The Importance of the Founding Team
By Jim Jen
In a previous post, I talked about how AlphaLab is centered around rapid iteration and lean startup concepts. Another core principle I wanted to share is our belief in the power of the founding team to build great companies.
At AlphaLab, we believe in the talent and potential of the founding teams to build awesome products that customers love, engage vigorously with the market to both acquire customers and learn from them, and to develop the startup leadership skills they need to add to the team, raise investment and build the company. We recognize that the founders don’t have all of these skills or experiences and try to provide them with the experience, mentorship, and advice to help them grow as founders.
During our selection process, we are focused on evaluating whether the team, as currently defined, has the ability to get the company to the next level. We are not banking on things such as bringing in a “professional CEO” or a “Sales VP”. We are focused on the quality and capability of the team and believe that smart, talented cofounders can learn what they need about the things they don’t know. In our experience, the right team’s natural talent, vision and understanding of their market, passion for the company is irreplaceable and can’t be underestimated.
Shoefitr is a great example of this point. They are 3 technical co-founders, all engineers from Carnegie Mellon, who have grown their company, including the sales and customer front, through a combination of determination, constant learning and focus on delivering value to their customers. I have had the pleasure of watching the company and the founders develop, reaffirming our belief in founding teams.
Second, we believe that a technical co-founder can (and should) get in front of customers and sell, and that a business co-founder can (and should) work closely with the development team to make sure the product reflects her vision shaped by the market feedback. Ben Horowitz, Partner at Andreessen Horowitz, emphasizes the criticality of real technical knowhow in his post, Why We Prefer Founding CEOs. Technology companies are, at their core, fueled by innovation, and he argues, while CEOs are effective at maximizing product cycles, they lack an ability to find new product cycles, and in his experience “teaching a founding CEO how to maximize the product cycle is easier.” We would agree.
Finally, we are not looking to replace any of the founders (not that we have the power to anyway) and we don’t tell founders what to do. We will certainly provide feedback and advice but our role is to help the founders make decisions by providing data and context learned through our experiences in a transparent manner. Ultimately it is their company and they have to make the call.