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Often there are nuggets of wisdom from other professions or careers that you can leverage in your own career or life.
One of my favorite nuggets is a technique I learned when I worked in venture capital.
Venture capitalists, like John Doerr or Vinod Khosla, are investors in start-ups that risk a lot of money on a bare concept or idea and – if things go well – make a fortune for themselves and their investors. Examples of such investments are Google, Intel, Sun Microsystems or even simple websites like Mint.com.
Venture capitalists must weed through literally thousands of investment ideas that people pitch to them before they find a diamond in the rough like Google. In fact they will invest in hundreds of companies and only a handful of them will be true blockbuster successes.
For that reason, the best venture capitalists are true masters of managing the funnel: weeding through thousands of ideas effectively without wasting too much time on the duds, and carefully betting their time and mental focus on the most attractive ideas.
In particular they use a technique that I call “finding the weakest link”. This technique allows them to very quickly test the validity of a very complex idea. I think this technique is useful in many situations in life and worth knowing about.
The technique
1. Spell out logic chain
2. Find weakest link
3. Test weakest link
4. If fails, kill idea, if holds true test next weakest link
5. Repeat until entire logic chain is successfully tested
Every investment opportunity venture capitalists come across is based on some sort of logic chain – a set of assumptions and conclusions that all must hold true for the idea to work out.
For example, if my idea is to become the internet’s premier source of tuna sandwiches, my logic chain (in a much simplified form) probably sounds something like this:
In order for my tuna sandwich website to succeed:
I need to be able to make tuna sandwiches that customer really enjoy AND
I need to be lower cost in making tuna sandwiches than anyone else AND
I need to be able to ship my tuna sandwiches for very low cost to my customers before my sandwiches spoil AND
Customers need to be willing to wait for my sandwiches to be shipped.
If I would pitch this idea to a venture capitalist, he would develop a logic chain and then try to guess which assumption is the weakest link – which assumption is most likely not true. There is no science to making that guess – it is based on experience and intuition. For the example above, the VC might have a hunch that customers really don’t want to plan their tuna sandwich consumption ahead of time and won’t want to wait for FedEx to deliver the sandwich.
Next the venture capitalist will do his homework to try to verify that weakest link.
So in our example, the VC will try to talk to several tuna sandwich connoisseurs to see if his hunch is right or wrong. If is hunch is right – and the assumption is wrong and busted, he will realize that he broke the logic chain. The idea is no longer viable and he will drop it. If the connoisseurs surprise him by saying they would totally wait for a day or two for a great sandwich, he will then identify the next weakest link and pressure test it.
If he tests all links in the value chain to his satisfaction he will consider the idea for investment. If one of the links fails the test, he will move on unless he can think of a way to fix the problem.
The takeaway
So aside from getting you excited about having a tuna sandwich for lunch, why should you be interested in this technique? I think it is very helpful approach whenever you need to make a choice and important decision in your career. It will allow you to get to the right answer very quickly and ensure that you don’t waste time on dead end paths. Examples:
Picking the right market for your new product
Hiring the right person
Choosing the best strategy for your marketing plan
Picking the next best career move

Background

Often there are nuggets of wisdom from other professions or careers that you can leverage in your own career or life.

One of my favorite nuggets is a technique I learned when I worked in venture capital.

Venture capitalists, like John Doerr or Vinod Khosla, are investors in start-ups that risk a lot of money on a bare concept or idea and – if things go well – make a fortune for themselves and their investors. Examples of such investments are Google, Intel, Sun Microsystems or even simple websites like Mint.com.

Venture capitalists must weed through literally thousands of investment ideas that people pitch to them before they find a diamond in the rough like Google. In fact they will invest in hundreds of companies and only a handful of them will be true blockbuster successes.

For that reason, the best venture capitalists are true masters of managing the funnel: weeding through thousands of ideas effectively without wasting too much time on the duds, and carefully betting their time and mental focus on the most attractive ideas.

In particular they use a technique that I call “finding the weakest link”. This technique allows them to very quickly test the validity of a very complex idea. I think this technique is useful in many situations in life and worth knowing about.

The technique

  1. Spell out logic chain
  2. Find weakest link
  3. Test weakest link
  4. If fails, kill idea, if holds true test next weakest link
  5. Repeat until entire logic chain is successfully tested

Every investment opportunity venture capitalists come across is based on some sort of logic chain – a set of assumptions and conclusions that all must hold true for the idea to work out.

