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How the best entrepreneurs build momentum

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Voracious reader. Curious observer. Determined experimenter. Constant thinker. Driven achiever.

As an entrepreneur, learning is a strength baked into your DNA. It fuels your sense of possibility.

Coming up with reasonable — and often brilliant — business solutions is rarely an issue for founders.

So why does your team struggle despite your problem solving skills and all that learning? Poor hiring decisions, slow progress, low engagement, instability. Things seem to be getting harder as you grow. The good times aren’t rolling as fast as they once did… or as you think they should now.

Here’s the thing. Your strengths come with a shadow — a dark side. Until you see it, that shadow holds you and your team back. It keeps you exhausted. Frustrated. Unable to achieve sustained forward momentum. As your business and team grows, that shadow becomes your nemesis.

Confusion is the dark side

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Your team needs a certain amount of predictability. When they don’t have it, they spin their wheels. Rather than focusing on incremental improvements, they’re busy trying to interpret your latest brilliant plan.

For you, every problem provides a new challenge. It’s an opportunity to test out your latest thinking. Newer is better. For them, every new process, meeting agenda, and set of expectations brings confusion, uncertainty.

The best entrepreneurs understand this. They follow five simple habits that feed their desire for progress and meet their team’s need for predictability.

Ritualize it!

The “it” is anything the team should be doing consistently. A strategy conversation. Providing quotes to clients. Hiring. Celebrating a big sale. Think of “it” as a mini checklist of to-dos — a list of team commitments. Rather than seeking perfection, start with good enough for now. Ritualizing “good enough” always outperforms a confused team searching for perfection.

Here are some examples from inside my clients’ companies:

When a software developer “breaks the build”, he or she needs to buy donuts for everyone on their team.

EVERY Tuesday and Thursday at 11:07 am a company-wide meeting begins with good news stories.

Four times each year, a preset group meets to review sales compensation payments.

At 4:30 pm on the last Thursday of every month the company hosts internal TED-style talks.

As the final step in the company’s onboarding process, each new joiner has a debrief with the CEO.

Steven Handel, author at The Emotion Machine, suggests the following as characteristics of rituals.

Rituals…

…are symbolic and meaningful (created with purpose)

….are internally motivated (and not an attempt to replicate something better suited elsewhere)

….require full engagement (be all in or don’t do it at all)

….are anchored in celebration (celebrate success, learning, growth, failure, innovation)

….tell a story (the whole thing needs to hang together)

….bring a sense of belonging (everyone who is part of the ritual has a voice in its creation and evolution)

….focus on the performance of tasks (something needs to get done)

One owner

Every ritual needs an owner. One owner. That person, sometimes referred to as the host or custodian of the ritual, keeps the ritual alive. There are two ways I’ve seen ownership handled best.

The first is having a single, consistent owner who is passionate about the ritual and sees value in it.

The second is rotating ownership, where ownership responsibilities are clearly documented. Rotational ownership of a recurring meeting or mentorship of new team members are examples.

In either case, ownership does not need to include content. The owner of a quarterly strategy meeting doesn’t need to prepare the meeting content. Their role is in making sure the meeting happens with necessary pre-work circulated.

As a general rule, busy entrepreneurs and CEOs make for poor ritual owners. Its best to outsource this role to the team when possible.

Have a trigger and a target

Every ritual needs a trigger. Without one, time passes and so does the ritual. The best triggers include personal commitments to others. It’s just too easy for us to ignore triggers when no one else knows or cares about them.

Each ritual also needs a declared target. When does it need to be completed? A good example of a failed target is a company strategy meeting that gets pushed out, again and again and again. Rituals fall apart when they are not prioritized as important. When setting up your ritual, agree to when moves or cancellations are okay.

Here are the triggers and targets for the examples I shared above [targets are in square brackets].

Software developers bring donuts when the build breaks… you can’t hide a broken build. [Same day, always]

The company-wide meeting is on everyone’s calendar every week, forever. It’s designed to run independent of any single person’s attendance. [Same day always unless the entire team is unavailable]

Sales compensation payment review meetings get scheduled by the company’s sales analyst. He needs to meet a payroll deadline. [Flexible within first 7 days of each new quarter]

TED-style talks are pre-scheduled, standing meetings owned by one individual. [As scheduled monthly except December]

Preparing to onboard of every new team member follows a preset checklist. [Completed before new hire’s first day]

Put it on (virtual) paper

The goal with rituals is consistency over time. Documenting the steps, the flow and the responsibilities ensures things don’t get forgotten. A simple checklist can do the job. It works for airline pilots and surgeons, and can work here too.

For example, having a simple standing agenda brings consistency to meetings. It ensures the little things don’t get missed like assigning a host for the next meeting.

Improve, continuously

Continuous improvement should be built into the ritual. It’s needs to be a core element rather than something set off to the side. It’s building on the foundation you’ve created rather than repeatedly starting from scratch. Retrospectives using a simple start, stop, continue exercise can take less than 5 minutes.

