John Gauch 2023-12-10 John Gauch 2023-12-10

When Don’t You Need a Fractional COO Like Me

It’s usually a bad sign if a product claims that it can do everything for everyone. Swiss Army Knives aren’t really great knives at all, but they do have a Job to be Done—they make great gifts even if they’re barely ever used afterward. I try not to fall into this trap. This blog posts lays out some of the signs that you don’t need the help of a fractional COO at all.

Stop image signifying not everyone needs to consider brining on a fractional COO — Photo by Linda Eller-Shein from Pexels.

In case this is your first visit, I’m John Gauch – a seasoned fractional COO, sales coach and mentor. Over 20+ years, I have applied my growth and operations skills to help dozens of startups, building one high-impact venture to nearly $100M in revenue and a second to exceed that benchmark. I began my career as a tech lawyer in New York City. I developed my expertise in progressive roles in business development, finance, sales, marketing and product, working along the way with companies like Amazon, IBM and Microsoft.

There is no right or wrong reason to want to build a business. Maybe it’s a creative outlet for one person. Someone else might be obsessed with solving a nagging problem they observed out in the world. Perhaps a third person never fit into a traditional corporate job and has a ton to offer in a role and company of their own making.

Business building is about changing the future.

A successful new business makes the world different than it is today, and I’ll be a match for anyone who aspires to have a huge positive impact on the lives of their customers and stakeholders.

This brief post is not about all that. It’s about when it might not make sense to work together formally, even if we are a match regarding outlook and values. You can still try me, but I may not be a fit in either of these two situations.

Situation One

You’ve got all the right team members with the right skills and experience in the right roles. You’re not struggling with scaling yourself, and you’re not missing any key capabilities. You have plenty of time to learn what you need to know. You are only spending time on the activities you alone can do. The team has everything else covered.

AND

The organization is learning quickly and efficiently. You have demonstrable evidence you’re onto a compelling new business opportunity (i.e., traction). You have practices and processes to surface the big assumptions and unknowns you need to test or get clarity on to move the business forward. You’re not struggling with team alignment or direction. You are sure about your next moves.

Situation Two

Your team makes you feel superhuman. You’ve eliminated all the significant unknowns relating to the business. Moreover, you’ve built the supporting infrastructure to scale. These efforts are going smoothly. You are making incremental business improvements. You are not making major shifts. You are not feeling out of control. You’re clearly well on your way to building a successful and sustainable business.

Congratulations to you for all that you’ve achieved so far. It is a real feat.

If you feel like you fall into Situation One or Situation Two, and there are still aspects of the business or your work life that you want to change, I’m always happy to chat. I’m also glad to be in touch purely for information sharing and networking purposes.

John Gauch 2023-10-10 John Gauch 2023-10-10

How Startups Can Make the Best Use of Lawyers

No startup wants to get bogged down in legal management. A principled proactive approach can keep your legal house in order and avoid pitfalls that will slow the company down. Apply the framework described in this blog post to strike a balance between cost, speed and quality for legal services.

I'm John Gauch, a consultant with extensive experience in business operations and growth. I specialize in helping startups implement both strategies effectively. As a fractional COO, I work with founders and CEOs through each step, tailoring solutions to your unique needs and objectives.

If you’re spending a ton of time and money on legal management, that’s probably too much. But little to no time or money at all is probably not enough.

In this post I’ll lay out a simple tried-and-true framework startup CEOs and founders can use to help you decide what kind of legal advice and support you need to keep your legal house in order and avoid pitfalls that will slow the company down.

The typical startup requires responsive and informed legal advice and a flexible and lean framework for getting it. I won’t dwell on the first two points. This is not the time to have your uncle who does real estate law draft and negotiate your $8 million Seed-round financing documents. And you’ll go mad waiting to hear back from a sloth-like advisor when the business is not yet breaking even and every second counts. Enough said.

At my prior employer Axiom (a venture-backed innovator in the legal space), we collaborated with the General Counsel of Fortune 500 companies to restructure and reorganize the work of their legal departments. The same basic principles offer an excellent framework for startups that can evolve as the business grows, from the early days through Seed and Series A financings and beyond.

Check out the three-step approach and an example of how you might organize your legal operations.

But first, legal AI is captured in the model under “Alternative Model Providers.” This category captures any alternative to traditional law. Watch this space. There’s no doubt in my mind that legal AI specifically will be moving from the Efficiency category to the Experience category over time. It’s just a question of how fast.

Legal Services for Startups (embedded) by John Gauch

Additional factors to consider:

Account for the complexity and costs of coordinating these legal activities. Theoretically, it might be more effective to split up projects among three tiers of providers, but if that’s going to add a ton of overhead to your operations, you might want to keep it to two.

