Noam T. Wasserman

Associate Professor of Business Administration

Unit: Entrepreneurial Management

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(617) 495-6215

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Noam Wasserman is a professor at Harvard Business School.  For more than a decade, his research has focused on founders’ early decisions that can make or break the startup and its team. He developed and teaches an MBA elective, “Founders’ Dilemmas,” for which he was awarded the HBS Faculty Teaching Award and the Academy of Management’s 2010 Innovation in Pedagogy Award.  In 2011, the course was also named one of the top entrepreneurship courses in the country by Inc. magazine.  In 2014, he was a visiting professor at Stanford University, where he taught Founders' Dilemmas and worked with a wide variety of students, ranging from undergraduates to post-docs and from engineers to business-school students.

His book, The Founder's Dilemmas: Anticipating and Avoiding the Pitfalls That Can Sink a Startup, was published in 2012 by Princeton University Press.  Within two weeks, it had become Amazon's #1 book on the Management bestseller list, #1 in New Business Enterprises, and #2 in Popular Economics.  Publisher's Weekly called it "seminal," "captivating," and "required reading."  The New York Journal of Books called it "the single-most indispensable guide for founders of startups."  In his review, venture capitalist Brad Feld said, “There are plenty of books lots with stories, anecdotes, and suggestions, but none that are particularly systematic about going through all of the issues. Noam’s book is the first I’ve read – and he totally nails it.”  Other reviews can be found here.  Among its awards, the Academy of Management named it one of the Top Five Business Books of the Year, it received the Axiom-Silver Award for Best Business Books of 2012 (Entrepreneurship category) from the Independent Publishers Association, and Startup Weekend named it Top Startup Book of 2012.  The book has been published in 7 languages so far.

Both The Founder’s Dilemmas (the book) and Founders’ Dilemmas (the course) provide a roadmap for founders about the most common pitfalls they will face.  The book and course integrate Noam’s research results, quantitative data collected over the last decade from 10,000 founders, case studies, and conceptual frameworks.  Since 2000, he has been the lead researcher on the annual CompStudy survey of technology and life-sciences startups, which has become the most comprehensive survey of compensation for top management at private companies in the U.S. (and is now expanding to include China, India, Israel, and England).  Noam was one of three members of the core faculty of the Kauffman Foundation’s Global Scholars program, and he has delivered numerous keynote addresses to meetings of the Young Presidents Organization (YPO) and Entrepreneurs Organization (EO), venture capital retreats, startup incubators, entrepreneurship conferences, and other groups.  He now chairs the Academy of Management's committee that judges and awards the annual Innovation in Entrepreneurship Pedagogy Award.

Noam’s research has been published in Harvard Business Review (his 2008 article on “The Founder’s Dilemma” became an HBS Publishing best seller), the Academy of Management Journal (2006), Organization Science (2003, 2008), the Best Paper Proceedings of the Academy of Management (2004, 2006), and other publications.  He won Harvard’s George S. Dively award for dissertation research and the Aage Sorensen Memorial Award for sociological research, and for four straight years won the Outstanding Reviewer award from the Academy of Management (Business Policy and Strategy division).

Noam received his PhD from Harvard University in 2002, and received an MBA (with High Distinction) from Harvard Business School in 1999, graduating as a Baker Scholar.  Despite being voted “Most Likely to Become a CEO” by his MBA section, Noam decided to pursue academia as a career and to enter the PhD program (thereby giving up on ever becoming a CEO!). Before coming to Harvard, he was a Principal and Practice Manager at a management-consulting firm near Washington, D.C., where he founded and led the Groupware Practice. He also worked as a venture capitalist at a firm in Boston. He received a BSE (magna cum laude) in Computer Science and Engineering from Penn, and a BSEcon (magna cum laude) in Corporate Finance and Strategic Management from Wharton. He lives in Brookline, MA, with his wife and eight children, loves coaching Little League, and completed Shas in 1997-2005 with the 11th Daf Yomi cycle.

Featured Work

Publications

Books

  1. The Founder's Dilemmas: Anticipating and Avoiding the Pitfalls That Can Sink a Startup

    Noam Wasserman

    Often downplayed in the excitement of starting up a new business venture is one of the most important decisions entrepreneurs will face: Should they go it alone or bring in cofounders, hires, and investors to help build the business? More than just financial rewards are at stake. Friendships and relationships can suffer. Bad decisions at the inception of a promising venture lay the foundations for its eventual ruin. The Founder's Dilemmas is the first book to examine the early decisions by entrepreneurs that can make or break a startup and its team. Drawing on a decade of research, Noam Wasserman reveals the common pitfalls founders face and how to avoid them. He looks at whether it is a good idea to cofound with friends or relatives, how and when to split the equity within the founding team, and how to recognize when a successful founder-CEO should exit or be fired. Wasserman explains how to anticipate, avoid, or recover from disastrous mistakes that can splinter a founding team, strip founders of control, and leave founders without a financial payoff for their hard work and innovative ideas. He highlights the need at each step to strike a careful balance between controlling the startup and attracting the best resources to grow it and demonstrates why the easy short-term choice is often the most perilous in the long-term. The Founder's Dilemmas draws on the inside stories of founders like Evan Williams of Twitter and Tim Westergren of Pandora, while mining quantitative data on almost 10,000 founders. People problems are the leading cause of failure in startups. This book offers solutions.

    Keywords: Entrepreneurship; Business Startups; Partners and Partnerships; Social Psychology; Outcome or Result;

    Citation:

    Wasserman, Noam. The Founder's Dilemmas: Anticipating and Avoiding the Pitfalls That Can Sink a Startup. Kauffman Foundation Series on Innovation and Entrepreneurship. Princeton University Press, 2012. (Academy of Management award - One of Top Five Business Books of the Year Independent Publishers Association - Top Business Books of the Year, Entrepreneurship category (Axiom-Silver award)) View Details

Journal Articles

  1. Planning a Start-Up? Seize the Day...Then Expect to Work All Night

    Noam Wasserman

    If you dream of starting your own business, it's better to leave the corporate nest sooner than later, before you get too comfortable with the big-company amenities every start-up lacks. Get going before you're 40 - or even earlier, if you want to make entrepreneurship your career.

    Keywords: Business Startups; Age Characteristics; Entrepreneurship; Personal Development and Career;

    Citation:

    Wasserman, Noam. "Planning a Start-Up? Seize the Day...Then Expect to Work All Night." Harvard Business Review 87, no. 1 (January 2009). View Details
  2. The Founder's Dilemma

    Noam Wasserman

    Most entrepreneurs want to make a lot of money and to run the show. New research shows that it's tough to do both. If you don't figure out which matters more to you, you could end up being neither rich nor king.

    Keywords: Business Growth and Maturation; Business Startups; Entrepreneurship; Profit; Growth and Development Strategy; Managerial Roles;

    Citation:

    Wasserman, Noam. "The Founder's Dilemma." Harvard Business Review 86, no. 2 (February 2008): 102–109. View Details
  3. Executive Compensation In Entrepreneurial Teams: The Founder Gap, Board Membership, & Pay For Milestones

    Noam Wasserman

    Keywords: Management; Compensation and Benefits; Groups and Teams; Governance;

    Citation:

    Wasserman, Noam. "Executive Compensation In Entrepreneurial Teams: The Founder Gap, Board Membership, & Pay For Milestones." Academy of Management Conference Proceedings (2004). View Details

Book Chapters

  1. When Does Leadership Matter? A Contingent Opportunities View of CEO Leadership

    Noam Wasserman, Nitin Nohria and Bharat Anand

    There is by now a long-standing debate on the impact that CEOs have on company performance. Studies of leadership describe how CEOs can significantly impact company performance, while the "constraints" perspective argues that leaders are sufficiently constrained by their environments, and that their ability to impact performance is limited. This paper seeks to alter the framing of this debate by asking, instead, "When does leadership matter?" We develop a "contingent opportunities" theory of leadership and empirically examine our predictions on a dataset of 531 companies from 42 industries from 1979 to 1997. We show that CEO impact differs markedly by industry, and that CEOs have the most significant impact where opportunities are scarce or where CEOs have slack resources.

