How to handle a VC who flies First
danshapiro.com
danshapiro.com
Drafting up the expenses agreement, having the board approve it, and having the comptroller deal with it seems like a lot of work that could have been dealt with by a simple conversation instead.
I fly my own (single-engine piston) airplane for recreation, most of our east of the Mississippi family travel and have flown it for a prior company on business trips. Even my little bug-smasher can save a night's hotel stay on one end, and often on both ends, making my life and my family's life better for that, making me more willing to travel for business, and I had no problem (ethically or practically) submitting a spreadsheet with column B as what the airlines would have cost, including airport parking and hotel charges, and column C showing what my airplane cost (including hotel and landing/ramp fees) and submitting for reimbursement the lower total (almost always airline, but saving 2 nights hotel and 4 days parking at Logan takes away a good bit of the difference).
Now you're having some extra meetings to get things straightened out. You know he typically flies first class in any case. Do you want to ask him to inconvenience himself (which is really what you're asking him to do) so that you can use him to raise more money?
While youy may say that this is a basic lack of assertiveness -- I could see the board member saying, "You're missing the forest for the trees."
It should less of a problem for startups, where all the board members will be investors.
Joel Spolsky has an old article that may help explain the mentality.
There are a few different answers to this one. The one you postulate is that the CEO lacks assertiveness. Presumably this is not a terribly common case.
A second situation is that the CEO is sufficiently assertive in the general case, but there are major power differentials between the players. One of the other commenters pointed out that a first-time CEO might not feel comfortable telling one of the titans of the industry to fly coach. This is presumably also uncommon, but more forgivable, although that CEO will need to get over it fast.
My circumstance, and I assume that of others, is that I regard board matters as a long-term interaction of fallible people. Matters of face, allegiances, and frankly who's in a bad mood on what day determine outcomes as often as logic. My job isn't to be idealistic about what should or shouldn't matter; it's to maximize the outcome for the company. Sometimes that may mean picking a fight over nothing to prove a point. Much more often, it means saving my bullets for big game. Others have different styles, but I find this a useful tool to have in the kit.
That said, this sort of minor-conflict-annoyance backfired on me once. I'll see if I can bang together a blog post about that soon.
This is so true. Matters of face can spiral out of control easily. I think you handled this specific one with real dexterity.
One related thing from my own experience - As groups grow you tend to get moments where the community norms that everyone took for granted can't be assumed anymore.
It always starts with a single person operating outside those norms. You're faced with the question of whether you have a one-off situation, or a systemic problem (of which this one moment is just the first inkling). Knowing which approach is the right one seems like it's frequently gut feel, but then again, if you know that you are going to need process or guidelines soon, you can use see those moments as an opportunity to get things right before you get bigger problems later.
On a side note most investors I know (admittedly that number is very very small), but still they would be incredibly conscious of any sort of over the top expense and would want the money to stay in the company and be used for something more productive than a better seat on a plane.
(Nobody's told this to FIFO miners, however).
That's how it was at one previous employer. You had to fly a particular class on certain durations, and that policy was baked into the contract with the preferred airline, as it was the basis for the negotiated discount.
Do board members seriously expense meeting costs to early (series a) companies? I haven't seen this, but I haven't seen non local investors at late stage companies either.
I know that I wouldn't want to
- stay in a 'classy'/'grand' hotel
- fly first class (although I recently, I'm 32.., had my first business class flight and liked parts of it, granted)
if you'd ask me to. Frankly, I prefer picking the accommodation. No suits, no ties please and give me a decent hotel bar instead of a spa area w/ business lounge.
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Uhm. Come to think of it, your post makes so no sense to me that I wonder if this new account was set up to troll. Did I accidentally bite?
With discounted coach vs full fare coach, often 10x, and for coach vs first, another 10x (maybe 5x if negotiated).
I have a fondness for nice Starwood hotels (since I get a suite for the lowest rate), or luxury rentals via airbnb, but still stick to upgradable coach and then pay for SWUs, even if a client offers business class. Marginal luxury dollars can go to better meals (even a great meal, without alcohol, is 20-100), then renting luxury cars (50-150 per day vs 25-50), then hotels (200-300 outside NYC), then upgrading flights (500 or so to go business internationally) and choice of hotel/airline for points.
Little things like having an exec or ops person personally spend time with you vs fending for yourself cost little and seem like the first dollars you should spend, especially at a startup, when dealing with clients, investors, potential hires, etc.
1) You have more than one admin
2) Said admins stay at the Ritz
3) The only reason you can imagine that a company would not pay for luxury accommodations is a lack of caring
From this, I deduce... you do not work at an early stage startup. Perhaps your comment was inadvertently cross-posted from your investment banker peer support group?