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Hi, I’m Brad Feld, a managing director at the Foundry Group who lives in Boulder, Colorado. I invest in software and Internet companies around the US, run marathons and read a lot.

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Precepts

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My first company – Feld Technologies – was a transformational experience for me.  I started the company in 1985 out of my fraternity at MIT.  My first major client was a 100 person dental practice in California (run by the step-father of one of my fraternity brothers) – I wrote their office management and insurance billing software that is still in use today (written in DataFlex 2.x- still available today although now version 3.2.)  I recall sending out invoices at the steep billing rate of $25 / hour. You’ve got to start somewhere.By 1992, we had a company that was doing around $2m a year in revenue and had about 20 employees.  We were self-funded (we originally funded the company with $10 so we could split up the ownership of the company – we had 10 shares of stock at $1 each.)  We never raised any other money – the business grew based on our cash flow.

We were always a pretty thoughtful and introspective group – especially since most of us were in our 20′s and had absolutely no experience creating a company.  We were idealistic about a lot of things, but fortunately very good at what we did – at least relative to all the other folks in Boston that were doing the same type of stuff we did at the time (custom database software and network integration services).

My partner – Dave Jilk – and I had a long standing tradition of taking a day off during the week each month and going on a “retreat.”  We’d often go to a bed and breakfast within a couple of hours of Boston and spend 24 hours together talking about the business (both long term “strategic issues” as well as immediate tactical stuff), life, our relationships (we had both gotten married shortly after graduating and subsequently divorced), and our aspirations.  We usually finished the day with a nice long dinner and plenty of booze, at which point we stumbled back to wherever we were staying, got a good night sleep, and drove back to Boston (and work) the next morning.  We tried to do this every month – we probably got in about nine a year – which in hindsight is something that clearly helped us keep our business – and our relationship – from going off the rails.

In 1990 when we had about 10 employees, we decided to start going on an annual retreat.  One of our clients had a family summer house at Lake Winnipesaukee – we’d haul up the entire crew for a long weekend (usually Friday and Saturday as folks would start peeling off Sunday morning.)  I recall these retreats with great fondness – these were some of the best times I had at Feld Technologies.  We always did these in October - so in addition to all the normal bonding rituals that a retreat like this entails – it was often cold – which created a whole new category of potential entertainment and “experiences.”

In 1992 – on October 6th to be precise – we decided to spend the day coming up with the “mission” for Feld Technologies.  When we started this process, there was plenty of scoffing – we were a young crowd and we all thought the “mission, vision” thing – which was very in vogue at the time – was a load of horseshit.

After talking about it for a while, we decided that we could define our mission with a set of precepts.  We all thought this was both more intellectual as well as more rigorous.  This appealed to everyone so we got after it.  A few months ago I sent Dave a note to see if he had a copy of these precepts (I was two hours into a long run when they popped into my mind – clearly I had something stuck in a brain crevice somewhere that really wanted to get out.)  Since I don’t keep my email or files past a few months, I didn’t expect him to have them, but lo and behold, “three zip files later” he’d dug them up.

I didn’t remember the precepts, but had a fantasy they would pass the test of the passage of time.  They do – and while they apply to Feld Technologies – I thought they were worth repeating and commenting on.  While I don’t think any company should have the same set of precepts that we did, I think it’s valuable to use this approach to define the mission of your business.  It’s a different approach than the standard mission, vision thing (which I still think is horseshit even though I’m not nearly as idealistic as I was a dozen years ago) – but I think it can be useful at the right time in the development of a company.

Following are the 10 precepts that – in our words “defined the mission of Feld Technologies.”  The precepts are in italics – my commentary follows.

We must be financially successful to be a business. Now – before you say DUH – recall what happened between 1999 and 2003 (and is still going on today with companies such as Commerce One (in case you are asleep, Commerce One – which was once worth a gillion dollars – is in the process of liquidating because it no longer has a viable business.))  Feld Technologies never had a choice – we had to be financially successful – or we wouldn’t exist.  We had to be positive net income and make a cash profit at the end of every month – if we didn’t – we wouldn’t be able to cover payroll.  Yeah – there were a number of times that Dave and I had to reach into our pockets and loan the business money to cover cash flow for a short period of time – but the money in our pockets came from the profits of the business – so it was a self-fulfilling prophecy – if we didn’t have “overall positive cash flow” on a monthly basis, we wouldn’t last long.  While we were pretty open book about our financials, we wanted to reinforce this with everyone that worked for us, hence precept #1.

Respect. This was a biggie.  Respect applied to everyone in the company, our clients, and our vendors.  When you are running a service business (or any type of business), it’s easy to start thinking that your clients and co-workers are idiots, especially when things don’t go as planned.  We had a zero tolerance approach to this – respect for each other and the people we worked with us.  By the time we were 10 people, this was starting to get more challenging, especially given the range of personalities within the company.  We borrowed the concept of Thinly Disguised Contempt (TDC) from Alan Trefler at Pegasystems and incorporated it into this precept which acted as an anchor for all of us.

