Tips for founders: shaping your 'minimum viable team'.

When investors are doing due diligence on a startup, they focus on the financial aspects of the strategy and plan: Do they have a viable business model? What’s the addressable market? Are the growth plans compelling with a capability to execute? Every startup is a bet based on a hunch and smart thinking, yet great attention is paid to numbers, as the be all and end all.

But when it comes to evaluating the startup team - standing in front of investors gripping their pitch deck like an artifact recovered by Indiana Jones -  scant attention is paid to the people aspect of the venture. This is odd, as you’re backing the team’s idea, their ability to execute and make it happen. 

Many investors have never run a fish and chip shop let alone founded a startup, so what they know about hiring, building and leading a startup team is hazy. I’ve always taken to heart the advice of Ben Horowitz, author of The Hard Thing About Hard Things, who said: We knew that if we took care of the people, the products and the profits - in that order – we had a chance of success.

So, what makes a successful startup team?  Let’s apply the Lean Startup approach. The concept is a process of testing and validating your assumptions across all aspects of the startup business model, not just the product features, so let’s apply this to building your ‘Minimum Viable Team’ (‘MVT’)? 

The most precious resource of a startup is the collection of passionate and persistent human minds. Minds dramatically amplify the value of hands. And don’t rush, Airbnb spent five months interviewing for their first employee before they hired. From the Skunk Works engineers of the 1950s to the surgical team collaborations that deliver stunning outcomes today, we need integrated, cross-functional, project-based teamwork. In tech, software engineers need to connect with sales teams, data scientists, and user-experience designers.

Startup teams must move quickly through the forming-storming-norming-performing stages of team development identified by Tuckman, And remember, there is no such thing as a solo entrepreneur. Nobody who’s ever scaled a business from the ground up did it alone, so it is imperative that you are selective and strategic about your team. How do you choose the right folks for your startup?

Here are some thoughts around hiring philosophy and strategy, why I focus on personality, and lessons from my own personal experience of building and running embryonic teams.

1. Hiring Philosophy

What is your hiring philosophy in terms of its purpose and principles that will make a difference?

Rockstars gives leverage You’re looking for rockstars who create 10x leverage – ‘moonshot thinkers’. In startup hiring there are few shades of grey, go for those that drive growth.

Culture-contributors are better than culture-fitters Hiring culture-fitters does not make your culture better. The founding team will soon be outnumbered by new hires. They will decide your future culture, not you.

Hire action-takers Execution transforms an idea into a revenue-generating business, so hire folks capable of accomplishing things, not just coming up with ideas. Challenges get thrown at you at every turn. It is imperative that you have people with the agility to do stuff.

Hire for potential Potential and experience are not mutually exclusive, but potential is more valuable, so hire those whose potential can explode, pulling you along with them. Hires with potential are easy to spot: they get excited talking about what they could do rather than what they have done. Expertise can become obsolete.

2. Hiring Strategy

Take your long-term vision and map the architecture to organisation functions that are necessary to give life to your business. The startup phase is temporary. While many startups don’t make it past the initial phase, that’s not what you want your trajectory to be.

Don’t build a team for a startup Build your team with the future in mind, not for now or the next twelve months, hire people who could be future leaders. This way, when you’re ready to scale your business, there’s far less friction.

Hire people who can relate to customers Every team member should be driven by a desire to engage with customers, even the introvert developers. Quiet people have the loudest minds.  

Avoid homogeneity There is a natural bias to hire people ‘like us’. Fight this bias. Hiring similar means repeatability over originality. Hiring different brings the sparky ones. Homogeneity is dangerous. Everyone will have the same blind spots.

3. Focus on Personality

Simply, what sort of people do you want in your team on your startup journey? From my own experience, attitudes, character, behaviour are vital -  so check for personality fit:

• Openness: look for free spirited, open-minded people.
• Conscientiousness: A startup can be a bit chaotic and disruptive, so look for people who are self-organised and dependable.
• Extraversion: hire energisers, live-wires who keep noise and energy levels up – not office jesters, but people who keep the lights burning.
• Self-awareness: People who with empathy and compassion are invaluable to balance searing ambition.
• Emotional stability: People with confidence don’t tend to worry often. Hire them!
• Purpose driven: They don’t join for money, but for the opportunity to do something remarkable.
• Ingenious: They don’t see money as the enabler of growth, they constantly looking for creative ways to make the most of the resources they have.

4. Lessons from experience

So, having identified above the hiring elements in the team recipe, how do you nurture and knit them together? Here are six learnings based on my experience.

Meaning Putting a sense of purpose in both the work itself and the output is important. The meaning of work and self-expression of this varies for each individual and should be nurtured.

Structure and clarity An individual’s understanding of expectations and the process for fulfilling these are important for their effectiveness. OKRs used to set and communicate goals are a good practice.

Create an environment of psychological safety An individual with high psychological safety will take risks. They feel confident that no one will be embarrassed or punished for admitting a mistake. A startup is all about risk, so create these conditions. 

Develop an operating system I use the term ‘operating system’ to mean the building blocks for the way teams collaborate, create value, the technical skills each member is expected to contribute. It is the processes by which work will be managed, and the cultural norms and mindset of collaboration that will guide behaviour.

The best operating systems embed an ethos of continuous improvement throughout the organisation. They are structured enough to provide consistent guidance but loose enough to accommodate changing conditions, priorities, data, and needs. 

The ‘Way We Work’ frames, shape, and improves on the principles of agile teamwork, so hold project kick-offs, regular one-on-ones, and review progress using retrospectives.

Sense the pulse One tool to measure and monitor people outcomes is an anonymous monthly survey. It asks a single question: How are you feeling? And offers five possible responses from Great to Terrible. This simple query allows founders to identify trends in sentiment for investing in additional learning and coaching.

To measure functioning, a quarterly engagement survey to ask members how they’re feeling about the project they’re working on or how they’re progressing toward their short- and long-term goals, both personally and professionally. If feedback scores begin to dip, that’s a sign that a team is struggling and indicates to founders that it’s time to intervene.

Enable self-development of the team Your team members should be able to identify their own areas for team development and self-improvement. This requires transparency and trust. This helps them to self-adjust, for example they might decide to modify their colocation model from being in-person two days a week to being two four-day weeks each month.

Summary

Shaping a team and working together is more complex than ever and more difficult to get right. It’s essential you are clear on your MVT philosophy and strategy, and then for me, balance experience v potential v personality. You want energised game changer, ‘moonshot thinkers’ as described. Then create the conditions to let individuals flourish and team dynamics spark. 

Don’t miss out on an exceptional talent just because it’s unfamiliar. Embrace diverse thoughts and bring in people from different backgrounds to tap into a broader pool of personalities and uncover individuals with unique perspectives. When a variety of voices are represented in a team, it fosters creativity and leads to more effective and inclusive decision-making.

The foundation of success lies in the capabilities and development of the people you hire, so, prioritise upskilling and learning. It’s all about hiring people with the potential to do a job well and then giving them all the creative freedom to let them work towards their goals. Technical skills and experience can be developed over time, traits like integrity, teamwork, emotional intelligence and self-awareness are harder to find, but seek these folks out and don’t settle for good enough.