Perhaps the first meeting of a quarter includes a mini-retrospective. The last step in a process flow can be a quick review and update. It’s here where you can bring all your latest learning, tweaking the “good enough” ritual to be even better.

It’s true that sometimes step changes are needed and incremental change won’t do. The best entrepreneurs limit step changes to a critical few areas. They prefer instead to build a strong, lasting and predicable flow to their business.

I blog to help Founder CEOs on their journey from kitchen table to 200 employees. My latest book, Reinventing Scale-Ups can be found here. Be the first to receive new articles by signing up for my newsletter here.

Superstar founder

The 7 rules for building powerful relationships from top 30-under-30 entrepreneurs

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Every superstar founder I work with has a single ability that sets them apart from everyone else: They know how to build a powerful network of powerful people.

Success has a ceiling. Entrepreneurs who don’t develop these power relationship skills will only go so far on their own merit and drive.

The good news? The skill of relationship building is available to EVERYONE… even if thinking about networking tends to make your stomach churn.

I’ve had the pleasure of working with two co-founders of Exact Media. Both come from modest beginnings and built their careers from ground up. Ray Cao, Exact Media’s CEO, made Profit Magazine’s Top 20 Under 30 list in 2011. Earlier this year Forbes named Daniel Rodic to its Top 30 Under 30 list. The two have personal and respected relationships with powerful people around the world.

Both Ray and Daniel are more introverted than extroverted. Neither one benefited from extensive family connections. They built their web of friendships from ground up.

Securing new leads and sales opportunities is the “that’s obvious” value of networking but founders are poised to gain so much more value from the RIGHT connections. For example, shipping costs will drop dramatically if you have a personal relationship at the executive level of an international courier company. The people at the top can provide better pricing.

So how’d they do it? How did they build a second-to-none global network? I’ve had a front row seat for the last three years. Here’s what I learned.

The mantra that defines a way of being

Ray has a mantra: Build relationships by adding value first, always. He has a sincere personal need to be helpful. In every interaction, Ray listens for opportunities. Can he leverage his knowledge, experience and relationships to lighten the load for others? He seeks nothing in return other than the personal high that comes with giving.

Daniel Rodic
Daniel Rodic sharing his perspective on adding value first at a Tedx event. https://youtu.be/xI6OSvznk6E

Leveraging assets

What’s the greatest gift you can give? Ray and Daniel figured out early that relationships are incredibly valuable and must be cherished, cultivated and protected. Connections are hard for others to get. As a result, they have a high degree of value. They are a gift.

A few times each year, Ray hosts a dinner party. He limits attendance to 20 people and brings in exceptional speakers. The guest list is curated with the goal of creating helpful interactions between attendees. It’s relationship building on steroids.

By now you’re likely thinking, “Sure, it’s easy to give when you have money, knowledge, proven experience, and an impressive rolodex, but I’m not there yet. Then what?”

Getting started

Have you heard the story of Kyle MacDonald? Unemployed, he bartered a single red paperclip, and through 14 trades secured himself a house. Daniel’s story of relationship building has many parallels. Early in his career, Daniel’s list of high-powered relationships was thin. Recognizing that connections would be key to his personal success, Daniel made a list. He compiled a spreadsheet of the interesting people he knew who could be helpful to others. The initial list was short, just three people. These became his red paperclips.

I recently experienced Daniel’s relationship building in action. I shared my interest in getting involved with a United Nations initiative. Daniel jumped in to say he knew someone leading the initiative. 24 hours later I was in touch with Daniel’s UN contact. Daniel’s red paperclip has grown into powerful international friendships.

Figuring out how to help

Both Ray and Daniel are masters at stepping into other people’s shoes. As Daniel shared with me, “business leaders are generally worried about the same things. They are on the lookout for great talent, new clients, and perhaps financing. Most have a cause that’s close to their heart.” By asking a few questions, potential opportunities to help emerge.

The rules of the game

There are unwritten rules when it comes to making introductions. Master these and you will be well on your way to game changing results.

Rule #1: Win — win. There needs to be a balance in value exchange. Both parties need to get a win from the interaction that’s of comparable value. Introducing a first year university student to a fortune 500 CEO is likely to be a failed connection.

Rule #2: Give for the joy of giving. You have to do this because you love helping others without the expectation of return. Without this mindset the interaction becomes a transaction. From this point forward go into the world with a mission to help as many people as possible. Ray and Daniel are known to “surprise and delight” people in their network with small and unexpected gifts. They play personal recruiter too, matching up people and jobs. They do it because “it’s just fun!”

Rule #3: Get permission first. In Daniel’s words, “I’ve learned that the double-opt-in is important. It gets everyone’s buy-in, gives context and sets up the right conversation.” By making an introduction, you are offering up someone else’s time. Make sure to have that person’s OK, first.

Rule #4: Full transparency. Ray and Daniel are both upfront in sharing the process they follow in making introductions. There are no surprises.

