emotional intelligence, what we know, book, Toby Elwin, blog

Recap: Emotional Intelligence

Social intelligence, social competence, emotional competence, interpersonal intelligence, intrapersonal intelligence, emotional adaptiveness, emotional quotient, emotional intelligence, EQ, and EI. There are many schools and many thoughts about what is and is not emotional intelligence.  And just as many tools that attempt to measure, monitor, and predict the impact of emotional intelligence. For me, Emotional Intelligence boils down to: the way I motivate myself, the way I motivate others, and focusing my intentions to result in correct consequences If being smart or a high IQ was all that mattered than only those with the highest IQ would ascend to the C-level or highest public-sector positions.  Every valedictorian would be successful. There is something more to knowledge.  Something more than being a valedictorian to get along and to succeed.  This something includes self-awareness and relationship awareness.  Below are a series of blogs I’ve …

mergers and acquisitions systems thinking, Toby Elwin, blog

Mergers and acquisitions systems thinking strategies, part 3

Systems thinking strategies for mergers and acquisitions (M&A) provide better integration valuations and post-merger operations. With mergers and acquisitions systems thinking the organization’s view is made of several components that interact with each other while simultaneously act as part of a whole. Systems theory helps explain dynamic interrelationship of several parts, beyond information technology or back office functions. Mergers and Acquisitions Systems Thinking No matter the motive for M&A the real work comes with integration.  A systems view for organizations presents organizations as dynamic entities that continually interact with their environment.  Workforce efficiencies, scale efficiencies, combined technology, and market expansion commonly fall under the synergy tag. Synergy seems like a hollow word, but synergy attempts to describe cost efficiencies that occur when companies consolidate into 1 company through a merger or acquisition.  Post-merger integration is where the components disrupt or combine to create a new …

monkey, board of directors, meeting, Toby Elwin, blog

Mergers and acquisitions systems thinking strategies, part 2

When evaluating merger integration risk the reality is true integration risk identification can only happen with an evaluation of systems integration. Without front-end, due diligence on human capital integration then too often the deal becomes a post-merger write-off. The result: wasted opportunity, multiples on paper only, and “synergies” left back on the deal table or with the executive hand-shake.

Evaluating risk, financial model, competency model, Toby Elwin, blog

Evaluating risk: financial models versus competency models, part 2

Models attempt to identify the assets that have value.  How to manage those assets.  And how to strategically turn these assets into money.  This is a second, follow-up, post comparing financial models to competency models to evaluate risk. As I mentioned in that post, typical financial models, and their build-outs, inherently, ignore important aspects of real-world behavior, models are truly as much an art as a science in their mathematical reasoning and interpretations. While financial models look to identify financial strengths and weaknesses of organizations, competency models try to identify critical knowledge, ability, and skills needed to lead and run organizations. Typical due diligence and valuation involves tangible and intangible research.  Tangible assets are usually classified as physical assets like inventories, machinery, buildings, and land. Intangible assets are usually classified as patents, licences, processes, and intellectual property, the knowledge of …

venture capital, return, private equity, Toby Elwin, Harvard Business Review

Venture Capital and the descent into irrelevance

The bigger the risk, the bigger the reward. Elemental finance: you assume the amount of risk suitable for an expected payoff. You assume bigger risk and its bigger payoff with the full caveat that there is an equally big downside loss that could happen. Invest in a money market and get slow, steady, decimal-point-% returns; you sleep well knowing your risk is low and what to expect. Invest in emerging markets, a start up, or unproven technology with wildly fluctuating uncertainty and huge range of possible returns; you get potential sleepless nights worrying about losing your entire investment or planning a safe harbor for your potential windfall. If venture capital (VC) is to assume its traditional place as the fuel for innovation than a 2% average quarterly return from 1981-2009, as well as a glut of investor money sitting around …

human capital, risk, evaluation, criteria

Human capital risk, now that’s real risk

You commonly hear an equity firm or VC partner claim, we invest in the people and when it comes to costs, human capital usually represents nearly 70% of all operating costs. Human capital risk is the real risk, but most investment firms don’t focus investment decisions and deal valuation not quantifying the people or human risk.  The overwhelming focus for investors is on quantifying risk by analyzing: Market growth or potential, Market size, Expected rate of return, and Expected financial risk Their decision to invest becomes a decision to assume the correct amount of risk for the projected payoff. However, the overwhelming valuations of risk are deeply flawed. The gamble, or risk is not on market or legal risk, but really a the risk of a team to deliver something within a certain time and within a certain budget. In other …

human capital, risk, lever, tangible, intangible, Toby Elwin, blog

Human capital assessments — the symptom or the disease

The drive to evaluate operations and to contain costs is mistakenly applied as an operational issue across the board.  Too often human capital assessments lumped into the systems theory world of process and become a technical asset for management’s diagnostic view for cuts. The result becomes an assessment or evaluation process that is really the disease responsible for symptoms such as high turnover, low morale, and mismanagement. Human capital is a sociological asset, an asset that does take up to 70% of your costs, but an asset that not treated like a process map or put on an accelerated depreciation schedule. Human capital, like all capital, however, is an asset that is open to waste, depletion, or improvement. Human Capital Leaves at 5pm Human capital also has the same risk associated with other capital options and in the world of …

champion, duckboat, venture capital, Boston

Notes from Boston: the state of US venture capital

This was originally posted in the nowEurope, where I post as a contributor. nowEurope reported on technology innovation in Central Europe Centrope ICT Technology Transfer. CENTROPE is the integration and cooperation of the quadrangle borders between the Czech Republic, Slovakia, Hungary and Austria. Here is the article, as originally posted: In Boston, I recently attended the Annual VC Outlook Dinner, hosted by The Indus Entrepreneurs (TiE), the world’s largest not-for-profit organization for entrepreneurs. The evening provided a snapshot of the investment climate here in the United States. Some of these insights may apply to other parts of the world, including Central Europe. The evening included a panel discussion and dialogue.  The panel was made up of representatives from six leading US venture capital firms: Highland Capital Partners; Battery Ventures; TVM Capital; Atlas Venture; Bain Capital Ventures; Commonwealth Capital Ventures; and Greylock Partners These …

Why Startups Should ALWAYS Compromise When Hiring? — Never!

Reading a blog on the venture capital website Start Up Hire called: Should Startups Compromise When Hiring? I found a reference to a blog Dharmesh Shah, Chief Technology Officer & Founder of Hubspot* and Onstartups.com, wrote, “Why Startups Should ALWAYS Compromise When Hiring?”. I posted a comment to the blog as I felt Start Up Hire’s blog and Dharmesh Shah’s blog both have valid points, but neither blog strikes a talent management, financial case. I post the thread here as I found it relevant to my last blog: The VC’s Missing Formula: Human Capital Discounted Cash Flow. Below, you first see the Start Up Hire blog [initalic], then Dharmesh Shah’s blog [in blue text], and finally, my comment follows. From Start Up Hire’s, Team Building Blog, page: Dharmesh Shah shared some thoughtful insights recently on “Why Startups Should ALWAYS Compromise …

VC’s missing formula, discounted cash flow, human capital, alchemy,

The VC’s missing formula: human capital discounted cash flow

Accounting assigns of assets and liabilities and financial management’s current or pro forma valuation both rely on art and interpretation more than any professional standard, science, or law. What valuation models measure human capital ability to meet financial and strategic business goals? What formulas are used to measure human capital contribution to profits? What are the human capital risk factors you justify when you build your financial statements and projections? Organization valuation usually involves four areas: Physical capital, Financial capital, Intellectual capital, and Human capital Both accounting and financial management start with familiar industry formulas to measure physical, financial, and intellectual capital. The departure from formula comes with asset classification and subjectivity of inputs. You most often witness this in the beta, or the numerical representation of risk, used in the discounted cash flow formulas on glitzy, initial public offering, road shows. …