We’re at the tail end of an awesome tech cycle with massive real value creation. This was the real dot-com boom. The information revolution created this weird self-Heisenberg effect where information about the market travels so fast that markets get way ahead of economics then collapse and take years to earn out their valuations. This kind of pre-mania, which I think dot-com was, is distinct from total nonsense speculative markets where there isn’t actually any underlying value creation. Make no mistake, there has been staggeringly massive value creation by tech since dot-com and the market has recognized that since
I’ve hired three CEOs, dozens of executives and managers, and hundreds of employees into early stage Seed and Series A stage startups. I’ve been exposed to hundreds of early stage teams through my network and the startups I’ve built in Consumer, SaaS, Enterprise, Deep Tech, Biotech, Fintech, Agtech, and other markets. So I’ve seen a lot of data on which backgrounds and traits work in startups versus which don’t
You made it! Your startup has some early traction and now you’ve hired your first leaders to help grow the company.
Trouble is that things aren’t going as planned.
Some parts of the company have team members that aren’t up to the bar you initially meant to set. These same parts of the company aren’t really performing, and progress seems to be slowing almost to a halt. You’re starting to hear more about what can’t be done than what can.
Building the founding team is by far the most important part of building a startup. The founding team sets the vision, builds the rest of the team, builds the prototypes, and brings in the initial customers. Once you have one or two people that want to work on a startup, there can be a tendency to ‘just get going’ without putting enough emphasis on ensuring that you have the right team in place, which leads to a lot of failure scenarios.
Setting goals is a lot more common than achieving them. This is in part because of how we set our goals, and in part because of how we check-in on our goals and hold ourselves accountable.
It’s important to know why we’re setting goals, so that we have a sense of commitment and motivation to achieve them. Then we need to make goals clear and measurable, and work backwards to define leading indicators and milestones. Lastly, we need to define a cadence of accountability so that we can evaluate how we’re doing and make behavior modifications along the way.
We all know the old “B-players hire C-Players” mantra, but maintaining an A-Players-only team isn’t easy.
A-Player leaders get a lot of fundamentals right, but invariably make mistakes and hire some B-Player leaders who have an amplified effect and tend to hang around months or even years longer than they should. When B-Players are left in place, it kills organizational performance in that functional area and spills out to tangent functions. The more senior the B-Player, the larger the magnitude of the fallout.
You can try to win, or you can try to make people happy, but you can’t do both
Paradoxically, trying to win leads also to making people happy, because people are happy when they win. Trying to make people happy in ways other than helping them win ends up making them unhappy, because they are less focused on winning, which is the thing that makes them happy.
Until startups are profitable while growing, they are burning down cash against a finite runway that’s usually less than two years away. As a result, it’s important to have a realistic plan at all times for what it will take to i) raise additional capital, ii) become profitable, or iii) fall back to m&a or wind down.
Double opt in intros are obsolete and too slow for the pace of modern business. Just make the intro.