The Exchanges

Q Do you ever see an offensive bet turn into a defensive and a defensive turn into an offensive?

A Yeah, that's a great question. You definitely do. The most common place for that is, um, as you top out a growth loop. And so I think like you can imagine, you know, the first growth loop for your business at some point is gonna kind of start topping out that S curve and be more in extraction phase, right? You need to be layering on a second one. You should start before it totally starts topping out. Like that will become the offensive bet. Once it starts topping out, you, you still need to invest in it. Like you still need to be right. Like if it's a virality loop, like you can't just be like, okay, it's, we're starting to get lower returns. We're just going to ignore it from now on. It starts turning into a defensive thing where you're like, we need to keep maintaining this, but additional resourcing on it is not producing additional returns, right? We're down in this diminishing returns curve. So then that moves like that virality, those things move into the defensive sphere. The opposite one also happens. Actually, an example of the opposite one here that I think I see is trust and safety. Trust and safety is usually defense, right? It's you're, you're avoiding downside risk. But sometimes it becomes offense and like Airbnb is a good example, actually, where trust and safety becomes offense because like a core barrier for Airbnb is this idea that like, I mean, somebody else…

AI assessment note: “Yeah, that's a great question. You definitely do.”

Q Do you ever see an offensive bet turn into a defensive and a defensive turn into an offensive?

A Yeah, that's a great question. You definitely do. The most common place for that is, um, as you top out a growth loop. And so I think like you can imagine, you know, the first growth loop for your business at some point is gonna kind of start topping out that S curve and be more in extraction phase, right? You need to be layering on a second one. You should start before it totally starts topping out. Like that will become the offensive bet. Once it starts topping out, you, you still need to invest in it. Like you still need to be right. Like if it's a virality loop, like you can't just be like, okay, it's, we're starting to get lower returns. We're just going to ignore it from now on. It starts turning into a defensive thing where you're like, we need to keep maintaining this, but additional resourcing on it is not producing additional returns, right? We're down in this diminishing returns curve. So then that moves like that virality, those things move into the defensive sphere. The opposite one also happens. Actually, an example of the opposite one here that I think I see is trust and safety. Trust and safety is usually defense, right? It's you're, you're avoiding downside risk. But sometimes it becomes offense and like Airbnb is a good example, actually, where trust and safety becomes offense because like a core barrier for Airbnb is this idea that like, I mean, somebody else…

AI assessment note: “You definitely do. The most common place for that is, um, as you top out a growth loop.”

Q So what stage of company are we at here then, Eli? Are we like series A, B?

A So yeah, most of the companies I advise are from seed to C, series C. I also have a few, actually a handful now of clients that are actually much later stage businesses where they're doing this incubation of their wave two. This is the one place where I advise non-founders If they've set up the structure that we were talking about before, where they have a GM with PNL ownership doing this wave two, zero to one kind of product market fit work, I can advise that person as if I was advising a founder. So that like, that tends to be the split. I'm helping them from seed through C and then I'm helping them sort of like wave two out the sort of extraction side of the curve.

AI assessment note: “most of the companies I advise are from seed to C, series C.”

Q I totally agree with you. When we think about kind of the, you mentioned that equity, you mentioned, you know, obviously cash, I'm sure is part of it too. How should founders think about compensation for advisors in this way?

A Again, depends on the shape. Maybe all these answers depend on the shape. For the company level advising, for the thing that I'm doing, really, like, what you're thinking about is, like, do you believe this person is going to have a substantial probability of helping you bend the curve, right? Like, the reason I'm there is to help you bend the curve, essentially. If you believe there's some percent chance that I'm gonna be able to help you do that versus not working with me, then it's worth the value. If you don't, you shouldn't work with me, right? I think that's the key thing. The fractional and, like, Functional level advisors are a little bit different because they're more, they're more like comps to benchmark against there, right? Like, you could hire a full-time person, you maybe hire a more junior person, and so usually the way you're thinking about compensation in those is sort of scaled from what a full-time version of that person would look like, if that makes sense.

AI assessment note: “compensation in those is sort of scaled from what a full-time version”

Q How do we determine whether we should bring in a consultant and an advisor, essentially, an incredible growth leader, like anyone in the Reforge community, or Bring in a head of growth. How do we decide between advisor versus hire?

