Keeping the Fire Burning

This post was conceived and co-written by Ed Tekeian (former VP Engineering at Brontes), a brilliant engineering leader, great all-around guy, and one of the key reasons our product saw the light of day. (also the only year-round surfer in New England I know)

Looking back, one of the things we did well at times, and not-so-well at others was keeping the entrepreneurial flame alive as the company grew. I’m proud that even 3 years after we sold, we had virtually no attrition. Here are some of our observations and learning’s:

Lift off – Founding team and first few hires

When we finally secured angel financing, we moved into the most inexpensive office space we could find. We had about 1,000 square feet, almost no natural light and an ensuite bathroom (not as fancy as it sounds) in which Doug (VP Hardware) had to scoot his chair in each time someone wanted to use the head. Those were the days!

In the early days, the founders come to work everyday completely dedicated to getting the company off the ground – it’s their baby. The first hires are those with a lot of reach and flexibility; they’re “best athletes.” They don’t think much about what is or isn’t their job description – this is their mantra. For this group, career growth and the development of the company are one in the same. In the early days, HR primarily means recruiting and occasionally planning an event to get folks out of the office. Most of the culture evolves organically. In our case, we ate lunch together (even when we were as big as 15) nearly every day. That made it easy to share food, information and form a bond as a team.

Middle of the marathon – Hires 20-50

After things have gotten going and the risk of a first year flameout is gone (perhaps Series A or B is in the bank), new hires join because they feel there’s modest stability, structure and a way of doing things. Some of these hires are looking to be in a startup, some are accepting a job in a new, small company. For the first time, career development has to be considered, in addition to the overarching goal of launching a successful product. Even for original members, career development may be needed to combat burnout. How do you achieve this in light of the daily pace of a company?

With the group-wide lunches a thing of the past, it’s important to have 1-on-1 discussions and fireside chats where everyone shares their concerns openly. Promotions and pay increases must be periodically considered. The founding (or senior) team needs to have periodic get-togethers; we did dinners at each other’s homes every month or two. Lastly, the founders need to get to know everyone (we both interviewed almost 100% of candidates even beyond 50 employees). At this size, the company’s too small to get lazy.

Turning “13” – 50+ employees and post-acquisition

In our experience, this is the hardest phase. It’s like turning 13 – you’re not a teenager but not really an adult either. In this phase, the managers need to think about lateral movement of staff to new responsibilities. Staff need to see that there’s a path to doing something new – perhaps an Engineer is interested in working as a Product Manager. Make it clear that management isn’t the only track – new skills can be more valuable to a startup than more managers. Commit at the senior team level to a few key promotions each year. People without co-founder status or single digit employee numbers need this to be connected to the heart of the company. It shows the whole staff that anyone can progress, not just the co-founders. In the early days, attrition doesn’t enter the vocabulary, but at this point, the senior team has to actively build a deep bench of leaders who can step in as people go.

One of the most valuable assets a start-up has over a large competitor is the fact that its team really cares – it’s more than a job. Nurturing this start-up “pixie dust” through the entrepreneurial roller coaster is tough but the rewards are incredible.

Team First or Idea First? (aka “Dude, we’re getting the band back together”)

As I’ve begun to think about my next venture, I’ve certainly spent a fair amount of time thinking about ideas that get me excited, sizing market opportunities and deciding whether to start something from scratch or join an existing venture.  I’m constantly thinking about how best to stack the deck and minimize risk.

However, another cut at the “order of operations” is to begin by team building before settling on a business direction. Each new venture is a chance to start fresh by building the culture you want, learning from what you’ve seen and done right and wrong, and identifying the people with whom you want to work. For the repeat entrepreneur, re-building the team of trusted comrades is ideal. By no means should this be limited to repeat entrepreneurs however; entrepreneurship is a team support whether it’s your first or fifth venture. My experience suggests that vetting concepts with a trusted team is more effective (and more fun) than by oneself.

There are practical challenges, of course, to this strategy. First, if you don’t know what technology or market direction you’re likely to take, you may not have the right skill sets around the table. That said, the best founding teams are generally “athletes” capable of learning different businesses and technologies in a relatively short period of time.  My co-founders and I entered the dental industry knowing nothing about the industry, and one investor even joked that I should enter Dental School at night! Nonetheless, you need to bring outsiders with domain expertise once you identify your market focus – early on at Brontes we brought on one of the best-known dental marketers. Of course, one needs to make sure they’re not hiring too close to home. I made that mistake at my first venture, As a 23-year-old founder my first hires were mainly the people I knew, other 20-something Cornell alum like me.

The other practical issue is that rarely is the trusted team in a professional or personal place to dive wholeheartedly into a new start-up. I often say that putting a venture together requires the “stars to align.” One can build the team with the explicit understanding that not everyone will be available when the start-up light turns green. I have a number of trusted future collaborators who have since scattered around the country, engaged in various ventures. By using these past colleagues as sounding boards and keeping them in the loop on my progress, I’m optimistic that I’ll work with many of them sometime in the future.

So many times start-ups struggle because of the team dynamics. Let’s face it, there will be rocky times, it’s the nature of the start-up. The first and best thing to do is start with a founding team you trust and enjoy working with.

On this topic, I’ve had the fortune to speak at a number of events over the past month or so.  These include the ICE Cleantech Open and MIT Professor Fiona Murray’s MIT/Russian School of Management MBA class.  At these events, I gave a brief presentation on my philosophy on early stage team building. Here are a select few of the slides I presented.