    Keywords: Business Ventures; Leadership; Performance Improvement; Research; Opportunities;

    Citation:

    Wasserman, Noam, Nitin Nohria, and Bharat Anand. "When Does Leadership Matter? A Contingent Opportunities View of CEO Leadership." Chap. 2 in Handbook of Leadership Theory and Practice, edited by Nitin Nohria and Rakesh Khurana. Harvard Business Press, 2010. View Details

Working Papers

  1. The First Deal: The Division of Founder Equity in New Ventures

    Thomas F. Hellmann and Noam Wasserman

    This paper examines the division of founder shares in entrepreneurial ventures, focusing on the decision of whether or not to divide the shares equally among all founders. To motivate the empirical analysis we develop a simple theory of costly bargaining, where founders trade off the simplicity of accepting an equal split, with the costs of negotiating a differentiated allocation of founder equity. We test the predictions of the theory on a proprietary dataset comprised of 1,476 founders in 511 entrepreneurial ventures. The empirical analysis consists of three main steps. First we consider determinants of equal splitting. We identify three founder characteristics—idea generation, prior entrepreneurial experience, and founder capital contributions—regarding which greater team heterogeneity reduces the likelihood of equal splitting. Second, we show that these same founder characteristics also significantly affect the share premium in teams that split the equity unequally. Third, we show that equal splitting is associated with lower pre-money valuations in first financing rounds. Further econometric tests suggest that, as predicted by the theory, this effect is driven by unobservable heterogeneity, and it is more pronounced in teams that make quick decisions about founder share allocations. In addition we perform some counterfactual calculations that estimate the amount of money "left on the table" by stronger founders who agree to an equal split. We estimate that the value at stake is approximately 10% of the firm equity, 25% of the average founder stake, or $450K in net present value.

    Keywords: Business Startups; Decision Choices and Conditions; Entrepreneurship; Fairness; Equity; Managerial Roles; Negotiation Deal; Ownership Stake; Value;

    Citation:

    Hellmann, Thomas F., and Noam Wasserman. "The First Deal: The Division of Founder Equity in New Ventures." NBER Working Paper Series, No. 16922, April 2011. View Details
  2. The Founder's Resource‐Dependence Challenge

    Noam Wasserman

    Does the degree to which founders keep control of their startups affect company value? I argue that founders face a "control dilemma" in which a startup's resource dependence drives a wedge between the startup's value and the founder's ability to retain control of decision making. I develop hypotheses about this tradeoff and test the hypotheses on a unique dataset of 6,130 American startups. I find that startups in which the founder is still in control of the board of directors and/or the CEO position are significantly less valuable than those in which the founder has given up a degree of control. On average, each additional degree of founder control (i.e., controlling the board and/or the CEO position) reduces the value of the startup by 23.0%‐58.1%.

    Keywords: Leadership; Value; Business Startups;

    Citation:

    Wasserman, Noam. "The Founder's Resource‐Dependence Challenge." Harvard Business School Working Paper, No. 14-090, March 2014. View Details
  3. The First Deal: The Division of Founder Equity in New Ventures

    Thomas F. Hellmann and Noam Wasserman

    This paper examines the division of founder shares in entrepreneurial ventures, focusing on the decision of whether or not to divide the shares equally among all founders. To motivate the empirical analysis we develop a simple theory of costly bargaining, where founders trade off the simplicity of accepting an equal split with the costs of negotiating a differentiated allocation of founder equity. We test the predictions of the theory on a proprietary dataset comprised of 1,476 founders in 511 entrepreneurial ventures. The empirical analysis consists of three main steps. First we consider determinants of equal splitting. We identify three founder characteristics—idea generation, prior entrepreneurial experience, and founder capital contributions—regarding which greater team heterogeneity reduces the likelihood of equal splitting. Second, we show that these same founder characteristics also significantly affect the share premium in teams that split the equity unequally. Third, we show that equal splitting is associated with lower pre-money valuations in first financing rounds. Further econometric tests suggest that, as predicted by the theory, this effect is driven by unobservable heterogeneity, and it is more pronounced in teams that make quick decisions about founder share allocations. In addition we perform some counterfactual calculations that estimate the amount of money "left on the table" by stronger founders who agree to an equal split. We estimate that the value at stake is approximately 10% of the firm equity, 25% of the average founder stake, or $450K in net present value.

    Keywords: Entrepreneurship; Equity;

    Citation:

    Hellmann, Thomas F., and Noam Wasserman. "The First Deal: The Division of Founder Equity in New Ventures." Harvard Business School Working Paper, No. 14-085, March 2014. View Details
  4. The First Deal: The Division of Founder Equity in New Ventures

    Thomas F. Hellmann and Noam Wasserman

    This paper examines the division of founder shares in entrepreneurial ventures, focusing on the decision of whether or not to divide the shares equally among all founders. To motivate the empirical analysis we develop a simple theory of costly bargaining, where founders trade off the simplicity of accepting an equal split, with the costs of negotiating a differentiated allocation of founder equity. We test the predictions of the theory on a proprietary dataset comprised of 1,476 founders in 511 entrepreneurial ventures. The empirical analysis consists of three main steps. First we consider determinants of equal splitting. We identify three founder characteristics—idea generation, prior entrepreneurial experience, and founder capital contributions—regarding which greater team heterogeneity reduces the likelihood of equal splitting. Second, we show that these same founder characteristics also significantly affect the share premium in teams that split the equity unequally. Third, we show that equal splitting is associated with lower pre-money valuations in first financing rounds. Further econometric tests suggest that, as predicted by the theory, this effect is driven by unobservable heterogeneity, and it is more pronounced in teams that make quick decisions about founder share allocations. In addition we perform some counterfactual calculations that estimate the amount of money "left on the table" by stronger founders who agree to an equal split. We estimate that the value at stake is approximately 10% of the firm equity, 25% of the average founder stake, or $450K in net present value.

    Keywords: Business Startups; Decision Choices and Conditions; Entrepreneurship; Fairness; Equity; Managerial Roles; Negotiation Deal; Ownership Stake; Value;

    Citation:

    Hellmann, Thomas F., and Noam Wasserman. "The First Deal: The Division of Founder Equity in New Ventures." NBER Working Paper Series, No. 16922, April 2011. View Details
  5. When Does Leadership Matter? The Contingent Opportunities View of CEO Leadership

    Noam Wasserman, Bharat Anand and Nitin Nohria

    Citation:

    Wasserman, Noam, Bharat Anand, and Nitin Nohria. "When Does Leadership Matter? The Contingent Opportunities View of CEO Leadership." Harvard Business School Working Paper, No. 01-063, January 2001. ((Later published as Ch. 2 in The Handbook of Leadership Theory and Practice, 2010.)) View Details

Cases and Teaching Materials

  1. Pixability: Managing a Corporate Board (Pre Class)

    Noam Wasserman

    "Bettina’s Board Walk" examines the board management methods of Bettina Hein, Founder-CEO of Pixability, Inc., as she prepares for and conducts a standard board meeting. The case is designed to give students an understanding of the delicate dynamics inherent in board management, and to impart best practices for building and managing a board of directors at an early stage startup. The written case is accompanied by video footage for both pre-class and in-class viewing.

    Keywords: entrepreneurial management; board of directors; Entrepreneurship;

    Citation:

    Wasserman, Noam. "Pixability: Managing a Corporate Board (Pre Class)." Harvard Business School Video Supplement 814-703, February 2014. (Revised April 2014.) View Details
  2. Pixability: Managing a Corporate Board

    Noam Wasserman

    "Bettina’s Board Walk" examines the board management methods of Bettina Hein, Founder-CEO of Pixability, Inc., as she prepares for and conducts a standard board meeting. The case is designed to give students an understanding of the delicate dynamics inherent in board management, and to impart best practices for building and managing a board of directors at an early stage startup. The written case is accompanied by video footage for both pre-class and in-class viewing.

    Keywords: entrepreneurs; entrepreneurial management; board of directors; Entrepreneurship;

    Citation:

    Wasserman, Noam. "Pixability: Managing a Corporate Board." Harvard Business School Video Supplement 814-702, February 2014. View Details
  3. Pixability: Bettina's Board Walk

    Noam Wasserman and Yael Braid

    Description: Bettina Hein, founder-CEO of Pixability, is meeting with her board of directors to discuss her startup's fundraising prospects and the recent strategic pivot. Though Bettina loves the entrepreneurial exhilaration of "riding a rollercoaster every day," the company's current cash position gives them only a four-month runway. For Bettina, though they can at times be tense, board meetings and their preparation have become an exercise in reflection that gives her encouragement. In her prior startup, SVOX, Bettina learned a lot about managing a board of directors. While she can apply many of those lessons to her experience at Pixability, she's had to continue to develop new practices for portraying the company's progress, and for soliciting advice from her directors while projecting confidence.

    While preparing for the upcoming meeting, Bettina wonders: How should she structure and lead the meeting? How might her board react to her team's updates? What difficult questions might the board members pose and how should she answer them?

    Keywords: entrepreneurship; corporate governance; board of directors; power and influence; Entrepreneurship; Negotiation;

    Citation:

    Wasserman, Noam, and Yael Braid. "Pixability: Bettina's Board Walk." Harvard Business School Case 814-021, August 2013. View Details
  4. Slicing Pie with a Razor: Ockham Technologies' Founding Agreement

    Noam Wasserman and Yael Braid

    Ockham Technologies' three founders are about to craft their founding agreement and split the equity among themselves. Uncertainty lingers over each member's future contributions, though—how is the team to devise a durable and effective split? Jim Triandiflou and Ken Burows worked resolutely to plan for the launch of their sales management software company. Soon they recruited a third member, Mike Meisenheimer, to lead product development. Each founder had contributed significantly to bringing the Ockham concept to life. The trio had provided the seed capital of $150,000, contracted a development team to build their product, garnered serious interest from a potential investor, and readily agreed on their roles within the company (Jim was CEO, Ken was COO, and Mike was Head of Product Management). But as Ockham entered its initial phase of product development, pressure began mounting for the team to discuss and finalize a founding agreement. What should they include in the agreement, and how should they structure their equity split?

    Keywords: Technology; Job Cuts and Outsourcing; Conflict Management; Governing and Advisory Boards; Employees; Management Teams; Product Development; Technology Industry;

    Citation:

    Wasserman, Noam, and Yael Braid. "Slicing Pie with a Razor: Ockham Technologies' Founding Agreement." Harvard Business School Case 814-017, July 2013. View Details
  5. Crafting a Founder Agreement at HealthCraft

    Noam Wasserman, Janet Kraus and Yael Braid

    HealthCraft's three founders are about to craft their founding agreement and split the equity among themselves. Uncertainty lingers over each member's future contributions, though—how is the team to devise a durable and effective split? Ever since consultant Kevin Rumsfeld conceived of the idea for HealthCraft, he had worked resolutely to begin building the company by recruiting a talented colleague to help with marketing and fundraising, and a junior member of one of his project teams to help him build the product. All three had been enthusiastically working on HealthCraft part-time for the last few months, contributing from personal savings to build a prototype. But now the pressure is on to discuss and finalize a founding agreement. What should they include in the agreement, and how should they structure their equity split?

    Keywords: entrepreneurs; Business Startups; Entrepreneurship; Health Industry;

    Citation:

    Wasserman, Noam, Janet Kraus, and Yael Braid. "Crafting a Founder Agreement at HealthCraft." Harvard Business School Case 813-101, December 2012. (Revised February 2014.) View Details
  6. Family Matters at ProLab

    Noam Wasserman and Yael Braid

    Hillary Mallow, founder-CEO of ProLab, learns that her health-services company is two months shy of bankruptcy. She needs to act—immediately—but isn't sure where to begin. Prolab's client list and geographic presence have grown steadily over the years, so the recent downturn is quite unexpected. Most worrisome, ProLab's executive team is in major trouble; contentiousness has developed between Hillary's husband, ProLab's CFO, and Hillary's business partner, ProLab's COO, which now threatens to envelop everyone else. With her company at stake and personal relationships on the line, Hillary must scramble to resolve the complicated mess that could mean the end of her company, or worse.

    Keywords: entrepreneurship; family business; Entrepreneurship; Health Industry;

    Citation:

    Wasserman, Noam, and Yael Braid. "Family Matters at ProLab." Harvard Business School Case 813-130, January 2013. (Revised August 2013.) View Details
  7. Founder-CEO Succession at Wily Technology (TN)

    Noam Wasserman

    Teaching Note to 805150.

    Keywords: Management Succession; Governing and Advisory Boards; Selection and Staffing; Transformation; Venture Capital; Business Startups; Decisions;

    Citation:

    Wasserman, Noam. "Founder-CEO Succession at Wily Technology (TN)." Harvard Business School Teaching Note 806-161, March 2006. (Revised March 2014.) View Details
  8. Evan Williams: From Blogger to Odeo (A) and (B)

    Noam T. Wasserman

    Teaching Note for [809088].

    Keywords: Venture Capital; Strategy; Groups and Teams; Blogs; Business Startups; Financing and Loans; Governing and Advisory Boards; Projects; Entrepreneurship;

    Citation:

    Wasserman, Noam T. "Evan Williams: From Blogger to Odeo (A) and (B)." Harvard Business School Teaching Note 809-137, April 2009. (Revised March 2014.) View Details
  9. A 'Rich-vs.-King' Approach to Term Sheet Negotiations

    Noam Wasserman, Furqan Nazeeri and Kyle Anderson

    This note offers a new approach to venture capital term-sheet negotiations, with actionable steps based on insights from Professor Wasserman's "Rich-vs.-King" approach to founder decisions. A core thesis of this note is that trying to negotiate all terms in a term sheet will be less effective than focusing on the terms that are most important to the specific entrepreneur in question, taking into account the entrepreneur's goals and motivations in founding the venture. In particular, terms that are higher priority to a control-motivated "King" founder are often lower priority to a wealth-motivated "Rich" founder and vice versa. Thus, this note identifies the most common terms that differ in their importance to different types of founders and provides a framework for weighing the relative importance of each potential term-sheet outcome for their specific type.

    Keywords: Entrepreneurship; Venture Capital; Financing and Loans; Framework; Negotiation Process; Negotiation Tactics; Motivation and Incentives; Financial Services Industry;

    Citation:

    Wasserman, Noam, Furqan Nazeeri, and Kyle Anderson. "A 'Rich-vs.-King' Approach to Term Sheet Negotiations." Harvard Business School Background Note 810-119, March 2010. (Revised December 2012.) View Details
  10. Ockham Technologies (B): Building the Board

    Noam Wasserman

    Describes the issues facing a founder-ceo regarding building a board, assembling an executive team, managing tension between co-founders, and outsourcing development work.

    Keywords: Human Resources; Job Cuts and Outsourcing; Management Teams; Groups and Teams;

    Citation:

    Wasserman, Noam. "Ockham Technologies (B): Building the Board." Harvard Business School Supplement 812-022, August 2011. (Revised February 2012.) View Details
  11. ghSMART & Co., 2006: Pioneering in Professional Services

    Noam T. Wasserman and Ashraf Haque

    Geoff Smart, founder and CEO of ghSMART & Co., wanted to build ghSMART into the #1 management-assessment firm for CEOs and investors. However, he had just received two pieces of very bad news: the demise of an existing project and the loss of a $1 million engagement he thought was already sold. The news raised difficult questions about how Geoff had structured his firm and had designed its governance and incentive systems.

    Keywords: Business Startups; Decision Choices and Conditions; Entrepreneurship; Corporate Governance; Growth and Development Strategy; Organizational Structure; Service Industry;

    Citation:

    Wasserman, Noam T., and Ashraf Haque. "ghSMART & Co., 2006: Pioneering in Professional Services." Harvard Business School Case 809-024, July 2008. (Revised December 2011.) View Details
  12. ghSMART(-er) & Co., 2008: Pioneering in Professional Services

    Noam T. Wasserman and Ashraf Haque

    Geoff Smart, founder and CEO of ghSMART & Co., wanted to build ghSMART into the #1 management-assessment firm for CEOs and investors. However, he had just received two pieces of very bad news: the demise of an existing project and the loss of a $1 million engagement he thought was already sold. The news raised difficult questions about how Geoff had structured his firm and had designed its governance and incentive systems.

    Keywords: Business Ventures; Managerial Roles; Organizational Structure; Problems and Challenges; Loss; Motivation and Incentives; Service Industry;

    Citation:

    Wasserman, Noam T., and Ashraf Haque. "ghSMART(-er) & Co., 2008: Pioneering in Professional Services." Harvard Business School Supplement 809-025, July 2008. (Revised December 2011.) View Details
  13. Frank Addante, Serial Entrepreneur

    Noam T. Wasserman and Antony Uy

    Frank Addante is a 28-year-old serial entrepreneur who is in the process of building his fifth venture. Of his first four ventures, two were sold, one went public, and in the last he decided to close the venture and return unused capital to his investors. With the passing of each venture, he has learned about forming founding teams, splitting equity with his co-founders, hiring executives to work for him, and when to take outside funding. Now, he's facing pressure from investors who aren't happy with how he is building his current team and are questioning whether he should remain CEO.

    Keywords: Business Startups; Entrepreneurship; Venture Capital; Equity; Selection and Staffing; Groups and Teams;

    Citation:

    Wasserman, Noam T., and Antony Uy. "Frank Addante, Serial Entrepreneur." Harvard Business School Case 809-046, September 2008. (Revised December 2011.) View Details
  14. Term Sheet Negotiations: A "Rich-vs.-King" Approach

    Noam Wasserman, Furqan Nazeeri and Kyle Anderson

    To give students and entrepreneurs a framework to guide their term-sheet negotiations with Venture Capitalists.

    Keywords: Entrepreneurship; Venture Capital; Framework; Negotiation;

    Citation:

    Wasserman, Noam, Furqan Nazeeri, and Kyle Anderson. Term Sheet Negotiations: A "Rich-vs.-King" Approach. Harvard Business School Background Note 812-028, September 2011. View Details
  15. Career at a Crossroad: Roopa Rao

    Noam Wasserman and Lisa Brem

    Akhil Patel is passionate about his business idea: an innovative green technology fuel cell. He wants to dive in and commit to his startup, but Roopa Rao, his fiancée, is much more risk averse, his parents don't approve of the startup, and Akhil has an enticing alternative offer from a prestigious consulting firm. Should Akhil follow his dream and become an entrepreneur? Or should he acquiesce to the other forces in his life and take the "safer" consulting job? This is a companion case to Career at a Crossroad: Akhil Patel, HBS No. 812-010, giving Roopa Rao's point of view.

    Keywords: Personal Development and Career; Business Startups; Business Growth and Maturation; Corporate Entrepreneurship; Work-Life Balance; Family and Family Relationships;

    Citation:

    Wasserman, Noam, and Lisa Brem. "Career at a Crossroad: Roopa Rao." Harvard Business School Case 812-011, August 2011. (Revised August 2013.) View Details
  16. Career at a Crossroad: Packing Up

    Noam Wasserman and Lisa Brem

    Akhil Patel is passionate about his business idea: an innovative green technology fuel cell. He wants to dive in and commit to his startup, but Roopa Rao, his fiancee, is much more risk averse, his parents don't approve of the startup, and Akhil has an enticing alternative offer from a prestigious consulting firm. Should Akhil follow his dream and become an entrepreneur? Or should he acquiesce to the other forces in his life and take the "safer" consulting job?

    Keywords: Business Startups; Technological Innovation; Job Offer; Personal Development and Career; Opportunities; Technology;

    Citation:

    Wasserman, Noam, and Lisa Brem. "Career at a Crossroad: Packing Up." Harvard Business School Supplement 812-013, August 2011. View Details
  17. Ockham Technologies (A): Building the Team

    Noam Wasserman

    Describes the issues facing a founder-ceo regarding building a board, assembling an executive team, managing tension between co-founders, and outsourcing development work.

    Keywords: Selection and Staffing; Recruitment; Governing and Advisory Boards; Management Teams; Corporate Entrepreneurship; Job Cuts and Outsourcing; Information Technology;

    Citation:

    Wasserman, Noam. "Ockham Technologies (A): Building the Team." Harvard Business School Case 812-021, August 2011. View Details
  18. Career at a Crossroad: Akhil Patel

    Noam Wasserman, Lisa Brem and Yael Braid

    Akhil Patel is passionate about his business idea: an innovative green technology fuel cell. He wants to dive in and commit to his startup, but his fiancée is much more risk averse, his parents don't approve of the startup, and Akhil has an enticing alternative offer from a prestigious consulting firm. Should Akhil follow his dream and become an entrepreneur? Or should he take the "safer" consulting job?

    Keywords: Decisions; Risk and Uncertainty; Opportunities; Entrepreneurship; Personal Development and Career; Green Technology Industry; Consulting Industry;

    Citation:

    Wasserman, Noam, Lisa Brem, and Yael Braid. "Career at a Crossroad: Akhil Patel." Harvard Business School Case 812-010, August 2011. (Revised January 2013.) View Details
  19. Earl Martin Phalen: Ready to ROAR?

    Noam T. Wasserman, Julia Taylor and Yael Braid

    Earl Martin Phalen is in the midst of starting his second non-profit organization, Summer Advantage, by implementing the lessons he learned from BELL, the non-profit he had founded and run for the prior 15 years. His aspirations for Summer Advantage were to make it "bigger, better, and faster [than BELL]. I am going to serve more children, more effectively, and for less money." In the midst of taking a very different approach to financing, staffing, and running Summer Advantage, he received an offer to become non-founding CEO of a much bigger non-profit, and is grappling with whether to take the job offer.

    Keywords: Corporate Governance; Nonprofit Organizations; Corporate Entrepreneurship; Selection and Staffing; Leadership Development; Financial Management;

    Citation:

    Wasserman, Noam T., Julia Taylor, and Yael Braid. "Earl Martin Phalen: Ready to ROAR?" Harvard Business School Case 812-024, August 2011. (Revised July 2014.) View Details
  20. The Tale of the Lynx (A)

    Noam Wasserman

    The founders of Lynx Solutions have survived major challenges within their board of directors, the firing of Lynx's founder-CEO and departure of its successor CEO, and a crisis sparked by media allegations that it had been spying on its users. Now that the company is finally becoming profitable, the two remaining founders are embroiled in exhausting fights over how aggressively the company should try to grow, and those fights are threatening to derail Lynx's recent success.

    Keywords: Business Startups; Decision Choices and Conditions; Governing and Advisory Boards; Growth and Development Strategy; Management Teams; Conflict and Resolution; Business Strategy; Computer Industry;

    Citation:

    Wasserman, Noam. "The Tale of the Lynx (A)." Harvard Business School Case 807-151, April 2007. (Revised July 2011.) View Details
  21. Curt Schilling's Next Pitch

    Noam T. Wasserman, Jeffrey J. Bussgang and Rachel Gordon

    As his major-league pitching career was starting to wind down in 2006, baseball all-star Curt Schilling decided to become an entrepreneur. Looking to focus his tenacity and his passion for online role-playing games on a new challenge, he founded an online gaming venture, which later became known as 38 Studios. During the venture's first two years, he built a team of 70 people, including an executive team of business and industry veterans and learned key lessons about the challenges faced by industry-changing entrepreneurs. Wanting to self-fund the venture initially, and later finding it hard to raise outside money, he put a substantial percentage of his net worth on the line to build 38 Studios. Now he is facing a critical acquisition decision that could either double his problems or help solve them.

    Keywords: Mergers and Acquisitions; Business Startups; Decision Choices and Conditions; Entrepreneurship; Financing and Loans; Leadership; Personal Development and Career; Groups and Teams; Video Game Industry;

    Citation:

    Wasserman, Noam T., Jeffrey J. Bussgang, and Rachel Gordon. "Curt Schilling's Next Pitch." Harvard Business School Case 810-053, December 2009. (Revised June 2011.) View Details
  22. A Note on the Legal and Tax Implications of Founders' Equity Splits

    Noam T. Wasserman and Lauren Barley

    This note summarizes key legal and tax issues that founders should consider as they contemplate an equity split and ownership structure. Specific issues covered include why founders should not delay splitting the equity and whether they should involve an attorney or accountant when they do; the importance of considering intellectual property (IP) issues when splitting the equity and the need to do so consistent with Section 351 of the Internal Revenue Code; and the need to make timely and valid Section 83(b) elections if the founders adopt vesting as part of the equity split.

