Our hosts cover a gamut of topics in our first episode of the new year, starting off by discussing the future, or lack thereof, of job opportunities in diversity, equality, and inclusion. Next transitioning to a conversion on the rise of secondary sales to generate liquidity. Wrapping up the episode by exploring the balance between speed and thoughtfulness in decision-making, emphasizing the need to adapt decision-making approaches based on the stage of business growth.
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Let's dive into this episode's key topics…
Diversity, Equity, and Inclusion (DEI)
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- Various companies, including Google and Meta, have drastically downsized their DEI teams. This could be a “zero interest rate phenomenon” as it’s not directly tied to core business functions, thus not having a strong impact on the bottom line.
- The general sentiment among leaders is that there will be a lot less patience for things that don't directly contribute to the bottom line, like DEI.
- But for better or worse, more leaders will likely be emboldened to say, “This is a place where we're going to do work. This is not going to be a place where we talk about politics.” Similar to Brian Armstrong’s political neutrality in the office as a response to the Black Lives Matter movement in 2020.
The Rise of Secondary Sales
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- Canva is set to complete a billion-dollar stock sale for employees and investors at the previous valuation of $26 billion, which is lower than its peak pandemic valuation. Investment experts anticipate a surge in such activities due to short-term liquidity needs.
- But Canva isn’t the only organization exploring this option. Currently, OpenAI is considering this with Thrive Capital as their backer. Last year, CoreWeave had a secondary sale of $642 million. And there are various others.
- However, most people should not worry about these secondary sales because the market for these transactions is not particularly liquid or robust. Even if they are going to happen more often, they happen for companies with lots of stock options and are already at multi-billion dollar valuations.
- What’s more likely to happen this year is a marginal increase in the amount of M&A activity because the markets are up, with public SaaS businesses and tech businesses valued higher this year than last. (Eyes on Zendesk, as they’ve signed an agreement to acquire Klaus.)
Quickness vs Thoughtfulness when Decision-Making
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- In a LinkedIn Post by Sam Jacobs, Pavilion CEO, he spoke about the pace of decision-making and how it has to evolve from speed and relying heavily on intuition at the early stages to slow, thoughtful, data-driven decisions as your company gets to a later stage in its life cycle.
- Having more historical data to base decisions on naturally slows you down and not to forget that as your organization grows, decisions have a larger ripple effect. But there is a need to balance speed vs consideration.
- Something to consider when trying to find the balance is what decisions are reversible and which are not.
- Reversible decisions or decisions that are easy to unwind could be marketing copy, SDR talk tracks, etc.
- Decisions that are much more difficult to unwind are ones like which markets you want to enter or pricing, which can have a multimillion-dollar impact.