I never met Bill Campbell. To be honest, I had never even heard about him until I heard Eric Schmidt speak his praises on the the Tim Ferris Podcast.

I picked up a copy of Trillion Dollar Coach and I’m so very glad I did. This book is easily in the top 5 books I’ve ever read. It’s right up there with Creativity Inc.

I don’t share book reports very often. Probably only 1 out of every 100-150 books I read. But this is one book that I felt compelled to share.

I’ll do my best to theme selected highlights vs. presenting things linearly.

Great coaches:

• Listen intently.
• Look for patterns.
• Assess strengths and weaknesses.
• Ask questions instead of offering advice.
• Hold a mirror up so we can see our blind spots.
• Hold us accountable for working through our sore spots.
• Take responsibility for making us better without taking credit for our accomplishments.
• Notice body language and side conversations in addition to listening.
• Act as a sounding board.
• Relate stories that help us gain perspective, draw insight, or make a decision without telling us what to do.
• Keep opinions about product and strategy to themselves.
• Make sure the team is communicating.
• Bring disagreements and tensions to the surface.
• Connect the dots with various stakeholders behind the scenes so that when big decisions come up everyone is on board—whether they agree or not.
• Don’t voice opinions about which way a decision should go—Just push for the decisions be made.
• Listen, observe, and feel the communication gaps between people.
• Lie awake at night thinking about how to make us better.

On coaching

• The best coach for any team is the manager who leads that team.
• I’ve come to believe that coaching might be even more essential than mentoring to our careers and our teams.
• It’s up to all of us to coach our employees, our colleagues, and even sometimes our bosses.
• Mentors dole out words of wisdom, coaches roll up their sleeves and get their hands dirty.
• Purpose, pride, ambition, love, family, money, attention, power, meaning, and ego are all primary motivations to consider when coaching someone else.
• It’s often the highest performing people who feel the most alone.

Excellence in teams comes from

• Psychological safety
• Clear goals
• Meaningful roles
• Reliable teammates
• Confidence that the teams mission will make a difference

On trust

• Perhaps the most important currency in relationship—friendship, romantic, familial, or professional—is trust.
• Trust means people feel safe to be vulnerable.
• Trust means loyalty.
• Trust means integrity.

Wisdom for leaders

• Leaders lead. You can’t have 1 foot in and 1 foot out. If you aren’t fully committed then the people around you won’t be either.
• In business there is growing evidence that compassion is a key factor to success.
• Go to extraordinary lengths to build safety, clarity, meaning, dependability, and impact into each team you lead.
• Create a climate of communication, respect, feedback, and trust.
• Listen. Pay attention. This is what great managers do.
• Managers authority emerges only as the manager establishes credibility with subordinates, peers, and superiors.
• Your title makes you a manager. You’re people make you a leader.
• “Get the one on one right” and “get the staff meeting right” were top on Bill’s list of the most important management principles.
• Failure to make a decision can be as damaging as a wrong decision.
• Never put up with people who cross ethical lines: Lying, lapses of integrity or ethics, harassing or mistreating colleagues.
• Letting people go is a failure of management, not one of any of the people who are being let go.
• It’s a manager’s job to push this team to be more courageous.
• Don’t just be a dictator assigning tasks, pair people up!

On Teams

• Coaching is the best way to mold effective people into powerful teams.
• Start treating teams, not individuals, as the fundamental building block of the organization.
• Teams need to act as communities, integrating interests and putting aside differences to be individually and collectively obsessed with what’s best for the company.
• When internal conflict arises the trick is to corral rivals into a community and get them aligned, marching toward a common goal.
• When team members can’t break the tie themselves, it falls on you to make that decision.
• When faced with an issue, his first question wasn’t about the issue itself, it was about the team tasked with tackling the issue. Get the team right and you’ll get the issue right.

On meetings

• He’d start by asking what people did for the weekend.
• Before decisions were made everyone weighed in, regardless of whether the issue touched on their functional area or not.
• Bill would often meet with multiple people before an important meeting to find out what they were thinking. This gave members of the team the chance to come into the room prepared to talk about their point of view.
• When labelled a debate rather than a disagreement, participants are more likely to share information.
• Having a well-run process to get to a decision is just as important as the decision itself, because it gives the team confidence and keeps everyone moving.

On 1:1’s

• Bill would always start with a hug.
• Next he’d ask about your personal life, family, and non-work stuff.
• Bill would write five words on a white board indicating the topics to discuss that day. The words might be about a person, a product, an operational issue, a prospective customer, or an upcoming meeting.
• Bill took great care in preparing for one-on-one meetings.
• Bill typically discussed performance, peer relationships, teams, and innovation.
• Deliver tough messages with respect, warmth, and candor.

