As any seasoned entrepreneur for advice and he or she will likely dip into a well fed by some degree of failure, because people learn the most when they screw-up. Take it from Ken Cho, CEO of People Pattern, an Austin-based company that harnesses audience data for large brands. Calling himself "the Forrest Gump of financial disasters," Cho's resume includes stints at both Enron and Lehman brothers. While the associations might smack of remarkable bad luck, Cho says he learned several valuable lessons that have made him a better leader. Here's his advice for how to avoid disaster in business.
Advocate for transparency.
As someone who had developed risk models for executives at Lehman Brothers, Cho left to work for Enron with a sizeable Wall Street chip on his shoulder regarding financials. He knew a lot about them but chalked up not understanding Enron's numbers to inexperience in the oil and gas industry. Eventually, he was frustrated enough to leave the company three years before the company's collapse. Looking back, he wishes he would have been better at venting his questions and concerns. The experience was transformative. "Now as an entrepreneur, I have a very transparent culture [in which] I hope employees feel empowered to ask these questions," he says. "I want them to question management and leadership and be comfortable asking questions about our financials and the future of the company."
Don't burn any bridges.
When Boston-based Open View Ventures contacted Cho about funding his previous startup, Spredfast, Cho was surprised to learn that the founder and managing director of the VC firm was his former boss at Lehman Brothers. As a result of their previous relationship--one in which Cho says he had proved his intellect and work ethic--Open View ended up contributing to Spredfast's C-round of financing. "Every relationship is really, really important, even those that are on the periphery," he says. "Do your best, be confident, make sure that you treat others well. You never know when those relationships are going to come around."
Know when to get out.
Cho left Lehman Brothers and Enron long before either company imploded, but stuck around far too long when it came to his own company, Spredfast. The enterprise social media marketing platform which Cho had founded out of his home had grown to 450 people and he brought in a new CEO with more experience running a fast-growing software company. When the new chief stepped in and began to make his mark, Cho quickly found himself second-guessing his own role at the company.
Looking back, he says he should have established a time frame for leaving the company while using goodwill to set up a liquidity event. "Figure out what you're going to do next," he says. "Are you going to take on a role within the company and be happy with that, or do you want to roll out and start your next idea?"