Operations
Operations is the machinery that keeps a company running as it grows past what the founders can personally hold: how work gets planned, how decisions get made and recorded, and how the business actually delivers what it sold. It is invisible when it works. The concepts here cover the practices founders adopt when informal coordination stops being enough.
7 concepts in Operations
- OKRs (Objectives and Key Results)A goal-setting framework that pairs a qualitative Objective, what you want to be true, with a small number of measurable Key Results that define whether you got there.
- Employee Stock Option Pool (ESOP)A block of equity set aside, and typically expanded before each priced financing round, to grant stock options to current and future employees without renegotiating ownership every time someone is hired.
- 409A ValuationAn independent appraisal of a private company's common stock fair market value, required by IRS rules, that sets the minimum legal strike price for new stock option grants.
- Board Meeting Cadence and MaterialsThe recurring rhythm of formal board meetings (typically monthly or quarterly at early stages) and the standing set of materials (metrics, financials, a narrative update) sent ahead of each one so the meeting is a discussion, not a first read.
- Due Diligence Data RoomA secure, organized repository of a company's key documents (financials, contracts, cap table, IP filings, HR records) assembled for a buyer's or investor's legal, financial, and operational review before a financing or acquisition closes.
- Customer Contract DiligenceThe review of a company's customer agreements during diligence to verify that the revenue they represent is real, durable, and actually transferable, checking term length, renewal and termination rights, pricing commitments, and any change-of-control or assignment restrictions.
- Board Written ConsentA formal document, signed by all directors, approving a specific company action without holding a live meeting, a faster, equally binding alternative to a board resolution passed at a meeting, used for routine or time-sensitive approvals.
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