A single project can be split across multiple categories. For example, you need an immigration visa for a new team member. Your Chief Financial Officer or Chief Operations Officer is comfortable navigating complex regulatory schemes. One of them might prepare the visa application, and then you could have an immigration lawyer review it to make corrections and suggestions.

There are functional and emotional elements to the decisions you make in building your framework. Let’s say you’re the CEO of a post-Series A company. You have several top-tier VCs in your cap table and have blown past the $10M revenue mark. For your bet-the-company matters, you may want to select an AmLaw 100 law firm with startup credentials not only to benefit from their expertise and infrastructure. You may also choose them to benefit from their brand and the imprimatur the firm brings with its counsel and work product.

From the beginning of your company’s life, pay particular attention to company formation, founders’ agreements and equity matters generally; intellectual property (IP); and fundamental regulatory and compliance issues. To take one specific example, having people sign confidentiality and IP assignment agreements is critical. If you neglect ongoing corporate formalities, you might be able to fix that up later, but it will be a nuisance, and it could lead to problems—if you were to issue more equity than you have authorized, for instance. Commercial agreements might fall in any tier of the framework above, depending on your business and the individual transactions, and should be treated accordingly.

There’s always a chance a legal issue can arise that knocks your startup journey off track. Still, a proactive and reasoned approach to handling legal services can optimize the quality and cost of the advice you receive--improving the odds of long-term startup success.

Use the illustration above and consult your trusted legal advisor(s) to devise a legal management strategy specific to your company and its lifecycle stage.

I’m always happy to chat about how I help startups. I’m also glad to be in touch purely for information sharing and networking purposes.

Nothing in this blog is intended to be a substitute for legal advice from an attorney knowledgeable about your unique situation.

John Gauch 2023-09-26 John Gauch 2023-09-26

Axiom: Discovering the Benefits of Fractional Talent

Whoever said we have to hire people in arbitrarily determined long-term, 40-hour-per-week blocks of time? Axiom has been a pioneering innovator in the legal industry and the way we work. Their experience shows the benefits of new work approaches such as bringing on fractional talent that are especially valuable in challenging economic times.

Photo representing Axiom legal talent — Photo by Fox from Pexels.

Are you new here? I’m John Gauch – a seasoned fractional COO, sales coach and mentor. Over 20+ years, I have applied my growth and operations skills to help dozens of startups, building one high-impact venture to nearly $100M in revenue and a second to exceed that benchmark. I began my career as a tech lawyer in New York City. I developed my expertise in progressive roles in business development, finance, sales, marketing and product, working along the way with companies like Amazon, IBM and Microsoft.

I hope anyone dissatisfied with their work—and company leaders everywhere who aren't satisfied with how they and their teams are doing—are exploring the different options available today for bringing talent into an organization.

I didn't know it then, but my path to working as a fractional COO began over 10 years ago when I joined the Benchmark-backed startup Axiom.

Axiom was a pioneering innovator in the legal services industry when I opened the Boston office as General Manager. We offered attorneys—alums of top law schools and leading law firms—a compelling alternative to the daily grind of traditional law firms and the conventional employee-employer relationship (working for a single company full-time).

We offered attorneys a new career option. They could work in-house part-time or full-time:

For one or more companies simultaneously (or “fractionally”).
For one company for a length of time, then another, and so on.

This approach gave them way more control over their lives. Our attorneys learned faster than other in-house lawyers by drawing insights from one client that sparked creative solutions for another. Freed from the sometimes problematic boss-subordinate power dynamic, they could also be more objective and honest than employees often feel they can be.

Attorneys loved it.

Because our attorneys were so busy (working, not idling on the bench), and our operational model was so lean, it was economical for our clients to hire them. Our rates approximated what a company might spend to hire and employ a full-time attorney.

Clients received top-quality support for an economical price. Sometimes our clients had struggled to hire attorneys for full-time positions of the same caliber we provided. Clients could bring on just the right talent for just the right amount of time to close capability and capacity gaps. They didn't have to only hire people in arbitrary long-term, 40-hour-per-week blocks.

Clients were thrilled.

Fast-forward to 2019, and I found myself living and working the Axiom way as a fractional COO.

I never doubted the approach's benefits when I recruited Axiom attorneys or sold our services to Fortune 500 General Counsels (GCs). Our attorneys and corporate clients talked about the advantages all of the time. Now that I've been working this way for several years, I've experienced the benefits firsthand and know how helpful it is to companies, especially in challenging economic times when bringing on new employees can be an expensive risk.

A ton could be better about work today, and I'm not advocating for throwing away the traditional employment relationship. But it's exhilarating to have been, and to be, a part of the movement innovating work models. I encourage more CEOs and founding teams to explore what Axiom's clients have known for over a decade.

If you’re a founder, and you feel it would be interesting to chat, I’d love to connect. Learn about my services and please reach out any time that it makes sense.