Coach Campbell

• Was tremendously respected and loved.
• Lit up the room whenever he walked in.
• Was a straight shooter.
• Was a hugger.
• Was generous.
• Like to help people.
• Cursed like a sailor.
• Treated everyone with respect.
• Believed in diversity on teams.
• Preferred operating behind the scenes.
• Saw through the title to who a person was.
• Always strived for a politics-free environment.
• Always gave you a call back when you left voicemail.
• Demanded commitment, passion, and loyalty.
• Cared about his people fiercely and genuinely.
• Was always there for you when you needed him, no matter what.
• Had a way of making you feel better, even if he was sharing bad news.
• Is sorely missed by many.

As I said, I never met Coach Bill Campbell, but after reading this book I wish I had.

Comments

I don’t do comments on this site, but if you have thoughts, I’d love to hear them. You can email me at its@davemart.in.

Two weeks ago I travelled to Japan for the first time. I was there for 7 days. It was everything that I had hoped for. Below I’ll share a few select memories.

Shibuya Crossing

Roppongi Hills Mori Tower & Museum

Akira in the Streets

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Vending Machines

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Capsule Hotel

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First Meal

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Cherry Blossoms

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Hie Shrine

Pachinko

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Shopping

Good Food

Toilets 😳

Kamakura

TeamLab Borderless

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Buildings

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Meiji Shrine

Street Ads

Ueno

Ueno Zoo

Photo by Suzy Hazelwood

Disclaimer: I’m a designer. I’m not an accountant or a lawyer. When it comes to stock options, if you’re not careful you can end up in a mess tax-wise. Be sure to consult with an accountant and a lawyer before considering any of the scenarios below.

Slow your roll…

You just received a job offer from a startup that includes a $120/yr salary and 20k options that vest over 4 years (with a one year cliff). How do you ensure that those options don’t just slip through your fingers?

Before you start browsing brochures for your Scrooge McDuck sized money vault, here are some practical tips that you should consider:

Don’t be like most startup employees

Most startup employees have no idea how stock options work. They blindly sign agreements, have no idea what liquidation strategies are available to them, and often times forfeit all of their options by leaving the company without exercising anything.

Learn the terminology

Here’s a quick primer:

a. Stock Option
It’s called an “option” for a reason. A stock option is not the same thing as “stock”. With stock options, you are not given stock, you’re giving the option to purchase stock once your shares have vested. Once you leave your company, you typically only have 3 months to execute your options, before it disappears.

b. Strike/Grant/Exercise Price
The fixed price you’re allowed to purchase stock at. This price stays the same during the life of your options grant. If the company that you’re working at is growing, the delta between your strike price and the 409A price and market price will continue to grow.

c. 409A Price
Private companies that issue stock options are required to periodically perform an evaluation of the companies value. Technically this should happen after any event that materially affects the value of the company. Typically though this process happens once per year. From this evaluation, a price per share is estimated. The 409A price is typically lower than the market price.

d. Market price
The per share price the market is willing to pay for your companies stock.

e. ISO vs. NSO
There’s quite a bit of nuance here. Instead of listing everything out, I’ll just link to this article. The biggest thing to keep in mind are the tax implications of the type of options you have.

f. Grant
The amount of stock options you’re given. In the scenario above this would be 20,000 options.

g. Issue/Grant Date
The date you were issued your grant.

h. Vesting Schedule
The schedule by which your stock options become exercisable. Having a 4 year vesting schedule with a one year cliff is super common. In our example above, that would mean that 5000 shares would become exercisable after one year at the company and approximately 416 shares would become exercisable to you each month thereafter for the next 3 years.

i. Cliff

The period of time before your first chunk of options becomes exercisable. After the cliff, a smaller pool of your options generally start becoming executable on a monthly basis

j. Exercisable

The point at which you can purchase some portion of your options.

k. Exercise Date

The date you purchase your options.

l. Expiration Window

The date at which your options expire. Typically this is either:

• 3 months after you leave the company
• 10 years after your issue date
• The date you were fired (if that applies)

m. Cap Table

The list of people who already own stock in your company. This may include founders, investors, advisors, other employees who have already exercised their options.

n. Options Pool

Stock options are granted from an options pool. From a company ownership standpoint, an options pool is necessary in order to prevent constant churn or dilution as options are granted and then expire.

o. Liquidation Preferences

Depending on the round and the state of your company when it raises money, liquidation preferences can be added as bargaining chips that can have an impact on your options when it comes to a sale or acquisition. Essentially this means that some investors will be able to get more money for each share they hold, and likely will be able to sell their shares in the event of the sale of your company before you can.