    Keywords: Business Startups; Entrepreneurship; Equity; Taxation; Intellectual Property; Law; Ownership; Partners and Partnerships;

    Citation:

    Wasserman, Noam T., and Lauren Barley. "A Note on the Legal and Tax Implications of Founders' Equity Splits." Harvard Business School Background Note 809-110, February 2009. (Revised June 2011.) View Details
  23. Strengths Become Weaknesses: Cognitive Biases in Founder Decision-Making

    Noam T. Wasserman and Kyle Anderson

    This note combines vignettes and scholarly research to outline the cognitive biases and decision-making strategies that influence key decisions in the founding process. It is argued that the same biases which provide early benefits can later prove to be a weakness for the startup, and that founders must learn to identify their biases and work to balance them out with sound advice and dispassionate analysis.

    Keywords: Decision Making; Cognition and Thinking;

    Citation:

    Wasserman, Noam T., and Kyle Anderson. "Strengths Become Weaknesses: Cognitive Biases in Founder Decision-Making." Harvard Business School Background Note 811-068, January 2011. (Revised October 2012.) View Details
  24. Rubbish Boys

    Noam Wasserman and Rachel Galper

    It looked like founder-CEO Brian Scudamore might not be able to pursue franchising as a growth option for his junk-removal business after all. Over the years, he had overcome many hurdles, including buying out his "too-fiery" co-founder, firing all of his employees so he could start all over again when he became disillusioned with the company's developing culture, and failing at experimenting with student franchising to increase the rate of growth. Now looking to expand within North America, he had turned to a professional franchising model and had developed a new brand to help grow the business. Paul Guy, his first franchisee who was beginning his operations in Toronto, had just called. "Brian, my wife's relative just told me that I'm crazy to open here because the city picks up things for free. It's crazy to charge $300 to pick something up when they can get the same service for free! We had never heard of that in Vancouver, but that's a big problem here!" Was Guy over-reacting, or had Scudamore made a major mistake in his growth strategy?

    Keywords: Service Operations; Problems and Challenges; Brands and Branding; Business Model; Partners and Partnerships; Business Growth and Maturation; Franchise Ownership; Growth and Development Strategy; Service Industry; Canada; North America;

    Citation:

    Wasserman, Noam, and Rachel Galper. "Rubbish Boys." Harvard Business School Case 808-101, January 2008. (Revised February 2011.) View Details
  25. Apple's Core

    Noam T. Wasserman

    Steve Jobs and Steve Wozniak are best friends who enjoy pulling pranks together and talking about electronics. After several small collaborations, Jobs pitches Wozniak on starting a company together to sell computers based on Wozniak's design for a personal computer. Wozniak faces decisions about whether to quit the job he loves at Hewlett-Packard to join Apple Computer, how to define his role within Apple, whether to take on Jobs as his co-founder, whether to accept a third co-founder proposed by Jobs, and how to split equity with his co-founders. Early on, they add an outside investor who changes the company's trajectory and who brings in a new chief executive. Later, tensions rise between the two founders as their strategic visions diverge and as the company grows. Wozniak has now learned some disturbing news about his co-founder and has to decide whether that news will affect his continuing collaboration with Jobs.

    Keywords: Business Startups; Entrepreneurship; Equity; Managerial Roles; Partners and Partnerships; Conflict Management;

    Citation:

    Wasserman, Noam T. "Apple's Core." Harvard Business School Case 809-063, October 2008. (Revised February 2011.) View Details
  26. Evan Williams: From Blogger to Odeo (A)

    Noam T. Wasserman and Louis-Philippe Maurice

    For several months, founder-CEO Evan Williams has felt trapped, unable to control Odeo and its strategic direction. He longs for the "simple" days of Blogger, the previous venture he had co-founded. Although his Blogger experiences had included a major blow-up with his co-founder that had resulted in legal proceedings, a brush with near-bankruptcy, and the laying off of his entire team, Williams has become even more disillusioned with his current venture, Odeo. Odeo, a podcasting pioneer, had debuted almost two years before and had gotten off to a very strong start, with a high-profile debut at a prominent industry conference, coverage on the front page of the New York Times' Business section, and the raising of a large round of financing from a top-tier venture capital firm. His attempts to find an acquirer have failed, layoffs have begun, and he is now facing a meeting with an increasingly hostile board of directors. At that meeting, he is very tempted to resign so he can move on to his next project and regain the thrill of being an entrepreneur.

    Keywords: Mergers and Acquisitions; Business Startups; Decision Choices and Conditions; Entrepreneurship; Venture Capital; Information Technology Industry;

    Citation:

    Wasserman, Noam T., and Louis-Philippe Maurice. "Evan Williams: From Blogger to Odeo (A)." Harvard Business School Case 809-088, December 2008. (Revised February 2011.) View Details
  27. Evan Williams: From Blogger to Odeo (B)

    Noam T. Wasserman and Louis-Philippe Maurice

    For several months, founder-CEO Evan Williams has felt trapped, unable to control Odeo and its strategic direction. He longs for the “simple” days of Blogger, the previous venture he had co-founded. Although his Blogger experiences had included a major blow-up with his co-founder that had resulted in legal proceedings, a brush with near-bankruptcy, and the laying off of his entire team, Williams has become even more disillusioned with his current venture, Odeo. Odeo, a podcasting pioneer, had debuted almost two years before and had gotten off to a very strong start, with a high-profile debut at a prominent industry conference, coverage on the front page of the New York Times' Business section, and the raising of a large round of financing from a top-tier venture capital firm. His attempts to find an acquirer have failed, layoffs have begun, and he is now facing a meeting with an increasingly hostile board of directors. At that meeting, he is very tempted to resign so he can move on to his next project and regain the thrill of being an entrepreneur.

    Keywords: Management Teams; Entrepreneurship; Web; Online Technology; Business Strategy;

    Citation:

    Wasserman, Noam T., and Louis-Philippe Maurice. "Evan Williams: From Blogger to Odeo (B)." Harvard Business School Supplement 809-093, December 2008. (Revised February 2011.) View Details
  28. "Lather, Rinse, Repeat": FeedBurner's Serial Founding Team

    Noam T. Wasserman and Eric Olson

    "Is this the right time or is it still too early?" Dick Costolo wondered as he reflected on the latest acquisition offer. He had been building FeedBurner with his three co-founders for almost four years and was staring at the details of an acquisition offer from Google. He and his co-founders had founded three prior ventures together, each of which had had increasingly attractive outcomes, but none of which had reached their full potential. The number on the table from Google was a big one. Should the deal be completed, it would be the biggest win the founding team had ever had. However, was this the right time to exit? If Costolo didn't think so, would he be able to convince his co-founders who all had different personal risk profiles? This was going to be the biggest decision in the life of FeedBurner and its co-founders.

    Keywords: Mergers and Acquisitions; Business Exit or Shutdown; Decision Choices and Conditions; Entrepreneurship; Negotiation Offer; Groups and Teams;

    Citation:

    Wasserman, Noam T., and Eric Olson. "Lather, Rinse, Repeat": FeedBurner's Serial Founding Team. Harvard Business School Case 809-089, February 2009. (Revised February 2011.) View Details
  29. Founder-CEO Succession at Acer

    Noam T. Wasserman, Michael Shih-ta Chen and Keith Chi-ho Wong

    Stan Shih, founder-CEO of Acer, Inc., had proactively chosen and transitioned the "perfect" successor as CEO, but was now faced with major problems. Over the last two years, his heir apparent, Leonard Liu, had made the changes he had been hired to make, including revamping the organization structure and instilling a new corporate culture that emphasized accountability. However, such changes had caused numerous clashes between him and other cofounders of the company, in particular, Shih's wife, Carolyn. Liu had now suggested that "Carolyn should retire into her kitchen." Faced with office infighting and increasing clashes between the markedly different Western and Chinese styles of management, Shih needed Liu to manage the increasing complexity of global competition. However, Shih was now wondering if he had made the right decision to appoint Liu as his successor.