John Gauch 2023-08-15 John Gauch 2023-08-15

Defining our Terms: What is a Fractional Leader Anyway?

Many leaders today, across functions, work on a fractional basis, part-time embedded in a team. But let’s take a moment and be super clear on exactly what we’re talking about when it comes to fractional executives, and how the role compares to advisors, mentors, coaches and consultants.

Photo representing someone confused by the meaning of fractional leadership — Photo by Andrea Piacquadio from Pexels.

Here’s a little about me in case you’re new here - I’m a seasoned fractional COO, sales coach (Microsoft) and mentor (High Alpha, Techstars). Over 20+ years I have applied my growth and operations skills to help dozens of startups (IAN, Axiom, Spartan). I began my career as a tech lawyer in New York City. I developed my expertise in progressive roles in business development, finance, sales, marketing and product, working along the way with companies like Amazon and IBM. So far, I have helped build one high-impact startup to nearly $100M in revenue and a second to exceed that benchmark.

“Fractional” leaders are not new to the world.

It’s a tried and true model for Chief Executive Officers to get the help they need to grow and operate their businesses. There’s still a lot of confusion around the term though, so here are definitions of various business helpers excluding full-time hires, which we all understand well enough presumably.

I’ll start with an “advisor” and end with my definition of a fractional executive or fractional leader.

One thing I want to share first is my bias for working with people—in any category—who properly balance “helping” and “telling.”

Helping happens when someone is curiosity-driven and understands there may be a lot they don’t know about a situation, to start at least. They’re committed to gaining this understanding to see whether and how they might be useful to another person. The reason to use this specific word is because the inquiry itself can help the other person gain greater clarity into what they are wrestling with.
Telling happens when someone is drawing on their expertise or experiences to make an assertion or prescription--a tactical recommendation, for instance.

Here’s a shorthand way to think about it.

Take doctors. When we’re in the diagnostic phase of working with a patient, we are in a “helping” mode. Sometimes, we never leave that conversational stage because we get to a useful insight or discovery that means we don’t need to go any further. We resolve the question at hand! When that doesn’t happen, we proceed to make a diagnosis and “prescribe” a next step. That is “telling.”

I’d be wary of relying on the contributions of someone who begins with telling or moves on to telling very quickly, for no other reason than that they probably don’t know enough to be so prescriptive so fast.

All of the below roles are assumed to report to the CEO or a founder, or at a later-stage company, a senior leader perhaps.

Advisor

An expert in a domain. The relationship could be any length, including indefinite. The commitment is on the order of one hour per week or less on average. Advisors lean toward more telling based on their domain expertise but should still start with helping questions. They don’t do work or follow through on their insights. They are not embedded in the team and don’t manage others.

There is also a flavor of advisors primarily there for branding, marketing and possibly networking purposes.

Mentor

A future version of yourself in one or more dimensions. The relationship could be any length, including indefinite. The commitment is on the order of one hour per month. Mentors share their relevant experiences and still do lots of helping. They don’t do work or follow through on their ideas. They are not embedded in the team and don’t manage others.

Coach

An expert in helping other people learn and grow. The relationship could be any length, including indefinite. The commitment is on the order of one hour per week. They emphasize helping someone think things through and discover new perspectives and options. They might offer recommendations (i.e., telling) with care. They don’t do work or follow through. They are not embedded in the team and don’t manage others.

Consultant

Fractional talent used to be a variant of consulting. Below is the definition of a consultant after carving out fractional talent:

An expert in a domain or domains. The relationship is limited to a project, defined by having a distinct beginning and end; a consultant might string together multiple projects over time. The time commitment varies and might extend to a few individuals if working with a consulting firm. They start with helping before moving on to telling. They execute the project they define but don’t do follow though that is out of scope. They are not embedded in the team but are sometimes co-located, and they don’t manage others.

Fractional Executive / Fractional Leader

The term “fractional” is often reserved for CXO-level roles. A fractional exec can provide the expertise of an advisor and consultant, insights from relevant prior experience like a mentor, and when called for, the thoughtful engagement of a coach.

Fractional talent doesn’t just advise, share experiences, or ask good questions. They roll up their sleeves and do the work that results from insights. And they do that work as an extension of the team, developing knowledge that flows back to the organization. They also can hire, develop and manage team members.

The relationship lasts as long as it’s providing value.
The commitment ranges from a few hours to multiple days and possibly even flexes up to full-time for stints (similar to an “interim” CXO).
The relationship balances helping and telling as new problems and opportunities arise to be addressed.

Finally, successful fractionals have top-notch management and leadership skills. Because they operate like a team member and are spread across different companies, they have exceptional self-management skills too. They are fast learners and have the ability to seamlessly switch between contexts and tasks, necessary attributes to hit the ground running with each new company and project.

If you’re curious you can learn about what I do and how I help startup CEOs and founders on my services page.