Chris, Tom, Jack, and Pat* were co-founders of a post-Series A startup. They were scaling fast but were having difficulties coming to a decision regarding their company’s future. I had already been working with them for a few weeks when they reached out for support.
“We need to create a steady revenue stream”, said Jack, “by focusing on where our current user base is located or else we won’t get anymore money”, to which Pat agreed.
“But if we do that then we risk losing all the users we gathered by having our app be national. We may never get them back”, countered Chris.
I was sitting in on their conversation to offer advice and support, but their indecision on how to proceed was creating more of a headache than anything else. Unable to agree, they hit an impasse:
Chris and Tom wanted to pursue a broader market while Jack and Pat wanted to narrow the scope, thinking that concentrating on a local market would ensure a steady revenue stream needed to scale and secure future investment. Typical considerations for first-time founders wanting to maximize their growth rate.
Situations like these are common. Here are the exact steps I took with them to help them find a way forward:
Declare a distraction-free zone with the intention that you’ll spend at the very least an hour hashing out everyone’s ideas.
Spend the first 10–15 minutes having everyone write out their ideas. Get as thorough as possible.
Then have each person write them out on a large white board, explaining their process or what lead them to want to add that idea or suggestion.
This hybrid brainstorming approach results in three times more productive ideas than if everyone just put out their ideas all at once. And in the end you will have a list of suggestions that you’ll rank.
Next, rank each suggestion with a numerical value. Collectively, everything will equal 100.
Have everyone individually do this first without showing their rankings to the rest of the team. Then bring the team together to compare their rankings. This will show you what is important to the team versus what is something they are willing to “trade for.”
Use these numbers later to negotiate around the different choices and find a solution that works.
This is where things will get interesting.
Facilitating a conversation between Jack, Tom, Pat, and Chris showed that they could agree on one thing: they needed to change gears and couldn’t keep doing business as usual.
They only arrived at this decision after about a half-hour of going back-and-forth and realizing that they weren’t actually listening to each other. I stopped the conversation when Chris said, “I just don’t see how we can keep doing things they way we have”, to which Jack said, “I agree.” This moment proved pivotal. This concession made going forward easier because it highlighted something psychologists refer to as building a “shared reality” and “procedural justice.”
Shared reality is what happens when others see the world as you do and then find a way to let you know. It’s very unsettling when others don’t share your understanding of reality. When they do, however, it puts people on the same team and opens them up to collaboration. Procedural justice is about getting a fair hearing. It’s when people can ask themselves, “Did I get a chance to actually be heard?” and answer in the affirmative. We’re far more likely to accept an outcome if we feel like we’ve been listened to and understood. Not only does finding something to agree on fulfill both of these psychological needs, but research also suggests that people tend to automatically reciprocate. So when you agree, your opponent is more likely to find something else to agree with you about in turn. (Source: Forbes)
Their area of agreement made agreeing and compromising much easier. Instead of arguing. there was now more space for listening, for agreeing, and for finding commonalities. A disagreement that lingered for 3 months was suddenly on the cusp of having a resolution.
The last step for Chris, Tom, Pat, and Jack was to make sure that the decision they came to ultimately lined up with the company’s values/vision.
They decided to narrow the market focus of their product to two localities where they had physical offices, and decided to communicate this to their employees all at the same time via their annual company retreat. Their startup valued transparency, innovation, radical candor, and freethinking, so their decision ultimately acknowledged these.
And because their long-term vision was to scale their product, their decision ultimately made the most sense. Ultimately, it proved the right decision.
Bottom line: work backwards and agree on something small first before tackling the bigger problem. Create a space where everyone’s ideas and suggestions can be acknowledged. And keep the best interests of the company in mind when coming to a final decision.
*Names were changed to protect confidentiality of clients.