    Keywords: Business Startups; Entrepreneurship; Cross-Cultural and Cross-Border Issues; Management Style; Management Succession; Organizational Change and Adaptation; Organizational Culture; Organizational Structure; Conflict Management;

    Citation:

    Wasserman, Noam T., Michael Shih-ta Chen, and Keith Chi-ho Wong. "Founder-CEO Succession at Acer." Harvard Business School Case 811-062, January 2011. View Details
  30. Knight the King: The Founding of Nike

    Noam Wasserman and Kyle Anderson

    It had taken Phil Knight 16 long years to build Nike into the number one athletic-shoe company in the country. When Knight had first conceived of the company for an MBA class project, Adidas had had more than 80% market share, but Knight's marketing approach had revolutionized the industry, his company had developed several ground-breaking shoe technologies, and Nike's brand had become one of the most recognizable in the world. In 1980, the same year that Nike had knocked Adidas off its throne, Nike had gone public and Knight, its founder-CEO, still owned close to half of the company. He had led the company through dramatic changes as it evolved from a scrappy start-up to a large public company. However, now, barely half a decade later, Knight had just received the news that Nike itself had been dethroned by Reebok, an upstart competitor. Knight closeted himself in his office, faced the wall, and sat there, weak and sick and devastated for hours.

    Keywords: Business Startups; Entrepreneurship; Initial Public Offering; Leadership; Growth and Development Strategy; Marketing Strategy; Competitive Advantage; Apparel and Accessories Industry;

    Citation:

    Wasserman, Noam, and Kyle Anderson. "Knight the King: The Founding of Nike." Harvard Business School Case 810-077, January 2010. (Revised December 2012.) View Details
  31. Playing with Fire at Sittercity (A) (TN)

    Noam T. Wasserman and Rachel Gordon

    Note: This mini-Teaching Note was created to provide a brief overview of the teaching plan for this case. Please see the upcoming, fuller Teaching Note for an extensive overview of the underlying research, pedagogical approaches, and other teaching issues.

    Keywords: Online Technology; Service Delivery; Family Ownership; Problems and Challenges; Growth and Development Strategy; Expansion; Service Industry; Boston;

    Citation:

    Wasserman, Noam T., and Rachel Gordon. "Playing with Fire at Sittercity (A) (TN)." Harvard Business School Teaching Note 810-120, June 2010. View Details
  32. Savage Beast (A1)

    Noam Wasserman and LP Maurice

    For several months, things had been spiraling downwards at Savage Beast, the music-recommendation company started three years before by Tim Westergren. The company's founder-CEO recently left due to pressures both at home and within the venture. Dozens of investors turned thumbs-down on the venture; salaries had been cut, and tensions had risen within the founding team. Now Westergren, the founder who has taken over as CEO, is facing even deeper pressures as he finds out about a lawsuit filed by former employees, and he is wondering if it is time to give up on ever achieving his vision. Note: The content of this version is the same as the content in the Savage Beast (A) case (809-069) but includes two directives in the text to students. At the end of page 8, the student is asked to pause and complete a one-question poll. The "page-8" poll asks, "At this point, should Tim persist in trying to build Savage Beast?" Yes or No, and why. At the end of the case, the student is asked to complete a second poll. The "end-of-case" poll asks, "Should Tim persist in trying to build Savage Beast?" Yes or No, and why. If you do not have polling capabilities, you should use the Savage Beast (A) case.

    Keywords: Business Exit or Shutdown; Business Startups; Entrepreneurship; Venture Capital; Financing and Loans; Lawsuits and Litigation; Management Teams; Partners and Partnerships;

    Citation:

    Wasserman, Noam, and LP Maurice. "Savage Beast (A1)." Harvard Business School Case 810-051, January 2010. (Revised November 2012.) View Details
  33. Playing With Fire at Sittercity (A)

    Noam T. Wasserman and Rachel Gordon

    To help her finance her aggressive expansion plans, Genevieve Thiers plans to raise venture capital for the first time. She has spent the last six long years building Sittercity into the nation's leading babysitting web service, larger than all of its competitors combined. In the process, she brought her boyfriend and his sister into the business to help her, and ended up learning important lessons about mixing family and business. Now looking to raise venture capital, Thiers has just received an email from a general partner at a top VC firm, proposing another meeting and asking her to bring to the meeting an extensive list of proprietary information. This was a promising development, but Thiers was unsure whether she wanted to discuss Sittercity in such depth, especially when the venture capital firm had refused to sign a non-disclosure agreement. How should she respond?

    Keywords: Business Growth and Maturation; Family and Family Relationships; Expansion; Venture Capital; Entrepreneurship; Agreements and Arrangements;

    Citation:

    Wasserman, Noam T., and Rachel Gordon. "Playing With Fire at Sittercity (A)." Harvard Business School Case 809-009, January 2009. (Revised December 2009.) View Details
  34. Playing with Fire at Sittercity (B)

    Noam T. Wasserman and Rachel Gordon

    To help her finance her aggressive expansion plans, Genevieve Thiers plans to raise venture capital for the first time. She has spent the last six long years building Sittercity into the nation's leading babysitting web service, larger than all of its competitors combined. In the process, she brought her boyfriend and his sister into the business to help her, and ended up learning important lessons about mixing family and business. Now looking to raise venture capital, Thiers has just received an email from a general partner at a top VC firm, proposing another meeting and asking her to bring to the meeting an extensive list of proprietary information. This was a promising development, but Thiers was unsure whether she wanted to discuss Sittercity in such depth, especially when the venture capital firm had refused to sign a non-disclosure agreement. How should she respond?

    Keywords: Entrepreneurship; Venture Capital; Problems and Challenges; Risk Management; Agreements and Arrangements; Service Operations; Family and Family Relationships; Competition; Expansion; Internet;

    Citation:

    Wasserman, Noam T., and Rachel Gordon. "Playing with Fire at Sittercity (B)." Harvard Business School Supplement 809-010, January 2009. (Revised December 2009.) View Details
  35. Nantucket Nectars: The Exit

    Joseph B. Lassiter III, William A. Sahlman and Noam Wasserman

    The founders of Nantucket Nectars are trying to decide whether and how to sell their company.

    Keywords: Mergers and Acquisitions; Business Exit or Shutdown; Decision Choices and Conditions; Auctions; Food and Beverage Industry; Massachusetts;

    Citation:

    Lassiter, Joseph B., III, William A. Sahlman, and Noam Wasserman. "Nantucket Nectars: The Exit." Harvard Business School Case 810-041, September 2009. (Revised February 2014.) View Details
  36. Les is More, Times Four

    Noam T. Wasserman and Rosy Fynn

    "I've had enough! I've decided that I need to resign," read the email from the founder of Webpoint to the company's board of directors. Les Trachtman, the CEO of Webpoint, has to figure out how to react to the founder's "it's Trachtman or me" ultimatum. Webpoint was Trachtman's fourth job as CEO, and in each case he had been hired as the first non-founding CEO, taking over from the founder-CEO of a tight-knit founding team. Trachtman had first taken over from a mother and son team, then from two brothers, then from a wife and husband team, and now from serial co-founders who were best friends. From these ventures, Trachtman had learned how to manage founders who had strong relationships, but those experiences had not prepared him for the current situation.

    Keywords: Conflict Management; Management Succession; Entrepreneurship;

    Citation:

    Wasserman, Noam T., and Rosy Fynn. "Les is More, Times Four." Harvard Business School Case 807-173, June 2007. (Revised October 2009.) View Details
  37. UpDown: Confidential Instructions for MICHAEL

    Noam Wasserman and Deepak Malhotra

    Michael Reich is having severe doubts about how he split the equity with his co-founders two months ago, when they completed a one-page "November Agreement." Since then, Michael has found an angel investor and has worked non-stop on the business, while one co-founder was off enjoying the winter break with his family and the other worked on lucrative consulting contracts for other companies. Michael has just sent his co-founders a proposal that would re-allocate the equity within their founding team, and all three founders are getting ready to reopen a negotiation they thought had been finalized.

