- Warren Buffet, Chair and lead investor, Berkshire Hathaway
It seems like I have always listened to the homespun, fly-over wisdom of investor Warren Buffet, the “Sage from Omaha.” To me, his knowledge is equally relevant across the company landscape – both for the founders and leaders of lean startups embarking on a new venture and seasoned CEOs of gigantic corporations.
For me, Buffett speaks directly to my personal experience as an entrepreneur, venture acceleration partner and advisor with over 20 years and 15 startup ventures. From early stage startups to company exits, I have learned lessons both the right way and the hard way on how to build successful teams.
I recently participated in a SAP Radio panel on the future of business and critical HR for startups. You can listen to the discussion here, and below is a summary on what have I learned along the way.
I work to build start-up teams who aim to make a difference, not make a million bucks.
It may seem funny to be talking about “conscientious capitalism” in the shadow of Warren Buffett, but hear me out. When looking to recruit people to your team, seek out people whose purpose, passion and motivation closely fit the startup venture, the vision, and the impact you want your startup to have. It’s all about impact, not just stock options. Sure, options matter, and earning them is important, but not if people don’t believe in what they’re doing. I have seen all too many startups whose only real attraction was generous stock options, yet they came to be worth zero.
So how do you go about finding employees passionate for your startup? Ask yourself, why do the people you are hiring want to be there? Do they want to make a difference? Will they work 24/7 when needed? Sure, if they want to make a difference. Will they step up to the toughest challenges? What will keep them going and keep them staying with you? Belief in the cause and, yes, a reward at the end of the day. Again, it’s “conscientious capitalism.”
There is NO substitute for team cultures of authenticity, transparency, honesty and truth across a startup. No deceits, no cover-ups, no false truths.
These cultures almost always win hands down. Find and keep people, in every role, who trust implicitly, and can be trusted with one another. Bad actors will spoil any culture, distract your team, and sabotage the venture opportunity. In my book, you simply cannot waste a moment to decide not to hire a bad actor, or to decide to terminate one who somehow got inside, but does not have a positive impact on the startup or the rest of the team.
Furthermore, show no tolerance for those who fail to commit, fail to try hard, or fail to be accountable for their contributions. Get them out. There is too much to be done and won than to drag the sea anchors through your startup yet another day.
Founder CEOs who get teams to agree to disagree, but always end up agreeing, will out-produce.
Although execution requires that everyone stands behind what is decided and agreed upon, creativity thrives on open-mindedness, deliberation and debate. Find people who can think openly, challenge each other, but can align around the agreed plan.
In addition to learning how to recruit the best team for your startup, it is also important to remember that as a startup founder, you must define your role and how you will lead the team. Below are a few of the lessons I have learned throughout my career.
First, as the founder leader of a startup, try hard to hire teams of people each of whom is better, smarter, more insightful, more experienced, more technical, more creative, more fiduciary…each and all more than you are.
Second, do not see yourself as having to be all those better things …you never can be, and even if you tried to be, you would set yourself up for a bout of burnout, disappointment, loneliness, and even failure. Trust me, check your ego and get the best.
Third, instead, see yourself as the “orchestrator” of the talent on your team. Set the goals, set the tone, set the pace, stick with the score or improvise where you can; however, it is crucial for you to bring the talent to their potential, and let them play things out for you. And when you do get there, go beyond Buffet’s expectation: you and your startup will not just “drift in that direction” but you will seize its potential.
I’ve been at the startup game a long time, and not that much really changes when it comes to people and performance! Building great teams in startups has, does and will require the same hiring disciplines, the same cultural norms and practices, the same balance inherent in “conscientious capitalism,” and the same constructive tension between creative thinking and effective consent.
- Ted West, BOHH Labs Executive Chair
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