Feedback Loops for Founders

Feedback loops are everywhere. Thinking carefully about them can be valuable, as a startup founder.

Feedback loops are everywhere, even if we don't realise it. We're taking in information from our environment daily, adapting and updating how we behave based on it - this is a feedback loop. More formally, a feedback loop is when the outputs of a system affect its behaviours.

Any incentive is a form of feedback loop; an incentive is created to bring about some action or behaviour in others. If successful, it will see a change in behaviour in the intended way, but often we see unintended consequences. These consequences act as new input to re-adjust the incentives.

Feedback Loops for Startups

A startup's progress is dependent on the founder's ability to learn continuously and grow with the company. A scaling startup will grow exponentially, so there are often periods where the founder's pace of learning is a bottleneck within the organisation. If a founder's pace of learning is so crucial to a company's success, it makes sense to put some thought into optimising it.

Two ways in which you can optimise the feedback loops (and therefore the pace of learning of a founder):

  • Improve the quality of the feedback being received
  • Decrease the length of the feedback loops (in other words, finding ways to receive feedback more frequently)

Improve the quality of the feedback being received

When people talk about feedback, they're often talking about direct feedback that someone else has given to them; being told that they're too controlling, not providing clarity when they speak, or not prioritising correctly. But there are many other forms of feedback that founders receive daily:

  • Observing the actions of other people on the team
  • Observing how users are using the product (both qualitative and quantitative data)

You can improve the quality of the feedback you're receiving by considering the types of feedback that apply to you and becoming more deliberate about how you collect that information.

For example, you might schedule a weekly check-in with your direct reports, and through practice and repetition, you gain the skill of being able to ask the right questions in the right way to elicit honest feedback that helps you improve.

Similarly, knowing which metrics matter within your business and which don't will come from a deep understanding of how they all relate to each other and how changing one affects the others.

Many founders work with a coach to improve the pace of learning - I've personally found this incredibly valuable. For example, a coach can ask targeted questions to force you to reflect and provide an external mind to increase the rate of processing all of the inputs you're taking in and make sure they lead to action.

"I have a simple yet fundamental assumption about coaching: the purpose is to change behaviour" - David Peterson, former Director of Executive Coaching and Leadership at Google

Decrease the length of the feedback loops

Another way to increase the pace of learning is to decrease the feedback loop. Looking at the loop, this can be done by:

  • having a bias for action
    • the faster you take action, the faster you're going to receive feedback on that action
  • finding leading indicators to what you care about
    • often, a meaningful metric within a company takes a long time to track, or it is slow to adjust to negative changes. Perhaps retention is most important to your business, but you realise it is strongly correlated with user activity within the first couple of days of signing up? Track that instead
  • filter input to focus on the most impactful feedback
    • not all feedback is created equally; prioritise feedback from people you admire and want to emulate.

By increasing the frequency and quality of feedback you're receiving and then taking action, you begin a rapid self-correcting process where you are constantly learning and improving. This has a compounding effect.

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