{ "docId": "019f6b8f-71b9-7767-8357-69b177d37fb3", "docSlug": "jarvis-throne-vs-the-kingdom", "documentTitle": "Throne vs the kingdom", "authorId": "throne-vs-the-kingdom", "authorName": null, "documentKindSlug": "deck", "documentKindLabel": "Deck", "sourceTypeSlug": "investor_relations", "sourceTypeLabel": "Investor relations", "presentationDate": null, "orientation": null, "aspectRatio": null, "pageNumber": 13, "pageCount": 45, "prevPage": 12, "nextPage": 14, "slideType": "other", "function": "establish_context", "density": "dense", "nDataPoints": 0, "notes": "Academic text page with footnotes.", "elementsJson": null, "metadataConfidence": 0.9, "imagePath": null, "slideHref": "/slides/019f6b8f-71b9-7767-8357-69b177d37fb3/13", "deckHref": "/decks/019f6b8f-71b9-7767-8357-69b177d37fb3", "deckJsonHref": "/decks/019f6b8f-71b9-7767-8357-69b177d37fb3.json", "deckAnchorHref": "/decks/019f6b8f-71b9-7767-8357-69b177d37fb3#slide-13", "components": [ { "bbox": { "h": 0.12, "w": 0.78, "x": 0.11, "y": 0.81 }, "kind": "disclaimer", "text": "10 Rather than deciding to forego attracting resources, founders may also try to attract them but fail to do so, thus ending up with a high control/low value venture. To account for this possibility, in the empirical analyses I use fixed-effects methods, propensity scoring, and other approaches. 11 It should be noted that attracting too many resources may also harm startup performance (George 2005). Similarly, within multinational corporations, although slack resources can foster greater experimentation, they can also reduce discipline regarding innovative projects (Nohria and Gulati 1996).", "attrs": null, "subkind": "disclaimer", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "3ba80c4b-8220-4912-92b7-86705d756f13", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.22, "w": 0.78, "x": 0.11, "y": 0.33 }, "kind": "paragraph", "text": "Companies use boards of directors to gain resources and minimize dependence (Pfeffer 1972). Outside directors bring four major benefits: “advice and counsel,” access to external channels of information, access to resources, and legitimacy (Pfeffer and Salancik 1978; Hillman, Withers et al. 2009). Founders who haven’t raised capital from outside investors will control the entire board of directors and thus all board decisions, but will lack the “board capital” (Hillman and Dalziel 2003) that directors could contribute, and also lack the discipline that can come from their monitoring (Garg 2013).", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "20e60c25-fee4-471e-bec3-9e3c858945d4", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.22, "w": 0.78, "x": 0.11, "y": 0.09 }, "kind": "paragraph", "text": "As decisions accumulate, they can lead to very different outcomes. At the control extreme, the founder consistently foregoes attracting resources, maximizing control but sacrificing value. The reasons why founders may make such choices include heterogeneous preferences for control or differing expectations about their ventures’ prospects.10 At the value-creation extreme, founders consistently attract valuable outside resources but risk losing control.11 In between these two extremes, founders may be able to keep a measure of control while building some value, but typically have to sacrifice some of each, and possibly large amounts of both.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "3d678e58-3931-44a4-9554-958dfc23b3f9", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.22, "w": 0.78, "x": 0.11, "y": 0.56 }, "kind": "paragraph", "text": "Some investors add few resources beyond their financial capital. Other investors, such as VCs, are known for “providing value-added services to their portfolio companies” (Baker and Gompers 2003:571). More specifically, “their involvement includes service on the boards of firms in their portfolios, frequent informal visits, meetings with customers and suppliers, and active involvement in key personnel and strategic decisions.” (Lerner 1995:302) As a result, VC backing can help grow larger companies (Baker and Gompers 1999) and help improve long-term outcomes (Baker and Gompers 2003). In one study, VC-backed companies went public more than four years sooner than did companies", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "7d0a71d9-b74b-4c43-894c-9c1bedfb2c56", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [ { "name": "Audience Definition", "slug": "audience-definition", "agent": "Storyteller", "layer": "slide", "matchId": "cdad2ad6-32df-4458-985c-cec69be076a5", "evidence": "Companies use boards of directors to gain resources and minimize dependence (Pfeffer 1972).", "confidence": 0.6 } ], "frameworks": [], "arcBeats": [ { "to": 15, "from": 6, "beatId": "7f6c6f40-8ea0-409f-b760-3bfa165fe38e", "arcName": "The Sequoia Pitch", "arcSlug": "sequoia-pitch", "beatName": "Market Size", "beatSlug": "sequoia-pitch-market-size", "evidence": "The document discusses the methodology and data used to analyze the relationship between founder control and value creation.", "position": 1, "confidence": 0.8, "parentBeatName": "Evidence", "parentBeatSlug": "evidence" } ], "loops": [ { "to": 20, "from": 10, "name": "Cost Of Inaction", "slug": "27-cost-of-inaction", "bestFor": "Urgent budget requests, compliance, risk mitigation", "matchId": "93fc7fbb-9e7f-48f5-93cf-3a34bae2fc91", "evidence": "The document discusses the potential costs of inaction in terms of valuation and capital raised.", "position": 0, "objective": "Highlighting the consequences of not addressing the tradeoff between founder control and company value", "structure": "The Status Quo -> The Hidden Costs Accumulating -> The Future State of Inaction -> The Tipping Point", "confidence": 0.7, "description": "Quantify what happens if the audience does nothing" } ], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }