what is relationship capital and how do you go about building it so your start-up can succeed?
TRANSCRIPT
Professional Relationship Management
Entrepreneurs Workshop Intellectual Capital + Financial Capital + Rela6onship Capital =
Entrepreneurial Success!
What is Rela+onship Capital and how do you go about building it so your new venture can succeed?
Andy Wilson Rexter/Innovate Pasadena
Rela%onship Capital Technologies Inc: Proprietray
Professional Relationship Management
Agenda
Rela%onship Capital Technologies: Confiden%al
• About me • Se+ng the stage • Success formula • Rela6onship capital (RC) • Rexter • Innovate Pasadena • Ge+ng Started • Q&A
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Me: Corporate Weenie è Compulsive Builder
• Engineering @Dartmouth
• Strategy consul6ng @LEK (big picture)
• MBA Harvard: Technology & Ops
• Led prin6ng co into digital age • Founded corporate spin out to IPO • CIO/SVP Ops @Bowne & Co: Growth
• Prez/COO of RiverOne ($50m of VC)
• SVP Product @Overture ($1.7B to Y!)
• Seed fund/accelerator (12 SoCal Co’s) • Rexter “my calling”: Thesis-‐driven
• Innovate Pasadena: Build ecosystem
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Why Does this Guy have a $1B Smile?
“Success is as much about who you know as what you know . . . ." - Kevin Systrom, CEO Instagram
New York Times "Behind the Instagram Feat, Networking the Old Way" 4/14/12
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Andy’s Entrepreneurial “Formula”
Intellectual Capital
+ Financial Capital
+ Rela+onship
Capital
= Entrepreneurial
Success!
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Intellectual Capital: the Idea The way to get startup ideas is not to try to think of startup ideas. It's to look for problems, preferably problems you have yourself.
The very best startup ideas tend to have three things in common:
• they're something the founders themselves want, • that they themselves can build, • and that few others realize are worth doing.
MicrosoE, Apple, Yahoo, Google, and Facebook all began this way.
Paul Graham: Co-‐founder Y-‐Combinator
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Note: Angel Investing: 85% of the $$ but 18x Deals
Financial Capital: VC Dollars
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Rela6onship Capital: Key Groups
Customers
Employee Team
Investors
Board/Advisors Others?
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Relationship Capital (RC) 101 • Key driver of success : who you know & how well
• Can be measured – not mysterious & intangible
• If can be measured then it can be managed
• Grows based-on quality & frequency of interactions
• Greater the RC the more valuable the relationship
• Effective RC management: building relationships &
engaging them to get things done
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Types of Relationships Theoretical Limits for Each Type
Max ~ 150
Core Relationships: Friends, Family, etc
~ 1,000 or more
Purpose Specific Occasional Relationships: Extended Network
Source: Hutch Carpenter bhc3.com
Rela6onship Management Process Fina
ncial
Man
agem
ent
1. Define your long term objec6ves 2. Iden6fy relevant groups 3. Out reach to grow contact base 4. Cul6vate contacts into rela6onships 5. Engage “ripe” contact for outcomes Re
la6o
nship
Capital
Man
agem
ent
Professional Relationship Management
Professional Relationship Management
Expa
nding your Network
Classic Networking
Engagement
Seed Financing
Hire CMO
Q2 Deals
Search & Selec6on
Mobilize for Outcomes RC
Managem
ent: A Process V
iew
Groups & Priori6ze
Angels
Talent
BD
VC’s
Suspects
Organize & Develop
Ini6al Screen
Work Backwards: Who should you know & why?
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Recap & Tips • In the “Connected Age” who you know as valuable as what you
know
• Networking is no longer the exclusive domain of BD & sales: all professionals
• Effective networking is systematic, focused and strategic . . . it is not “magic” but a discipline that almost anyone can master
• Critical to network with intent: to what end? (work backward)
• This value driven view becomes your filter: who to target, who to develop, who to prioritize (don’t confuse quantity with value)
• Relationships drive success so it is critical to have a strategy and a system
The smartest list in the world.Give your brain a break. Let Rexter do the thinking for you.
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Rexter Secret Sauce Quan6fied Self
Your Digital Exhaust
Big Data & Analy6cs Real-‐6me Guidance
Dynamic Call Sheet
Core Con
cept
Rexter Flavor
Rela6onship Scoring
Who you know & how well
Impact of the Connected Web Ac
cessing Info
Networking
Exclusive Domain of Sales/BD
Arduous & Labor Intensive
Then Now
Instant & Comprehensive
Open & Universal
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Getting Started • Step 1: Define success:
o What are your key long term goals?
o Where are your headed?
• Step 2: Think about what types of people can help you (define your relationship groups)
• Step 3: Do an inventory of who you already know in each group and build relationships of quality
• Step 3: Develop a reciprocal value proposition (what can you offer them)
• Step 4: For groups that are thin, develop a strategy to grow your contact base
• Step 5: “Cherry pick ripe relationships” to achieve results
Professional Relationship Management
Thank You!
Rela%onship Capital Technologies: Confiden%al