These are almost surprisingly rare, relative to the level of operational discipline, opportunity, and trust involved in the startup ecosystem, particularly at early stages.
I honestly don't know how you don't figure out "Wait, sorry, that math doesn't work, and seriously what did you just say the story was with an account at Bank of America?!" in due diligence for a 9 figure round, but be that as it may, capitalism is pretty self-correcting there.
"Aren't employees even worse off than investors?"
I mean if an employee joins a company whose CEO would do this a) they're inevitably going to have an unfun time and b) in a sense they are inadvertent beneficiaries of the fraud, not victims, because guess where salary came from.
But that due diligence thing: when I sold Bingo Card Creator, which did *not* go for $175 million with $20M+ direct to my pocket, the due diligence caught a $29.95 refund which had been paid but not reflected as an adjustment against revenue and asked what the story was.
And the DD report to the buyer included an asterisk "There was an anomaly in the revenue ledger which management has provided an explanation for. The anomaly was not material."
Imagine an accountant walking away from an explosion putting on his mirror shades.
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Next up at MicroConf, and possibly the only talk I’ll tweet today (dealing with some insomnia so might need to nap), @randfish on what he learned regarding the VC funding versus bootstrapping models.
“After publishing Lost and Founder [a guide inspired by Rand’s experience at Moz], some VC friends told me ‘What are you doing?! You’ll never raise money again.’ That was sort of the point.”
Rand: Many people who are accredited investors could not place the hundreds of bets on startups that one needs to statistically get a venture style outcome.
Next up at MicroConf: attendee talk from Austin Bouley on doing $100k much faster than typical in building a SaaS business.
Find a community: being a frequent participant in an online forum establishes you as an authority and makes it much easier to sell into that community in the future.
Austin says remember to build rep with admins so that they don't get annoyed with you for restrained promotion.
Deliver quick wins: you want to have a short feedback loop for getting users to value.
First business died because churn was too high. Users didn't see benefit until years after doing the thing.
Celebrate small wins of customer early. Confetti/etc, make it fun. Show progress.
I’ve been working with an executive assistant for the first time in my life.
I cosplay as being impressively organized, but I have limited amounts of that energy, and often deploy it in other-than-strategic ways.
This is how I’m both the person who has 125 pages of KYC information ready to fax to a Japanese regional bank and also forget to follow up with a consulting lead for a month at a time.
When I was working full-time, one of the most useful things my manager did was simply reminding me of commitments I had made and then checking to make sure they were done. Not rocket science, but not something computers are good at yet.
An internship project worth doing at any age: go out into the world, learn one relevant thing, write it down, then bring it back to us (who are equally capable of going out into the world and writing things down *but will not do this*).
I have literally suggested this to interns over the years, but it was also my default marching order for my executive assistant: if you don’t know what to do, to learn one interesting thing and write it down.
The ceiling for this being useful is crazily high.
And while one could perform years of academic effort to do a study with controls etc etc given how low the fruit hangs you can probably have an artifact worth reading for the price of a single coffee conversation or five user interviews or similar.
Swift on Security, one of my favorite "Twitter accounts", wrote up their life story:
It's a deeply personal and reflective one. A thing I would like to underline: in between long stretches of showing up, there are occasionally leveraged choices.
Sometimes, choices are made by people who have grossly insufficient ability to understand the tradeoffs presented or even that there is a choice to be made at all.
One of best acts of charity is noticing if you observe that and intervening to extent possible.
I did not grow up in the best of socioeconomic circumstances and owe a lot to a friend's dad, and I don't even remember whose dad it was, who saw me with an IIT pamphlet in high school and said "Patrick, come here a minute."
This is, FWIW, a fairly complicated area where the IRS’s position is “We won’t make trouble for small business owners unless you really go out of your way to turn your credit card into a business into itself.”
What many, many small business owners do is spend $50k on the business’ card and extract $1k of value (flights, cash back, whatever) for themselves personally without that value being taxed.
The IRS has a technical objection to this but doesn’t really care.
The technical objection is that the card rewards should function as a discount and then that discount reduces the value of the expense that your business is deducting. Few small business owners actually do this.