A Yeah, that's a great question. Especially if you think about function, um, there tends to be sort of a, a time factor here at, again, because if let's say product-led growth is sort of the primary lever that you're using, you need to be owning that. An advisor, a company level advisor who is sort of leaning into teach you to fish, right? Which is kind of, to me, the, the advising side of the line here. Is fantastic, even from the very beginning, because that person has got that experience. You're the one actually making the decisions. You're the one actually executing at the end of the day, but they are helping you get better at doing that thing and giving you guidance. That's good early on. At some point, as you scale, you're gonna have to start building a function around this. As that function grows bigger, you will need leverage in running and managing that function that is executing on your strategy. There tends to be a gap Period for most startups where they are not yet big enough. It doesn't yet make sense to hire a full head of growth, head of marketing, head of product, but it's getting big enough that it's taking too much of that founder's time, or it's really what it's doing is taking lower leverage. It's you're using your cycles in a lower leverage way than you should be as a founder. Again, it's not because you want to step back from product strategy, but it's that …

AI assessment note: “An advisor... is fantastic... As you scale, you're gonna have to start building”

Q What one piece of advice would you give to a growth leader before they start a new role?

A Um, I mean, I'd say the most important things are understand that business. Like, is there opportunity Is there leverage to be had in the business? I think this is something like they're hiring you because they need to help to grow, but you want to figure out if they're actually, if you're actually going to be able to be successful there. And two, does the founding team understand the growth mindset, right? This is a point about is, can we instill growth in everything we're doing? They may not have that yet if they're hiring you, but do they get it at the top level where they're going to be, be able to make that shift? Because if they're not going to be able to make that shift, you're going to be running uphill the whole time you're there.

AI assessment note: “understand that business. Like, is there opportunity Is there leverage to be had”

Q Can they having done it inside an incumbent?

A Yeah, that's a great question. I think big companies can, Do these things quick. I think there are two versions of what you're talking about, actually. One is the like, let's supercharge the things we are already doing with this new tech. That's sort of a fairly unique thing in this new LLM wave that you didn't have particularly often before. And you've actually seen a few companies do a decent job of like the first step of that very quickly, which is impressive for, for those way, for those companies. True zero to one though, where you're really like, you're serving a new need or a new customer or a new vertical, like you're really expanding Solving a problem you hadn't really solved before. That really requires you to do again, my, like what I have seen is your highest chance of success is if you carve out a startup org and you know, everyone likes to throw around, we're a startup within a big company. It's like the leader of that doesn't have P and L you're not, you're not a startup within a big company. Right. I think that is the important piece, which is like, you need to fund this as an independent unit that is looking at a business line holistically and is autonomous within the sort of like spending of that capital. Right. A startup, you should fund them a little bit at first, right? And they should come back and show progress and ask for more funds as if, you know, they…

AI assessment note: “I think big companies can, Do these things quick.”

Q you. Okay, no, that makes sense. And should these advisors have done it before at the stage of company that you are at, in the geography that you are? Because you can imagine like you have a, I'm sure, a Facebook growth advisor who did, you know, Facebook newsfeed. It may be very different if you're being hired into Chime, where it's very different. Should they have done it before?

A I think it helps a lot. Um, I think the things that are It doesn't have to be identical because it was identical. You're never going to find the person, right? I think the things that matter most are one is like, did they develop the playbook or did they scale the playbook? I think you see a lot of split between somebody who scaled the playbook that was developed prior to them, or they developed the playbook from scratch. And in, in all of these different areas, you should be thinking about, are we developing the playbook or are we trying to scale the playbook? And you want to match your sort of advising to which stage you're at from that perspective within the sort of functional places. I think again, On the growth side, like if your primary lever is virality, definitely get somebody that did virality stuff, right? If they come from a performance world, they're gonna not have, they're gonna struggle to help you with, with the core virality stuff and vice versa, right? I think that matters a lot. Geography also mostly matters there. This is where it depends, right? I think there are things where the geography matters a lot, and there are things where the geography matters less. So like brand, brand people need to know that the culture of the place that they are doing branding too. Performance works pretty similarly in a lot of different places, right? And then like maybe fintec…

AI assessment note: “I think it helps a lot.”

Q I totally get you. Ok, so, eighty-twenty there. Ok, so we agree on this eighty-twenty split. Now, thank you. You are advising me. I'm very excited. I'm a hypothetical founder, and you're working with me. What can I do, Eli, to set you and us up for success in that first month?

