Features | From Pivot Magazine

Secrets of the scale

Delegate, diversify and other lessons from Elad Gil’s business-building bible

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For entrepreneurial dreamers there’s no end of advice manuals, from The First 90 Days to The Complete Idiot’s Guide to Low-Cost Startups. What Elad Gil—ex-Google, ex-Twitter, serial entrepreneur and angel investor—has to offer in High Growth Handbook is a rarity: pragmatic, valuable advice for the almost-unicorns, the start-ups that hit a sweet spot from the get-go and begin growing exponentially. Gil has been there himself, albeit not on the crest of the wave. When Twitter bought his seven-person start-up Mixer Labs in 2009, the soon-to-be social media giant had about 90 employees. Gil stayed with Twitter for two and a half years, and by the time he left, it employed 1,500. 

Book cover for Elad GIl's book: High Growth HandbookGils book offers pragmatic, valuable advice for the almost-unicorns, the start-ups that hit a sweet spot from the get-go and begin growing exponentially. (Image provided)

All such companies face the same issues—from founders learning to deal with boards of directors to finding the talent they need to hire—and often make the same mistakes. First-world problems, perhaps, the sort of issues a founder maxing out her credit cards to pay expenses might envy, but they are certainly real and tricky to navigate. Gil, who knows his start-up jargon, from “scaling” (expanding) to “reports” (not documents, but the people who now answer to a founder-CEO), also has a nice touch with homely metaphors in a book addressed directly, in the second person, to start-up founders. If your co-founder is your spouse, then your board of directors are in-laws: “You are going to see them regularly, they are hard to get rid of, and they can have an enormous impact on your company’s future.” The overall effect is a book as accessible as it is useful.

What to do with yourself, the most important question of all, kicks off the book. Founders-turned-CEOs are often surprised by the demands exerted by management and organizational issues. There will simply be no time for the business itself until a strong executive team is in place: take too long at that, and burnout is inevitable. Learn to say no, and delegate, delegate, delegate, advises Gil. You have to identify and focus on the things only you can do. Avoid even what you like—perhaps you enjoy writing code, but now you employ 50 programmers, so leave it to them. Dial down the media access: “Do you really need to talk to Dog Life Monthly Webzine?” asks an acerbic Gil. 

Since someone has found your concept potentially lucrative enough to advance you millions of dollars (otherwise you would not be scaling up), a board of directors will arrive as surely as night follows day. Most start-up founders realize their relationship with board members, both the independents and those from venture capital (VC) firms whose seats are guaranteed by the financing agreement, is significant. But fewer are aware they have to be on top of it from the very start—if only because board members are difficult to unseat once they’re ensconced.

Most will come from the VCs, and Gil advises accepting a lower valuation if that means better board members—senior operatives with networks and experience. And remember the VCs have their own fiduciary duties to their shareholders, which makes your independent directors crucial. If you find good ones, ideally people who have been in your shoes, from “two guys in a coffeehouse to thousands of employees,” and thereby understand the constant chaos and existential crises that go along with exponential growth, they will help you push back against the short-term bottom-line focus of the VCs. That’s why, in naming independent directors, you need to find true independence. Be cautious about VC suggestions, because their candidates will often be in debt to them. (There is an entire subsection on how to spot a “VC crony.”) 

What may be Gil’s most compelling theme is the need for diversity, from senior executives on down to the most junior hire. There’s no reason to doubt Gil is a mainstream Silicon Valley-ite—economically conservative (a raging capitalist, in fact) and socially liberal—but his stress on diversity has nothing to do with social justice. It’s best illustrated in his interview with Joelle Emerson, founder and CEO of Paradigm, and Silicon Valley’s reigning expert on inclusion and unconscious bias. She talks about a 2012 YouTube discovery. The company had launched a mobile product that allowed people to upload videos from their cellphones, but found 10 per cent were being uploaded upside down. YouTube, which had no left-handers on their design team for that product, eventually realized that left-handed users held their phones differently. 

Not only does a diverse workforce help you reach a diverse customer base, it’s a necessity in and of itself. Cutting-edge start-ups, the ones most likely to attract VC cash, have by definition limited talent pools to tap. They can’t afford to ignore any corner of the prospective worker world. That’s why you have to display diversity in the employees featured on your website, have diverse hiring committees for every position, offer what matters to your workers—start-up employees skew young, so make sure your benefits include topped-up paid parental leave—and seek out female business founders and entrepreneurs of colour for your board. They will all provide insights you may not even be aware you lack. 

After 344 pages of solidly practical do’s, Gil concludes with a few don’ts, mostly lighthearted in tone. The biggest comes in the spirit of The Princess Bride’s classic admonition to “never get involved in a land war in Asia.” Don’t go to China, warns Gil, where tech companies end up blocked, cloned and shut down. And, although you’ll have to read the book for a full explanation, never put a pool table in the office: “not a good sign.”