MONEY DOESN”T MATTER ANYMORE
Today, for a startup, especially in the tech space, money just doesn’t matter anymore. There’s more money available today – even for mediocre stories and half-baked ideas - than anyone knows what to do with. And there doesn’t appear to be any end in sight with more and more investors than ever before all frantically chasing the shiny new things and the few deals that they hope are really exceptional. As always, it’s still a great big crapshoot in any event because (just like we say in the music business), it’s easy to tell when someone’s got a bad idea, but it’s a lot harder to figure out the one-in-a-million deal that’s gonna break through. So if you’ve got something special to sell and people are beating a path to your door, now’s the time to let them in.
And there’s another game-changing aspect of the money game which is equally important. In addition to having fairly painless, reasonably-priced and readily-available access to a great deal of cash, virtually every startup today actually needs millions of dollars less to get their businesses up and operating. In fact, they can even get themselves far enough along the way to hit a few major milestones on what we used to call “chump change”. It’s not like the good old days when capital was a central concern (and critical to your business’s credibility and success) and you needed to raise a real war chest because – at least back then - you couldn’t launch your company on sweat, smoke and mirrors with a few servers rented from AWS. But today, for better or for worse, you can pretty much get the ball rolling with some relatively modest funding and then you just have to start praying hard for both traction and momentum. However, it’s still important to keep in mind that just because the barriers to entry are much lower; it doesn’t mean that it’s any easier to succeed. In fact, if you don’t have all the tools you need; it’s actually much harder to break through the noise, clutter and competition to get yourself and your business noticed.
So, if money isn’t the be-all and end-all gating factor these days, what really does make the major difference in a startup’s likelihood of success? I’d say that it all comes down to how you handle your talent. You can teach someone all about technology, but you can’t teach talent. Talented and highly motivated people have always been and will always be the only, long-term, sustainable competitive advantage for a business and managing this particular resource is something that you need to do from the very first day of your business. In addition, we are starting to better understand that talent management is an ongoing, maybe every day, kind of job and not some kind of lay-away plan where once a year you try to make all the folks happy with raises or bonuses or options (or at least less unhappy) and then you generally try to forget about these things for the rest of the time or until something blows up in your face. We see this particular phenomena and the hyped-up emphasis on talent acquisition and accommodation in Major League Baseball right now where the balance of power (and compensation) has shifted dramatically from the on-field and dugout managers of the clubs who used to run the show to the corporate GMs who are the guys responsible for tracking down, tempting and securing the talent.
Now I realize that there are already plenty of treatises, textbooks (remember those?) and thoughtful articles out there about the need for (and the clever ways of) attracting, nurturing and retaining talent, but these things are generally written by people sitting on the sidelines like corporate managers, business school professors and HR professionals. Frankly, it takes a lot more talent, strength and energy to start, grow or change a company than it does to run one. And, as I like to say about picking surgeons if I’m having an operation: I want the guy who’s done a hundred operations; not the guy who’s watched a thousand. My life, and the world of startups in general, are not about “say”, they’re all about “do”.
So, I want to get down to brass tacks and into the trenches and talk about three critical things to keep in mind when you’re dealing with the people who will make or break your business.
(1) Exceptional Talent is a Package Deal
A very important part of your job is to make room for people. Talent comes in strange and wonderful packages and – while we’re happy to have the upsides – we are all too often not willing to understand that there are going to be trade-offs that come with the deal. You don’t get to pick and choose and you’ve got to make sure that there’s a place for everyone (including many who don’t speak, act or look like you) in your business whether or not they believe that bathing is optional or prefer working all night long to showing up before the bell rings in the morning. Productivity is what you’re looking for, not punctuality.
(2) Your Business is as Bad as Your Worst Employee
While it’s still true that the best and most talented software engineers’ contributions are a multiple of those made by the next group of smart programmers or designers; it turns out that there’s a more important overall consideration. It turns out that the damage done by even a modestly underperforming employee is far more negative to the overall company efforts than the added benefit of those people punching above their weight. And tolerating mediocre performers is not only a horrible example for the rest of your folks; it’s a contagious disease that can sink your ship. This means that another part of your job – not the easiest and certainly not the most popular – is to promptly and regularly get rid of the losers. And this means even the people who are trying the hardest. It’s a sad thing to see people who have just enough talent to try, but not enough to succeed. Nonetheless, for your business to move forward, they need to move out and you have to be the agent of those changes. Waiting never helps in these cases. These situations don’t fix themselves and I have found over the last 50 years that I have never fired someone too soon. Think about it and get busy.
(3) Even Your Superstars Need Support
I used to say that talent and hard work are no match for self-confidence, but over the years, I have discovered that every one of us has serious moments of self-doubt and crises of confidence. With extremely talented people, it’s a special problem in their maturation and development. In their early years – whether it’s in business or in baseball – the superstars can mainly get by on their sheer talent alone at least until the going gets really tough and the competition starts to even out the score. Then, at some point, they fail – in a project or in a pitch – it’s inevitable and that’s where you need to be standing by to help. Because it’s only after you have failed – only once your raw skills and talent have let you down – that you realize that the really great talents are those people who combine their talents with thought and preparation – those who can add the power of discipline to their talent are the ones we come to call geniuses down the line. But this is a precarious juncture for these people who’ve never before known a rainy day or caught a bad break and, without some support – whether they ask for it or not – there’s a risk that they can fall apart and never get their risk-taking confidence and their mojo back. If you’ve had it your own way for too long, you can come to believe (or at least convince yourself) that even luck is a talent. But it’s not. At these times, if you want to hang on to these precious people, you need to be there to help.
PS: “You Get What You Work for, Not What You Wish for”