    Keywords: Negotiation Participants; Agreements and Arrangements; Business Startups; Ownership Stake;

    Citation:

    Wasserman, Noam, and Deepak Malhotra. "UpDown: Confidential Instructions for MICHAEL." Harvard Business School Supplement 809-021, July 2008. (Revised November 2012.) View Details
  38. UpDown: Confidential Instructions for GEORG

    Noam Wasserman and Deepak Malhotra

    Michael Reich is having severe doubts about how he split the equity with his co-founders two months ago, when they completed a one-page "November Agreement." Since then, Michael has found an angel investor and has worked non-stop on the business, while one co-founder was off enjoying the winter break with his family and the other worked on lucrative consulting contracts for other companies. Michael has just sent his co-founders a proposal that would re-allocate the equity within their founding team, and all three founders are getting ready to reopen a negotiation they thought had been finalized.

    Keywords: Negotiation Participants; Agreements and Arrangements; Business Startups; Ownership Stake;

    Citation:

    Wasserman, Noam, and Deepak Malhotra. "UpDown: Confidential Instructions for GEORG." Harvard Business School Supplement 809-022, July 2008. (Revised November 2012.) View Details
  39. UpDown: Confidential Instructions for PHUC

    Noam Wasserman and Deepak Malhotra

    Michael Reich is having severe doubts about how he split the equity with his co-founders two months ago, when they completed a one-page "November Agreement." Since then, Michael has found an angel investor and has worked non-stop on the business, while one co-founder was off enjoying the winter break with his family and the other worked on lucrative consulting contracts for other companies. Michael has just sent his co-founders a proposal that would re-allocate the equity within their founding team, and all three founders are getting ready to reopen a negotiation they thought had been finalized.

    Keywords: Negotiation Participants; Agreements and Arrangements; Business Startups; Ownership Stake;

    Citation:

    Wasserman, Noam, and Deepak Malhotra. "UpDown: Confidential Instructions for PHUC." Harvard Business School Supplement 809-023, July 2008. (Revised November 2012.) View Details
  40. Savage Beast (A)

    Noam Wasserman and LP Maurice

    For several months, things had been spiraling downwards at Savage Beast, the music-recommendation company started three years before by Tim Westergren. The company's founder-CEO recently left due to pressures both at home and within the venture. Dozens of investors turned thumbs-down on the venture; salaries had been cut; and, tensions had risen within the founding team. Now Westergren, the founder who has taken over as CEO, is facing even deeper pressures as he finds out about a lawsuit filed by former employees, and he is wondering if it is time to give up on ever achieving his vision.

    Keywords: Business Startups; Entrepreneurship; Venture Capital; Lawsuits and Litigation; Leadership; Groups and Teams;

    Citation:

    Wasserman, Noam, and LP Maurice. "Savage Beast (A)." Harvard Business School Case 809-069, November 2008. (Revised November 2012.) View Details
  41. Savage Beast (B)

    Noam Wasserman, LP Maurice and Yael Braid

    For several months, things had been spiraling downwards at Savage Beast, the music-recommendation company started three years before by Tim Westergren. The company's founder-CEO recently left due to pressures both at home and within the venture. Dozens of investors turned thumbs-down on the venture; salaries had been cut; and, tensions had risen within the founding team. Now Westergren, the founder who has taken over as CEO, is facing even deeper pressures as he finds out about a lawsuit filed by former employees, and he is wondering if it is time to give up on ever achieving his vision.

    Keywords: Business Ventures; Entrepreneurship; Compensation and Benefits; Employee Relationship Management; Lawsuits and Litigation; Groups and Teams;

    Citation:

    Wasserman, Noam, LP Maurice, and Yael Braid. "Savage Beast (B)." Harvard Business School Supplement 809-096, November 2008. (Revised March 2014.) View Details
  42. Negotiating Equity Splits at UpDown

    Noam Wasserman and Deepak Malhotra

    Michael Reich is having severe doubts about how he split the equity with his co-founders two months ago, when they completed a one-page "November Agreement." Since then, Michael has found an angel investor and has worked non-stop on the business, while one co-founder was off enjoying the winter break with his family and the other worked on lucrative consulting contracts for other companies. Michael has just sent his co-founders a proposal that would re-allocate the equity within their founding team, and all three founders are getting ready to reopen a negotiation they thought had been finalized.

    Keywords: Business Startups; Entrepreneurship; Capital; Venture Capital; Equity; Compensation and Benefits; Negotiation; Partners and Partnerships;

    Citation:

    Wasserman, Noam, and Deepak Malhotra. "Negotiating Equity Splits at UpDown." Harvard Business School Case 809-020, July 2008. (Revised November 2012.) View Details
  43. Big to Small: The Two Lives of Barry Nalls

    Noam T. Wasserman and Rachel Galper

    Barry Nalls describes lessons learned during his 25-year career—his rise at GTE and shorter-lived ventures—and how these prepared him to found MASERGY, a telecommunications start-up. Even as a young boy in a family of entrepreneurs, Nalls had a reputation as a hard worker, but instead of becoming an entrepreneur himself, he built a long career at "the biggest company around," GTE. After years of working there in sales and marketing, he decided to venture out on his own. His GTE experiences armed him for some entrepreneurial challenges but also caused additional problems as he tried to start, build, and grow MASERGY. Four years after founding the venture, he now feels that he should have "taken the entrepreneurial plunge" much earlier in life.

    Keywords: Business Startups; Experience and Expertise; Entrepreneurship; Corporate Entrepreneurship; Personal Development and Career;

    Citation:

    Wasserman, Noam T., and Rachel Galper. "Big to Small: The Two Lives of Barry Nalls." Harvard Business School Case 808-167, June 2008. (Revised October 2012.) View Details
  44. Ockham Technologies: Living on the Razor's Edge (Abridged)

    Noam T. Wasserman

    Describes the issues facing a Founder-CEO regarding building a board, assembling an executive team, managing tension between co-founders, and outsourcing system development work. The abridged version does not include the introduction and final sections of the full case in order to give case-writing workshop participants practice writing those sections.

    Keywords: Selection and Staffing; Recruitment; Governing and Advisory Boards; Management Teams; Corporate Entrepreneurship; Job Cuts and Outsourcing; Information Technology;

    Citation:

    Wasserman, Noam T. "Ockham Technologies: Living on the Razor's Edge (Abridged)." Harvard Business School Case 808-089, November 2007. View Details
  45. Excerpts from Interview with Jim Triandiflou, Founder of Ockham Technologies

    Noam Wasserman

    Describes the issues facing a founder-CEO regarding building a board, assembling an executive team, managing tension between co-founders, and outsourcing system development work. The abridged version does not include the introduction and final sections of the full case in order to give casewriting workshop participants practice writing those sections.

    Keywords: Entrepreneurship; Governing and Advisory Boards; Job Cuts and Outsourcing; Management Teams; Managerial Roles; Conflict Management;

    Citation:

    Wasserman, Noam. "Excerpts from Interview with Jim Triandiflou, Founder of Ockham Technologies." Harvard Business School Case 808-088, November 2007. (Revised March 2014.) View Details
  46. Founder-CEO Succession at Wily Technology

    Noam T. Wasserman and Henry McCance

    Before he accepts the new CEO position, Dick Williams wants founder Lew Cirne to step down as chairman. While considering Williams' incredible demand, Cirne reflects on everything he has already given up to get Wily Technology to this point. He agreed to step down as CEO and take what could be a largely symbolic CTO title. He also agreed to give Williams roughly as much equity as he himself owned and far more in salary. As the founder, CEO, and chairman of Wily Technology, Cirne had worked hard to build the skills necessary to lead his start-up. He had developed Wily's early technology single-handedly, had hired 50 employees to help him build his company, and had successfully spearheaded a strategic transformation of his company. He had led Wily to the point where several important customers bought its flagship product and had successfully raised two rounds of financing from top investors. Cirne wonders what he could have done to be pushed to the side like this. What should he do now?

    Keywords: Business Startups; Entrepreneurship; Growth and Development Strategy; Management Succession;

    Citation:

    Wasserman, Noam T., and Henry McCance. "Founder-CEO Succession at Wily Technology." Harvard Business School Case 805-150, May 2005. (Revised October 2007.) View Details
  47. The Tale of the Lynx (A and B)

    Noam T. Wasserman

    The founders of Lynx Solutions have survived major challenges within their board of directors, the firing of Lynx's founder-CEO and departure of its successor CEO, and a crisis sparked by media allegations that it had been spying on its users. Now that the company is finally becoming profitable, the two remaining founders are embroiled in exhausting fights over how aggressively the company should try to grow, and those fights are threatening to derail Lynx's recent success.