Rule #5: Watch the timing. You never want anyone left feeling you made an introduction to get one in return. An ask that follows shortly after a give says, “now that I did an intro for you, I need you to….” Not cool.

Gary Vaynerchuk

Rule #6: Spread out “asks”. Gary Vaynerchuk is a serial entrepreneur, four-time New York Times bestselling author, speaker and internationally recognized internet personality. He’s also been a guest speaker for one of Ray’s famous dinners. In his writing, he advocates for a “give, give, give, ask” approach. Spread out the asks and make sure the gives far out pace the takes.

Rule #7: Make it personal. Ray puts a lot of thought into his helpfulness. I know because I’ve been on the receiving end. He does his research to figure out when and how he can be uniquely helpful. Daniel shared two of his favourite questions for discovering ways to be helpful. By asking, “What’s keeping you busy?”, Daniel looks for ways to ease that busyness. “What are you most excited about this year” unlocks boatloads of information about what’s top of mind.

I blog to help Founder CEOs on their journey from kitchen table to 200 employees. Be the first to receive new articles by signing up for my newsletter here.

jumping

The bullet-proof (founder) habit that gains and keeps the trust of your team

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When the energy and commitment of a team slumps, there is only one reason. Super successful CEOs know the reason. They make sure it never happens.

Once superstars disengage, the organization is headed for trouble. In my work with founding CEOs, I’ve seen how a simple, innocuous misstep quickly grows into a team-destroyer. Productivity drops. Contributions and creative problem solving disappear. Worse yet, disgruntled former superstars spread malaise like a contagious virus, bringing others down with them.

It doesn’t have to be this way. You can keep your team on your side. The key is to understand and embrace a truth of human emotion…

Everyone is happy when your team’s current reality remains above their expectations. The slump begins the moment reality falls below expectations. The slightest gap between the two is like a pebble in their shoe. It might not be big, but it quickly moves from annoying to maddening.

As a founder you are, by necessity, a dreamer and visionary. You set an exceptionally high bar for yourself. The likely result is over-commitment on your part.

“We’re going to have an option plan within 8 weeks and I promise to give you options as soon as the plan is done.”

… 9 months later, the option plan remains on your to do list.

“Our company is going to grow and that’s going to create a ton of career opportunity for you.”

… but as the company expands, junior team members watch as you hire experienced talent rather than promoting from within.

“I’d like to hear how you think we should design the product going forward.”

… but you’ve already decided the product roadmap priorities and there is little chance you’ll change your mind.

In the moment, every one of these commitments comes from a good place. You want to provide stock options asap. You plan to help develop careers. You want input from others.

With each commitment you make, and without appreciating the long-term implications, you are setting expectations that will be missed.

As soon as an expectation-to-reality gap opens up, you’re sunk. Even if you eventually close the gap (like providing stock options in the example above), the damage is done.

Eliminating the Expectation-to-Reality Gap

Honest transparency is the answer. The single most effective way to eliminate the gap is by ensuring it doesn’t get created in the first place. Here’s what that looks like:

“It’s my intention to put an option plan in place as soon as I can. I’ve never done this before and it’s likely to take time. I know options are important to you so feel free to reach out from time to time for an update on progress.”

“All signs point to our company growing. You will get a lot of interesting growth opportunities here. Much of that will come through the work you get to do rather than frequent role changes and promotions. I’m sure we’ll hire some senior, experienced people too and we’ll all be able to learn from them.”

“I have some pretty strong thoughts on where the product needs to go next. I’d like to hear your thoughts to see if I can improve the plans that I’ve got. What advice do you have on the product roadmap?”

Keep the gap closed. Search deep for the truth of the situation so that reality ALWAYS stays above the expectations you are setting. The result will be a team that trusts and supports you. Your occasional misstep will be seen as exactly that, an honest mistake.

If you hit some bumps, contact me and I’ll share more tips to help close the gap.

I blog to help Founder CEOs on their journey from kitchen table to 200 employees. Be the first to receive new articles by signing up for my newsletter here.

leadership teams

How to champion a world class leadership team meeting, even when past attempts have failed miserably.

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Scrapped your weekly leadership team meetings yet?

There are three measures of a world class leadership meeting:

(1) Everyone shows up every week, driven by FOMO and a belief that this hour is the most valuable of their week

(2) There is a palpable sense of forward momentum and an unlocking of potential throughout the meeting

(3) The team leaves energized with a greater sense of clarity

Few leadership teams seize the full benefit of their weekly connection. More often they find any reason to skip it, or bail on the routine completely. The unspoken truth is that everyone finds the meeting a massive waste of time.

For many founders, these meetings take on a bipolar personality. One minute someone at the table seeks to validate their worth, boasting about their latest achievement. The next minute, you find yourself managing a barrage of passive aggressive attacks.

Your leadership team meeting — the group meeting you have with your direct reports — is the most expensive recurring meeting on your calendar. It’s also the biggest leverage point you’ve got. Without them, inefficiency permeates your business.

