“Hey Brett. Congrats on getting your company funded. I’ve heard the horror stories, and I was just wondering how many hours you’re working?” Kent asked me in an email.
The horror stories of founders working 100 hours week on end are commonplace. The reality, or at least my reality, was different.
I was working hard, but I wasn’t working 100-hour weeks. And I wasn’t stressed out. In fact, I was having the time of my life.
Maybe this was because I had spent the previous two years being turned down by investor after investor while raising money. Now that’s stressful.
Running a company? Well, it’s stressful, but not THAT stressful in comparison.
But there are things you need to know about your first year as a startup CEO. Here are seven things I learned in my first year as a startup CEO:
A. Everything starts with building your team:
Team building. Focus on quality over quantity. Make sure each and every employee is smart, passionate, has integrity, and fits the company culture.
Your job as CEO, especially that first year, is “Recruit, recruit, recruit” and “Sell, sell, sell.” You should be spending around 50% of your time recruiting.
Those first employees you hire will set the tone for the rest of the company’s life. You are in great shape if you hire high quality people that fit your culture people right from the start.
Oh, and make sure you, the CEO, interview each new hire. Personally, I would suggest interviewing at least the first 50 employees you bring into your company.
B. Then you need to upgrade the team once you’ve built the team.
You’re going to hire some non-believers. In other words, you’re going to hire people that are just there for the paycheck and don’t believe in your company. Worse yet, these non-believers share their disbelief with their fellow co-workers.
The problem is non-believers are like cancer in a small company. Non-believers can destroy a small company’s morale.
Imagine your company has ten employees including you. And one of the employees is a non-believer.
That one non-believer (10% of your workforce!) is complaining about the company to the other employees. Everyone knows if someone is unhappy in a small company,
And that stuff brings down everyone’s morale.
Your job as CEO is to ask the non-believers to move on. They don't fit, and you will not miss them.
C. You need to execute your plan.
Focus on the details, and don't be afraid to hold the team accountable. Your team is looking at you for leadership.
You’ve got a long road ahead of you, and it’s important that you set the tone of the company right at the start. That means you’re going to have milestones and objectives that need to be met.
Now this doesn’t mean you are running a sweatshop. The idea isn’t to whip everyone to meet unrealistic goals.
You will fail if you take the course of pushing your people too hard. Successful CEOs understand that managing people is like driving a car. You need to know when put on the gas and when you need to apply the brakes.
D. Manage your money wisely.
Most CEOs believe their startup is going to rocket to success. And most CEOs are wrong.
The classic saying I like to remember is “It takes twice as long as you think it will and twice as much money too.”
The reality is your success and getting to cash flow positive might take even longer than twice as long. So manage your money wisely.
Spend on the things you absolutely have to spend on like top talent, but save money where you can save. For more, read: www.brettjfox.com/are-you-being-appropriately-frugal-and-why-its-so-important/
E. Celebrate your successes.
Startups are a marathon, not a sprint. Your journey is going to take many years (the average is seven to ten years to a liquidity event), so you need to celebrate along the way.
So employ the Kaizen method (read: www.brettjfox.com/how-do-you-keep-your-company-on-the-right-track-when-youre-just-starting/) of recognizing your small incremental achievements that you are making on your way to changing the world.
You’re trying to build momentum when you start a company. So every small achievement along the way helps build that momentum.
I liked the idea of giving the team small rewards as we hit minor milestones. It might be giving everyone a $10 Starbucks gift card or free movie tickets.
These small rewards don’t break the bank, but they do remind everyone that you care. Plus they remind your team that the company is executing and achieving.
F. Working with investors.
Make sure you have regular 1:1's with each investor before every board meeting. Remember the golden rule of never surprising your board during a board meeting.
Bad news is expected. Don't hide it. Instead build the trust of your board. Having a mentor or coach that is not a board member (someone who has been there before) is something to consider.
G. Be transparent with your team.
One of the biggest mistakes you can make is not sharing the bad news with your team. You will be amazed at the positive (yes positive) response when you share bad news.
- You’ve built a team that believes in your mission, and…
- Your team wants to win, and…
- Your team is made up of high-quality, high-integrity people, so…
- Your team will be able to handle the bad news, plus…
- Your team knows that not everything is going to work out, so…
- You send a message of trust when you tell your team the problems along with the successes, and better yet…
- You will be amazed that many times your team will come up with the solutions to the problems.
One final piece of advice: Have fun!
I remember having a conversation early on with Bob, our one Angel Investor. Bob is a brilliant technologist and an industry legend.
Bob asked me, “Are you having fun?”
I immediately answered, “I’m having the time of my life.”
And that’s how it should be for you too. Yes, there are lots of things to do.
Yes, you have to recruit, and execute, and manage your money, and work with investors, and deal with countless unexpected problems, but you should still be having fun at the end of the day.
As I said to Bob that day, “Even the bad days are good.”
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