Avengers Assemble! Tips on building your startup’s own management team
Building something from scratch ain’t easy. The glitz, glamour, and magazine covers that scream ‘Visionary Entrepreneur’ can often be very, very misleading. Because make no mistake, building a startup and navigating the choppy waters of entrepreneurship is no walk in the park. It can quickly become a very exhausting, lonely affair.
That is why at LAN, we encourage founders to put together a capable management team as soon as they can. But how exactly do you go about doing so? That’s the question we will attempt to answer through this blog post. And we spoke to two entrepreneurs who’ve gone down that path before — Lakmini Wijesundera, the co-founder and CEO of Iron One Technologies, and Vipula Dharmapala, CEO of InsureMe.lk.
Don’t try to do it all
“As a founder, you often try to do it all. But that’s definitely not the way to go” opined Lakmini. Lakmini said she was fortunate enough to find a co-founder with whom she could split responsibilities. “My co-founder was able to shoulder the bulk of the marketing and business development activities, while I could focus more on the product development side of things”.
Vipula agreed. “It’s all about knowing your own shortcomings with respect to the skills you need to run your startup, and then plugging those gaps. In my own case, I came from an operational background. But given that we’re in the business of insurance, it was important to find someone who understood the technical intricacies of each insurance policy. There is no way I could’ve done that on my own” he said.
Look for people who can be trusted and are hands on
Both Lakmini and Vipula agreed that startups should be open to shuffling their management teams depending on where the startup is in its lifecycle. “During the early stages, you need doers. They must be able to roll up their sleeves and get things done. But as the startup matures, you should look for people who know how to hire the right people to work under them” said Lakmini.
For instance, Lakmini pointed out how IronOne Technologies’ current Head of Innovation was initially hired as a delivery manager. As the years went by, this individual’s outstanding ability to hire great people became apparent and the company decided to put those skills to good use.
“You must hire people who understand that it’s going to be an uphill climb, and are not afraid to get their hands dirty. You can hire someone who has a lot of experience in the corporate sector, but they must be ready to fight in the trenches alongside you. Startups cannot afford the luxury of large teams that can be ordered about while you yourself are comfortably cocooned inside a cubicle,” said Vipula.
“Fledgling startups need hands-on management teams. Grown up startups need good people managers” Lakmini concurred.
“Another thing you need to look out for is trustworthiness. You must be able to trust them without having to look over their shoulder all the time. To get things done, you must delegate. To delegate, you need trust,” Vipula said. Vipula recounted how immediately after hiring someone to be part of InsureMe’s management team, he kept a watchful eye from a distance, and that too for a few months. Once it became clear that the new hire had settled in, Vipula said he let them do their job with full autonomy.
Pay well and accept the funding when it comes along
As the saying goes, ‘If you pay peanuts, you will get monkeys’. Unless your management team is also not related to you, it is likely that you will have to recruit them from outside. In doing so, you must commit to compensating them fairly.
“I am probably the lowest paid member of InsureMe’s management team” Vipula chuckled. “It is important that I pay these people what they’re worth, otherwise they have no reason to come join me. They have enough opportunities out there. To a certain extent, you can also sweeten the deal by granting share options and other incentives,” he continued.
In Lakmini’s opinion, this is where growth capital from early stage investors can be invaluable. “If you are offered capital by way of a fair investment, grab it with both hands. Those funds will help you grow. Not accepting early investments was a mistake I made, and I chose to go to a bank instead. I was afraid of losing control, but looking back, I realise that my fears were misguided” she said. As Lakmini recounted, the bank didn’t really care how IronOne spent the money it had loaned, and left IronOne to figure things out on its own, the hard way.
“But if the same funding was to come from an investor, then there is a higher chance that the investor will help you put that money to good use,” she said.
We couldn’t agree more with what both Lakmini and Vipula said. At LAN, we place 50%-70% of our attention on the team behind a startup. It is important to have a team that can build a product. But it’s equally important to make sure that the said team can hire talent and delegate responsibility. In a startup, everyone must bring something to the table — like a certain group of superheroes we all know and love. Now, imagine if everything was left in the hands of Captain America, while the other Avengers just sat around? Cap’ is going to lose his cool in no time, that’s for sure.
The success of your startup depends on how well you build things, be they products, relationships, or…the team.
