TOPIC: How & What Growth-stage CEOs Are Planning for 2011

Below is the hyperlink to take the Q4 CEO peers speed-survey, exclusively for growth-stage CEOs.  This survey focuses on “How & What Growth-stage CEOs are Planning for 2011″

This shouldn’t take more than 5 minutes of a busy CEO’s time–

We here at BSG Team Ventures periodically take the temperature of the markets we serve. The survey is no more than 15 questions, most simple multiple-choice.

These surveys are created and compiled by BSG Team Ventures as a courtesy to our executive ecosystem with the belief that knowledge is power.  Aggregated peer-provided knowledge is “actionable power.”

For the survey results from Q2 2010, titled “Impact of Economy & Renewed Growth Planning”, go to http://www.bostonsearchgroup.com/blog/ceo-survey-results-q2-2010-%E2%80%93-impact-of-economy-renewed-growth/

We make an effort to survey only those who fit the category (in this case, sitting CEOs or board member/founders of technology/science-driven growth-stage companies). [Note, if you don't fit the aforementioned description, please refrain from responding.]

Feel free to forward to the qualified CEOs in your sphere of influence. The more data generated, the more accurate the trend lines.

All responses are anonymous due to the web-based survey technology employed.

We will forward the survey results within the next two weeks to the email address on file. Please let us know if there is another email address you wish us to send the results to as well.

Registration is Now Open

4th Annual Benefit

VCs vs. Entrepreneurs – Davis Cup Challenge

Thursday, September 23, 2010
Longwood Grass Courts  /  2:00 – 7:30pm

Welcome Back!  BSG Team Ventures is proud to once again host the 4th Annual  Benefit: VC vs.  Entrepreneur Tennis Tournament – Davis Cup Challenge, and we are thrilled to have you join us.

The VC/Entrepreneur tennis community has been growing every year so please register now so we can build the teams early.

Entry is by donation of $175.00.  Please click here to register!

For questions, please email Cristina Vieira Abramson at cvieira@bsgtv.com or call 617.784.4987

Agenda Overview

VCs vs. Entrepreneurs - Thursday, September 23, 2010

Format - Round Robin, Doubles

Time - 2:00 – 7:30pm (includes tournament, finals, cocktails, dinner and networking)

Location – Longwood Cricket Club, Chestnut Hill, MA

REGISTER

Indian Students Wield Tests for College Spots

India has one of the world’s youngest populations, yet as the middle class has steadily grown, so has the cutthroat competition for the limited slots in the country’s system of higher education. High school seniors must pass national board exams to graduate from high school. But those same board exams also serve as the rough equivalent of SATs for students applying to most programs in many universities…more»

Student Loan Bill Scorecard

A look at who fared well — and who didn’t — in legislation to overhaul the student loan programs…more»

Students playing catch-up as they hit college

Each year, tens of thousands of Texas students land in this academic purgatory – no longer in high school but not ready for college. About 40 percent of recent high school graduates in the state’s public universities and colleges need at least one remedial class. Statistics show those students take longer to earn a college degree, if they do at all…more»

FCC Broadband Plan Pushes Ambitious Agenda for U.S. Education

After almost a year of development that included holding 36 public workshops in person and online and reading through 23,000 public comments, the Federal Communications Commission has released its national broadband plan with a formal report to Congress. Calling high-speed Internet access “indispensable for the 21st century, the foundation for our economy, the foundation for our democracy in the digital age,” FCC Chairman Julius Genachowski declared the plan “ambitious but achievable”…more»

The Great Charter Debate: Part Four

This is part four of a debate between myself and a colleague who believes I have been too critical of charter schools. In Part One, he shared his perspective on the value of charter schools. I responded with my own views on the limitations of charters as a force for reform, and this week he offered his rebuttal to that. Here is my response to that one, Part Four of the great charter debate…more»

Mobile Learning Makes Its Mark on K-12

Mobile devices such as smartphones and iPods, still seen as nuisances or contraband by many schools, are now viewed by an increasing number of teachers and administrators as cost-effective tools to build and sustain 1-to-1 computing programs. But while the use of mobile devices for learning is sparking a shift in the ed-tech landscape, its impact on student achievement is unclear…more»

Educators Struggle to Design Mobile-Learning Content

Developing meaningful lessons that fit the constraints of small-screen devices is a challenge. How can educators (and publishers) find or develop meaningful, standards-based lessons that fit the visual and data constraints of a small-screen device?…more»

In Texas Curriculum Fight, Identity Politics Leans Right

In the fight over curriculum, conservatives in Texas have more in common with liberals than they think. In reality, this controversy is the latest version of a debate that reaches back many decades and is perhaps essential in a heterogeneous democracy whose identity has long been in flux…more»

Historians speak out against proposed Texas textbook changes
Historians criticized proposed revisions to the Texas social studies curriculum Tuesday, saying that many of the changes are historically inaccurate and that they would affect textbooks and classrooms far beyond the state’s borders…more»

A Private College Goes For-Profit
Dana is sold a year after another Lutheran institution was sold. But new owners plan to keep tenure and the traditional, residential mission…more»

One Classroom, From Sea to Shining Sea

No one in either party today has the courage to say it, but what made sense for a sparsely settled continent at the dawn of the Republic is ill suited to the needs of a 21st-century nation competing in a global economy. Our lack of a national curriculum, national teacher training standards and federal financial support to attract smart young people to the teaching profession all contribute mightily to the mediocre-to-poor performance of American students, year in and year out, on international education assessments. So does a financing system that relies heavily on local property taxes and fails to guarantee students in, say, Kansas City the same level of schooling as students in more affluent communities…more»

In Hard Times, Lured Into Trade School and Debt

Commercial trade schools are under fire because they are attracting more students and Pell grants. At institutions that train students for careers in areas like health care, computers and food service, enrollments are soaring as people anxious about weak job prospects borrow aggressively to pay tuition that can exceed $30,000 a year…more»

CCA Response

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FCC announces Children’s Agenda for broadband

The FCC has announced the creation of the FCC’s “Children’s Agenda for Digital Opportunity,” which will build on the four pillars of digital access, digital literacy, digital citizenship, and digital safety. The Children’s Agenda is part of the National Broadband Plan to be released this week…more»

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Panel Proposes Single Standard for All Schools

A panel of educators convened by the nation’s governors and state school superintendents proposed a uniform set of academic standards on Wednesday, laying out their vision for what all the nation’s public school children should learn in math and English, year by year, from kindergarten to high school graduation…more»

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False Fronts? Behind Higher Education’s Voluntary Accountability Systems

A new report from Education Sector and the American Enterprise Institute examines current voluntary accountability systems—the University and College Accountability Network (U-CAN) and the Voluntary System of Accountability (VSA)—and argues that these systems are not measuring up…more»

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Cultivating Failure

Alice Waters’s Chez Panisse is much more than a restaurant. It is a standard-bearer for correct moral values, and now it will dictate our kids’ education. Do we really want this?…more»

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Will Millennials become the chump generation?

A study of the 50 million Millennials 18 and over by the Pew Research Center found some surprising and some not-so-surprising developments. Surprising (to me): Almost two-fifths of Millennials have tattoos, up from a third among Gen Xers and from a seventh (15 percent) among boomers. Not surprising: Millennials are the first truly digital generation. Three-quarters have created a profile on Facebook or some other social networking site. Only half of Gen Xers and 30 percent of boomers have done so. A fifth of Millennials have posted videos of themselves online, far more than Gen Xers (6 percent) or boomers (2 percent)…more»

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School Districts Lay Foundation for Mobile Devices

More districts are allowing students to bring their own notebooks, iPhones or other computing tools to school and connect them to the district network…more»

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New Battleground for Publishers

With demand for online assessment and e-tutoring tools growing, good textbooks alone are no longer enough to win over professors…more»

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Plan to stem dropout rate stirs controversy

President Obama is proposing $900M to turn around the nation’s worst performing schools—but to get the money, districts would have to agree to dramatic changes that have some educators concerned…more»

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Feds release new national ed-tech plan

The plan, called “Transforming American Education: Learning Powered by Technology,” calls for engaging and empowering learning experiences for all students; standards and assessments that measure key 21st-century skills and expertise; a shift to a model of “connected teaching,” in which teams of interconnected educators replace solo classroom practitioners; always-on connectivity that is available to students and teachers both inside and outside of school; and a rethinking of basic assumptions, such as seat time, that limit schools’ ability to innovate…more»

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Race to the Top finalists announced

The U.S. Department of Education (ED) has named 16 finalists in the first round of its Race to the Top competition, which will deliver $4.35 billion in school reform grants. The winners will be chosen in April…more»

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Let’s give children the ’store of human knowledge

In virtually every Western society, education is in trouble. Unfortunately, however, policymakers tend to obsess only about the symptoms of the problem – unsatisfactory standards in core subjects, growth of a cohort of poorly schooled underachievers or erosion of classroom discipline – and not the cause…more»

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Four Myths About the Online Education Experience

U.S. News University Directory in collaboration with E-learning insiders clear up four common myths about the online learning experience and how online classes are perceived. …more»

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Obama Calls for Major Change in Education Law

The Obama administration is seeking changes to the Bush-era No Child Left Behind law and proposing to eliminate provisions that have labeled one in three schools as failing…more»

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Lowering Student Loan Default Rates

In a new Education Sector report, “Lowering Student Loan Default Rates: What One Consortium of Historically Black Institutions Did to Succeed,” co-authors Erin Dillon and Robin V. Smiles analyze why students default on their college loans and argue institutions are vital to lowering student loan default rates…more»

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Princeton students, profs give Kindle mixed grades

Princeton University has released findings from its semester-long pilot of Amazon.com’s Kindle DX electronic reader, and the results appear mixed…Students and faculty who were surveyed after the pilot program ended said they appreciated the portability of the Kindle DX, and the fact that it greatly reduced the printing and photocopying they did for their courses. But they said they missed the ability to highlight text directly, take notes, and flip back and forth through pages of their textbook easily…more»

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6 Months, $90,000 and (Maybe) a Great Idea

The entrepreneur-in-residence model has gained prominence as a calculated way for a venture capital firm to nurture a successful company into being and to increase the odds of solid returns…more»