A There's sort of three key things I see as signals of successful relationship. And again, I'm, I'm looking for these things in this sort of free trial mode to decide if I want to work with you, but just so you understand, right? Like really, especially when you're early on and, and like trying to figure out strategy, you can ask questions of data, you can ask questions of customers, and you can ship small things quickly to learn. Like those are the levers that you need to be able to pull. If you cannot pull all three of those levers, that can be a challenge. There have been times where one of those levers people are struggling with, and I can come in again because I'm teaching to fish at the ground level. If you just really struggle to ship quickly, I've actually done that. Like I've worked with people where we start working on strategy and then we realize their teams just can't ship. And so we sort of put the strategy on pause for a little bit and I help dive in and say like, let's, let me help you figure out how to get to your team to a place where they can ship really quickly. So if that can happen, we can do that. Data is one where like, if you just have no data, It's gonna be hard. I probably need to say, like, come back to me when you have instrumentation.

AI assessment note: “There's sort of three key things I see as signals of successful relationship.”

Q How do I make the defense or people not feel like staples and bread and butter that's a bit boring?

A I mean, the one thing to remember here, I mean, talking about this is really important and how you talk about is really important. But the one thing to remember here is defense is equally important to offense, if not more important, right? Like the whole point is that these are existential. If you do not do these things, you're not going to have a company to invest in offense. You need to be making sure that everybody understands how important these things are. You need to be celebrating it in the right way. I think this is another thing that people do wrong is they tend to celebrate offense. They tend to celebrate metrics movers. Right. In their org. And that makes people working on defensive things feel crappy because they never get celebrated. But really you need to build a culture that celebrates like finding points of diminishing return and giving back resources. People should be, that's so valuable to the business because of the opportunity cost of that. Right. And so you should be celebrating this idea that like, Hey, we actually think we only need to invest this much in this tech debt and no more. And we, we figured out a way to cut that in half. Celebrate that all day, right? That's a huge impact to your business because of the opportunity cost of the savings that they have found, right?

AI assessment note: “you need to build a culture that celebrates like finding points of diminishing return”

Q Can I ask, when it comes to advisor roles, again, back to that, What are the number one reasons they don't work out?

A I think one of the things I have heard from founders, since I'm on the other side of the table here, but I've heard from founders about other advisors is when you get a kind of advisor who has done a bunch of things before, and essentially their advice is do the things I did because they worked for me. That happens a lot. And what ha what the challenge is if their situation was meaningfully different from yours in a way that you may not even totally understand that you're going to burn a lot of time Trying the playbook that worked for them that doesn't actually work for the nuance of your business. And this is why I'm such a fan of the hands-on approach, which is like, yes, I'm bringing all of my past experience to bear, but I'm also in there with you making intentional decisions based on what's actually going on in your business.

AI assessment note: “advice is do the things I did because they worked for me”

Q I get you. It's like the data entry ones who have large-scale data entry problems, or whatever that is. Eli, final one before we do a quick fire. What's the biggest mistake you've made in product, and how did you change your mindset as a result?

A Early in my career, I, I did the thing that I think a lot of people do, which is Be too focused on solutions, right? Be too focused on the feature and not think about the outcomes. I mean, this is part of the reason I'm now preaching this idea of outcomes so much is these are the mistakes I made. Offense, defense, these are all mistakes I personally made, right? You see this in a lot of people. It's like, they think about product as like, we, you know, we want to build the coolest X or whatever. We want to make this thing better. And really they need to be thinking about the outcomes they're trying to drive for the customer and for the business and where those things overlap.

AI assessment note: “Be too focused on the feature and not think about the outcomes.”

Q Can they having done it inside an incumbent?