p. Dilution

Any time additional shares are added (typically as a result of fund raising rounds) there is going to be dilution of the stock value for all stock owners across the board. Basically this means that (at least temporarily) your individual stocks, or options will be worth less money.

q. Equity Investment Plan Document

This formal document outlines the bylaws of a companies stock option program. You’ll need a copy of this if you ever wish to sell your shares.

r. Option Agreement Document

This legal document outlines everything about your particular stock grant. This document will also be needed if you ever go to sell your shares.

s. Exercise Agreement Document

Once you exercise stock options, it is done through an exercise agreement. You’ll also want to hang onto this document.

t. Right of First Refusal

If you have a contract to sell your private stock to a third party, the company typically has a clause that they can purchase your shares at the same price that the third party. This ensures that the company has control over who is added to their cap table.

Know the Tax Implications

I can only speak from my experience. Again, if you’re considering purchasing options, you’ll want to consult with an accountant and a lawyer.

Long-term vs. short-term capital gains tax

In the U.S. if you purchase options and hang on to them for a year before you resell them, you will pay long-term cap gains taxes which as of 2018 is a flat 15% rate. If you purchase your options and sell them before a year passes, you’ll pay short-term cap gains tax which is effectively your personal tax rate 25-35%.

ISO vs. NSO

With ISO options you wait to pay the taxes on the sale of your stock until April 15th of the following year. When you sell NSO options, you pay the taxes immediately upon purchase.

AMT tax rate

This is a tricky bugger to figure out and plan for. 🙂 Basically, if you exercise your options and hold on to them for a year (in order to qualify for long-term capital gains tax) come April 15 you’ll still need to report the purchase of your options and likely pay AMT taxes on them. Talk to your accountant. They should be able to help estimate this for you.

Warning: If the delta between your strike price and the current 409A price is large, the AMT taxes that you’ll be required to pay (prior to selling your stock and recouping any of the money you spent to purchase your stock) may be high (depending a number of variables, like your household income level). You’re absolutely going to want to factor this into your decision to exercise and hold stock.

Get the big picture

Mapping everything out will help you get a better picture of what sort of return you could see from your options.

I created a sheet to help you plan out your liquidation options:

If you’d like to use this sheet, just go to “File” and select “Make a copy” within this Google Sheet.

Liquidation options

Finally, since the company you work for is not a publicly traded company, how do you go about actually selling your private stock? You actually have quite a few options.

1) Forward/accelerated vesting

First, going into a new role it’s helpful to be aware of the option of forward vesting shares. If you’ve got the cash, and the company is open to it, this is your best option, as it avoids all tax hassles down the road.

Here’s how it works:

Taking our example above. Let’s say you’re in the process of joining a new company. They’ve extend a grant of 20,000 options at a strike price of $0.10/share. Chances are the 409A price is also at or near $0.10/share as well.

With forward vesting you purchase all of your options ahead of time. Since there is no delta between your strike price and the 409A price, you don’t pay any taxes. So in this scenario, you’d still have a 4 year vesting schedule with a 1 year cliff. You’d pay $1500 up front, but once you pass your cliff, you start vesting stock instead of options.

There’s a decent chance that the company you’re joining has never heard of this. They may need to consult their lawyer.

But what happens if you leave the company before all of your stock has vested you might be wondering? Not to worry. There is a clause in the agreement that the company can purchase back any unvested stock from the employee at the price the employee paid if the employee leaves the company before they are fully vested.

It requires a little bit of extra paperwork on the company, but can be a win, win situation (assuming you have the cash up front to pre-purchase all of your options).

2) Your company goes public

This is an easy one. Typically there will be a window of time post IPO where you cannot liquidate any of your shares, but after that you can sell your stock at any time at the current market value.

3) Your company is acquired

This is another easy scenario. But again, be mindful of liquidation preferences. Chances are that if you received employee stock options that you have common stock which receives it’s distribution last, and often at multiples less than preferred stock.

4) Sell to someone already on the cap table

If your company isn’t planning on going for an IPO and there’s no sign that they are planning on selling in the near future, a next best step is to reach out to them to see if anyone on the existing cap table is interested in picking up some additional shares. This is in their best interest because it means that no new investors are added to the cap table. It’s in your best interest because it saves you from having to hunt for someone else to buy your stock, and prevents you from having to pay a commission fee.

5) Piggy back off primary rounds

If your company is raising money, it’s almost guaranteed that some people in the company are taking some money off the table. If you can get in on that, this is an easy was to liquidate some of your holdings.

