Launching My Executive Sparring Practice

European Straits #175

Hi, it’s Nicolas from The Family. Today, I’m announcing the launch of my new practice: executive sparring. Read along and contact me if you’re interested 👇

1/ My cofounder Oussama Ammar and I met 10 years ago, in 2010. We were both the CEOs of our respective startups at the time. Sébastien Romelot, then an investment banker with Lazard (and now the CEO of Phenix Groupe, a fascinating company in outdoor media), was a shareholder in both our companies, and he thought Oussama and I would get along well. The three of us met for lunch at a restaurant near Place de la Madeleine in Paris, and off we went. I must say Sébastien made the right call! 

At first, Oussama and I only interacted sporadically, exchanging news about our respective businesses. But then he left his position as CEO and settled in Silicon Valley, where he focused on advising corporate executives interested in innovation and angel investing in local startups. Each time he came back to Paris, I would learn more about how entrepreneurship was done in Silicon Valley. Oussama even ended up investing a small amount in my startup. Then, in 2012, I, too, left my position as CEO.

This is when our relationship started to intensify. We would meet once or twice a week for long lunches at Les Éditeurs, a restaurant in the beautiful Odéon quarter. We wanted to partner up and explored founding an investment firm together. We worked on the thesis, the positioning, the kind of assets we had in mind, and we lamented how far behind the Paris startup ecosystem was at the time. 

2/ My work with Oussama always followed a well-defined pattern. Building on what was said at our previous lunch, I would sift through my nascent database of interesting articles stored on Evernote (I had probably 2-3,000 of them at the time—now it’s north of 35,000), and I would contribute with ideas, precedents, comparables, objections. Oussama would digest it all in real time, and then bring us toward the next iteration. This was one of the many streams that led to our founding The Family the following year (another was obviously Oussama meeting our co-founder Alice Zagury).

Here’s the thing: What Oussama and I were up to during those long lunches was something Venkatesh Rao calls “executive sparring”:

You might talk for hours, but in the end, it’s one casual phrase or thought that ends up unlocking the critical idea. My very first client said as much to me — that after twenty hours of chatting, the value I delivered all came out of one phrase I happened to drop casually in thinking through a problem: “penny auction.” Two seconds in twenty hours...

Insights like this cannot be found in textbooks, cranked out of fully-formed theories, or by “solving” cartoon case studies in a classroom setting (the equivalent of a punching bag or boxing dummy). They can only emerge through the process of preparing mindfully for specific live-fire challenges with a live sparring partner who can keep up with you.

⚠️ Today, I’m officially launching my personal practice of executive sparring 🚀 If you’re a C-suite executive in a large corporation or the owner of a small or medium business, please reach out! 👇


3/ In the meantime, let me explain how this fits into my work at The Family. First of all, I’m already doing some executive sparring with three groups of people:

  • My colleagues at The Family. What happened with Oussama during those early lunches at Les Éditeurs now happens at the scale of our entire firm. I’m the one everyone comes to when they’re confronted with a tough question or specific challenge. We exchange ideas, we spar a bit, I go explore my database, and we usually end up with a satisfying answer after 2 or 3 iterations. It’s an easy process because we share the same work culture, but it’s quite distinctive—and it has earned me the nickname “brain on demand”.

  • Entrepreneurs in our portfolio. I do the same with founders of startups in which we’re a shareholder. All of them can get in touch with me directly and then we’ll spar either over Slack, the phone, or meetings. Founders usually approach me in three cases: either we have built a strong relationship from the start (as with Guillaume Fourdinier, CEO of Agricool); or they’re sent to me by one of my colleagues who thinks a few sparring sessions are in order; or they simply reach out because they read this newsletter or have heard me speak at an event.

  • A few clients on the side. I’ve also been doing some outside executive sparring over the years, for two reasons. First, I get better at thinking about corporate strategy when I root my ideas in actual practice. And it’s always useful, working as I do in European tech, to be reminded of the scale and strength of legacy corporations. I’ve had a frequent glimpse of that since I joined the board of directors of Radio France, the French national radio broadcaster, in 2017. But I find it important to complement that with 1-on-1 sparring sessions with business leaders.