A Yeah, that's a great question. I think big companies can, Do these things quick. I think there are two versions of what you're talking about, actually. One is the like, let's supercharge the things we are already doing with this new tech. That's sort of a fairly unique thing in this new LLM wave that you didn't have particularly often before. And you've actually seen a few companies do a decent job of like the first step of that very quickly, which is impressive for, for those way, for those companies. True zero to one though, where you're really like, you're serving a new need or a new customer or a new vertical, like you're really expanding Solving a problem you hadn't really solved before. That really requires you to do again, my, like what I have seen is your highest chance of success is if you carve out a startup org and you know, everyone likes to throw around, we're a startup within a big company. It's like the leader of that doesn't have P and L you're not, you're not a startup within a big company. Right. I think that is the important piece, which is like, you need to fund this as an independent unit that is looking at a business line holistically and is autonomous within the sort of like spending of that capital. Right. A startup, you should fund them a little bit at first, right? And they should come back and show progress and ask for more funds as if, you know, they…

AI assessment note: “highest chance of success is if you carve out a startup org”

Q How do we determine whether we should bring in a consultant and an advisor, essentially, an incredible growth leader, like anyone in the Reforge community, or Bring in a head of growth. How do we decide between advisor versus hire?

A Yeah, that's a great question. Especially if you think about function, um, there tends to be sort of a, a time factor here at, again, because if let's say product-led growth is sort of the primary lever that you're using, you need to be owning that. An advisor, a company level advisor who is sort of leaning into teach you to fish, right? Which is kind of, to me, the, the advising side of the line here. Is fantastic, even from the very beginning, because that person has got that experience. You're the one actually making the decisions. You're the one actually executing at the end of the day, but they are helping you get better at doing that thing and giving you guidance. That's good early on. At some point, as you scale, you're gonna have to start building a function around this. As that function grows bigger, you will need leverage in running and managing that function that is executing on your strategy. There tends to be a gap Period for most startups where they are not yet big enough. It doesn't yet make sense to hire a full head of growth, head of marketing, head of product, but it's getting big enough that it's taking too much of that founder's time, or it's really what it's doing is taking lower leverage. It's you're using your cycles in a lower leverage way than you should be as a founder. Again, it's not because you want to step back from product strategy, but it's that …

AI assessment note: “there tends to be sort of a, a time factor here”

Q I totally agree with you. When we think about kind of the, you mentioned that equity, you mentioned, you know, obviously cash, I'm sure is part of it too. How should founders think about compensation for advisors in this way?

A Again, depends on the shape. Maybe all these answers depend on the shape. For the company level advising, for the thing that I'm doing, really, like, what you're thinking about is, like, do you believe this person is going to have a substantial probability of helping you bend the curve, right? Like, the reason I'm there is to help you bend the curve, essentially. If you believe there's some percent chance that I'm gonna be able to help you do that versus not working with me, then it's worth the value. If you don't, you shouldn't work with me, right? I think that's the key thing. The fractional and, like, Functional level advisors are a little bit different because they're more, they're more like comps to benchmark against there, right? Like, you could hire a full-time person, you maybe hire a more junior person, and so usually the way you're thinking about compensation in those is sort of scaled from what a full-time version of that person would look like, if that makes sense.

AI assessment note: “usually the way you're thinking about compensation in those is sort of scaled”

Q What does that look like in reality, aligning the team around offensive and defensive bets?

A Yeah, so again, I think, like, the most common version of this is actually you have, sometimes this is called, like, a core experience org that really owns all of the defense. One of the things that I've seen be really effective is when you have a core experience org that owns every piece Of the defense. All of the defenses within that org and no non-defense is in that org. That really lets them prioritize apples to apples defense against defense. That is much, you're empowering them in a much stronger way. And then you have an org for probably each of your offensive bets. Again, like you should at most have three core offensive bets and an org that is dedicated to each of those things.

AI assessment note: “a core experience org that really owns all of the defense”

Q Can I ask, when it comes to advisor roles, again, back to that, What are the number one reasons they don't work out?

A I think one of the things I have heard from founders, since I'm on the other side of the table here, but I've heard from founders about other advisors is when you get a kind of advisor who has done a bunch of things before, and essentially their advice is do the things I did because they worked for me. That happens a lot. And what ha what the challenge is if their situation was meaningfully different from yours in a way that you may not even totally understand that you're going to burn a lot of time Trying the playbook that worked for them that doesn't actually work for the nuance of your business. And this is why I'm such a fan of the hands-on approach, which is like, yes, I'm bringing all of my past experience to bear, but I'm also in there with you making intentional decisions based on what's actually going on in your business.

AI assessment note: “their advice is do the things I did because they worked for me.”

Q Eli, I'm loving this because we're just rolling. Why on earth would brilliantly talented people do that in a company where they don't own it? Like go out and raise money for your own company and come to people like me who will give you millions of dollars.