The defining question to ask yourself before creating or reshaping your leadership team meeting:

Do your direct reports collectively constitute a leadership team?

Most leadership teams in early stage companies aren’t actually teams. They are a collection of individuals who report to the founder and CEO. They don’t feel a shared responsibility for running the company. Instead, they co-lead their respective departments with the CEO.

If you don’t have a leadership team, you don’t need a leadership team meeting. Other types of meetings will be helpful, but skip this one until you are ready to build a true team.

Find the format that meets your needs

Let’s assume you do have a functioning leadership team. It’s a group where everyone brings unique content and has a voice in the running of the business.

Here are three different meeting formats to consider. Use these to customize a meeting that works for your circumstances. Try out all three so you know which one works best for your team.

Format #1: The weekly check-in

Best used: when the primary goal is to keep everyone aligned and you informed.

Meeting rhythm: go around the table with each person sharing the following four items in 5 minutes or less:

1) Changes to their top metrics (sales numbers, milestone completions, cancellations, etc.)

2) An update on critical news since the previous meeting. What should everyone else in the room know?

3) The top 2–3 priorities of their team for the upcoming week.

4) Requests for help (information, resources, etc.) from other teams.

Leave 15 minutes at the end to tackle the most pressing issue of the week.

Close out: by quickly reviewing everyone’s action items.

Format #2: The weekly tactical

Best used: for tackling a high volume of action items. This meeting is all about getting shit done. When teams rely on each other and are too busy to connect between meetings, this format rocks.

Meeting Rhythm: Select a scribe to capture notes that get projected in the room or shared live online. Create an agenda on the fly by capturing a list of topics. Everyone in the meeting participates in creating the list.

Example: “Discuss hiring — Mike”

Start at the top of the list. “Topic one, discuss hiring, Mike what do you need?”

Mike has four possible responses:

“I need everyone to know… [insert critical information that Mike cannot share in some other written format]”

“I need a quick answer (or approval) on…”

“I need time with Zak, Julie, and Sarika to discuss…”

“I have an issue/tension/problem with… [insert issue] that I would like to address by… [propose solution]”

Each of these should lead to an immediate and quick resolution of the issue or to a specific action item. The scribe captures the action and assigns an owner.

Example: “Mike to schedule a 30 minute meeting with Zak, Julie, and Sarika to discuss…”

The weekly tactical should move super fast and cover a long list of issues.

Close out: with each person sharing their version of: “Leaving this meeting I am most excited about / energized to / focused on…”

Format #3: The weekly problem solver

Best used: for tackling big topics needing time and collective brainpower.

Meeting Rhythm: Select one or two topics in advance of the meeting. Send everyone a clear problem statement.

Example: “Sales are 20% below target with 5 weeks left in the quarter. How can we work together to turn this around while we still have runway?”

Start the meeting by restating and taking ownership of the problem statement. Ask for advice. Dedicate a solid 10 to 15 minutes to brainstorming. Let the ideas flow — no idea is a bad idea. Then move to action, recording decisions when made.

The key to these meetings is staying on topic.

Close out: by quickly reviewing everyone’s action items.

Tips for staying on track

At this point you may be rolling your eyes thinking it can’t be that easy. You’re right. Even the experts religiously use hacks to keep meetings on track. Whatever meeting format you choose, here are some tips to keep your meetings running smoothly.

Tip #1: Know why you are meeting.

If you don’t know, the meeting is over. Your time is too valuable to sit around hoping something important drops onto the table.

Tip #2: Be clear on your role at the table.

How are you going to show up in these meetings? As a “teller”? A decision maker? A tie-breaker? An instigator? A disruptor? A facilitator? A negotiator? I guarantee you have a default style you use in these meetings. Choosing to flex is a sign of true leadership. Sometimes the team needs you to be a decision maker. Other times, allowing the rest of the team to debate is better.

Tip #3: Keep it super simple.

You are too busy to manage the creation of a new meeting agenda every week. So don’t. Depend on rituals, repetition and habit instead. Design a standing agenda and stick with it. When you reach the end of the agenda, the meeting is over.

Tip #4: Have an eagle eye for balance.

Agendas can become too rigid. Item. Item. Item. Done. Teams need the opportunity to bond too. Some social banter throughout the meeting is healthy. Without it, creativity and collective problem solving will suffer. If the balance swings too far the other way, important business gets missed. It’s your job to keep this balance healthy.

Tip #5: Meet to design the meeting.

Until you all agree on a set of meeting principles, everyone comes with their own ideas. Your first leadership team meeting has one agenda item: how will we run this meeting? Together, create a short list of principles that will give shape to the meetings. White board a list of questions. Is technology allowed? Under what circumstances can a meeting be missed? What type of content is a good fit? etc. Distill the answers into 5–6 principles. Keep it simple.

Tip #6: Stay focused on business fundamentals.

