Team Building for Early Stage Startups
So much has been written about team building for early stage startups, yet one of the main reasons startups fail is the team’s lack of ability to remain laser focused on a shared mission. It can take many years to build a company of value and during that time most startups will go through multiple recruiting efforts.
I want to focus on building the right team.
Most founders don’t have recruiting or hiring experience, so you’ll most likely have to convince others to join your team. As with the multitude of skills required in startup building (finance, marketing, operations) founders need to learn on the job.
But what about a single founder startup?
This is rare and I can’t think of any case where a single founder didn’t quickly bring on a CTO or a CEO. A single founder startup lacks diversity and it’s also a clear sign that your amazing idea may not be so amazing. In a sense, building a team is a point of validation that your startup idea is viable. In addition, building a strong team can help split the emotional stress of starting a company.
Think like an investor.
When determining whether to fund an idea, investors typically consider three things:
- Product — What you’re building.
- Market — Is there a demand for your product and who will buy it.
- Team — Who’s building it.
Assuming that you’re building an amazing product that someone will buy, investors are going to be very interested in who’s building it and you should too.
Your product and market are like a science — they can be clearly defined and measured. Team building is more like art. Human dynamics, emotion and differing opinions come into play.
Early stage startup teams are like rock bands. The Eagles, Guns N’ Roses and Destiny’s Child are great examples. If the band can’t stay together, the music suffers.
For startups, if the team can’t work together, then the startup suffers, and most likely fails. That’s why it’s important for startups to focus on quality when bringing on team members. No one cares if you have headshots of a fully formed team in your pitch deck. Investors like to bet on a small team of scrappy entrepreneurs who are willing to slug it out and do everything necessary to launch.
Find the coal, and you don’t need to look for diamonds.
In evaluating teams we accept into our R.E.A.L. program at RNOX, the team is often times more important than the product. A great team when placed into an accelerator strengthens even further — like high grade coal put under pressure forms diamonds. They fuse together, focus on their applicable strengths, and become the strongest element in the known universe. The ‘dirt’ equivalent of a team when put under pressure forms a dirt clod at best, and will inevitably crumble.
It’s obvious if you’re a strong tech founder, that you should be searching for someone who can deliver solid business results. The inverse is also true.
A well rounded team for early stage startups consists of:
The Visionary — Typically the leader with the idea to build the product and some technical understanding of what’s needed to build it.
The Executer — Someone with a passion for building technical solutions.
The Creative — This person owns the product and has a keen interest in the user experience.
Later stage team members will need to be recruited for managing design, sales, business development, finance, etc. For early stage startups, these are hats that you’ll have to wear and that can be challenging, but it’s also good. It’s your team’s opportunity to understand every aspect of the product you’re building.
How to build the perfect startup team:
Hire for Results.
The fact is, most startups don’t have the luxury of hiring their CTO or CPO from a top university, so choose team members who have a passion for the product you’re building. Titles and resumes mean nothing. Passion, knowledge, and focus are everything.
Work with people who are smarter than you.
This is advice you hear a lot, but I’d also add that you should work with people who are not only smarter than you, but will also challenge you. The smartest person in the room adds little value to your startup unless they’re willing to express their opinions and challenge assumptions.
Look for someone who has done it, even if they’ve failed.
You’re going to be spending many hours over many years building your startup, so work with people who you know will slug it out. This can be someone you’ve worked with in the past — even a project or course work. Failure is the master teacher and the lessons learned are worth their weight in gold to your company.
Communication is critical.
As you build your team, it’s very important that you engage them in decision making processes, not only so they can express their opinions, but also so they are part of your mission. Trust your instincts when making hiring decisions, but be prepared to cut ties and move on quickly. New teams (especially important for remote teams) need to get in a room together ASAP. Personalities matter and you’ll want to know how well the team works together under pressure.
Lasty, you should understand that there is no perfect startup team. If you can build a team that can match your level of passion, then you’re off to a good start.