6) Secondary rounds

It’s becoming more and more common for privately held companies to do secondary rounds where employees and early investors have the option of cashing out.

7) Buying yourself 103 days

If you have ISO stock, one handy trick you might try and leverage is to purchase your stock on January 1st. Since you don’t owe taxes until April 15 of the following year, this buys you 3+ months the following year to find a buyer for your stock, thus qualifying you for long-term capital gains tax AND preventing you from having to pay taxes before a sale.

Note: I’ve not actually tried this. You’ll have to let me know if you ever do.

8) Private stock marketplaces

If you work for an exciting startup—one that investors are eager to get a piece of—there are multiple private stock marketplaces where you can list your stock:

– https://equityzen.com
– https://sharespost.com
– https://www.sharebid.com

Just be aware that just because you list your stock doesn’t mean that you will sell it. There is also typically a commission fee that you’ll pay when you sell your shares (5% is typical but you may pay more or less depending on how popular the company is that you work for).

9) Extending your window

Finally it’s worth noting that if you’re leaving your company on good terms and you don’t have the resources to purchase your vested shares (and pay the corresponding taxes) you should definitely check with your company to see if they’ll extend your expiration window. This is becoming increasing popular. More and more tech companies are extending their expiration window out as much as 10 years.

Just know that by law, 3 months after you leave your company your ISO stock options will convert into NSO options.

I hope that was helpful

If you have any thoughts or feedback I’d love to hear it. You can email me at its@davemart.in.

If you’re interested in receiving additional posts like this on a weekly basis, just toss your email in the form at the top of this page. 🤘

Photo by Tim Gouw

What’s a negativity audit?

It’s a simple self-evaluation that when held on a regular basis can highlight negative influences in your life.

How does the audit work?

It’s simple. Just ask yourself these 3 questions:

1. What 3 people leave me feeling the most negative after I spend time with them?
2. What 3 songs leave me feeling the most negative after I listen to them?
3. What three things that I’ve watched or read recently leave me feeling the most negative?

Try and answer each of these questions completely and honestly every time. The most is intentionally bolded in each of these. You may not hang around net-negative people at all, but who are “the most” negative 3 people you hang around.

I’ve found it handy to record my answers in the same place every time (either in a journal or in dropbox paper or Google Docs). That way I can look for patterns.

What are the benefits?

I’ve been able to identify and eliminate quite a few things from my life which I believe have had an outsized impact on the quality of my everyday life. One simple example was when I realized how much of a negative influence consuming the news has on me. 3 years ago I stopped watching the news altogether and I can attest to the fact that my life is better for it!

How do I know if something is negative or not?

Common negative behavior includes:

• abuse (verbal, physical, emotional)
• gossip
• fault finding
• insults
• discrimination
• lying
• sabotage
• theft

In general, negative interactions can leave you feeling:

• fearful
• guilty
• sad
• superior
• shameful
• depressed
• inadequate
• vulnerable
• jealous
• fat/ugly

How Often is “Regular”?

That is up to you. I generally do this once a quarter.

There are a number of tools out there that specialize in creating full-length screenshots of a website, but did you know that you can also use Chrome’s Developer Tool to accomplish the same thing?

Check it out, first pull up any website:

Next, right click and select “Inspect”:

Once the dev console is showing hold down command + shift + p and you should see the following menu:

Type “screen” in the top search box and select the “Capture full size screenshot” option:

Then sit back and let Chrome do it’s thing. Within a few seconds you should see a full-length screenshot pop into your downloads folder:

🙌

Updated November 28, 2018.

This week my exploration took me to the onboarding flow for Asana. Once you sign up and confirm your email you hit this screen:

Note: I clicked play for this animated gif, but the video actually auto plays normally.

I thought this was clever for a couple of reasons:

First, the video auto plays but the sound is turned off and captions are turned on. I really appreciated this approach. I’ve not seen anyone else do this within the context of an onboarding flow before.

Typically I’m not a fan of intro videos because in my experience they tend to rarely get played and auto playing videos that have sound can be a bit of a turn off—especially depending on the environment that you’re in when you go through the flow.

This approach was novel enough to me that I found myself watching the entire video.

Photo by rawpixel.com from Pexels

If I were to boil down everything I’ve learned over the past 10 years into a single sentence, it would be this.

It applies to multiple areas of my life:

In product design


I’ve learned that my primary role as a designer is to understand who’s using my product and what they’re trying to accomplish. To interact with them. To try and develop deep empathy for them. And then to advocate for them.

In my life

Simply put, the less I focus on my own needs and the more I focus on others, the happier I am.