Meetings often become so intense that business fundamentals get lost. The company Resourceful Humans built a free app to keep the fundamentals present at all times. When someone notices that one of these five basics is no longer true, a red flag goes up.

• The customer is clearly the centre of our debate

• We are making things as simple as possible

• We are clear on the question before moving to solution mode

• Actions are understood and clearly communicated

• We are honouring our values in this meeting

Once you take off the training wheels, these meetings will become a crucial pillar of your business success. You’ll wonder how you functioned without them. Your team will love the clarity and energy that results, and so will you. Embrace a format that works for your circumstances.

Reach out with your success stories and share your unique customization. If you hit some bumps, contact me and I’ll share more tips to get things on track.

I blog to help Founder CEOs on their journey from kitchen table to 200 employees. Be the first to receive new articles by signing up for my newsletter here.

founder

Founders: How to Stop a Huge Time Waster Before It Starts

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Soon someone close to you will propose the ultimate time waster. They will tell you it’s essential you implement it in your company. They will say you can’t scale your company without it. Their intentions will come with the most genuine and positive intent. For them, their recommendation is a no-brainer.

They will tell you that you need a performance management process. As a founder, you despise the term and what it stands for. YOU NEED TO ADDRESS IT HEAD ON or it will surface again and again.

You’ll hear that…

“You need to cascade objectives and get people aligned.”

“People need to be accountable.”

“You need visibility into what people are doing.”

“You can’t manage what you don’t track.”

“To fairly compensate your people, you need to measure their performance.”

This is OLD THINKING.

Companies that are CRUSHING it know how to balance accountability and freedom… Communication and trust… Planning and flexibility. They do it without the baggage of complicated and time wasting processes.

When it comes to setting up your growing team for success, there are only 5 or 6 moments that matter. Get these decisions right and your team will soar. Make the wrong choice and you will mire your organization in time wasting processes. Energy will be zapped. Frustration will build.

This is one of those decisions.

The industrial era was fertile ground for metrics-driven, top-down planning systems. That time has passed. The most progressive organizations have moved on. If you are a founding CEO starting from scratch, rebel against this system.

Want to align your team around your priorities — and keep them aligned?

Try this instead.

Humans are not machines to be measured and controlled. Our strength is in our ability to manage in complex environments. Emotion is infused in our work, decisions and communication.

Every member of your team wants to add value. They want to do good work that matters. They want to grow founder.

Rather than relying on a rigid system, build the following philosophies into your leadership.

Share your vision in full colour rather than creating soul destroying targets. FREQUENTLY communicate the themes and priorities that are most important to the business. The best teams aren’t motivated by numbers and targets. It’s impact that fuels their work. Use storytelling to bring your priorities to life. Did I mention you need to do it FREQUENTLY? Take your current communication and increase it 10x. Check out this article for ideas on how to amplify your message.

Trust and enable personal choice. If you can’t trust your people, there is a problem that requires immediate attention. Exceptional talent expects trust. Ritualize asking “What are you working on and how can I help?” This allows you to enter into a conversation and see if their work aligns with your priorities.

Model deliberate ownership of personal development. We all need role models to support our personal development. Share your personal development areas. Seek insights from others about how you can improve. Encourage the same of your team. If you are a founder of a growing company, you already embrace personal development. Now your founder job is to make your development skills visible to your team.

Ensure 20% of your weekly meetings focus on important rather than urgent conversations. With a frequency and format that works for your team, schedule regular conversations. Use the time for a deeper dive on important topics. Include each others’ personal development priorities. This is a two-way conversation anchored in the work that you are both doing. Taking notes is optional. Food and drink is highly recommended. Keeping up with these meetings can be tough in an urgency driven world. Use nudges to help keep you on track. There are many great tools out there to help. WorkTango is a client of mine and I like the approach their tool offers.

Resist any approach that rates, ranks or categorizes people on your team. Trust the power of conversation to tell you who is doing well and who is struggling. Ratings and rankings are a scapegoat for important and often difficult conversations. Don’t slip into the industrial age practice of treating people like soulless resources.

Stick with language that real people use. When we use terms like human resources, performance management, and feedback, we dehumanize the relationships we have with our team. Consider terms and phases like: “Let’s get together for a check in and share what we’ve learned over the last few weeks”; “Can I share a thought?”; “I see you struggling, how can I help?”; “What have you learned about yourself over the last few months?”

Do you feel the difference? Your team will.

Superstar leaders understand the nuances between what I’ve just described and traditional performance management. Communication and a sense of direction is essential to the success of your organization. Trying to control and manage performance is not. The style and frequency of communication permeating your business reflects what you model.

Give it a try. I’d love to hear your success stories. If you hit some bumps, contact me and I’ll share more tips to get things on track.

I blog to help Founder CEOs on their journey from kitchen table to 200 employees. Be the first to receive new articles by signing up for my newsletter here.

internal war topple

The internal war that could topple your startup

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You’ve never been more pumped — and confident — about the future. You’re certain of your customer-acquisition-cost, your sales pipeline looks AMAZING and you’ve got a realistic plan to scale up, up, UP!

