Values alignment is the new key metric

Here we are, in the end times. (It's called late-stage capitalism for a reason. What comes after late-stage anything? A complete -and completely unexpected- re-birth of the incumbent paradigm.)

The beauty of these times is that we get to re-invent every single aspect of our system - including, first and foremost, ourselves.

Here's a comment from my last newsletter by Indy Rishi Singh :

Here's how we are NOT going to create a values-aligned culture in our startups and investment portfolios:

• Requiring impact metrics, of any kind. We choose our portco's based on actual thesis alignment: are they creating a product or service that can be a lever for industry transformation and impact humanity at a large scale? If so, they are aligned. The impact is baked, weaved, and utterly ingrained in the product (and processes.) The founder's life calling is to execute on it. This, understandably, weeds out 99% of startups. (Note: Impact metrics aren't bad, they can be useful, it's just that you don't force it on them.)

• Requiring founders (or employees) to do meditation daily. Would we love if founders meditated daily, and brought that stable, calm foundation of leadership to their team culture? For sure! But, meditation isn't for everyone, and anything can be commoditized. For us, it's not about external performative metrics of "values," it's about living in integrity. This means doing what is in the highest alignment for yourself, your venture, and your industry, in that order - and being transparent and truthful with everyone, including yourself. (This is harder than meditating. :))

• Blindly following the "rules" that seem to be the status quo in our industries. Venture capital, the way it's done today, is very effective in some ways. In other ways, not as much. For example, an exit for a startup (buy out or IPO) seems to be the only way to cash in on your investment returns. But if these founders don't want to fuel more centralization of capital in our system, where they are swallowed up by corporations, and the corporations are all ultimately controlled by their primary shareholders (e.g. Blackrock,) are there other ways to get back returns? Of course! We ourselves created the venture capital system, and we can change it if we want to. We can extend the time the venture has to IPO, and traditional private equity has many other diverse options, like equity buy back, dividends, revenue share, secondaries ... and more are being created everyday (e.g. Daos...) The main thing is that the venture is successful, that we stay true to what is right and good for the company, and that we create liquidity somehow.

Here's some more ways we DO create a values-aligned culture in our startups and investment portfolios:

• Having a set process for due diligence (or hiring) that rigorously tests emotional intelligence, and other factors that are aliases for how aligned the founder is to his/her stated vision and mission, as well as his/her ability to stay anchored in that well past seed stage. (Fun fact: lying or exaggerating about your venture metrics during this phase is not favorable to you.)
• Having a coaching or leadership development plan for founders post-investment that supports them to self-reflect and implement company-level systems to create high quality results from a happy, stable team (which means risk mitigation for investors!)
• Creating a culture of trust and service. We operate with full trust and transparency with our people, but/and we also protect our boundaries like a razor blade.

What about you? How do you ensure values-alignment in whatever you do? Have you seen it be useful to vet for this? Let me know in the comments.

My first live weekly podcast last Friday went awesome and here were some key highlights of my chat with Barry Palte:

• There's a time pressure of many VCs to get money back out, and family offices may come with a longer-term perspective ... plus, we can all culturally shift our energy of "rush"
• We want to see the majority of ventures in a portfolio succeed, even if it's not a multi-billion dollar exit
• How AI can be used to match founders, investors, and service providers, including creating pitch decks and updating investors continuously, thereby up-ending our industry and perhaps making accelerators obsolete.
• How nuclear fusion can create energy sovereignty ... and how might that be a mirror to an era of energetic sovereignty!
• The Industrial Revolution got a bad rap, we're now catching up to ourselves to create a balanced world, and this is the best time to be alive.

You can access the full podcast episode here.

+This Friday, July 5th at 12pm CST I'm talking to ?? Gillian Muessig and Anne F. Kennedy from Mastersfund, who are taking a radically innovative approach with their term sheets for founders.

Register here to catch this podcast live, or simply hit "attending" so you can watch it later!

Did you enjoy this? Let me know in the comments below if there are any topics you want me to address in future newsletters.

New Paradigm Venture Capital is my weekly newsletter - and live podcast - for investors, founders, and thought leaders creating a new paradigm for your industry and humanity. Subscribe now to join the community.

(It's a love letter because I believe in founders, and I think venture capital is the most powerful tool on the planet to create a new paradigm in all of our critical industries - e.g. healthcare, education, and more - in order to impact humanity and transform industries at scale.

My content is based on my lived experience of 15+ years in the impact venture space across the world. These are purposely opinion pieces, not rigorous academic pieces (though I have plenty of those, published at places like Harvard, UMich, and Kellogg.) Take what resonates. Leave the rest. And never, ever be a troll.)