The VC perspective

As an experienced venture capital investor, you all know the benefit of early identification of “people” problems.  You probably recognize that gut-level feeling that says all may not be right in your new portfolio company.  The challenge is, how to find out and address what is really going on, especially when the management team may have a lot invested in keeping the issue hidden.

There are a variety of challenges to early identification of a problem:

• Denial People aren’t usually willing to see a problem until they believe they know what to do to solve it.  So the problem that is glaringly obvious to an outsider may be denied or even not recognized by those in the middle of it.
• Misinterpretation Each person involved in the issue will have his or her own spin on what the root cause is – usually a root cause that is all someone else’s fault.  Finding the truth amid all the different stories can be challenging.
• Finding a Solution Einstein said, “We can’t solve problems by using the same kind of thinking we used when we created them.”  Those in the midst of the problem may be acting from a place of self-protection, so will only suggest “safe” solutions.  Only an outsider may be able to see, and sell, a solution seen as more risky to some or all of those involved.
• Managing Resistance Even once those involved in a problem agree to a solution, they may exhibit resistance once the solution begins to take hold.  After all, problems persist because they have value for the system – so the system may resist change.  Managing others’ resistance can be frustrating and confusing, and may take more time and skill than many want to employ.

All these challenges are greater if you come in wearing the hat of an investor or Board member.  Not only are people invested in making you believe everything is fine, you also may have your own challenges in wanting to believe there is trouble in this great new investment.  For these and many other reasons, you may wish to bring in outside help.

At Perspective2, we believe that it is possible, and valuable, to identify emerging people issues early, before the resulting disruption can put at risk the organization.  We have seen it all, and can quickly identify and begin to resolve the issue.  Got a start-up that is keeping you awake at night?  Give us a call.