4/ There are three reasons why I’ve decided to expand this practice and allocate more time and focus to sparring with executives:

  • For The Family, it’s one way to deal with more mature companies. Our original model was to take a small equity stake in the companies we start working with and then to deploy more capital along the way. But that doesn’t work with companies that are already large and mature. Executive sparring might be a way to facilitate deal making at that stage. 

  • More executive sparring with individuals creates value that can then be reinvested collectively. The Family is an organization whose business is about education at scale—not only our portfolio entrepreneurs, but also the ecosystem as a whole. In our experience, however, education at the collective level starts with strong practice at the individual level.

  • It’s a bad thing to get trapped within one narrow, homogeneous group. Investors who spend their days listening to pitches and negotiating term sheets have their brains dry out as a result. This is something several people at The Family share: we need to take detours and excursions to get better at what we do, and for me executive sparring belongs in that category.

5/ I’ve long wondered if that type of work with clients was effectively compatible with growing a portfolio of tech startups. In retrospect, however, I think I’ve made it work at The Family and I’m ready to up my game. I was further reassured to discover that there were indeed interesting precedents in the past. Here’s legendary investor Lionel Pincus quoted in the book Done Deals:

I brought a management consultant into the firm. That combination was always interesting to me, and I started a consulting business that provided a combination of financial and investment banking advice, management consulting, and the adversarial, advocacy, ministerial, and psychiatric functions necessary to help managers build their businesses. [Emphasis mine.]

Doesn’t that sound like executive sparring to you 😉?

6/ Now, in his blog 👆 Venkatesh mentions “reading widely and deeply about technology and business to develop an appreciative worldview of it (a sparring Weltanschauung if you will)”. Here’s how I would describe my own Weltanschauung:

  • Everything I know about the business world, I learned by studying how tech startups were entering the music industry’s value chain. (That was in 2009-2010 when I was the chief of staff of a task force formed by the French government to ‘save’ the music industry 😜) More than 10 years later, my view is that the shift to the Entrepreneurial Age happens in a similar way across industries, just not at the same pace. Marc Andreessen helped us a great deal by putting the right words on that (see Why Software Is Eating the World), but the signs were already there.

  • After several iterations, I wrote out this vision in a 2015 article (Les cinq étapes du déni), which I translated into English the following year (The Five Stages of Denial). All my subsequent work on entrepreneurship, corporate strategy and corporate finance has been about refining this vision and turning it into practical frameworks—with a historical perspective. What emerged is a set of mental models for both tech entrepreneurs trying to enter an industry and seasoned executives confronted with strategic challenges by new entrants.

7/ I’d add that the geopolitical dimension matters. Until recently, business executives saw all the world as a stage. Sure, there were tiny differences between countries, but they were considered immaterial in the grand scheme of the capitalist game: there would always be a way to expand and serve customers on most local markets. Executives were not interested in knowing the specifics of a country’s politics or the historical and cultural background of doing business there.

I think this has to change. The new Cold War between the US and China is dividing the world in two. There’s the growing transatlantic rift between the US and Europe. The Old Continent itself is fragmenting at an accelerating pace. And new powers are emerging in South East Asia and Africa.

The COVID-19 crisis will only intensify these trends. Countries are turning inward in their efforts to counter the pandemic. All governments are having to step in and will come out of the crisis stronger than ever, which in turn will contribute to an unprecedented divergence from a policy perspective. 

This is a challenge for executives used to globalization. I think it’s now mandatory for them to learn to navigate a more unstable and fragmented world. And so my own writing about countries is about more than culture générale: for all those in pursuit of increasing returns to scale, creating and capturing value will require greater attention to the pitfalls of doing cross-border business in this new, different world. 