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The ‘Prior Learning’ Edge

An examination of the educational records of more than 62,000 adult undergraduates at 48 colleges finds that students who had sought and been awarded academic credit by their institutions for “prior learning” earned in the military, corporate training and other non-classroom settings were more than twice as likely to graduate, and to persist even if they did not graduate, than were their peers who had not earned such credit…more»

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Prison Students Illustrate the Shortcomings of Public Schools

Today more than 100,000 juveniles are incarcerated around the country. Schools for prisoners are obviously the extreme of the alternative school spectrum. In New York City incarcerated youth make up just a fraction of the 70,000 students in alternative setting. Nonetheless, these schools illustrate the many ways that traditional public schools cannot possibly meet the diverse needs of all American students…more»

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Experts Lay Out Vision for Future Assessments

Led by Stanford University professor Linda Darling-Hammond, a panel of experts outlined a comprehensive system that includes summative and formative tests of higher-order thinking skills, reflecting a marketplace that they say places increasing value on such skills…more»

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Free Online Courses Don’t Hurt Paid Enrollment

Offering some online courses for free does not hurt paid enrollments, according to a recent study…more»

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Race to the Top?: Part III

True education reform involves two fundamental changes in our public education system. The first requires a structural shift in the areas that research has shown to actually improve education, such as teacher quality, class size, and available resources…The second demands a process shift in education, namely, changing the curricula that determine what and how teachers teach…more»

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The Web Way to Learn a Language

With the growth of broadband connectivity and social networks, companies have introduced a wide range of internet-based language learning products, both free and fee-based, that allow students to interact in real time with instructors in other countries, gain access to their lesson plans wherever they are in the world, and communicate with like-minded virtual pen pals who are also trying to learn the same language, reports the New York Times…more»

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6 Emerging Technologies That Will Impact College Campuses

As students increasingly learn on the go, they demand that their colleges and universities stay up to date on the latest technology. That’s where the 2010 Horizon Report comes in…more»

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Worldwide eLearning Market Surges to $27.1 Billion in 2009

The global market for eLearning reached US$27.1 billion in 2009 according to a new report by Ambient Insight called, “The Worldwide Market for Self-paced eLearning Products and Services: 2009-2014 Forecast and Analysis.” The demand is growing by a five-year compound annual growth rate (CAGR) of 12.8% and revenues will reach $49.6 billion by 2014…more»

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Are You Better Off Than Your Parents Were

A new report from the Organization for Economic Cooperation and Development looks at various indicators of intergenerational social mobility, which refers to the “relationship between the socioeconomic status of parents and the status their children will attain as adults.” It appears that the United States has less intergenerational social mobility than many other industrialized countries…more»

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For-Profit Colleges Change Higher Education’s Landscape

For-profit universities now educate about 7 percent of the nation’s roughly 19 million students who enroll at degree-granting institutions each fall. And the proportion rises to 10 percent, or 2.6 million, if you count students who enroll year round…more»

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Divided Attention

Students’ minds have been wandering since the dawn of education. But until recently—so the worry goes—students at least knew when they had checked out. A student today who moves his attention rapid-fire from text-messaging to the lecture to Facebook to note-taking and back again may walk away from the class feeling buzzed and alert, with a sense that he has absorbed much more of the lesson than he actually has…more»

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Tuition-Free University Gains a Following

A year since its formation, the online University of the People has attracted several hundred students, a team of top academic advisers, and growing support worldwide…more»

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Holding Colleges Accountable: Is Success Measurable?

Time magazine education reporter Gilbert Cruz sits down with Policy Director Kevin Carey to discuss why parents—and public officials—should demand more accountability from colleges…more»

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If Your Kids Are Awake, They’re Probably Online

The average young American now spends practically every waking minute — except for the time in school — using a smart phone, computer, television or other electronic device, according to a new study from the Kaiser Family Foundation…more»

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America’s K-12 Education Strategy

Technology is addressing the dysfunctions in education…more»

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Annual Poll of Freshmen Shows Effect of Recession

The recession hit this year’s college freshmen hard, affecting how they chose a school as well as their ability to pay for it, according to an annual nationwide survey released Thursday…more»

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Apple’s iPad: What does it offer for e-Learning?

The Apple iPad offers an interesting combination of features and options that make it worth considering for possible mobile learning applications. But there are drawbacks to the device as well. Here’s how the iPad may (or may not) be able to fit into your plans…more»

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Has Google developed the next wave of online education?

