Valentin Toc

Here's a big list of things that don't seem to work, based on the last 20 years of running Tiny: • Giving an advisor or advisory board free equity to advise a CEO without putting any real skin in the game and investing their own money (they usually go "thanks for the free equity" and occasionally respond to emails) • Variable price/cost plus contracts (going over budget = vendor makes more money - natural incentive to go over budget) • Synergy between two entities, unless they are almost 100% identical and it happens naturally between the two management teams with a clear profit incentive (even then, rarely works) • Hiring people with traditional finance backgrounds—especially big corporate accounting—as opco CFOs (I see this a ton - first time entrepreneurs in small businesses hire a bean counter when they need somebody who is willing to roll up their sleeves and operate the business alongside them with a financial lens) • Hiring outside management/compensation/etc consultants (they have no alignment and get paid regardless of the outcome / often incentivized to tell you to change everything so they sound smart / they can't deliver hard news to management because they serve them / "consulting is the art of picking your pocket watch to tell you the time") • Fractional CFO/finance people vs. in-house finance (you'd almost always pay the same amount just in-housing, except you get 1/20th of their time and attention and they aren't aligned with you) • Hiring a big company person to run a small or medium company (no scrappiness, used to a big cushy org full of support - usually don't know how to hire, how to do HR, how to incentivize, how to run an actual org, think TOO big) • Hiring a CEO from a business with X business model (for example, ads) and expecting them to execute Y business model (for example, recurring membership revenue) in your business (people typically keep executing the strategy they know and love/are comfortable with - “to a person with hammer, everything looks like a nail”) • Expecting a business to disrupt itself or incubate its own “labs” projects (these are usually expensive boondoggles and the innovator’s dilemma typically kicks in “never expect someone to understand something that their paycheck depends on them not understanding”) • Expecting a CEO to issue dividends vs. horde cash when their incentives don’t align with dividend receiving shareholders (CEOs will often  press to keep as much cash on the balance sheet as possible, unless dividends benefit them as well - you essentially incentivize them to create silly R&D projects or at least project the need for massive cash investment) There's so many more. Will share as I think of them :-)