Founder and co-CEO of Techstars David Cohen addressed Kansas City via a simulcast on Thursday morning, sharing three tips for startups.
This preceded the day long workshop Taste of Techstars, which is hosted in multiple Techstars cities. Including simulcast talks, mentor sessions and pitch practice — Kansas City Techstars managing director Lesa Mitchell said she hopes the day’s activities will prepare startups for the program, which will begin this July.
To kick off the day, Cohen shared three things that all startups considering applying to Techstars should know.
Emotional intelligence is important to Techstars. Cohen said that he and his wife regularly go to relationship therapy not because there are problems, but because he wants to insure optimal communication.
As startups are often working in tense, time-sensitive environments, Cohen suggested applying reflected listening.
Cohen said that reflective listening is the idea of playing back what somebody says to you internally and asking a couple simple questions, to insure you’ve captured the nuance correctly.
He offers an example.
“When somebody says to you that you need to have 18 months of runway, a lot of entrepreneurs will try and turn that into dollar amounts and quickly say ‘Alright, got it!… I need 1 million dollars,’” Cohen said. “If you’d instead use reflective listening you’d realize, that all they care about is that you have 18 months of runway.”
In this situation, Cohen said not listening could have cost you a chance at fundraising — and ultimately, your business.
“Playing it back (what someone said) instead of just translating it is the first key. And ask, ‘did I hear you right?’” Cohen said. “Then, you’re having a conversation where you are actually communicating effectively.”
Over asking will kill you
Cohen said that an oversubscribed round is always better than aiming too high, due to the positive energy and momentum it creates.
“Let the market push you up,” Cohen said. “We’ve collected a lot of data over the past 10 years and what we’ve found is that if you ask for too much money — you rarely close a round.”
Cohen said that for example, if you ask for $2 million then discover that the market will only allow for$1 million, you are much less likely to able to raise $1 million than if you targeted that amount initially, due to negative energy. When that happens, he said the data shows people rarely will reach the $1 million.
OFNR conflict resolution framework
OFNR stands for Observe, Feel, Need and Request. This is a framework that Cohen suggests using with teammates when the going gets tough.
“I observe that you’re frustrated, and that makes me feel frustrated,” Cohen said as an example. “I don’t want to feel frustrated, so I need to resolve this conflict with you and my request is that we talk about the issues.”
Cohen said that OFNR is a great way to take conflict out of an emotional place and can allow people from different perspectives to understand each other.
Techstars announced in October that Kansas City would be next on the list of over a dozen city-based programs, after leading the Sprint Accelerator for three years with Sprint. Over 3 billion dollars have been raised by Techstars companies. In January, Lesa Mitchell shared with Kansas City three tips for landing in the accelerator.