At work

It’s taken a while to come to this realization, but I don’t care about titles and power. I don’t care about accumulating money. I don’t care about fame. None of these things bring me real happiness.

The things that do excite me and bring me happiness tend to revolve around: connecting with others 1:1, helping others, building tools that help improve other people lives, and striving to remain positive & optimistic (in a world that feels increasingly negative).

It’s not about me

Happiness comes as I turn my attention away from myself, and focus on others.

What do you value most in your business, or in the company you work for?

My priorities are clear:

1) Principles
2) People
3) Product
4) Profit

In that order… every time.

1. Principles

These are the foundation. Principles can be hard to define, but once you have them, they can serve as guard rails for future decisions. Here are the principles I’ve defined for Howdy (My little side project):

• Intentionally Tiny
• Embrace constraints
• Reduce complexity
• Stay focused
• Stay independent
• Forever frugal
• Remarkably original
• Minimal feature-set
• Simple tech
• Gut driven data informed
• Give way more than you get
• Default free
• Promotes itself

2. People

A close second after principles is people. This can be customers, employees, freelancers, partners. Basically anyone you associate with.

3. Product

Third comes your products and services. This is the value you bring to the world. It’s your unique way of solving problems and making other peoples lives a little bit better each day.

4. Profit

Profits come last. Not because profit is least important, it’s clearly important, but in a well run company profits come as the direct result of nailing your first 3 priorities.

Hold strong to your priorities

It can be tempting at times to make exceptions, especially when things get tough. But changing your priorities tends to be one-way street. Once you’ve given yourself permission to value profit over product, people, or principles it’s a very slippery slope. It’s very hard to come back from.

Can you run a successful profit first business? I guess that depends on your definition of “success”. It’s certainly possible, but it’s certain to come at a cost.

Today marks 12 full months that I’ve been working on a side project called Howdy.

In that time I’ve:

• Re-written the code base 4 times (Laravel, Vanilla JS, React, then back to Vanilla JS).
• Started working with a partner, then broke it off.
• Seriously considered stopping and working on other side projects at least half a dozen times.
• Taken 2 month-long sabbaticals where I didn’t work on the project at all.

I’m happy with the tech stack that I have now and the project is probably 90% complete, but I’m finding it extremely hard to finish.

The resistance

In The War of Art and Turning Pro, Steven Pressfield talks about “The Resistance” that keeps us from doing our work.

If you’re a maker and you’ve yet to read these two books, do yourself a favor and buy them today.

It get’s worse the closer you are to completion

Pressfield says:

The danger is greatest when the finish line is in sight. At this point, Resistance knows that we’re about to beat it. It hits the panic button. It marshals one last assault and slams us with everything it’s got.

My brain is literally trying to convince me to quit and to start working on “this other exciting new project”.

The ever so quiet whispers in my head are saying:

• A year! Why haven’t you shipped yet? What a failure. Save your dignity. Just call it a wraps.
• This is boring. Just shelve this project and move on to something fun & exciting.
• No one will actually use this.
• Will designers really find this useful?
• What if you launch and no one finds it valuable?
• This niche isn’t big enough. You should change the target to developers? Marketers? Sales?
• Stay safe. Make it as generic of an offering as possible. That way anyone can use it.

And even though I know that these are all fabricated to get me to stop, the temptation to actually stop is legit.

I am very tempted to stop.

It get’s worse the more important it is to us

Pressfield says:

The more important a call or action is to our soul’s evolution, the more Resistance we’ll feel towards pursuing it.

As tempting as it is to call it quits, I honestly think my heart will break if I don’t finish this project. I can think back to so many moments where I still had optimism, hope, and excitement for this project. Where did all of that excitement go? Where is the hope now? How can I get it back?

Side projects are bloody hard

Massive props to anyone who is able to launch a side project and stick with it for a year or more.

Optimism, hope, and excitement be damned…

I’m not giving up on this one.

The resistance is real, but so is my aspiration to have dogged determination!

I will launch this project. 🤘

Wish me luck.

I’m always on the lookout for interesting business models. One that caught my recently was from a company called Quip.

The app is interesting. Seems like there’s overlap with Google Apps, and companies like AirTable.

What caught my eye though was their pricing:

Basically it’s 5 users for a flat $30, then $10 for each additional user. For whatever reason, this approach to pricing resonated with me. It’s reminiscent of Jira’s pricing, which I’ve always admired:

I love the idea of just getting people in the door at a lower price, allowing them to stay at that price forever if they don’t continue expanding, but then capturing additional value as a company continues to grow.

If I were launching a SaaS product, I would probably test this route before experimenting with a freemium model.