Combining text, audio, and video chat with features like drag-and-drop documents and interactive polls, Google Wave’s Web 2.0 features could add unprecedented depth to student interaction, many educators and campus decision makers say. But some IT officials remain skeptical…more»

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As School Exit Tests Prove Tough, States Ease Standards

On the way to creating a statewide exit test for graduation, many states have softened standards, delayed the requirement or added alternative paths to a high school diploma…more»

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Whiteboards’ Impact on Teaching Seen as Uneven

The large, computerized screens—which allow Internet access, video and audio presentations, digital assessments using remote clickers, and recorded lessons for replaying later—are seen by proponents as an investment in modernizing classrooms to meet the needs of the digital generation. But while the boards have gained a loyal following among even old-school teachers, at a cost of up to $5,000 a classroom they have also drawn significant criticism as being nothing more than an expensive update on an age-old teaching tool…more»

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.Scholars Test Emotion-Sensitive Tutoring Software

‘Intelligent’ Systems Respond to Students’ Cues…more»

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In India, a Student-Recruiting Industry Ups the Ante for U.S. Colleges

India has become a mass market for a different kind of student: undergraduates. They are far less informed than older students about where to study. And while the United States remains a top choice, they are more likely to consider places like Canada, Australia, Britain—even Singapore—for their degrees…more»

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Schools Face Uphill Challenge to Improve

Despite decades of reform attempts and billions of dollars of investment, the American education system badly “needs improvement,” reports CBS News Correspondent Russ Mitchell…more»

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Race to the Middle? How to make a little education reform money go a long way.

The big education story these days is the state competition for some $4.35 billion in Race to the Top grants to be passed out by Education Secretary Arne Duncan. President Obama said this week he’ll seek an additional $1.35 billion for the program for next year, but more important than the amount is whether Mr. Duncan really wants to race to the top, or just the mediocre middle…more»

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A Study Offers a Caution on Obama’s Community College Pitch

In his State of the Union address President Obama reiterated his longstanding support for community colleges, calling them “a career pathway to the children of so many working families.” A new study out this month, however, suggests that community colleges could take a cue from for-profit, or career, colleges. The Educational Policy Institute, a research group in Virginia Beach, Va., based its study on a federal data on nearly 7,000 higher education institutions, 41 percent of which were career colleges, as well as its own surveys…more»

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Education Technology is Not About Gadgetry

The promising use of technology in education is not about creating gimmicky video games or virtual worlds, but about using software and hardware to rethink the business of teaching…more»

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A Smarter Path to a “Race to the Top” in Education Reform

RTTT is based on the theory that incentives and guidelines provided by the DOE can spur effective education reforms by state governments and school districts. But past experience with No Child Left Behind (NCLB) shows that strengthening federal control may result in a number of unintended consequences…more»

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Differentiate, Don’t Standardize

Simply stating what students must know and be able to do is not enough to ensure the desired outcomes. When standardization is taken to mean universalization, the result may well be lower achievement for many students…more»

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New Report Profiles Schools With Expanded Time As National Leaders Call For More Time In School

A new report by the National Center on Time & Learning has found that a growing number of U.S. schools have broken from the traditional school calendar and expanded learning time to improve educational outcomes.  The report is based on a database developed by the National Center on Time & Learning and is the first effort to catalogue schools operating with days substantially longer than the six-hour norm and in many cases a calendar that exceeds the standard 180 day school year…more»

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eSN Special Report: Beyond virtual schools

These days, virtual education can be more than a home-schooled child sitting alone in front of a computer. Purveyors of online-education products are creating various delivery methods to suit school districts, students, teachers, and parents with differing needs, requirements, and budgetary constraints…more»

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That Old College Lie

Pell grants for higher education seemed such a good idea in the 1980s. But a careful look at who benefits from them today raises disturbing issues…more»

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During a moment in recruiting history when most executive search professionals are suffering, our practice in for-profit education has been thriving. Part of the reason is what I call ” board fatigue”–PE or VC partners and other board members who’ve grown impatient with the CEO of a portfolio company. In some cases their dissatisfaction is known to the CEO; in others, for various reasons (such as accreditation issues in the postsecondary education market), the board has chosen to conceal its desire for change, even from the sitting CEO.

The call to me typically begins, “We’re thinking of replacing a CEO. But we need this to be done in confidence. Can you do it and still be effective?” The answer, of course, is, “Yes, but first give me one good reason why you don’t sit down with your CEO and discuss why the change is needed.”

Answers vary, but the most common is, “We don’t want to lose momentum or cause uncertainly within the company,” i.e., “We’re afraid that news the CEO is being replaced might affect morale and revenues.”

This may be true, of course, but before embarking on a sub rosa search for a replacement, consider these issues–

•    Are you sure the situation cannot be resolved without the CEO being deposed? Have you tried everything to turn him/her around? Is the problem focused on a few concerns–work ethic, slow decision making, failure to address a single overriding market challenge, etc.–or is it overall leadership?

•    Are there intermediate steps you might take to at least put the CEO on notice? “Probation”? Come to Jesus? Sabbatical? Revisiting compensation?

•    Could the problem be resolved by bringing in the right support, e.g., a COO or new CFO?

•   Could the CEO be moved into a different to position, allowing you to bring someone in above him/her? Would your CEO accept demotion to President and COO, for example? Could the CEO be moved into a Chairman role?

•    How can you present the decision to replace in such a way that the CEO sees the wisdom in your decision? Obviously the CEO has a financial stake in the company’s success. Might it be that he or she will be relieved? See this as a win-win?

•    How valuable could the CEO be in the process to find the replacement? Do you want him/her to play an active role, and would s/he be effective in this role, if properly motivated?

•    What are the risks if word gets back that a search is being conducted for a new CEO?

