How to build a great core team?

This is the single most important question for a start-up. The makeup of your partnership or core team will be the largest contributing factor to whether you succeed or not.  The right partners and the right execution team are two different problems. In this article I want to focus my thoughts mostly on the question of partners or core team members.

You may be thinking about inviting someone in because they bring with them financial resources. What you need to consider is that money alone is worth a lot less than you think. If a potential partner is willing to contribute money ask yourself this- once this partner is done bankrolling you what does he add to the team? Sooner or later their appetite will run out, and it will probably be at the worst of times. If you are going to take money from someone make sure that they have experience with start-ups, connect with their active business network, be certain they are truly inclined to contribute to the endeavor in other ways beyond their bank account. As a start-up you don't want anyone idling. Don't take money for money's sake and don't believe that there are 'silent' partners.

Another reason to bring on someone early- is to complement your skill set. One rule of thumb is to choose someone that is better than you at doing what they do. If you want to win choose winners. You need to really look hard at their past and look for real success. It's more valuable if they can point out how specific failures led to success. Success alone is luck. Success from failing is learning. If they can't show or don't talk about how they learned from failure you are setting yourself up. Look at their life in general not just business related concerns.

At the beginning of a start-up what skills are critical and need complementing? Let's say every product needs to be supported by a three legged stool. The three legs are viability, desirability, and feasibility. Now, which two of the three are the most important? As a designer I'm inclined to hold onto the idea that desirability is essential. The reality is that products succeed when you are relieving a real pain in the market. Focus on both making something that is desperately needed and the revenue stream to support that continued making. Once you have those two legs you can then design your product and service to be desirable. It's not as if design isn't important on the front-end- after all you have to first 'design' your product and 'design' your business model. What I'm saying is don't worry about making it beautiful or perfect just make it work. So what makes a good initial team? One person skilled at making and another one skilled at selling, those are the two essential skills that need to be complemented in a start-up.

Risk comes for the Greek word for root and was used as a metaphor for difficulty to be avoided at sea. Risk can be a beautiful thing. Does your team agree with you? Risk is what drives change in this world but few are even comfortable with the thought of it. Understanding the level of risk your core team is willing to take is essential. It's very easy to be excited about a new venture in the beginning. It's very easy to have thoughts of positive outcomes. The reality is that people loose interest when things don't go well. People start fearing the worst when things are bad. It takes a delusional tenacity to change anything.

I recently watched the Soderbergh film Che. I was struck by two things about Che's persona. The first and most relevant to the topic is- his continuous culling of his men. It seems as though he understood that at every turn it was necessary to trim the fat. He would constantly provide an opportunity for people to walk away. He would also present the stark consequences and allow people to reinforce their commitment or walk. This is a necessary process for any start-up.

The other thing that struck me about Che was- during the campaign for Cuba he was patient but new when to cut his losses and his decisions were quick and sharp. He was focused on the goal. When it came to Bolivia he was incapable of doing the same. He had to have known that things were not going well and yet he continued to barrel ahead. I think every entrepreneur is likely to face the same dilemma. It is a dilemma that cuts deep into our humanity. Why was it that Che could not make the right decisions in Bolivia? I think it was because his personal ties weighed him down.

If you're going to start a business you are going to involve people in a very intimate way whether you like it or not. When the high likelihood of money being lost is present be prepared for a lot of personal disappointment.  If money has seemingly been lost you may feel an enormous sense of responsibility towards all those that have contributed directly or indirectly. You may go out of your way and do ridiculous things to keep things afloat. Despite your best efforts people will blame you and walk. Do you still think risk is a beautiful thing? Making money and being caring towards others can often seem like two different things. There is no right answer you can not predict nor can you prevent your success or failure. You have to prepare yourself for either temporary outcome and be willing to keep at it. Above all value people and people of value will come through. If you are lucky they will be with you till the end.

Comments

[Amanda Koster]

solid powerful post.

[Emeric]

Hey Eduardo !
I agree with most of your great article, just one comment : you don't always have the chance to "choose" whom your money comes from, most of the time, I am afraid that you just take money from whoever is willing to invest in you, event if they only bring money... That is my experience... And when the money is in, you and your team are the only one invested in growing the business!
All the Best !