So why do you have that awkward feeling that the other shoe is about to drop? When things are this good, something bad is just around the corner… right?

With this article, you can peer straight into that blind spot you fear. You can fix the ONE THING that could topple your scaling business, before it becomes an epic disaster.

There’s a war coming your way…

It’s the inevitable clash between the founding team and the superstar talent you start hiring. Two camps start to form.

Soon the divide will become your biggest frustration and distraction. Precious customer facing time will disappear as you mediate infighting. At a time when you need everyone energized and more focused than ever, things will start to unravel. Everything that you’ve worked so hard to build is at risk.

The founding team is the group that took the risk to join a fledgling startup. They worked long hours because they believed in what you were building together. They shared your vision when it was nothing more than scribbles on a napkin. Vacations — sacrificed. Weekends off — a luxury. You know everything about this group — their families, close friends, fears, aspirations. You’ve shared many meals together. These are smart people — scrappy problem solvers. You are loyal to this group who have been loyal to you and your ideas.

Camp #2 are the newcomers. These are also smart people. They come from bigger companies and have circled the block a few times. Experience has taught them that systems and processes are critical. They have the skills you need to move to the next stage of growth. You know it and so do they. They have a lot of good ideas and their arrival marks a change in how your company will run. Despite best intentions, you can’t remember the names of their spouses, partners, or children. You spend much less time together.

Leadership missteps now will lead to a divided company. These two camps will be at war with each other. The longer the war, the harder the healing. Some companies never recover.

There are three misunderstandings at the heart of this divide.

  • Without help, your newest team members will not appreciate the early struggle. They will see all the mistakes made and problems waiting to solve. They won’t appreciate the fatigue that the team pushed through. Resource gaps from the past are now invisible.
  • The special bond that developed between you and the founding team will be contentious. New team members perceive that special relationship as a threat. Talk will turn to the preferential treatment the founding group receives.
  • Your new, experienced hires signify change. That change will become a rallying cry for the founding group. Their mission will be to rebel against new processes. Anything that restricts their freedom is counter to their DNA and hence an enemy.

Get ahead of these challenges and keep your growth on track with these four rituals:

1. Storytelling — When we meet new people, we tend to focus on surface information. What’s your job? Where did you go to school? Go deeper. Make storytelling a critical component of how people connect in your company. It’s our stories that make us human. Here are six ideas to get you and your team started.

  • Tell me about your longest workday ever.
  • Who is your closest friend in or outside the company? How did you get to be so close?
  • What’s the biggest mistake you’ve made at work that you can now laugh about?
  • What’s something that’s happened to you in the past that’s shaped who you are today?
  • What’s been your most exciting or proud work moment?
  • What past vacation most shaped who you are today?

Written or recorded stories are also critical. Find ways to share the stories of the earliest days of your company as you on-board new team members.

2. Shared experiences — Our strongest relationships are rooted in shared experiences. For startups, shared experiences are an everyday occurrence. As your company grows, creating these experiences becomes a necessity. They can be big — retreats, orchestrated company-wide activities, hackathons. Or they can be simple — small group dinners, community charity events, hikes. The structure is much less important than the sharing of a memorable experience.

3. Sharing your values — What do you value most? Even if your company has yet to define its values, the founding team knows what you value. They have shaped and lived those values with you. As your company grows, you need to become more purposeful in articulating those values. The founding team has a keen sense for knowing when new team members don’t share your values. You’ll know you’ve made your values clear when your team starts mocking you.

4. Calling out the divide — If your founding team is getting special treatment, own it. Let the broad team know about the deep friendships you’ve created with this group. Share the history. Invite the rest of the team into that circle. Acknowledge what is, and share your thoughts of how you would like things to be in the future.

Give it a try. I’d love to hear your success stories. If you hit some bumps, contact me and I’ll share more tips to get things on track.

I blog to help Founder CEOs on their journey from kitchen table to 200 employees. Be the first to receive new articles by signing up for my newsletter here.

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Founders: If you can’t answer this question your business won’t grow

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There is one important piece of work that needs your focus. It’s the prelude to all business breakthroughs. The ultra successful know this already. They’ve done the hard work. And they are reaping the rewards.

Avoid this upfront work and you doom your business to spin its wheels month after month. You will spend your next team meeting rehashing the last one. Decisions won’t stick. You will be in a rut. Team members will question your leadership.

Until you can answer any one of the following questions without pause, your business is dead in the water.

“What is our purpose as a company?”

“Why do we exist as a company beyond making money?”

“Why us? Why now?”

Can you do it? Can you answer right here, right now, without pausing to think? Can every member of your team?

If you can’t, you are not alone. In my experience working with Founder CEOs for over 10 years, less than half can do it. When it comes to their teams, the number drops to 10%.

Without a clear purpose, you are missing the critical emotional connection. It’s this connection that separates the winners from those stuck in the mud.

