The Golden Pig, Prosperity, and the Importance of People
This Lunar New Year is the year of the pig. More specifically, it is an “Earth Pig” year and called by some as the Golden Pig year, which supposedly comes every sixty years. While the pig symbolizes prosperity, 2019 is a special year of abundance and success for pigs, so being born in 1971 my lunar zodiac is the pig and things are looking great for my personal and professional life.
It just happens that four out of five co-founders at the SparkLabs Group (Jimmy Kim, HanJoo Lee, Frank Meehan, and I) are born in the year of the pig. We all should expect 2019 to be a banner year of exits, home run investments and our portfolio companies killing it. Alas, I don’t believe in horoscopes, numerology, and fortune telling so all this abundance could be for naught.
But I do believe in chance. Even within our venture capital firm, we state often that “it’s better to be lucky than smart” when it comes to entrepreneurship and earning a successful exit. I personally believe startup success is driven by chance and additionally hard work and talent put you in situations to become more lucky. In competitive ecosystems, such as Silicon Valley, if you’re one of 20 file storage startups or online video plays, and there are marginal differences between success and failure. It’s those chance coffee meetings that might lead to a big customer, that one feature that becomes the difference between a thousand users and 10 million users, or a random encounter at your kid’s playdate that leads to your first seed investor.
To put your startup in a position to get more lucky, I believe you need hustle and hard work, talent and team chemistry. I’ve written before about elements of a strong startup founding team and how trust is essential, so I want to drill down on the importance of the founding team. Whether it’s the getting the best engineers in your field available, enterprise sales people or a marketing executive, the DNA of the founding team is critical. In rare situations you can have an incredibly visionary and driven founding CEO or founders that compensate for any free riders, weak team members or initial chemistry issues a founding team encounters, but for most startups the strength of a founding team can be the difference between a startup dying after their Series B and becoming a world changing unicorn.
As co-founders, you should discuss what culture you want in your company, what values are essential, what types of people you want and don’t want, and agreeing on what is important for the company versus personal preferences. Do you value transparency versus thoughtfulness? Product excellence, such as Apple, over speed to market? Even within these examples, there is never a strict dichotomy, so the key is the finding where you generally want to tip the scale towards. Also is diversity important? Is having a collaborative environment versus a more top down decision making process preferred?
FIRST FIFTY HIRES MATTER
Your first ten, fifty and probably 100 hires are critical, so do not become lazy in background checks, references and multiple interviews. Yes, the war for talent is real and time is critical, but so are your first hires. I remember when my wife, Christine, was at Google (2004–2013) when it was over 3,000 people (today they have over 80,000) and for senior hires (not just executive level) Eric, Larry or Sergey would still have to sign off. Google also had a notoriously tedious hiring process where some people would go through many, many rounds of interviews. This was carryover from their founding days when their hiring process was even more rigorous and the founders knew every single person mattered and influenced the company’s culture.
During my second startup back in 2000, we just closed a $7 million seed round from Softbank and others, and felt the pressure to quickly build up our team. We ramped up to almost 60 people that first year and thought we were being selective, but in hindsight we really weren’t. We cut corners and relied too heavily on personal vouching. We hired too many “managers” and not enough doers, and too many self-labeled “all-stars” and not enough team players. My co-founders and I hired some bad seeds that eventually created headaches for us. By the end of the first year, I felt a quarter of my time was dealing with internal politics and tension between employees. Now I know this could have been prevented, so today I never wish this upon any of our current founders.
HAVING AN “A” TEAM LEADS TO THE AMAZING
Not just looking at our portfolio of over 220 companies at SparkLabs Group, but just within ourselves I can say that having an “A team” leads to amazing things. Our initial ambition for SparkLabs was to be the best startup accelerator in South Korea. We were “startup venture capital firm” founded by excellent entrepreneurs, so as we executed on this vision it unexpectedly expanded beyond Korea to throughout Asia and now snowballing across the globe.
Driven by the co-founders (Jimmy Kim, HanJoo Lee, Frank Meehan, Jay McCarthy and myself) and the greater team of Eugene Kim, Carl Wescott, Brian Kang, Chris Koh, Edgar Chiu, Jessica Jackley, William Chu, Colin Qu, Sameer Chishty, Joyce Kim, Jonathon Quigley, and others we have expanded now to 8 accelerator locations and 3 venture capital funds. Our vision and ambition has transformed and grown to become the best startup ecosystem builder in the world.
The founding team truly matters, so don’t compromise, don’t get lazy and don’t give up when you are looking for the best people for your startup.