One question, I have noticed, that comes up regularly in the workshops we run here at the New Entrepreneurs Foundation is about the Team. Most of our entrepreneurs are at a very early stage of their ventures, but they know that to be credible in front of investors and to develop their business, they need to either have a team in place very quickly, or, at least show what the future team will look like.
So how do you put together the “A” team! How do you create the right team which will give you, as John Mullins, the startup Guru describes it, a “domain of opportunity”?
1/ Hire people you need
This sounds like a very obvious point, but it is easy at the start to recruit people you like or know, and not actually look for the people you and your business actually need. We all hear about the friends falling out with each other and bringing the business down! So here, and depending on what stage your business is at (introduction, growth, or mature), the key questions to ask yourself are: what co-founders or team members do I need to recruit to do X, Y or Z? What are the critical success factors that will contribute to my business idea moving forward?
2/ Know your skills
You need to know what you are good at and what you are not good at. You need to be honest with yourself, may be even do a personality test so you can find out what really motivates you and where your skills and work preferences are. Of course, in the early stages, you may be doing everything, but as soon as you have validated your business idea and are growing, you may want to start looking at surrounding yourself with key people that will complement you.
3/ Create the right culture
Hamish Pringle, Non executive at 23 Red, talks about having a “glue” to create a culture. This means, you need a piece of glue that binds your new company together. A single organising idea which every new employee/co-founder understands, believes in, and can convey to customers. It is about creating a strong team spirit, engagement and be able to explain what you do and why you do it. For example Hamish says it could be having CSR in your DNA, or having a narrative drive, or be able to develop a “self-confident” culture, as opposed to a “command and control”. “In terms of glue – I think self-confident cultures are bound to be more successful, like Google and Apple. I know there is a lot of ‘Command and Control’ within their processes as well, but as far as having a cohesive and successful culture goes, both companies do an incredible job of engaging their employees with their brand!”
4/ Be THE leader
This means take charge, build trust and a consensus even in the face of uncertainty, and keep a clear and consistent message. Your team will be looking at you for direction, input and decisions. Of course, you may want to create a collaborative environment to maximise the skills-set of your team and make them engage in the process… but don’t forget YOU should be their leader, and ultimately lead the way, set directions, inspire them and ensure they are on the same journey as you are. As Rob Goffee, Professor of Organisational Behaviour at London Business School, said: “Leaders who can be trusted are self-aware and know what differentiates them from their colleagues. They are not afraid to reveal their weaknesses and know how to adapt their style to different situations”
5/ Give the right incentives
Let’s start by saying that this point can be very subjective and depends on many factors. At the start of your journey, most of the time it comes down to how much equity you give away to motivate the co-founders and team members. But sometimes we know that a 50:50 split is not always good. Consider using equity to help you get more valuable resources, using it as a currency to attract not only a co-founder, but also other team members with the right skills-set to execute your idea and taking the business forward. There are some legal ways to do this and I would recommend you consult with a lawyer (for example, you can insert a one year cliff clause in the term sheet).
All the above is to show you, that in your entrepreneurial journey, the people side of the business is very important. Creating high performing teams, through having in place the right recruitment process, culture and incentives could be a key differentiator between success and failure.
Véronique Rapetti, Learning Director, NEF