A Yeah, it's a great question. I think their biggest reason is there are some things that only can be built as an extension of a successful business that cannot be built as a standalone business, right? And so I think like some people do this. If you are trying to build a totally adjacent business inside of a large company, don't do that. The company shouldn't do it. You shouldn't do it. It's not a good idea. The way that you succeed is you build something that leverages some aspect of the success That the business and the legacy product has already had to be able to build something that nobody else could build. Right. And so I think that's the thing that you're doing there of like building zero to one inside of a larger org. You are leveraging all of the advantage, all of the customers, all of the data, all of the tech, like all of that is at your disposal to build something that most cases couldn't have been built outside the company. That's the main reason.

AI assessment note: “there are some things that only can be built as an extension of a successful business”

Q So how does that look then? If we take that one step further, what does that look like in reality?

A A few different pieces here. I see kind of like three top level shapes of advising today. The first one is company level advising or founder level advising, where the perspective is across the whole company, the whole business. You're really like a partner to that founder. This is the kind of advising that I do. And there's some sub areas here. You then see functional advising. So think like a marketing advisor, right? Like that person is really coming in to help bridge a gap within a particular function. And then you have sort of like domain, like deeper, deeper domain kind of advising. So think like SEO, or if you're in a deep domain, like international logistics, like people who are deep in that domain, right? These are sort of the three high level shapes of advising that I think you're seeing now.

AI assessment note: “I see kind of like three top level shapes of advising today.”

Q Do you not want to take it one step further though, actually, and actually go down into the functional weeds? Because now you're relying on the CEO to relay everything to the functional leader. I would want you with my marketing team, with my product team to actually relay and teach.

A Yeah, great. This is a great point. This comes up a lot. This is where the teach to fish is really important, right? Because the founder can't rely on me. If they are not able to run the functions of their company, that's going to be a problem. And so it's much higher leverage for me to help them up level in how they execute. This is where, again, at the hands-on level, we work on everything from strategy to then how do I set up my org to execute on this? So we did this last week and here's what we learned. Let's think about that and make new decisions going forward. Because you're there every week, you're, you're sort of like your second brain for that founder all the way through the process and you're helping them up level all the way across. If you tried to embed me in one of your functions, then you're getting too far away from that function. If it's a core offensive leverage growth function for your company, which you shouldn't be. And if you need me to do those things, that's going to be a problem because I'm not going to be there the whole time and I'm only there an hour a week. Right. And so like, you really need to be able to do it and I can help you get better at doing that thing.

AI assessment note: “This is where the teach to fish is really important, right? Because the founder can't”

Q you. Okay, no, that makes sense. And should these advisors have done it before at the stage of company that you are at, in the geography that you are? Because you can imagine like you have a, I'm sure, a Facebook growth advisor who did, you know, Facebook newsfeed. It may be very different if you're being hired into Chime, where it's very different. Should they have done it before?

A I think it helps a lot. Um, I think the things that are It doesn't have to be identical because it was identical. You're never going to find the person, right? I think the things that matter most are one is like, did they develop the playbook or did they scale the playbook? I think you see a lot of split between somebody who scaled the playbook that was developed prior to them, or they developed the playbook from scratch. And in, in all of these different areas, you should be thinking about, are we developing the playbook or are we trying to scale the playbook? And you want to match your sort of advising to which stage you're at from that perspective within the sort of functional places. I think again, On the growth side, like if your primary lever is virality, definitely get somebody that did virality stuff, right? If they come from a performance world, they're gonna not have, they're gonna struggle to help you with, with the core virality stuff and vice versa, right? I think that matters a lot. Geography also mostly matters there. This is where it depends, right? I think there are things where the geography matters a lot, and there are things where the geography matters less. So like brand, brand people need to know that the culture of the place that they are doing branding too. Performance works pretty similarly in a lot of different places, right? And then like maybe fintec…

AI assessment note: “I think it helps a lot. Um, I think the things that are It doesn't have to be identical”

Q I totally get you. Ok, so, eighty-twenty there. Ok, so we agree on this eighty-twenty split. Now, thank you. You are advising me. I'm very excited. I'm a hypothetical founder, and you're working with me. What can I do, Eli, to set you and us up for success in that first month?

