Ben, good post, and really good point about knowing what kind of culture you are looking for. There are a lot of factors at play in choosing a culture for your startup that often make it a more complicated proposition that we realize.
I spent some time at a startup that had intentionally shifted its culture to enable it to accommodate employees with young families. Seems like a great idea, right? It certainly allowed the company to hire some talented folks who couldn’t have committed to a job that required long hours in the office. But the result was that the entire company gradually dialed back the hours they worked, leading to a decline in productivity. An attempt to accommodate a few individuals altered the culture across the entire company.
I have also worked at a tech company selling technology to professional sports teams. Quite naturally, we liked the idea of hiring people who were athletes. But when push came to shove, we also wanted to hire the best software engineers we could get our hands on, few of whom were serious athletes. Trade-offs like that confront most tech companies that don’t happen to be in the video game industry.
Great things to be thinking about here. I don’t think most founders put a lot of thought into exactly what they want their culture to be at the outset, but if you let it develop organically, it can be difficult to course-correct down the road without encountering unintended consequences.
Cool post! It’s great to hear some thoughts from folks who have actually been through these situations.
These points align almost exactly with what we are taught here at business school in classes like Managing Human Capital – be upfront, cut deeply all at once, don’t communicate by email, etc. Did you come across anything in talking to these folks that conflicted at all with the conventional wisdom on layoffs? Did any of their learnings conflict with each other? It may be that this is an area in which there are just very clear right ways and wrong ways to do things, but if that’s the case, I wonder why companies still do it the wrong way from time to time. Why do some layoffs still get communicated by email, if everyone knows the CEO should announce the news in person? I’d love to hear someone who didn’t follow all the rules in the layoff process explain why they deviated from the playbook.
I agree that having the right people on your team is very important for your company’s growth prospects. One thing I have struggled with as we think about whom to hire and when is the balance between preparing for the future and having the humility to recognize that the future is not guaranteed. In some ways, hiring a COO or CFO who will be prepared to take your company from $100M in sales to $1B feels a little brash when you only have $1M in sales today. Hiring for where you hope/expect your company to be in two years requires a lot of prescience and could leave you paying big dollars for a resume you don’t really need in the short term.
This is not to say that you’re wrong to advise hiring with an eye toward the future – it’s just a tension that I have not been able to completely resolve in my own mind. And like most things, it is probably situation-dependent.
Good points, John. I find the first one about humility to be particularly interesting and thorny in the startup world. In my experience, the people who found companies tend to fall on the more self-confident side of the self-confidence spectrum. Which is to say, most of them are super cocky. Every founder has, at some point, decided that they will be better off founding a completely new venture that is totally untested than they would be by joining an established company with a track record of success. Only people with a fairly high opinion of themselves are going to make that decision.
I struggle with this as a job-seeker in the startup world who doesn’t love working with people who have over-sized egos. In my case, I have basically come to accept that enlarged egos come with the territory, and my best bet is to find a founder whose self-confidence is justified by a great deal of ability.
I think expecting founders to recognize that they may not be the best person to scale their own startup is asking a lot of these people. Who among us can honestly say that we can be trusted to fire ourselves at the appropriate time? But you’re absolutely right that looking for people to fill their blind spots is a great way for founders to think about building their management teams. It also has the added benefit of making it less likely that an investor will decide the management team could use a new CEO.
Good point, Ben. It strikes me that for the same reason convincing someone to forego other opportunities to join you provides validation, it also represents a commitment on your part. In some respects, it’s similar to raising money from a family member or friend – you are accepting an investment from someone else whom you care about, which forces you to get serious about your new business very quickly.