The most important complement inside growing teams
There is such a thing as an amazing business leader who is not a great founder.
There are also amazing founders who are not great business leaders.
This may sound obvious, but I have observed so many examples in the last few years where the two have been conflated or even completely confused, especially at the founding stage.
Every once in a while, you find someone who has both the operational / execution-oriented chops to build a business AND the visionary / borderline insane mentality of a standout founder. I am lucky enough to work with some of these folks and it’s absolutely inspiring and quite intense. But I don't think it's necessary to have both to be a member of a great founding team.
The most important thing is to maintain the awareness of which special talents are present and make sure they are appropriately complemented by other team members for each stage of the business.
Over the last few years, it seems there was a trend towards viewing starting a company as a step on a career trajectory - by both investors and potential founders. It's not. It's on an entirely different path. You can definitely jump to that path, but it's a nonlinear growth trajectory and requires a major mindset and attitude shift. Going from working for someone to being that person is a major change. I have gone through it over the last few years and it has required a major mindset shift. It’s also exhausting both physically and emotionally.
The CEO/CPO/CTO founder of the company needs to have that itch, that insane drive, that visionary attitude to make things really interesting. It is someone who doesn't need to do 100 customer validation calls to know what product to build, and instead has the killer instinct to bring their vision of the world into reality. Getting excited about something is fundamentally different from being obsessed with that thing.
There are a handful of entrepreneurs in the world who can get excited about something because of the monetary opportunity that it represents and stay excited for 5-10 years. These people are very rare - they have the ability to deal with the ups and downs of a business while keeping their eyes on the prize for an unreasonably long period of time, then once they’re done, they walk away (usually very wealthy) and never think about that market or industry again. Most people who think they have this ability learn that they actually do not, especially when the going gets tough.
The Super Business Leader - who can power through and force an outcome. These are very very rare.
The broader truth is that functionally every business needs a bit of everything. You see this as businesses scale: initially they only need a CEO and CTO, then comes Sales and Marketing, then Operations, then they will bring in someone for Product management and Engineering management, then HR, then Finance, then Admin, etc. Each of these roles is actually critical from day one, but may not require the attention of a full time team member until the business gets larger. There is a broader question about how to fill these gaps in the interim, but the focus of this post is on the founding stage.
Initially the CEO (or office of the CEO) is responsible for everything. As the company grows, individual people can be hired to own these areas and report back to the CEO.
These various roles build out in a fairly predictable way as businesses scale up. This process of company building is critical to the success of any business. But there is a step before that - it’s the big bang step: the one that starts with something coming from nothing, absolute creativity or invention. Regardless of the skills or experience of an operator, this step may just be beyond their reach: not quite creative enough, not quite aggressive enough, not quite disruptive enough, not quite obsessed enough. There are those who are meant to make that entrepreneurial jump and those who are meant to join the journey somewhere along the way. Sometimes it’s as employee number one, sometimes it’s as the CFO who joins 6 months before the IPO. And usually that changes for each person in each situation and as they develop in their career.
The paradox is that everyone knows that in order to be an entrepreneur, you need to have stamina and the “won’t take no for an answer” mentality, so it’s often hard for people who have those two things to recognize that their vision is just not quite enough. But it’s very hard to know if your vision is actually good enough - you have to believe that it is in order to step into the entrepreneurial ring, but you can’t know for sure. In theory, early investors are the “gatekeepers,” sifting through and selecting for the true visionaries and the teams they need. But investors have actually become generally less sophisticated over the last 10 years in this respect. Not because any investors got worse, just because the number of investors has increased so dramatically in such a short period of time, and their perspective is inherently limited by time.
So what's the opportunity?
In the last few years, there are more than a few great business leaders who have started companies (and got meaningful funding because they hit certain signals for investors), but they know that they don't have that insane drive towards their vision to take them through the hard times as the fearless leaders of the businesses they started. Most will either involuntarily or voluntarily call it quits, which is totally fine. Starting a company and swinging for the fences is a crazy thing to do, and it’s not for everyone - even the right people usually fail. It’s hard to know that before you give it a real shot. (I am in no way discouraging anyone from making a run at being an entrepreneur.)
These former founders are the next amazing group of Series A/B/C COOs that visionary CEO/CPO/CTOs need to make their visions a reality. To be clear, these operators are absolutely leaders; they are not followers. Followers are not what most great companies need - they need people who will take charge, have strong opinions and make big things happen, but people who benefit greatly from sitting beside a true visionary.
I hope some of the visionaries can see the opportunity to bring in someone complementary to help them realize their vision more aggressively, and that the business leaders have the humility, awareness and understanding to find the right visionary to work with.
It will be easier to find your complement than to become it.
It is the overlap between these two talents and the shared experience that will ultimately make them a successful team.
There’s a massive opportunity here for synergistic collaboration, and VCs may play a role in making some of these matches despite the awkward conversations involved.