•    What are the risks that a disgruntled CEO could sabotage the search process? Agree to participate in interviewing, then blow candidates out of the water?

•    What effect will conducting the search in confidence have on the overall quantity and quality of candidates? On your ability to secure the best among these?

•    How and when do you expect to inform the CEO what’s going on?

•    What role will the departed CEO have in the transition process once the new CEO is named?

click here for more

If your decision remains to conduct the search sub rosa, your first line of attack should be internal. Do you or others on the board already know the right replacement? Could that replacement be the COO or someone else within the company? Someone from another portfolio company? Someone you interviewed for another position, or in a previous CEO search? Someone from a major competitor whom you have reason to believe could be lured away? The fewer the people who know of the replacement process, the better.

If you engage a search firm, make sure you are comfortable that they are comfortable–and have experience with this type of search. Have them share their stories of similar assignments: the scenarios, the specific challenges, the process, the outcomes. Unless they are truly confident they can succeed with “one hand tied behind their backs,” they won’t. Also make sure they use a Confidentiality Agreement with all prospective candidates, and that, in addition, they enforce confidentiality with candidates throughout the process through constant reminders. Some candidates love to brag–or just back-door reference you and the company.

And keep asking yourself, is now the time to sit down with your CEO?

So how hard is it for an executive search firm to conduct a quiet search? Not so, if they’ve done it before. Being presented an opportunity in the abstract–without knowing the “who”–can be enticing to a candidate. The idea of replacing a sitting CEO can also be enticing. The key to how enticing can depend on how much latitude the recruiter has in profiling your company. If it’s “an industry leader in LED technology,” then the appeal may be high…but the exposure equally high. If it’s “a profitable, private equity-backed company with EBITDAs > 20% and a market cap of $1B,” then the appeal may be equally high but without the downside of exposure. A good recruiter knows how to set the hook without naming the fly.

Where it can and does affect the recruiter’s performance is in sourcing others for leads. You no doubt know from your own experience that recruiters are on a constant hunt for referrals. Now think about the reasons you do and don’t respond. If I called or emailed you that I was looking for Eric Schmidt’s replacement at Google, you might just take time to reply. If instead my message was, “Doing this search. Can’t tell you much other than it’s a CEO position in the K-12 curricular market,” you might well not. More than half of the executive placements we make come from such referrals. Starve the lead process, and you starve the search.

Willingness to relocate the candidate can also be a factor. The wider the geography of the search–the more candidates from outside your region–the less likely is it that word will circulate back to your CEO or to others in the company, and the more latitude your recruiter has.

Give serious thought to how and where you intend to interview prospects, and to how many you expect to interview. It may be relatively easy to bring candidates into your office, and to the offices of others on the search committee. At some point, however, they may want to “smell the paint”–meet others in the company, see the offices, gauge the culture (and the commute). This may be the point of no return. Is now the time to reveal?

In the best of all possible worlds, your CEO will be your biggest and most powerful advocate for change. He or she may be the critical factor in a candidate’s decision to accept an offer. The deposed but relatively content CEO can also be instrumental in the transition process. Be thinking about what you can do to secure the CEO’s cooperation. Extra equity? The right spin on how the replacement is announced? Promise to plug into the right future portfolio company?

Confidentiality can be a problem. But it does not have to be–if you think through the alternatives, work hard to get the CEO’s buy-in, and work with a search firm that has the right expertise.

On September 24, 2009, BSG Team Ventures hosted the 3rd annual Charity tennis tournament at Longwood Cricket Club in Chestnut Hill, MA.  The format is a la Davis Cup, with venture capitals pitted against entrepreneurs.

We’ve been graced with great weather all three years, and this Thursday was nothing different, with a touch of Indian Summer in the air.

Although the teams were a bit smaller in number this year, many remarked (including the blogger) that there has never been a higher quality of play, or sense of competition.

The beneficiary of the charity tournament all three years has been Tenacity, the brainchild of Ned Eames, who founded it a decade ago this year to use tennis as a tool to help build discipline and academic achievement in inner-city at risk youth.   Their 10 year Gala is coming up in the next week or two, so be sure to visit www.tenacity.org to learn more and register.  It too will be held at Longwood, and is guaranteed to be a memorable evening with hundreds of supporters sharing food, tennis, and a shared mission together.  Ned Eames is pictured below, with one of the Tenacity students, addressing this year’s tournament and conveying his story as to the value Tenacity has brought to his life and his family’s.

This year’s winners of the Longwood Charity Cup 2009 were the entrepreneurs, both the entire team, as well as the play-off match-up of best VC team and best entrepreneur team.

Per Suneby and Doug Denny-Brown played in the finals for the entrepreneurs, against the best VC team from the day’s play, represented by Will Peppo of Revolution Partners and Dan Waintrup.  In a fiercely fought super-tie-breaker format, the entrepreneurs brought the Cup home for the year (above pictured winners Per and Doug).

Given the competitive nature of participants, several asked for statistics from the team score cards reported.  The format dictated that each doubles team played together for the entire afternoon, and there were a total of 5 teams each, VC and entrepreneur.

The mean total game score for entrepreneurs?  22.6 games per team.

Mean total game score per team for VCs? 16.5 games.

