EIR Series: Should I be an Executive in Residence (EIR)?
This is the second post of a multi-part series on being an Executive in Residence (EIR). The initial post outlining the full series can be found here. The previous post was What is an Executive in Residence (EIR).
The most common question in relation to the Executive in Residence role has been a simple one:
Should I be an Executive in Residence?
The truth is, when people ask me this question, they are very often asking two similar, but different questions:
- Is the Executive in Residence Role a good opportunity?
- Is the Executive in Residence Role something I should pursue?
The answer to the first question is fairly simple, but it has an over-arching caveat. Like most things relating to venture capital, the quality of the partnership that you’ll be working with and the expectations of that partnership around the role are paramount. As long as there is strong alignment of expectations between the partnership and the executive about the expectations for the role, the Executive in Residence role can be a unique and fantastic opportunity.
The second question, however, is much more complicated. And that’s because it implicitly brings up some of the most difficult career questions we have to ask ourselves.
What Do You Want From an EIR Role?
Last year, John Lilly wrote a simple blog post about leadership and the key questions to ask when you’re asked for advice. If you are at the point in your career where you are qualified to be a CEO, then the question of what you want from your career becomes increasingly dominant.
What are you optimizing for? Is it passion for the product you’re building, particular technology or a target market? Are you looking for a particular business model, corporate culture or lifestyle? Are you looking to join the ranks of the Forbes 400? Are you looking for power & influence and if so, in what industry / sector?
These questions can become increasingly difficult as you progress in your career because to be uniquely qualified to lead a company, there needs to be incredible alignment between your values and goals, and the goals of the company you want to lead. Put another way, matchmaking for the right company actually requires a deep understanding of your own motivations, values & priorities.
Benefits of the EIR Position
The Executive in Residence role offers a lot of unique benefits. These include:
- Create, Build & Grow Relationships. It’s an incredible opportunity to make new relationships, re-establish dormant relationships, and deepen existing ones.
- Broaden & Deepen Your Knowledge of the Market. When you are in an operational role, you tend to become extremely deep on the companies related to your market and space, and tunnel vision sets in. The EIR role gives you the opportunity to explore a much wider range of product categories and sub-sectors, and learn more deeply what strategies and tactics have been successful outside your specific niche.
- Learn about New Companies. We all like to think that we’re in the flow of knowing the important, successful private companies being built in Silicon Valley. The truth is, there are a shockingly large number of amazing private companies that you haven’t heard of. The EIR role gets you fantastic exposure to a large number of companies you haven’t heard of.
- Platform for Thought Leadership. Top tier venture firms have great reputations, and EIR roles offer a unique opportunity for you to nurture, develop & grow your own reputation around specific topics and issues. The venture firm benefits from its association with thought leadership, and the EIR benefits from its association with the firm. The end result can be magnified opportunities for both parties.
- Try Before You Buy. The EIR role gives you an exceptional ability to spend time with portfolio companies. They are usually extremely happy to get additional help, and the time spent can help both parties figure out if it’s a potential good fit or not. The best part about the role is that if it isn’t a good fit, the time spent was without firm commitment, and can be easily ended at any time without few (if any) negative relationship or reputation effects.
- Self Discovery. The EIR role is structured to give you time to ask the hard questions about what you are looking for in a company, a product, a market, a culture. It’s structured enough to provide stimulus and ideas, but unstructured enough to give you gaps to ask (and answer) the hard questions.
Problems with the EIR Position
While I’m extremely positive about my experience as an EIR at Greylock Partners, I’m one of the first to caution people who ask me about the role that there are real issues to consider.
- Firm Lock In. When you are immersed in the people & culture of a particular firm, it’s very easy to de-prioritize networking and intellectual debate outside the firm. Venture firms tend to discuss their own successes and failures, and the burden is really on the EIR to ensure they broaden & deepen their relationships outside the firm. This is why, for example, some successful executives will take EIR roles at two different firms.
- Paradox of Choice. We are all human, and humans don’t do well with a massively expanded selection set. The more companies, industries, products & concepts you are exposed to, the harder it can be to assertively make a choice to pursue a single company. This is why, for example, successful EIRs will often frame their time in waves – spending weeks or months on a particular area or topic, and then shifting to another, rather than trying to explore and pursue everything at once.
- Portfolio Work vs. Discovery. Working with portfolio companies takes a certain amount of time and effort to be effective. If you are going to spend 1-2 days a week with a company, you’ll quickly run out of days of the week. As a result, it’s important for EIRs to find a system that allows them to balance networking & discovery time with active engagement with companies. 6-12 months can pass unbelievably quickly, and in the end, your goal is to find that next great role.
- Operating Skills / Credibility. Technology moves incredibly quickly, and it’s amazing how even in a matter of months the landscape of ideas and tactics can change. Venture capital firms tend to be comfortable places, but never forget that you always need to be learning & growing, most likely by engaging and helping entrepreneurs with real challenges they have today. The lessons from 2012 are interesting and useful in 2013, but the half life of those lessons can be shorter than you might think.
So, Should You Do It?
I’m colored by own personal experience, which was with a great firm and a great outcome (I’m exceptionally happy with my role at Wealthfront).
If you are looking for either your first CEO role, or your next CEO role, and you have the opportunity to be an EIR with a great firm, I believe the Executive in Residence role can be a unique & excellent opportunity. Going into it, however, you need to do two things to be successful: be prepared to take advantage of the unique opportunities of the role, and be extremely cognizant of the potential pitfalls and issues inherent with the position.
Going forward in this series, I’ll be focusing on the Executive in Residence role. My next post will attempt to answer the question: “How Do You Get an Executive in Residence Role (EIR)?“