like I said, some of the biggest investors, they will only invest based upon referral. Then, when you get so, kind of, well-known and in high demand, they'll only invest based upon two or three referrals. So, every single step is just like hard work. You can't ask for one intro. You can't just take the no on face value. You have to ask for three intros. Then you have to ask for follow-ups. Then you go to the meeting. Then you follow up on the meeting, and if they say “no,” you follow up again. There's all those little, little, extra steps that other people are doing that I think more folks should know about.   Poornima Vijayashanker: Yeah, and invest their energy in that versus what Danielle said, around the drama in their heads. So, anything else you guys have heard from your experience? Any other nos that we maybe haven't covered? I know there was some of the stuff that Ooshma was talking about, like the type of investors. Maybe we can dive into that a little bit?   Ooshma Garg: Yeah. I think...Well, with regards to the nos that people give, one of the toughest ones is simply just environmental. There are times when you're starting a company, and it's just a rough funding environment where it's just rough for your market. There might be bigger companies who are...for whatever reason, they're not doing well on the public markets, and that's affecting you. So, like the stamina, managing your psychology, being frugal, focusing on just the minimum prototypes, all of that's so important because the main thing you need to get to yes and get funding is time. You can correct a lot of things in the nos overtime, but there's some environmental factors you just have to weather.   Poornima Vijayashanker: Yeah, let's dig into that a little bit more. What do you mean by like, public companies? "How does that impact me? I'm just a two-person start-up, why should I care what Google or Facebook is up to?"   Ooshma Garg: Yeah. Well, hopefully your aspiration is to be a big public company, or to just be a big organization in general, and to be, one day, going from wherever you are to making hundreds of millions, if not billions, of dollars of value for your shareholders, for your employees, for your customers, and so on. So, investors will look at the current state of the market, at the public market, to understand what's happening in your industry. How are those companies valued? What are your chances of getting there, of breaking out? What is it gonna look like when you IPO? That trickles all the way down and influences your valuation, even as early as at the seed stage. So, it's very well-advised to not be delusional and to take a look at the public markets of your industry—   Poornima Vijayashanker: The landscape, yeah.   Ooshma Garg: —and be able to speak to that. I think people will be very impressed.   Paying For A Previous Founder’s Mistakes   Poornima Vijayashanker: I think another situation is, often, we have to pay for previous mistakes. So, the investor might have invested in a space when it was too young, or maybe the founders that they invested in weren't that knowledgeable or were the first. You know, just a number of factors to where, now, they just aren't willing to look at the space, or matter how amazing you are, they're like, "No, sorry, not interested in the space. You might be amazing, unicorn person, but I'm just gonna say ‘no.’"   Ooshma Garg: I would take that no. It's kinda like in relationships. Someone had some issues with another girl that looked like you, or whatever, like it is not your—   Danielle Morrill: He is never gonna stop saying that.   Ooshma Garg: That is not the best guy for you. So, there are many investor fish in the sea, and I think that's just when the numbers game comes into play, and you have to make sure that you're not just talking to five, you're not talking to 10, but you have a big target list that you're just setting up and rolling through.   Poornima Vijayashanker: Awesome.   Danielle Morrill: I think one other thing that is valid but complicated is, people might say to you, "This isn't venture-backable." I actually think that's very helpful feedback to hear. Whether you agree is sort of beside the point. Find out why they think that. Sometimes, investors know things about markets that you never...can't learn until you're in them for a long time, and they can save you years of your life.   So, part of why people get a bad taste in their mouth often has to do with, like, a poor-margin business that can never get better, or a business that caps out somewhere, and there's this trough of sorrow that seems to go on forever and ever, and you don't get to find out until you're a $50-million company, which is great, except for when you have a huge burn rate and expectations. So, especially if you're entering a market where you're fairly new, maybe you're a software-centric person, but you don't have domain expertise, those types of nos can tell you a ton about things that.   It's easy to say, "I don't care. If I get to $50 million of revenue, I'll deal with that then." And you can still make that decision, but I think the key is to actually make sure you understand that no because they are in the business of billion-dollar outcomes. They might know something that you don't, and they might be able to help you redirect towards something that is worth it.   Poornima Vijayashanker: Alright, well thank you, Danielle and Ooshma, for walking us through all those nos. For all of you out there who are watching, if there was a no that you recently received that maybe we didn't unpack, feel free to share it with us in the comments below this video.   That's it for today's episode. Be sure to subscribe to our YouTube channel where we'll continue the conversation and talk about what it's gonna take to get that yes from an investor. Ciao for now!
Disclaimer: The podcast and artwork embedded on this page are from Poornima Vijayashanker, which is the property of its owner and not affiliated with or endorsed by Listen Notes, Inc.