Grumblings from both sides sounded very similar, with a refrain echoed that “[VCs/entrepreneurs] certainly had more time to practice this summer than we did….”

A special thanks to our sponsors, Silicon Valley Bank and Xconomy without who’s support the event would never have happened.  Jim Maynard was much missed from SVB, but Jim’s bank colleague, Mike Quinn, held his own, and will clearly be coming back next year with Jim to present a fearsome twosome.

And this year we honor our first female competitor, Lynn Calkins, playing for the Xconomy team, and racking up a total game score with her partner than came in a close second in total team game scores.  Thanks Lynn for coming out, and Xconomy for once again blazing the path of innovation in building their corporate team.

Per Suneby and Doug Denny-Brown, winner of 2009 Tournament

Finally, no reflection on the day would be complete without a total two-team photo of all who contributed their time and energy.  Note that only one player dared play barefoot.  Next year, we’re going to mandate that the last two games of the tournament will both be played shoeless by all teams.  It’s an experience that needs to be added to everyone’s “bucket list”….

Below is the hyperlink to our latest CEO peers “speed-survey,” exclusively for growth-stage CEOs.  Topic– “Preparing for Recovery?”

http://surveys.polldaddy.com/s/D3642F14267CCC14/

We at BSG Team Ventures periodically take the temperature of the markets we serve. This speed survey is no more than 10 questions, simple multiple-choice.

Knowledge is power.  Aggregated peer-provided knowledge is “actionable power.”

We make an effort to survey only those who fit the category (in this case, sitting CEOs or board member/founders of technology/science-driven growth-stage companies). [Note, if you don't fit the aforementioned description, please refrain from responding.]

Feel free to forward to the qualified CEOs in your sphere of influence.  The more data generated, the more accurate the trend lines.

All responses are anonymous due to the web-based survey technology employed.

We will forward the survey results within the next two weeks to the email address on file.  Please let us know if there is another email address you wish us to send the results to as well.

INmobile.org released their first collective intelligence research paper today, titled “Harnessing Collective Wisdom to Forecast the Near Future of Mobility.”

INmobile.org – Harnessing Collective Wisdom to Forecast the Near Future of Mobility Aug 2009

The Idea in Brief

A problem presents an opportunity: Periods of economic slowdown such as the one we are currently operating within offers us the unique and incredibly valuable opportunity to reflect upon past periods of expansion and prepare strategically about the upcoming period of recovery and growth.�This practice should be universal but often is not and too often the methodologies used are flawed, outdated, or both. The remarkable opportunity for assessment and planning may in part be unintentionally squandered when companies continue to rely upon the same perspectives and methodologies that have disappointed in the past regardless of where they are in the economic cycle.Previous techniques to forecast vary historically based upon cost and theory.Some rely upon internal perspectives, outside or analyst input, and market data.Often they range greatly in their level of sophistication, objectivity, and conjecture.While many remain valuable, they are perhaps too often relied upon.Here we begin to offer a more innovate and arguably more accurate means to acquire that knowledge.It is the tool of collective intelligence.

The idea of collective intelligence: Collective intelligence can perhaps be best understood as the intelligence which results�from the competitive collaboration of a group of individuals. Published in 2004, The Wisdom of Crowds � Why the Many Are Smarter Than the Few and How Collective Wisdom Shapes Business, Economies, Societies and Nations by James Surowiecki argues that the aggregations of information in groups results in decisions that are better than those which could have been made by any single member of the group. In Surowiecki�s book, he argues that under the right circumstances, groups are remarkably intelligent and often smarter than the smartest individuals within them. When faced with a cognition problem such as, Who will win?, the idea of posing it to 100 experts was suggested as a collective �wisdom of the smart crowds exercise.As we currently seek to gain more informative and credible insights into the next five years of mobile technology, we should begin to take hold of this incredibly useful and adept tool called collective intelligence and apply it to the task.

The power of INmobile.org: INmobile.org is a private, global community of senior executives focused on mobility and convergence.This vital community of global wireless industry leaders enjoys both on-line and in-person events. Its private forum is fueled by a genuine and generous exchange of ideas, informed observations, timely information, empirical knowledge, and analysis.

The opportunity taken:In order to harness the collective intelligence and predictive abilities of INmobile.org, we interviewed one hundred senior executives from within this on-line community.We independently asked these executives the identical question during a one on one conversation and under similar circumstances.No previous conversations or predictions were referred to during these interviews in order to avoid the potential problem of group think.Based upon this methodology, it is our expectation that the whole of the INmobile.org community represented by these one hundred executives will show itself to be significantly more than the sum of its many parts.

The question:We posed the question, What industries will be most affected by the growth of wireless technology over the next five years? This question was suggested during the INmobile.org member reception held on March 31^st at the Wynn Hotel in Las Vegas, NV.�Over 200 senior executives attended the private reception where the concept of �capturing the collective intelligence� of INmobile.org was initially discussed.

