How to build a successful business team
Once you’ve raised business funding, the pressure is on to fill key roles in a company. Here are the main considerations for team building
If you’ve successfully raised business investment, the pressure now really starts – you’ll need to start thinking about how to build a successful business team.
Investors will be expecting you to accelerate your growth and demonstrate some proof points before your next round of funding.
If you’re filling key roles in a company, you’ll need to consider how to gather more talent around you.
But where do you start?
These are my favourite questions to consider when team building:
What are you good at, what are you bad at and what are the gaps?
Discipline yourself (i.e. find some uninterrupted time and be objective) to write down:
- Where the real value for the business is generated. Value for (potential) customers and what will create a higher valuation with investors at the time of your next round
- Other activities that have to get done to keep the lights on.
- the talents that the founders and those already in the business have, and the talents they lack.
- where can we develop skills versus where we have no choice but to hire.
This should flush out what valuable skills & talents are missing from the team. A third party, such as an investor director, advisor or friend, can add valuable objectivity to this process.
A while ago I was one of the first seed investors in payasugym.com. With two super bright ex-management consultants as founders. They were all over the product design, strategy, finances, projections and governance.
But critical to the business was selling their new concept into gyms and marketing to consumers. They decided that one of them could skill up quickly in business-to-business (B2B) selling, but neither of them were intuitive consumer marketeers – so that skill set had to be their first hire.
What roles do you need to fill and what can you afford?
Whilst talent, skills and aptitude are the first considerations, unless you are some ridiculously funded Silicon Valley start-up, you are going to have to get pragmatic with the number of people the business can afford. So now think back to where the real value is created in the business and the roles that are therefore needed.
Do some research on what salary the roles will need – and get creative about the mix of salary and performance-based equity options that could be used to attract the best talent. The main consideration here is not to skimp. Worse than having a vacancy is having someone that is a drain on time & energy and is eating up budget whilst not delivering what is needed.
Pull together the budget of what is needed and compare against the cash burn that can be afforded before fund raising again. Reconcile these, and now you have your recruitment hitlist.
Where do you find what you need?
There are three types of people working in start-ups: a. founders that are taking the big risks, b. those that have actively sought out a business (for the thrill of the growth journey and sharing in some of the success) and c. those that are not good enough to work for a large established business with lower risk and more stable employment.
Clearly you want to find Bs not Cs. So it is helpful to hang out at where they hang out – at start-up events and in online groups. Or there are now online recruitment sites specifically for the start-up community. When you start to scale up, an employee referral system is the most direct way of getting more people like the people you already have.
How do you avoid compromise?
The first rule of recruitment I ever learned as a young manager was ‘if in doubt, don’t hire’. Whilst someone you are 100% convinced by may not always work out, unfortunately where there is any doubt about talent or cultural fit, that person never comes good.
However much you think you are desperate for hands on deck and to be done recruiting, it is better to have a vacancy and carry on the search than have the wrong person. Better to find short term stopgaps – like an intern or a temporary hire – or to find ways around the activities needed.
How do you welcome new talent?
It is never too early to deliberately build your culture – what your business stands for, how everyone behaves and how you go about getting stuff done. The easiest way to build culture is to indoctrinate new hires as they arrive.
A business I joined had an iconic way of doing this. Every month half a dozen or so new starters would board the ‘magic bus’ with the founders and do a tour around the important places and milestones that contributed to the growth of the business.
Whilst explicitly about places it was valuable time to chat, get to know the founders and hear about what they valued. The trip ended in the pub where the established team were ready to continue the conversation (and get the unburnished story).
How is everyone working out?
Unfortunately, none of us get hiring 100% right all the time. Fortunately, we usually know quickly when we have made a clanger. If so, it is important for both the business and the misfit individual to act decisively.
Zappos (the big online shoe retailer) were brilliant at this. After 14 days all new recruits were offered $2,000 to leave the company – clearly only those who were confident they were a good fit decided to stick around. You can do something similar and cheaper by making sure you sit down and have frank review conversations with all new hires after seven, 14, 28 days and each month after to make sure the fit is working.
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