We want our clients to love our service. The corollary to this precept was “we suck less.”  The custom software business in the early 1990′s was a bitch – nothing worked very well.  Our clients were deploying mission critical PC-based systems for the first time and it was hard enough to get the networks working properly, let alone the software.  Oh - and you had to understand what the client actually wanted – which was even harder when they didn’t really know what they wanted, and had probably already failed at a few prior projects.  So – our goal became to “suck less” than the previous company that had tried to build a custom system for our client.  While “we suck less” was a fun and memorable mantra, it wasn’t a particularly good precept.  As a group, we decided we’d hang on the mantra – especially in situations that were pressure packed – but that the actual precept would be to have our clients love our service.  “Love” in this case is still a relative thing – so we could achieve this precep
t while still sucking less.

The success of the business along all dimensions is everyone’s responsibility. I remember spending a lot of time talking about responsibility.  At the time, my therapist had a recurring theme going with me about my taking too much responsibility for things.  Fortunately, most of the people at Feld Technologies were naturally responsible people (and the ones that weren’t didn’t last), but by calling this out explicitly, everyone was linked in responsibility for the entire business, rather than just one aspect of it.  This precept created a natural rhythm where things – especially problems – didn’t lie on the floor. Someone quickly picked it up and – even if they weren’t the right person to address it – knew that they were responsible for bring it to the right person’s attention.  After having been involved in over 100 companies since Feld Technologies – I fondly recall us getting this right in comparison to most other companies and cultures (although this may be another case of “we suck less.”)

Our work environment must be comfortable and stimulating. This was another biggie.  I have always been a jeans and t-shirt kind of guy (once a year I go to the Gap and set a single store record for unit purchases – this year it was 60 t-shirts, jeans, and underwear since I’d left a lot of my clothes in Alaska this summer.)  One of our managers liked to wear a tie every day.  We ridiculed him for a while, but then realized that he felt more comfortable in a tie in a work context then he did if he was wearing a t-shirt.  Aha!  This precept didn’t mean “casual” – it meant “comfortable” - both physically and emotionally.  In some ways, we were way ahead of the curve on the whole dress code thing as we believed people should do what they feel is comfortable given the context there were in. Occasionally we’d have some inappropriate moments (I remember showing up in shorts at a client who was a very Bostonian-conservative suit and tie place and realized that I was most definitely NOT comfortable at that moment in time) but overall, we ended up with a work environment that – well – worked.

Strive to be the best. While “we suck less” defined how we wanted to perform in relationship to our competitors, we believed strongly that trying to be the best we could possibly be was a logical precept that wasn’t in conflict with we suck less.  Many “mission/visions” have a “be the best component” – we started this precept intentionally with the word “strive.”  We didn’t actually expect to be the best at everything, nor did we really care if we were.  However, striving to be the best was a key part of our culture.

We want to grow into new areas that we have not yet explored. Feld Technologies was full of super smart people (many of the folks were MIT, Brown, Brandeis, and Wellesley grads.)  Not surprisingly, there was a lot of “intellectual curiosity” floating around.  We also got bored quickly (ever try to spend week after week developing custom business applications for mid-size companies that didn’t really know what they wanted – boring!)  So – we played and explored.  We tried to have as many technology toys around as we could (although in hindsight we were pretty pathetic at this because we were cheap about spending our hard-earned positive cash flow dollars on things we didn’t really need.)  In addition to going out and blowing off steam on Friday nights (remember – we were in our 20′s and we were nerds – we knew how to party), we’d get together and discuss books like Zen and the Art of Motorcycle Maintenance.  We tried to always have learning be part of what we did without having it interfere with either work or non-work time (and this was tricky.)

Work should be a substantive, positive part of our life experience and personal growth. Ok – now we are hanging out in the zone of “let’s make sure work matters, but have balance in our life with work being part of that.”  We all worked really hard.  As a group, it was clear that some of us (including me) were way out of balance – work was “all consuming” rather than “substantive.”  For others, work treaded into negative territory – either it wasn’t fun, wasn’t rewarding, or was just a chore.  Of all the precepts, this one has had the deepest impact on me as I no longer think of work as either (a) my life or (b) simply work. What I do is woven into who I am, which is not just my work.

We want to be our clients’ best computer technology investment. I recall us having a whole bunch of “be the best” type of comments that we were trying to roll into a precept.  We were tired (this is #9 after all) and struggling with how to represent these thoughts as a precept.  We kept coming back to “be the best at what, for who?” which – once we answered the question, we had our precept.  It’s a pretty focusing one, since we lived for our clients (that was who measured us) and their measurement was a directly financial one (if they kept paying the bill we sent them each month, we were doing ok.)  By linking these two concepts, we had a precept that held us financially accountable to our primary constituent.

We will periodically meet as a group to evaluate, question, and re-affirm our precepts and our mission. All the MIT nerds (me included) loved the idea of a recursive precept.  We sold the company in the fall of 1993, about a year after we came up with the precepts in the first place, so ironically we never revisited them.  12 years later, I still think they are pretty good.

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