A There's sort of three key things I see as signals of successful relationship. And again, I'm, I'm looking for these things in this sort of free trial mode to decide if I want to work with you, but just so you understand, right? Like really, especially when you're early on and, and like trying to figure out strategy, you can ask questions of data, you can ask questions of customers, and you can ship small things quickly to learn. Like those are the levers that you need to be able to pull. If you cannot pull all three of those levers, that can be a challenge. There have been times where one of those levers people are struggling with, and I can come in again because I'm teaching to fish at the ground level. If you just really struggle to ship quickly, I've actually done that. Like I've worked with people where we start working on strategy and then we realize their teams just can't ship. And so we sort of put the strategy on pause for a little bit and I help dive in and say like, let's, let me help you figure out how to get to your team to a place where they can ship really quickly. So if that can happen, we can do that. Data is one where like, if you just have no data, It's gonna be hard. I probably need to say, like, come back to me when you have instrumentation.

AI assessment note: “ask questions of data, you can ask questions of customers, and you can ship small things quickly”

Q How do you, how do you know Where that break point is though?

A Yeah, this is a great question. I think it depends. And one of the big key things here on building a really high functioning engineering team is hiring engineering leadership, especially, and folks who are able to think this way and are really good at making estimations of where these things are. And so one example I think is like technical scaling, right? It's like, all right, our infrastructure, once we hit ten million users, like we know our infrastructure is going to fall over or somewhere in that range, right? And it's okay to pad that a little bit. Like you can be careful and be like, you know what? Let's make sure we don't get past eight million, right? Just to be sure, because we're not going to be perfect about it. And then what you can do is work backwards, right? And you can say, okay, we're, we're pretty sure that the effort required to move our infrastructure to the next level of scale is going to be four months of work. We have projections, like our CFO should have projections about where we think we're going to grow over what amount of time. We can work backwards from those projections and say like, okay, this is going to take us four months of work. We're going to hit eight million users. We think by this point, And so like, again, let's buffer ourselves. You don't want to be right. It's okay to not be right on the line. Let's be like, let's start that five mont…

AI assessment note: “We can work backwards from those projections and say like, okay”

Q I totally agree. Ok, so we have that as one reason. Any other reason why it doesn't work out as well?

A Like on the founder side of that, if the founder is not willing to engage and commit to the relationship, then it doesn't work, right? Like at the end of the day, If the, if the founder is not going to engage, not going to show up like this happens sometime, especially with high level advisors, the founder is just too busy, right? Like it's just not going to work. You need to get to that working relationship where you're aligned and working together on driving outcomes for your business. And you're doing that in an engaged period. Again, it's kind of retention. It's kind of activation, right? You got to get the activation for that thing to go so that that founder has a habit of working with this advisor consistently and driving outcomes.

AI assessment note: “if the founder is not willing to engage and commit to the relationship”

Q I totally agree. Sorry, I'm just peppering you with questions now that I have. Yeah, yeah, yeah. Should, should, and this is one that I get a lot, should growth teams be independent? Should they sit with inside product teams? How do you advise on that?

A It depends, but let me kind of break down some of the factors here. I think in general, uh, the, the model now is to have growth be embedded in everything that you're doing. There was a period of time, and there still may be companies who need to do this, there was a period of time from essentially nobody thinking about growth. It was necessary to pull those things out into their own orgs to help that org Sort of make that maturity step into starting to think about growth and starting to bring together those functions. Honestly, a bunch of those companies have now moved to the third step, which is now integrating that into everything they do. So if it is, if you are a company that is at the first stage, it may well be the right step for you to go to having a separate growth org, but you should think that your end goal is to integrate growth into everything that you're doing.

AI assessment note: “the model now is to have growth be embedded in everything that you're doing.”

Q What are the biggest fuck ups people make in activation? Is it messaging? Is it not building a habit? Is it shitty eye onboarding where there's no customer education and it's like a blank screen of death? What are the Activision fuck up you see the most?

A Yeah, that's a good question. I mean, one of them is not understanding your ICP because again, depending on your, how good your top of funnel is, you are likely acquiring a lot of people who are not a great fit for your product. And so one of the biggest things I see people do wrong is they see they have a conversion problem. They point a team at conversion and they look at the conversion metric overall. The problem is a bunch of those people are not ICP and they're never going to convert anyway. And so you're, you're spending a lot of time trying to convert a bunch of people and you're going to get marginal improvements to conversion. Cause it's not all the way to activation. Like you can make the button bigger, like things will happen. You'll move that metric, but it's just super under levers as opposed to really understanding who your ICP is, being able to track your ICP in that activation funnel. So you know how well the ICP is doing and then finding the highest leverage gap for those core ICP users and targeting that specifically.