The executives who answered:�The identification and selection of the 100 interviewees was done in two stages.The initial selection targeted fifty senior executives to represent the vital components of the mobile ecosystem with the broadest and most relevant perspectives for this specific question.These included mobile carriers, handset OEMs, OS vendors, and mobility focused venture capital and private equity.A call to action was then sent out to the INmobile.org membership requesting additional participants in this research project. Those additional participants provided increased geographical reach and diverse areas of mobility.Telephone interviews were conducted from April to June of 2009 and were conducted by either Matthew Corbett or Mark Newhall.

The results:Consensus predicts industries most likely affected by mobility because the predictive likelihood is heightened if and when a majority of experts independently think the same industry will be affected. These findings have been aggregated and documented in the report.

For more imformation, contact Matthew Corbett at mcorbett@bsgtv.com or at 1-617-266-4333 x241.

www.bsgtv.com

www.inmobile.org

Is executive retention a problem one might ask?  From our own experiences in search, we felt it was.  Educators and consultants alike have taken a more objective and statistically relevant approach to outlining the problem. A 2001 study of executive failure done by Executive Search Information Exchange pegged the average failure rate for recruited executives in their first year at between 40% and 50%.  More recently Michael Watkins,a recognized thought leader in executive leadership and author of The First 90 Days, has revealed from his research that a staggering 58% of new executives hired from the outside fail in their new position within 18 months.

The cost of executive failure? A Mercer study estimated that it's often more than $500,000 or 2.5 times salary. And this doesn't include organizational, opportunity, productivity, and transitional costs for the new executive (Mercer et al, 1999). Including these other components of executive hiring, the calculus for fully loaded cost to the organization per failure at the executive level can top a million dollars (Fortune Magazine).

After spending a decade or more as an executive recruiter working on early & growth-stage CEO searches, it seems worthwhile to take a look-back on some of the reasons CEOs seem to fail.  In fairness, we’re a boutique firm, so the sample set isn’t hundreds of searches.  However, it’s also more than anecdotal, as for every CEO search we’ve done, there was a high probably that there were several CEOs who had already come before our search, and in doing a thorough CEO replacement search, we are students of why predecessors failed in order to ensure we don’t repeat others’ past mistakes.  Another macro observation is that these failures don’t seem to be different from practice area to practice area, or geographic region to geographic region.  We’re a multi-specialty firm, yet we don’t see that software/ Internet/ media CEOs fail for dramatically different reasons than medical device CEOs or cleantech or biotech CEOs.   Nor is there great variability when you look at CEO searches in one innovation center versus another. With presence in Boston and New England, New York and the Tri-State area, Silicon Valley/San Francisco, and London/Cambridge, England, we’ve been able to test this and haven’t witnessed much foundational difference one area versus another.

The following 7 reasons below cover the vast majority of CEO executive failures we’ve seen:

1.      Failure point #1: Founder “Peter principle.” This has been well-documented by others, most notably by John Hamm, venture capitalist at VSP Capital and leadership development coach who authored a Harvard Business Review article a few years back, titled “Why Entrepreneurs Don’t Scale.”  To set up John’s observations, most of our time as executive recruiters, we focus on helping early-stage companies jump the leadership chasm from entrepreneurial to professional leadership.  More often than not, there is absolute certainty that a casualty will occur– the only question is whether that casualty will be the founder(s), or the company.   Where venture capital or private equity is involved, all is done to avoid the latter in favor of the former.  Regardless, it is too rare an occurrence when this collision between founder CEO, growth mandate, and outside investors ends positively, and if the company survives, it has to deal with the emotional baggage of shedding this first founder layer and all the pain this brings with it.   John outlines four management tendencies that work for smaller-company environments but become Achilles’ heels as these CEOs try to scale their companies. The first tendency is loyalty to founding team mates. In entrepreneurial mode, you need to lead as though you’re in charge of a combat unit on the wrong side of enemy lines where anyone on your team is a keeper. However, in larger company growth mode, blind loyalty can become a liability.  At some point, it may be required that the rest of the team that started the company with the CEO may need to be changed out for an executive team with experience at the “growth-stage” versus just the “start-up” stage.   The second tendency, task orientation, is critical in driving toward a big initial product launch, but excessive attention to detail can cause a growing organization to either suffocate under such leadership–one that can’t generate creative ideas or momentum without being instructed by the CEO–or lose sight of its long-term goals. The third tendency, single-mindedness, is important in a visionary CEO who is unleashing a revolutionary product or service on the world.  However,  this can limit the company’s potential as it grows, as all good ideas aren’t always born from one person.  In addition, often a lack of self-awareness or “emotional intelligence” can create a large blind spot around what isn’t working with the original idea, and instead of an ability to iterate to a better but related idea for the marketplace, the founder CEO can become caught up in the initial “vision” and stick to it regardless of external market input that would indicate changes to the initial value proposition are needed to capture broader market adoption. The fourth tendency, working in isolation, is fine for the brilliant scientist focused on an ingenious idea, technology or science. But it’s a non-starter for a leader whose expanding organization increasingly relies on people other than the CEO. There is also a significant difference in skill set required when the company grows beyond a single layer of management, requiring, VPs who manage directors, who may manage managers.  Managing through a multi-layer management system requires a very different managerial toolbox.  As the summary for the article outlines, “Leaders who scale deal honestly with problems and quickly weed out nonperformers. They see past distractions and establish strategic priorities. They learn how to deal effectively with diverse employees, customers, and external constituencies. And, most important, they make the company’s continuing health and welfare their top concern.”

