Perhaps one of the best videos on SaaS if you are running a Software as a Service company is from David Skok of Matrix Partners: Driving SaaS Success Using Key Metrics
Enterprise Value vs Equity Value
Enterprise value (EV) and equity value/market value (MV) are business valuations. Enterprise value (EV) is used when considering the purchase of a business, whereas equity value/market value (MV), is used when considering an investment in the common stock of the business. A great resource for reviewing these valuations definitions.
The net assets of a business are funded by a combination of debt and equity. It follows that the value placed on these net assets must be the same as the value placed on the equity plus the value placed on the debt.
Interviewing can be hard and having the right questions to ask is extremely important. Below are some of the best questions to ask when interviewing. Always remember, interviewing is a two-way street, the candidate is looking for the right fit and you are looking for someone you can work with. Think to yourself “Can I work with this person?”, “Would I enjoy having dinner with this person?”, “Is this person a good culture fit”?
I look for a blend of different people to bring into my startup, people who might not have domain expertise but have the right a great foundation or attitude with some people who have some domain expertise. Diversity in your team makes it stronger, people from all different backgrounds of life and level of experience.
People generally say,
Hire slow/fire fast
I don’t necessarily agree with this, you really should be forcing yourself to interview at least 10 candidates to give you perspective. Then hire the right person fast. Make calculated and conscious hiring decisions and avoid the “fire fast” part of what people generally say scenario. Firing fast can be demoralizing. Hiring slow, with lots of of interviewing gives a greater perspective into what you are really looking for.
One tip I have is asking a question in several ways, maybe three different ways, to see if a candidate is really sticking to what they initially said when you asked a question the first time. Think about people who can help the company and company plan evolve. Let’s assume that things change in a startup as they do, you need people that can adopt and change the company as the plan changes.
The best skill to look for is to learn how to learn and finding people that know are optimizing learning to learn. Innovation is happening all around us and skills from yesterday are irrelevant to what is needed for tomorrow.
Also, I generally keep a score of how well the candidate is doing, this is the scoring system, below is an example of it for a phone interview and an in-person interview-
Phone Interview Scale, Attributes [1-10]
Knowledge of Healthcare 8, 7 years at another EHR
Knowledge of Technology 6
People Skills/EQ 9
Why pick drchrono? Stagnate Growth at current job
Ideal salary range? 45k
Willing to move? Yes, Baltimore, NY, not CA
Willing to take any position? Yes
In person Interview Excellence survey, Attributes [1-10]
Good relationship skills?
Going to school to better themselves?
Always on time?
Grow and learn and wanted to take on more responsibility?
Didn’t wine if they needed to stay late or work on the weekend?
From Warren Buffet
Things to look for, these are not questions but qualities to look for in a person!.
Integrity (most important)
From Reed Hoffman
In every job, you create an artifact.
Founders create the vision statement, the org chart, the financing strategy
Business development creates the signed contracts with other companies
What is the best idea you ever came up with to improve your business?
How do you plan your day?
What would you do if you found out if your boss was doing something illegal or unethical?
What was the reason you left?
Explain how you plan your day?
Jen Miller of the Gallup Organization
Profiles of people.
Find out what really matters to people.
Hire someone you would gladly report to yourself.
What really matters most to you?
What are your passions?
What do you believe in?
Demonstrate your expertise.
Questions for Leaders
Ask yourself how will this leader make my VP of Sales or VP of Marketing better?
How do you stay on top of the labor costs in your organization?
Ask for references, ask for the person’s last company performance review of them. Also get “off-sheet” references, people who know them but aren’t on the potential person’s reference sheet. Find out about the interview candidates reputation.