DISQUS

Josh Petersen · 12 months ago

He lost me at "the Segway-riding idealists who ushered in Web 2.0".

Glenn Bore-men · 12 months ago

Glenn is certainly not at a loss for verbosity. All those links in his article makes me think he's trying to game Cook in to boosting his web traffic to ailing Redfin.

Not a particulary sage post <yawn>.!

robertinbellevue · 12 months ago

Insightful piece, Glenn. As a lifelong entrepreneur (long before the stupid Web 1.0 Serial Entrepreneur title), I've learned that leading a tech startup takes a lot of different skills, not the least of which is... leadership.

As much as being a good manager means listening to those around you hired for their expertise, at some point, you have to take all that advice, make an informed decision and then choose a destination. I have always half-jokingly described my ventures as "friendly dictatorships." After all the opinions and advice have come in, someone has to take the lead and show the way.

Same goes for the vision thing: There can generally be only one clear vision to guide the Company along and it has to be made crystal clear to those within the organization to become successful. Regardless of whether it's a social agenda or a for-profit enterprise, making that choice and imparting it to employees as well as the public early on is probably one of the most important tasks for any startup.

Redfin, with its disruptive business model, was destined early on to be in a lot of people's sights for a lot of different reasons. Consider all those mercenaries as your rite of passage!

David Meyer · 12 months ago

Loved that piece, Glenn. Reminded me of the good old days.

Glenn Kelman · 12 months ago

@robertinbellevue: that is a very insightful comment on leadership, though I might add that one component of leadership is being able to synthesize different opinions into a persuasive vision.

@ Mr. Bore-men: linking doesn't increase the number of words in the post; it's just a courtesy to readers, and a way to connect TechFlash with other blogs. Most of the links are to non-Redfin sites. If we were link-farming, we would have published it elsewhere. But we thought it belonged here.

ivan · 12 months ago

Amazing post. The human psychology basics of which Glenn reminds us have developed over thousands of years. Like with HCI (human computer interaction) in which the key to successful innovation is to accomodate the immortal human form/shape and modalities, a successful business venture with a business model that can withstand economic turmoil entails not only sound financial leadership but also a purpose. The basic tenets and followers of major religions around the globe are powerful examples of how humans become empowered when meaning and purpose is granted to them. Its a lesson for the ages.

billythekid · 12 months ago

Glenn, I consider myself closer to a mercenary than an idealist. I am in it for the money. If there was no money in it or if it was the same, I'd rather coach high school football. I love start-ups too, but I love business more than start-ups. For me, not being in it for money is like shooting hoops without being concerned about whether the ball goes in. I also find something especially ironic: Most "entrepreneurs", including yourself, do not have any hard dollars invested in your business. 99% of the idealistic entrepreneur never actually invests his own cash. This cash belongs to pension funds, endowments, etc; they want returns, which VCs haven't delivered throughout this decade. When you say you worked for free, that's not really accurate, considering that you still have upside. But you do not have any downside other than ego, face, and pride. This makes your idealism hollow, since it is on someone else's dime.

Mark Britton · 12 months ago

Great post Glenn.

Mark Britton
CEO, Avvo
www.avvo.com

Glenn Kelman · 12 months ago

@billythekid: This was an unusually insightful and persuasive critique. It is irresponsible to be idealistic with someone else's money, unless that is the best way to generate a return on their money. As the table above suggests, idealistic companies are at least some of the time better investments.

My point was that people who have no passion for software, for consumers, for whatever mission their company is supposed to be on, won't be able to muster what it takes to compete and endure against those who do. A high-school football team that doesn't really love the game won't win very often.

But I think there's another side to that argument, and you articulated it perfectly.

Krassen Dimitrov · 12 months ago

I do not understand this division, maybe it's just applicable in the Web2.0 sector. In most sectors if you are successful you make money AND you make a difference. Whether someone is in it for the money or for the "difference" it should not matter, the goals are aligned: success.

The problem with mercenaries is that often they are not in it for the success of the company but for the job and the salary. So they would sell out the company's prospects and suck up to incompetent investors on the Board to protect their cushy jobs. That's the problem with mercenaries, it's not that they care about profitability...

Alex Castro · 12 months ago

Glenn,

Great Post. Thoughtful. Passionate.

I shared it with my team.

Alex Castro
CEO
Deve Networks, Inc.

billythekid · 12 months ago

Glenn, I enjoy your writing immensely. It is always a treat. You are at the extreme end of the transparency-idealism spectrum. I am at the other end; the opposite of transparency is not obfuscation in my case, but internal financing so I don't explain much to anyone. I have learned to communicate and explain myself to my employees a little better because of you, but one of the reasons that my people have responded well is that they know that I am a practical businessman. They don't question my motives because my motives are blatant. My company is the equivalent of a stock portfolio; it is an instrument of wealth creation. One benefit of this approach is that it is easier to cut losses and change course very quickly, especially given the current environment. When start-ups are too mission-centric, the survival instinct is often secondary to the mission; after all, how can a business be in peanuts one day and walnuts the next if the mission was peanuts. When profits and revenues are front-and-center, people understand dramatic changes better. By the way, maybe I am cynical, but the sense of mission in start-ups has less to do with making a difference than wanting to be a part of something...tribal, really, like rooting for a team or city or candidate.

Glenn Kelman · 12 months ago

BtK: It is tribal isn't it? And I agree, once you lay out a mission, you're beholden to it in a way that can make you less flexible.

Alex: thanks for the kind words!

Krassen: I wasn't suggesting you could be successful without building a self-sustaining, profitable business. Failing that, even the fat-cats suffer, no matter how much sucking up they do!

MSFTie watching startup-land · 12 months ago

Good stuff, Glenn, good stuff. Your passion is idiosyncratic, won't light everyone's fires, but who cares? You strike the chord of an obvious # of people - keep at it, both with the insightful posts, and also with the attempts to build a great business and to improve the world!

Krassen Dimitrov · 12 months ago

"Failing that, even the fat-cats suffer, no matter how much sucking up they do!"

Oh, no! Not true! (And a hot-button issue for me.) They just move to the next startup funded by the same investors. The CFO at NanoString came from another failed start-up, same investors...

Glenn Kelman · 12 months ago

@MSFTie: thanks for the kind words! It means a lot coming from the folks in Redmond.

@Krassen: CFOs might be in a special category. I mean, how often is a startup's failure really the CFO's fault? But I've never understood why a startup hires a CFO in the first place. You need to make a LOT of money before hiring someone at that level to tell you what to do with it...

Glenn Kelman · 12 months ago

FYI, this has been re-posted to AllThingsD:
http://voices.allthingsd.com/20081230/guest-pos...

Flatraterealestate.com · 12 months ago

Glenn, I would like to talk to you about your approach of branding and marketing. The best domain name is a name that explain what you do. I feel that with the right name and approach Redfin can redefine real estate for EVERYONE! Please feel free to e-mail me. I have thoughts of contacting a BLUECHIP real estate company about this platform but would like to talk to you first!

Krassen Dimitrov · 12 months ago

Glen,
the CFO in question was a COO in his prior life at Action Engine (like NanoString, funded by OVP)...

I completely agree that CFOs are useless in startups. My wife's one-person company for home-made cookies had more complex finances than most startups (it had revenues, invoices, etc.) The problem is that VCs would often install their friends (aka leaches) at their startups, and in some cases they return the favor by f-ing up with people like you and me...

Michael · 11 months ago

If I were an investor in RedFin (thankfully I'm not), I would wonder why my CEO is spending time writing lengthly posts on blogs, when he should be focusing on liquidating the business to return 10 cents on the dollar for me.