2.      Failure point #2: Unable to “imbed” with the existing team. This is all about forging meaningful bonds, trust, and a following with the existing executive team/staff/employees as the “newcomer.”  This is most often the cause for CEO failure when an outside CEO is brought in as the first successor to the founder CEO.  We refer to it as “organ rejection.”  The host organism (the company) has a high degree of the founder CEO’s DNA in it.  That founder CEO has proven that they are a miracle worker, coming up with the idea, building it out through proof-of-concept on a shoestring budget, getting venture or other funding for the idea, that the rest of the employees who imprinted on the founder CEO “reject” the new CEO as an “imposter” or “foreign matter.”

3.      Failure point #3: Getting sideways with the board. As executive recruiters, we hear this often.  A CEO, whether founder or non-founder, doesn’t gel with the Board of Directors.  In the case of a growth-stage company, there is often outside capital involved, and investors who serve as part or all of the board of directors.  A CEO’s inability to quickly understand the drivers of each board member, and inability to build a communication bridge that may be unique to each board member, is very likely to fail, regardless of whether growth milestones are being hit or not.  One a board member loses faith in a CEO, it’s very hard to win that faith back.  Activities that often alienate a board include hiring issues (holding on to existing employees too long, or holding off on hiring into a key role, board communication issues (not sharing the bad with the good), lack of realism around budgets and burn rate and unwillingness to make the tough decisions, etc.)

4. Failure point #4: Inability to balance revenue/burn rate There is always a constant struggle between CEO and investors if the company has a net burn rate (spending more cash than revenue coming in the door).  Just last week, I heard from a venture capitalist who said that a CEO, during a board meeting, said that he was unwilling to cut the burn rate for fear of being unable to scale fast enough to meet demand once the product “got traction.”  The VC then said, “After the board meeting, I got a call from one of the other investors, expressing concern that the current CEO just didn’t understand the realities of the situation, and he felt it was time to start a search for a new CEO who did.”  Often, this is a circumstance where the CEO has come from a larger company environment, and has rarely if ever faced a situation where “out of cash,” is a literal term, versus just a euphemism for asking the parent corporation for some more capital.

5.      Failure point #5: Inability to hire well. There is an expression, “the first time, shame on you, the second time, shame on me.” This is what the board of directors often employs when a CEO can’t find the right VP level executive to successfully fill a key seat on the management team.  Often, it’s the VP Sales.  When the product is still in development, it’s often the VP Engineering.  However, if the CEO churns either of these positions with several candidates that don’t end up meeting board expectations, ultimately the board feels it’s perhaps not these VPs, but rather the CEO who needs to be changed out.  When a VP Sales commits to a revenue target, and then misses it repeatedly, often the CEO and board decide to make a change in the VP Sales.  multiple replacement in a single role, VP Sales, or VP Engineering) (blaming someone else

6.      Failure point #6: Change of business model. Part of emerging & growth stage company building is the iterative approach to finding the magic business model that takes root and thrives.  At times, founders, investors, and early team members develop a thesis on what model they’re going to chase first, and hire a CEO into that thesis.  However, as often as not, the early iterations miss their mark, and the ultimate business model that evolves as the winner is one that doesn’t play to the strengths of the earlier CEO hired.   In this eventuality, it’s much like “no fault insurance.” Neither driver is at fault, but in the best interests of the company, the earlier CEO hired needs to be changed out to make room for one better tailored for the market approach the company finally settles on as bedrock on which to scale the company.

7.      Failure point #7: Leadership fatigue.  At times, running a company turns into a grind.  The company doesn’t grow as fast as anticipated, or the magic formula for business model doesn’t materialize.  Or the executive team doesn’t come together as all wished at the beginning.  At this point, the company doesn’t fail or flame out, but nor does it continue to show healthy growth and positive direction.  Sometimes, a company grows for a bit, then plateaus and efforts to move the proverbial needle continue to fall short.  One of my favorite expressions comes to mind, “The definition of insanity is doing the same thing over and over yet expecting a different result.”  If most all other variants and permutations have been tried, no doubt it’s possible that leadership fatigue has set in and the company is in need of a fresh horse.

There certainly are other subsidiary reasons that less often cause failure-a CEO not being technical enough to shepherd a pre-revenue start-up through early product development stages into successful commercialization, or not enough industry domain expertise in an area where a Rolodex of relationships are critical to obtaining early customer wins or market credibility.  However, for the most part, these and many other one-off failures function as exceptions to the larger CEO failure points outlined above.

One of the questions that naturally follows in exploring the most typical reasons for failure is what steps, actions, or changes can be made to optimize the probability for CEO success?  Is there “another way of doing it?”   One of the best ways we’ve found is to split the Chairman and CEO roles.  However, this is a topic for another discussion.  It’s something that’s actually done in the UK as SOP, and even out in Silicon Valley more than in Boston or New York.  We’ve executed our fair share of executive searches in each, and comparing the perspectives around leadership-sharing held by venture or private equity investors is interesting grist for further analysis.