For example, if my idea is to become the internet’s premier source of tuna sandwiches, my logic chain (in a much simplified form) probably sounds something like this:

In order for my tuna sandwich website to succeed:

  • I need to be able to make tuna sandwiches that customer really enjoy AND
  • I need to be lower cost in making tuna sandwiches than anyone else AND
  • I need to be able to ship my tuna sandwiches for very low cost to my customers before my sandwiches spoil AND
  • Customers need to be willing to wait for my sandwiches to be shipped.

If I would pitch this idea to a venture capitalist, he would develop a logic chain and then try to guess which assumption is the weakest link – which assumption is most likely not true. There is no science to making that guess – it is based on experience and intuition. For the example above, the VC might have a hunch that customers really don’t want to plan their tuna sandwich consumption ahead of time and won’t want to wait for FedEx to deliver the sandwich.

Next the venture capitalist will do his homework to try to verify that weakest link.

So in our example, the VC will try to talk to several tuna sandwich connoisseurs to see if his hunch is right or wrong. If is hunch is right – and the assumption is wrong and busted, he will realize that he broke the logic chain. The idea is no longer viable and he will drop it. If the connoisseurs surprise him by saying they would totally wait for a day or two for a great sandwich, he will then identify the next weakest link and pressure test it.

If he tests all links in the value chain to his satisfaction he will consider the idea for investment. If one of the links fails the test, he will move on unless he can think of a way to fix the problem.

The takeaway

So aside from getting you excited about having a tuna sandwich for lunch, why should you be interested in this technique? I think it is very helpful approach whenever you need to make a choice and important decision in your career. It will allow you to get to the right answer very quickly and ensure that you don’t waste time on dead end paths. Examples:

  • Picking the right market for your new product
  • Hiring the right person
  • Choosing the best strategy for your marketing plan
  • Picking the next best career move

(Photo:Unhindered by Talent)

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Sometimes the phones rings, and someone you never heard is calling, wanting to speak about a job opportunity. You have no idea how the get your name and number, but here they are on the phone talking to you. A well groomed network of head-hunters can be a real life saver in a job search, so here are some tips how to deal with them.

Spell out your profile / needs

Before you speak to a head-hunter, think about you want to get out of the interaction. What is the quick profile of jobs you are interested in:

  • Location
  • Industry
  • Job role / seniority
  • Minimum salary
  • etc.

You will be asked these questions,  so better to have thought about them before hand.

Be friendly

Always be polite and courteous, never rude and short. Often head-hunters will call at a bad time – tell them that politely and ask to talk later that day or week. They will almost always take you up on that.

Be cautious

Keep your hand close to your chest – don’t reveal too much. Seem happy but not ecstatic to talk to them. Its a little bit like dating – if you seem desperate they view of you will be diminished, if you play too hard to get you might seem like too much effort and they will give up on you – strike the right balance.  Don’t say anything about how eager or not you are about finding a new job / leaving your current outfit – just always say that you are happy where you are but also always open for the right opportunity.

Don’t say anything negative about your firm, job

Never say something negative about your firm, boss, job etc – just as in interviews, spending too much time on negative issues will make you appear like a whiner or discontent who would also not fit in at a new firm

Keep a current resume handy

Always keep a current resume handy – if that perfect opportunity comes by you want to be able to send over your resume within 24 hours and not have to wait to until you crank out a emergency – and probably non-ideal – version of your resume.

Help out friends

Often head-hunters will call with job options that aren’t a good fit or don’t come at the right time. Listen to the head-hunter, be honest but polite in turning him or her down, but then think of friends, colleagues etc who might be interested in the position. Then tell the head-hunter if or not to use your name when contacting the people you recommended – depends on your relationships with them. This helps your friends, but also show the head-hunter that you are helpful and will make sure that you keep a special place in his rolodex.

Keep the network fresh

Keep a file tracking the names of head-hunters you know so that you have a good list when you need them. Keep in contact with that list of head-hunters – send them updated resumes when you get promoted, move around etc, and aim to speak to them at least once a year.  When you speak ask them to send you good openings if they fit your profile – and react to emails, vmails to them don’t ignore them or they will delete your file.

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