A lot of the entrepreneurial stories that I read feature the ‘entrepreneur as hero’. A dashing visionary (maybe wearing a mock turtleneck) has a brilliant idea and through near-supernatural effort creates a new product or a new industry. In this narrative, the founder hero is the center of the story - everything starts with the hero. I’m part of the founding team of a ~ $100 million email technology business and my experience couldn’t be further from that narrative. In my experience, the success of a business isn’t about the brilliance of the founder (or founding team).
In my 16+ years building technology businesses, I’ve learned one thing: success isn’t about me. So what is it about? Here are a few things that I’ve found have been critical to building our business:
- It’s about building a great team, not a collection of brilliant individuals: No one person has all the skills to build a large successful organization. A team should contain the right mix of functional and domain expertise to meet the needs of a growing business. However, a collection of brilliant individuals is not enough. This collection needs to be a team. Although I find the ‘business book as parable’ genre to be annoying to the point of distraction, Patrick Lencioni’s “Five Dysfunctions of a Team” gives a good description of what a true team look like. It’s a group that trusts each other, that can have productive conflict and that can commit to a plan of action once a decision has been made. When the businesses that I’ve been involved in have been most successful, the management team has been highly functional.
- It’s not about your idea, it’s about the best idea: It’s hard not to fall in love with your own ideas. However, if you want to make sure you are spending your firm’s limited resources on the best ideas, treat your own concepts with skepticism and source ideas widely from your customers and your employees. Figure out where the risk exists in your own brilliant ideas and figure out how to to test that risk as quickly and inexpensively as possible. In meetings to solve problems, ask questions that frame the problem but don’t be the first to offer a solution. If an idea (yours or someone else's) isn’t quite right, fiddle with it. Make changes to your product, marketing, service model until the good idea you have has become a great idea.
- It’s about doing the functional, emotional and social jobs that a customer need done: As a company gets bigger, it is natural for the focus on the business to turn inward. As the ‘machine’ gets bigger, it takes more focus to maintain the machine. Successful companies overcome this and focus on the jobs that customers need doing. It’s important to note that functional jobs (“I need something to ensure that my email makes it into the inbox”) are only part of the story. When a client buys a product, they are buying it to fill emotional (“I don’t want to worry that the results of my well crafted email campaign may be harmed by a delivery issue”) and social (“I want to look like a hero in my organization by exceeding my commitments to the organization”) needs as well. Understand these jobs. Do them well.
- It’s about doing those jobs better/cheaper than the competition and substitutes and getting there first: Your prospects and clients have a lot of choices as to what to ‘hire’ to do their jobs. You have to do a better or cheaper than the competition. If the competitors are ‘over-serving’ the customer, provide something at a lower cost with good enough functionality. If competitors are ‘under-serving’ customers, find a way to solve their whole problem - you can probably do that at a higher price. Look for ways to provide a better solution at a lower price. You need be laser focused on what the competition is doing and recognize that you are in a race. Ensure that you make investments in team and technology that allow you to continue to move fast.
There is a big difference between “being and entrepreneur” and “building a great company that is also a great business”. I’m lucky to be able work with a lot of startups in my hometown of Boulder, Colorado. I’ve noticed that the majority of Enterprise B2B business startups that get initial traction get stuck in the $2 million to $5 million revenue range. The companies that break through that barrier typically are those where the founders realize that if they want to build a great company, it cannot be about them. It is about the team, the customer and beating the competition.