    Keywords: Governing and Advisory Boards; Business Growth and Maturation; Ethics; Decision Choices and Conditions; Management Succession; Conflict and Resolution; Management Teams; Information Technology Industry;

    Citation:

    Wasserman, Noam T. "The Tale of the Lynx (A and B)." Harvard Business School Case 807-112, January 2007. (Revised April 2007.) View Details
  48. Village Ventures

    Noam T. Wasserman, G. Felda Hardymon, Christopher Rogers and Ann Leamon

    Matt Harris, general partner and founder of Village Ventures, a nationwide umbrella organization for VC firms in secondary cities, is about to negotiate with the general partner of one of the organization's most successful funds. Describes the costs and benefits of the relationship from the perspectives of both parties and examines how it might evolve in the future.

    Keywords: Venture Capital; Relationships; United States;

    Citation:

    Wasserman, Noam T., G. Felda Hardymon, Christopher Rogers, and Ann Leamon. "Village Ventures." Harvard Business School Case 806-080, March 2006. (Revised March 2007.) View Details
  49. Orientation for Viewing "Startup.com"

    Noam T. Wasserman

    Introduces founders Kaleil Isaza Tuzman and Tom Herman as they start and grow govWorks.com. The movie "Startup.com" documents the challenges that these founders face in building their company while dealing with tensions within the founding team and managing a demanding and concerned board. The film also deals with the issues of buying out a drop-out founder's equity, raising venture capital, and balancing co-founder friendships with working relationships. Describes the founders' backgrounds and relationships before govWorks, their initial perception of the opportunity, govWorks' initial business model, and the company's early financing, advisors, and partners. Provides a timeline to help follow the movie.

    Keywords: Business Startups; Corporate Entrepreneurship; Venture Capital; Corporate Governance; Management Teams; Relationships; Familiarity;

    Citation:

    Wasserman, Noam T. Orientation for Viewing "Startup.com". Harvard Business School Case 807-136, February 2007. View Details
  50. Building to a Crescendo

    Noam T. Wasserman and Vishesh Kumar

    Examines the efforts of an early-stage venture capital firm to formalize processes and build a pyramidal organization in an industry dominated by informal, unpyramidal structures.

    Keywords: Venture Capital; Organizational Structure; Business Startups;

    Citation:

    Wasserman, Noam T., and Vishesh Kumar. "Building to a Crescendo." Harvard Business School Case 804-009, August 2003. (Revised April 2004.) View Details
  51. Ockham Technologies: Living on the Razor's Edge

    Noam T. Wasserman

    Describes the issues facing a founder-CEO regarding building a board of directors, assembling an executive team, managing tension between co-founders, and outsourcing system development work.

    Keywords: Technology; Job Cuts and Outsourcing; Conflict Management; Governing and Advisory Boards; Employees; Management Teams; Product Development; Technology Industry;

    Citation:

    Wasserman, Noam T. "Ockham Technologies: Living on the Razor's Edge." Harvard Business School Case 804-129, February 2004. (Revised March 2004.) View Details
  52. Stock Options at Virtua.Net

    Brian J. Hall, Noam T. Wasserman and Carleen Madigan

    Describes issues facing three young founders of a high-tech start-up in Silicon Valley, including hiring an experienced CEO and negotiating with a potential VC investor. Focuses on the incentive and compensation aspects of negotiating with job candidates (e.g., what percentage of the equity is appropriate to offer) and with venture capitalists (e.g., options-vesting issues).

    Keywords: Venture Capital; Stock Options; Executive Compensation; Employee Stock Ownership Plan; Negotiation;

    Citation:

    Hall, Brian J., Noam T. Wasserman, and Carleen Madigan. "Stock Options at Virtua.Net." Harvard Business School Case 801-324, December 2000. View Details
  53. Venture Capitalist as Entrepreneur, The

    Robert J. Robinson and Noam T. Wasserman

    Introduces students to negotiations between venture capitalists (VCs) and the limited partners who provide the VCs' capital. Also discusses negotiations between VCs and other VCs, including those within a VC firm itself. Explores interests, sources of negotiating power, barriers to reaching agreement, and common contractual terms. Describes how the parties try to reduce information asymmetries, align incentives, control decision making, and protect financial downside.

    Keywords: Business Model; Venture Capital; Capital; Negotiation Tactics; Entrepreneurship; Financial Services Industry;

    Citation:

    Robinson, Robert J., and Noam T. Wasserman. "Venture Capitalist as Entrepreneur, The." Harvard Business School Background Note 800-237, March 2000. (2000.) View Details
  54. Venture Capital Negotiations: VC versus Entrepreneur

    Robert J. Robinson and Noam T. Wasserman

    Introduces students to the challenging negotiations between venture capitalists and entrepreneurs. Explores interests, sources of negotiating power, barriers to reaching agreement, and common contractual terms. Describes how the parties try to reduce information asymmetries, align incentives, control decision making, and protect financial downside.

    Keywords: Negotiation Tactics; Venture Capital; Entrepreneurship; Financial Services Industry;

    Citation:

    Robinson, Robert J., and Noam T. Wasserman. "Venture Capital Negotiations: VC versus Entrepreneur." Harvard Business School Background Note 800-170, October 1999. (Revised March 2000.) (2000.) View Details

Other Publications and Materials

    Research Summary

  1. Founder Frustrations

    by Noam T. Wasserman

    Noam's research focuses on top management team (TMT) dynamics within entrepreneurial firms, with particular emphasis on the roles played by founders, top executives, outside investors, and board members. His paper entitled 'Founder-CEO Succession and the Paradox of Entrepreneurial Success' was published in Organization Science in March-April 2003, and won Harvard's 2003 Aage Sorensen Memorial Award for sociological research. His paper on entrepreneurial compensation, 'Stewards, Agents, and the Founder Discount: Executive Compensation in New Ventures,' is forthcoming in the Academy of Management Journal and was named a Best Paper at the 2004 Academy of Management meeting. Noam's current working papers include 'Mentoring and Monitoring: Boards of Directors in New Ventures' (co-authored with Warren Boeker) and 'Rich versus King: The Entrepreneur's Dilemma.'
  2. The Venture Capitalist as Entrepreneur

    by Noam T. Wasserman

    Noam's dissertation, entitled “The Venture Capitalist as Entrepreneur,” won Harvard’s George S. Dively award for dissertation research. In the dissertation, Noam examined the organizational dynamics and characteristics within venture capital firms themselves, viewing the general partners within VC firms as a TMT that has to found its own (venture) firm, craft a strategy, structure its activities and internal organization, and negotiate with its own investors and other external parties. A chapter from the dissertation was included in Research in the Sociology of Work: Entrepreneurship in 2005, and a current working paper examines the linkage between structure, strategy, and performance within VC firms. Future work in this area includes examinations of careers patterns within and across VC firms, and of the impact of inter-firm syndication networks on internal firm structures.

    1. Winner of the 2013 Silver Axiom Business Book Award in the Entrepreneurship category from the Independent Publisher Association for The Founder's Dilemmas: Anticipating and Avoiding the Pitfalls That Can Sink a Startup (Princeton University Press, 2012).

    2. In 2013, the Academy of Management selected The Founder's Dilemmas: Anticipating and Avoiding the Pitfalls That Can Sink a Startup (Princeton University Press, 2012) as one of the top five business books published in 2012.

    3. Noam Wasserman received the 2010 Academy of Management Innovation in Entrepreneurship Pedagogy Award for his course, Founders' Dilemmas.

    4. Winner of the 2002 George S. Dively award for dissertation research for "The Venture Capitalist as Entrepreneur: Characteristics and Dynamics within VC Firms" (Harvard University, 2002).

    5. Winner of the 2003 Aage Sørensen Memorial Award for sociological research for "Founder-CEO Succession and the Paradox of Entrepreneurial Success" (Organization Science, March–April 2003).