AI assessment note: “one of them is not understanding your ICP”

Q How do I make the defense or people not feel like staples and bread and butter that's a bit boring?

A I mean, the one thing to remember here, I mean, talking about this is really important and how you talk about is really important. But the one thing to remember here is defense is equally important to offense, if not more important, right? Like the whole point is that these are existential. If you do not do these things, you're not going to have a company to invest in offense. You need to be making sure that everybody understands how important these things are. You need to be celebrating it in the right way. I think this is another thing that people do wrong is they tend to celebrate offense. They tend to celebrate metrics movers. Right. In their org. And that makes people working on defensive things feel crappy because they never get celebrated. But really you need to build a culture that celebrates like finding points of diminishing return and giving back resources. People should be, that's so valuable to the business because of the opportunity cost of that. Right. And so you should be celebrating this idea that like, Hey, we actually think we only need to invest this much in this tech debt and no more. And we, we figured out a way to cut that in half. Celebrate that all day, right? That's a huge impact to your business because of the opportunity cost of the savings that they have found, right?

AI assessment note: “You need to be celebrating it in the right way.”

Q How do you, how do you know Where that break point is though?

A Yeah, this is a great question. I think it depends. And one of the big key things here on building a really high functioning engineering team is hiring engineering leadership, especially, and folks who are able to think this way and are really good at making estimations of where these things are. And so one example I think is like technical scaling, right? It's like, all right, our infrastructure, once we hit ten million users, like we know our infrastructure is going to fall over or somewhere in that range, right? And it's okay to pad that a little bit. Like you can be careful and be like, you know what? Let's make sure we don't get past eight million, right? Just to be sure, because we're not going to be perfect about it. And then what you can do is work backwards, right? And you can say, okay, we're, we're pretty sure that the effort required to move our infrastructure to the next level of scale is going to be four months of work. We have projections, like our CFO should have projections about where we think we're going to grow over what amount of time. We can work backwards from those projections and say like, okay, this is going to take us four months of work. We're going to hit eight million users. We think by this point, And so like, again, let's buffer ourselves. You don't want to be right. It's okay to not be right on the line. Let's be like, let's start that five mont…

AI assessment note: “folks who are able to think this way and are really good at making estimations”

Q How do you think about when you've extracted enough value from the advisor? Again, like, like therapists, sometimes you need to change, or you don't need to see them anymore. How do you know when's the end life of that?

A Yeah, again, if you are working closely with them, this is the, if you need to be doing that, if you're working closely with them, it's going to start getting obvious that you're not getting the right value of that relationship. You're going to know. You're going to get to the point in your business, and this does happen, right? Like, advisors will be better at certain types of things than other types of Things. And if the things that are important for your business are the things that they are good at, you're going to get lots of value. And as your business progresses, if you move into things that they are not as good at, you're going to pretty quickly know that you're not getting the same level of value from that relationship. And you need to start looking for somebody who is really good at the next set of problems that you have.

AI assessment note: “if you move into things that they are not as good at”

Q So for me as a CEO, do I sit down with the CPO or the product leader and do we literally map out offense and defense and then map out resources accordingly? How do we kind of pop down and instill that?

A Exactly. I think that's exactly right. The other piece of this is actually org. I've been working on a workshop for this, actually, that I've like come into companies and try to like help them up level at this really quickly. So we've done a couple of these now, but like the core sort of phases of this generally are Once you understand the concepts really well, and your org understands the concepts, go in and look at everything you are planning to do right now, like your whole roadmap, and essentially tag all the things as offense and defense and figure out, and neither, because you're, you're always going to have a bunch of things that are like, this is actually not offense. It's not really defense. Should we really be doing this right now? Maybe we shouldn't, right? And that's going to help a lot. But once you do that, actually, one of the things that can be really high leverage is aligning your org around Offensive and defensive bets can also be really powerful, right? Because then it allows you to have really focused teams on those offensive bets that are not getting distracted by other things, and focus is how you make progress, right?

AI assessment note: “tag all the things as offense and defense and figure out, and neither”