Many startups fail. Founding teams don’t expect to fail when they create their startup, but something goes wrong along the way. These four elements of a great startup founding team will keep your team strong, motivated, unified, and successful.
In this post, we will walk you through several elements that can help you build a great founding team. This is the sixth part of Icebreaker’s Is my idea any f#%!ing good guide. The post will give you great insight as of its own piece, but you can also read parts one, two, three, four and five.
Aim for Tangible Diversity
In your startup team, you want to aim for a diverse group of people. Intentionally implementing diversity in your team, both through soft skills and hard skills, will ensure success. You need people with soft skills that fall into three roles: a leader, a manager, and a doer.
A leader is required to help with hiring, selling, and fundraising. This person will inspire the rest of your team to work to the best of their ability. The leader is also able to inspire others to follow through with investing in your startup or purchasing your product.
A manager is essential to stay organized. Someone who is efficient at managing will keep your team on task. They will also be best at streamlining the workflow for all aspects of your startup; this efficiency could save you both time and money.
A doer will get things done. Leaders and managers are more likely to spend time planning, calculating, and analyzing before springing to action. A strong doer is the one on your team who will plow ahead to smash your startup’s goals.
Remember to look at the hard skills offered by each of these types of people as well. You will inevitably need someone who is great at sales because you need to sell your product to buyers and your company to investors. You will also need someone who is proficient at product development, so that you create a high-quality product quickly.
As tempting as it may be, do not hire your friends, or a family member who just really needs a job. For your startup to succeed, you have to focus on creating a great founding team with the hard and soft skills necessary for success. Each person needs to be the best in their own domain.
Have a Competitive Advantage
Your founding team needs to have a competitive advantage over other startups. You may have better access to technology or data to create a superior product. Perhaps you have better access to stakeholders in your industry.
Even if you don’t have any unique market insights, one competitive advantage that you can develop that will separate you from the rest is execution speed. While others in your industry may deliberate and consider options, you need to be able to think and act faster to get the upper hand.
Have a Mutual Mission and Purpose
Your startup team needs a mission and a purpose. Having a common goal will help you work together as a team even when things are difficult or the money isn’t flowing. A mission could even be seen as a competitive advantage because it unlocks success in so many other areas.
Being able to explain the “why” of your startup, and not only the “how” and the “what” of what you are doing, will set you apart from other startups and make you stand out while recruiting. Employees will be more loyal when they agree with your mission. Leaders who truly believe in the mission will be better at inspiring others and making decisions.
Simply put, more equity creates more motivation. Many startups fail, but a highly motivated startup team has a higher chance of success. If each member of your founding team has equal equity, everyone will be more motivated to succeed.
Investors evaluate how the CEO values their co-founders by looking at how equity is split between founders. If a co-founder is only given a small percentage of the equity, it may seem as though the CEO doesn’t value them because they aren’t very good at their job, or perhaps won’t be very impactful on the business. Conveying that each team member is essential to business success is what investors want to see. When each team member has equal shares, it shows that you value your co-founders equally.
Unequal founder equity splits are often in favor of the person who came up with the idea, or the person who started working first, or even the person who refused to take a salary for longer than the other founders. It takes between seven to ten years to build a company of great value. These small differences in the first year should not have an impact on equity splits for year two and will only serve to cause problems between team members if these differences determine equity splits.
Creating a great startup team depends on choosing the right people, showing they all have value, creating a common mission, and using or developing your competitive advantage. Create a diverse founding team with varied hard and soft skills, and keep everyone motivated with equal equity split. In addition to all this, your team needs to
Unite your team with a mission statement that everyone believes in. With a motivated team of diverse skill sets and personality types, unified by a mission statement, you will already have a competitive advantage over other startups. Strive to find or develop other competitive advantages to ensure success, like the ability to quickly make decisions and move into action.