8/ Finally, it’s one thing to reposition successfully in the current paradigm shift; it’s quite another to survive over the long term in the Entrepreneurial Age. On markets, as on the world stage, stability and predictability might be things of the past. Doing business used to come with risks, but they were known and could be managed—even mastered, in some cases. Now there’s something else: uncertainty—which, to echo economist Frank Knight, is different from risk:

Risk applies to situations where we do not know the outcome of a given situation, but can accurately measure the odds. Uncertainty, on the other hand, applies to situations where we cannot know all the information we need in order to set accurate odds in the first place.  

What do you do as an executive in a world perpetually ridden with uncertainty—because of the nature of computing and networks, because of macroeconomic ups and downs, because of the public constantly threatening to erupt in revolt, because of activists that are all too happy to fuel that perpetual fire to force you to comply with whatever they demand? 

What you do is find a good sparring partner who will help you navigate the uncertainty with clear strategic insights and frequent adjustments to your worldview, helping you to constantly refine your long-term thesis. As recently written by Byrne Hobart in his excellent The Diff, “as real-time data gets commoditized by efficient markets, more of the residual is explained by longer-term theses”.

9/ Who are those executives that I would spar with? There are several options:

  • I’m not a big believer in the idea of a “chief digital officer”, but I’ve already been sparring with a few—and there have been some interesting results.

  • I happen to think that CFOs can make or break a firm’s effort to reposition in the current context, so I’m looking forward to sparring with them.

  • CEOs should definitely be the ones in charge on all those fronts, so obviously they’re part of my list of potential clients.

  • As for small and medium businesses, their smaller sizes doesn’t spare them from the need to tackle all those challenges, and their owners and executives, too, need a sparring partner.

10/ I’m sure you have many questions! So please reach out so that we can exchange a bit, and I’ll let you in on the details. If you need references, I’m also happy to provide them. Talk soon 🤗


💵 Yesterday, my colleague Younès Rharbaoui sent the second issue of his newsletter Chasing Paper, this time about “Finance Hacking”. He reveals a bit of how we manage finances at The Family and describes the tools that every CFO can use to automate their tasks. Here it is: Finance Hacking: The rise of the augmented CFO.

⚠️ Oussama has launched a new series of blog posts targeted at guiding startup founders through the COVID-19 crisis. Here are the first three installments:

👩‍🍳 In an environment where making a sale is harder than ever, crafting a superb customer experience becomes an even bigger value add (plus, it’s one area where startups can absolutely compete with and outdo legacy players). That’s why our next big online event at The Family is the Customer Experience Summit, being held on June 18. Get all the details and your free ticket right here.

In the next Friday Reads edition, I’ll share a list of articles which I think together form a solid foundation for doing executive sparring my way. Here are some of the authors included in the list.

😾 Martin Gurri, author of the landmark book The Revolt of the Public, has designed a powerful framework to analyze the loss of trust between individuals and institutions. Martin always insists there is no turnkey solution for leaders determined to restore trust in a world so dramatically changed by the Internet. But keeping his thoughts in mind is, I think, mandatory for business leaders moving forward. 

🎼 John Hagel has been working for years on understanding how organizations should reinvent themselves to become more innovative and more sensitive to their environment. His views on the future of work, in particular, resonate with my experience of legacy organizations having to switch from command-and-control to what John calls “scalable learning”.

🌊 Rita McGrath, of Columbia Business School, is one of those authors who knows how to put words on things that I’ve been sensing for some time. Reading her (or listening to her) creates many of those enjoyable ‘aha!’ moment that we in the startup world rarely find in the world of large corporations. Rita’s is an enlightening contribution to business leadership in the Entrepreneurial Age.

🌎 Peter Zeihan is one thinker I’ve been quoting over and over, all thanks to my friend Erik Torenberg of Village Global. He provides us with a compelling framework, at the crossroads of history and geography, for understanding the direction in which the world is headed: more fragmentation, more conflicts, extraordinary struggles for countries deprived of essential resources, great opportunities for the others.

👉🏻 To discover the complete list of thinkers whom I think business leaders should have on their radar, as well as a selection of their works, become a paying subscriber! The whole package will be sent in three days with the next Friday Reads edition 🤗

And in case you missed it:

From Normandy, France 🇫🇷