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Behind the Craft cover image

AI Hacks to Scale Your Business and Life From a 3x Founder | Siqi Chen (Runway)

Behind the Craft

NOTE

Aligning Teams by Bringing Clarity to the Business Model

Assumptions in a model can sometimes lead to inaccuracies, but it serves as a tool for thought in understanding the business drivers. Connecting real data to the model allows for refinement and a better grasp of how the business operates. As a company grows, fewer people comprehend the business model, hindering alignment and collaboration. Sharing information is insufficient; the key is to provide context and understanding to team members, enabling them to make a meaningful impact and work efficiently.

00:00
Speaker 2
and something pretty dumb is like, you know, like the more assumptions you make in a spreadsheet, sometimes the more bullshit it becomes, right? So, yeah, talk about how Runway, you know, maybe ties this stuff to business context.
Speaker 1
Yeah, so two thoughts here. So the thing that you said about more assumptions in a model, the more bullshit it becomes, right? Like there's too much detail already. I think that is to some extent true. I think the nuance there is one like it is a tool for thought, right? It's useful to do the exercise of thinking about what are the drivers of the business, right? Like the plan is useless, but the process of planning famously is quite useful. And a model does serve that purpose. The other thing though, is that when you're not on this spreadsheet, when you need something like Runway or another finance platform, one of the key things that is valuable is connecting to your actual data. And so when I've operated sandbox, what I was able to do month is say, okay, here's what I thought was going to happen across all these different inputs. Here's what actually happened. And then I can refine the model and refine my thinking how the business works. And so that process of evolution happens over time. And I would argue it's like probably a little bit more friction to happen just on this brush sheet for not connecting to real data and actualize a model over time. So I think there's truth to that. But I think the other, the bigger, the most important piece of value that we're trying to create a runway is this idea of understanding. So right now you have a model and when you're a small company, it's fine. And with a small company, the financing just understand it and the founder group can maybe understand it. But as you get larger, less and less people as a percentage basis understand how the company works, how the business works, what the plans are, what the impact of those things are. And if you want the team to move fast, they have to collaborate and have to be aligned. And what enables that is context, is understanding, right? Like they need to understand how the business works, where the plans are going. And what people do is they just share information, right? They maybe, and most people don't even do this, but you know, maybe they share the model, maybe share the data. But like all of the context in the world won't matter if people don't understand what they're looking at. And that's how they're hard to this problem. It's like if we can build something where you can look at it and engineer a designer PM can say, this is how the business works, I get it. And this is how it fit in. And this is how we can make the business better. I think it really has a huge impact both on the output of the business and in people's ability to fulfillment and purpose and make an impact on it. Yeah,
Speaker 2
that makes sense because whenever I get especially from the finance department, it's like, you know, there's no understanding at all. Like, you know, I need to the
Speaker 1
only person who understands how a model work through the one person named in the first place. Got. That seems like a pretty big opportunity if you can fix it. Got it.
Speaker 2
Awesome. So where can people check out runway? We're
Speaker 1
runway .com. We're still in early access so you can sign up now, but we will be launching general availability very soon. That said, you know, we have very significant companies easier today, including Superhuman and AngelList and LOB and Lambda, a bunch of other companies.

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