Take the time to do this important work. Without it, you will hit a painful wall in your growth. Your dream will elude you.

Here are the 5 steps to define your purpose.

1) Select your purpose-defining team — Who will you include in the purpose journey? If your company is less than 30 people, include everyone in the process. Emphasize how their voice is important. Clarify that, as the founder, you will be the final decision maker. This is an inclusive but not a democratic process. Choose a small group of 4–6 trusted advisors from inside and outside the company to help you craft the purpose. Make sure these are people who will push back and challenge you.

2) Answer these five questions:

Question 1: What do you collectively love to do? What’s the common passion that has brought the influencers in your company together?

Question 2: Who are you serving? Who benefits the most from your work?

Question 3: What want or need are you filling for these people?

Question 4: What core competency are you leveraging in helping those people? Your competency will fall into one of four categories:

Connecting: Bringing people together through direct links or likeminded communities

Problem-solving: Providing a solution for a specific problem faced by people

Educating: Sharing knowledge, information and expertise

Process Improvement: Developing systems that deliver consistent and sustained results

Question 5: What change or transformation will people experience as a result of what you give them?

3) Draft your purpose — You will find your purpose in the answer to question 5. Successful companies exist to serve a genuine need that improves the collective human experience. It goes beyond the intellectual and connects at a deep emotional level.

4) Test your purpose — Purpose statements are notoriously vague. They try to resonate with everyone, everywhere. A good purpose statement closes doors. It defines a specific direction and creates defined boundaries. “We head east, not north, west or south.”

Give it a test drive. Challenge your working group to run through 10–20 different scenarios with you. If almost everything gets included as part of your purpose, it’s too broad. Tighten it up. You can always modify it later as your company grows. Lastly, make sure it excites you. If you aren’t super pumped about the company purpose, no one else will be either.

5) Commit — Put a stake in the ground. This IS your purpose. Don’t question it. Live it. Be ready to answer the question “What is our purpose as a company?” before people ask.

Give it a try. I’d love to hear your success stories. If you hit some bumps, contact me and I’ll share more tips to get things on track.

I blog to help Founder CEOs on their journey from kitchen table to 200 employees. Be the first to receive new articles by signing up for my newsletter here.

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Founders: Why hiring your first manager will sink your business

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When do you assign someone on your team to be a manager?

It’s a decision that you — and every growing company — will make before reaching 15 employees.

It’s going to feel like a minor decision. It isn’t.

Most founders don’t give it a second thought.

Yet, this single impulse driven decision will make or break the future of your business. It won’t feel like a big deal when you hire your first one or two managers. Even so, on that day, you’re rolling a snowball that won’t be stopped.

The decision will turn your business into a bloated, expensive and unproductive hierarchical mess.

Your shiny new management layer will infect your office with ego and politics. It will slow information flow, bottleneck decision making, and — ironically — slow down everything that you’re trying to speed up.

All those things that you — as an entrepreneur — believe you’re rebelling against. They’ll creep into your business irreversibly the day you hire (or promote) your first manager.

As “The Scale Coach for Founder CEOs”, I get a front seat ride with entrepreneurs as their businesses start to take off. I see the manager snowball all the time.

One of my client’s is an entrepreneur, like you. He’s been grinding away for over five years, spending long nights in an engineering lab. His business is poised to do big things. Money is in the bank. The client list is impressive. The product will transform entire industries for the better.

Sound familiar?

Over the next 6 months my client’s company is going to double in size. In the process, and without realizing it, he’s going to make that hiring decision. It will make or break his business.

99.9% of businesses do the exact same thing. They feel like they need a manager, so they hire one. Why? Because that’s what every company does. Then they’re stuck with the results.

When do you hire a manager?

Is it when you hit 5 employees? 9? 12? 15?

Most people’s immediate response is: “Well it depends…”

If you’re thinking that right now, you’ve already started the snowball rolling. Everyone has this basic assumption: Companies need managers. That’s how business works.

Before you jump off this particular bridge — just because everyone else does — these are THE four questions to ask yourself:

1) What problem are you trying to solve by hiring a manager?

You probably feel you need more bandwidth, and thus good people to delegate to. Maybe you’ve got a great person who’s been with you since day one who needs recognized with a promotion.

I’ve seen the same logic, many times. I’ve learned “a new manager” is rarely the solution, just a band aid.

Dig deeper.

Let’s say you want to add a manager to add bandwidth.

Why do you need to add bandwidth? Because you don’t have enough time to answer everyone’s questions.

Why are there so many questions? Because your team is inexperienced.

Have you considered an internal coach for your team? What about a peer mentoring strategy? Perhaps you simply need more diversity in your hiring.

Don’t let hiring a manager be a knee jerk response.

2) Do you want to build an organization based on hierarchy?

Hierarchies are old school. Pyramids centralize information and restrict innovation. Outside of work we have an expectation of instant access to information via Google. We see good ideas get voted up and bad ones die on Facebook and Quora. Age, titles, and degrees play a shrinking role in innovation.

Remember how great you felt when you started this business? Remember how free your initial team felt to get busy and kick ass?

Don’t be too hasty to set off the chain of events that guarantees no one in your company will ever feel that way again.

Google “Reinventing Organizations” for the newest thinking on the topic. There you go… instant access.

3) What’s your personal management philosophy?

Manager is a loaded word. To me it means a consolidation of power and authority. You might view a manager as a coach and mentor. If you are giving someone a manager title, get tactical and write down exactly what that means to you. Use this description in deciding how you hire, set expectations, and coach.

When you’re done writing, ask yourself: Do these responsibilities really need to be limited to a manager role?

4) How do you want decisions made in your organization?

Manager = decision maker = bottleneck = frustration.

This is true in most organizations. To avoid this pattern, pick up the book The Decision Maker by Dennis Bakke. In it, Dennis provides a whole new perspective that asks: “Who is best suited to be the decision-maker for this issue?”

It’s a philosophy of giving away power, not taking it.

Your need to hire a manager may simply be a sign to rethink how decisions get made.

So now what?

Scale your company by thinking outside the box

Building a traditional management hierarchy is — at best — a snowball you want to think carefully about starting. There are many alternatives available.

Structure is still important. So is role clarity. A small investment of time spent considering alternatives will pay huge dividends.

I blog to help Founder CEOs on their journey from kitchen table to 200 employees. Be the first to receive new articles by signing up for my newsletter here.

People Looking

Five tips to building (or rebuilding) your first sales team

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Ready to move beyond entrepreneur-as-solo-salesperson?

Tried already and disappointed with the results?

This article’s for you.

One of the biggest challenges for most entrepreneurs is building their first sales team. Sales provide the essential fuel that makes tomorrow possible. Company founders carry a lot of that responsibility in the earliest days. And if all goes well, the need to build a sales team comes fast. Without the team, opportunities will dwindle.

As founders we tend to have one of two views of sales. We’re either born to sell and love to be in every deal. Or we can’t wait for someone else to take over. Both offer challenges when it comes to building the team.

To get a fresh perspective on how to best tackle this phase of growth, I reached out to Andy Aicklen. Andy has been driving hyper-growth in software and tech companies for over thirty years. He now works with venture capital firms to maximize returns from their software investments. Andy and I shared stories and compiled the following list of tips for founders as they build their teams.

Deciding what you need

Do you hire a heavy hitter or an energetic new grad? Manager first or pure hunter? There are many needs to balance.

Although there is no single right answer, there are a few important elements to consider. Some of the questions that Andy asks founders include, “What are you selling? How long is the sales cycle? What’s the expected average monthly and annual run rates? How technical is the product? Who is the buyer?”

There’s a big difference in hiring someone to manage a short, simple sales cycle versus  a long, complex one. “Big deal” sales people can inspire a customer to stay engaged for the long haul. They help customers get to a place they didn’t think they could get to. They understand customers at a deeper level. They know how to leverage people on the team. They have an advanced level of social skills. They are also expensive.

Often product knowledge gets too much focus. From Andy’s perspective, “Understanding the technology and product isn’t that big an issue. Do you want your people to be experts in the product or an expert in selling? If they are too product-focused they won’t be successful long-term in managing a large number of clients. I’d rather hire a salesperson who was a sale executive first and a subject matter expert second. That’s why we use sales engineers or product specialists”.

Spend time upfront. Figure out exactly what you need before building a sales team with the wrong mix of skills for what you’re trying to sell.More

mac, computer, laptop, working

Five ways to turn the traditional termination process on its head

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Terminate: To bring to an end.

Whatever the situation, we humans don’t usually do well with endings. Emotions get triggered. Things get messy.

When it comes to terminations, we are asking a colleague to leave our tribe. No matter the reason or the situation, it can be torturous for everyone involved.

Traditional termination processes don’t help. Risk reduction trumps trust and human decency.

What if there was a better way?

Why things go awry

Despite many great evolutionary developments, much of our wiring is still primitive. Our reptilian brain (yep, the same one that reptiles have) kicks in more often than we’d like to admit. As danger approaches, we regress quickly to basic fight, flight, or freeze responses.

When it comes to basic human needs, termination of employment hits all the wrong buttons. Uncertainty. Loss of social status. Fear of the unknown. Social exclusion. A deep sense of unfairness.

Whether staying or leaving, similar emotions of fear, anxiety and guilt flood your body.

Consider these paradigm shifts to make the process easier on everyone.

Who’s in the room?

Old paradigm: Two people meet with the employee to deliver the news

There are usually three fear-based “what if” drivers of this approach. One: What if we need a witness to what was said in the meeting? Two: What if the manager doesn’t do a good job delivering the message? Three: What if the terminated employee gets physical? In reality, the risks are small. We can manage every situation anticipating the worst, causing unnecessary trauma to everyone involved.More

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