Knowing how to build a team for your startup may be one of the most important steps. It is a step in which your biases can creep your judgement, and where you can take bad decisions. The problem is that you will see how good is your decision is just on long term. This will make you lose time and energy trying to achieve something that can’t be done with a team that is not homogenic, doesn’t have complementary skills and knowledge, or doesn’t share the same values.
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We are assuming that until this point you have made the due diligence all by yourself. You analyzed the industry, you analyzed the customer needs, and the way they are satisfying those needs at the moment. At the end, you concluded that:
- The industry is growing and there is a place for newcomers.
- You understood the Supply Chain and identified an entry point in the industry, that has promising potential for profits.
- You understand the client and their needs, and you are confident that you can create a product/service that can better satisfy their needs.
- The Total Addressable Market is big enough and you can build a product that can be scalable and there is enough room to grow.
Now, it is the time to dive deep on “how to build a team for your startup?”.
Where to start when building a team for your startup?
Do you need a business partner?
I think that the first question for which you need to find an answer is: “Do you need a business partner?”
If you do, you should first find that partner, before proceeding with finding the other members of your team.
Ideally, any complete start-up team, should have the following three roles fulfilled by the founders:
- Dreamer
- Builder
- Seller
Think about what is your role. Unusually one person can have as many as 2 roles. You can’t have all three of them.
Depending on what roll/rolls you can accomplish, you will start looking for someone who can fill the gap for the remaining roll/rolls
How to search and choose a business partner?
This step has a high level of complexity. It requires a structured approach, and it takes in considerations the specific situation of your business. Depending on the industry, on the complexity of your business and the knowledge and experience that you already have, the final result will be different.
1. Evaluate Your Skills and Weaknesses
For the first step of this process, you should start by evaluating your skills and knowledge. Identify areas where you excel and where you may lack the required expertise. It’s necessary to look at this step in an objective manner. Consider what are your superpowers, and what would be the processes that you can own.
2. Consider the Complexity of Your Business
Depending on the business model, and the industry, the future business can require a different amount of knowledge and expertise.
What role you can fulfill? How familiar are you with the industry? How easy would be for you to fill the knowledge gap in yhr business?
This questions may help you decide if would be a good idea to find a partner or not.
3. Workload and Responsibilities
Once again, depending on the business model and the industry, you can have a constant and difficult workload that can overwhelm you.
On the other hand, if you may have an unbearable amount of work just for the beginning of the business, or you may have some spikes from time to time, it can be a better idea to work with collaborators. You can externalize the work that brings you spikes internally. R
4. Consider the Financial Aspect
If you need to build an MVP in an industry that has big financial entry barriers, or if you need to cover start-up losses until you reach an economy of scale, necessary for the viability of your business, you may be better to have by your side a business partner with which you can share the financial burthen of a start-up, until you can have a tested MVP, and a proof of concept that can help you bring alongside some investors.
5. Think About Networking and Connections
Some businesses may need access to special raw materials, access to certain information or proprietary knowledge, or may need intensive C-level sales efforts. Usually, this kind of business requires a big networking and a good connection. Even if you have those, a business partner from inside the industry, that may double the size of the networking and the quality of the contact, may double your chance of success.
6. Evaluate the Business Risk
Evaluate the risk associated with your business. Some ventures, particularly those with high financial or legal risks, may benefit from shared responsibility and shared liability.
Some business models can have high liabilities, financial risks, or legal risks. Oslo, you may not want to invest all of your time, resources, and energy in one single initiative.
In these cases, a partner may be a good way to take calculated risks and to keep things under control at any point.
7. Explore Alternative Structures
If after this exercise you are still hesitating to make a decision, you can further explore some alternative structures.
- You may have part-time collaborators.
- Work with consultants
- Hire freelancers to do the work that you can’t perform.
Be aware that this forms of collaboration have their risks. It will be hard to monitor the quality of your work. Also, your collaborators might change their minds and decide to not work with you anymore. They will not have any of the risk and liability. They even may start to copy your business model if this is a promising endeavor with good traction.
8. Seek Input and Advice for how to build a team for your startup
You can look in your network to search for someone that had already been in your situation. You may connect to discuss this problem, to see if your conception can provide you with a perspective that you didn’t saw until now.
Also, you may look for a mentor. If you are lucky, you may find someone willing to share his knowledge with you and is willing to guide you through this process.
What you should do next to learn how to build a team for your startup?
After you have decided if you need, or not, a partner and you have a clear image of the ideal partner that you want to bring alongside you, you can start looking for it.
It will be a challenging step to find a good partner. You need to find someone that has:
- An entrepreneurial mindset.
- Has expertise in the industry you want to start a business.
- Has business acumen.
- It is an expert in the industry, and on a particular business function (marketing, sales, technic, etc.)
- Has a common mission, and vision.
- Is not involved in any other project at the moment.
Depending on your network, it can take you more then a months to find the right person. Don’t rush it!
*** Your first instinct will be to enter in a business with a good friend. Don’t do that, unless the objective conditions presented above are met. The attributes necessary for building a good relationship, are not the same as the ones necessary for building a business. Most commonly, we choose our friend after criteria like interests, values, and personalities. If you are serious about learning how to build a team for your startup, follow all the steps in this article.
- You may first try to find a partner, by searching in your network.
- Then, you can search on platforms like LinkedIn.
- And probably the most efficient method would be to take part in meetings, at a local level, between entrepreneurs. Most commonly, these meetings are taking place in a business incubator or business hubs. If you have one around you, you should join!
How to build a team for your startup?
Once you have found your partner, you can start working together and build together the organigram and the team. This is the next next step of the process, and require the same level of seriousness.
1. Assess Commitment and Shared Vision
Together with your potential co-founder, asses if you have a shared vision, commitment, and passion for the business. A co-founder should be as invested in the success of the venture as you are.
If not, find ways to level up each other.
2. Define Your Vision and Mission
Before you start recruiting team members, it’s essential to have a clear understanding of your business’s vision and mission. What are your goals, values, and long-term objectives? Knowing these elements will not only guide your hiring decisions but also help you communicate your purpose effectively to potential team members.
3. Discuss Roles and Expectations
It is important to have an honest discussion with your new co-founder right from the beginning about the following aspect of your collaboration:
- What are the roles that each of you will fulfill?
- What is the expectation that each of you has from this collaboration?
- What are the goals and objectives in the long term?
- What is the responsibility that each of you has?
- What are the KPI after your performance will be measured?
4. Start with a Small Core Team
80% of the work Is done. At this point, together you may start to build your core team for your business.
- Analyze the skills and knowledge that your team needs, to succeed.
- After that, make a gap analysis between the skills and knowledge that you and your cofounder have, and the skills and knowledge that you need.
- Now, try to divide the list of skills and knowledge that your business needs and categorize them into different departments.
- Assess what will be the workload on each department (HR, Sales, Marketing, etc.)
- Make a list of the open positions that you will need.
- Make a job description for each position.
- Build an organigram.
5. Leverage Your Network
This is a good point to ask for help in your community. Communicate your needs, and talk with people who are in the industry or people who work in HR.
If you have in mind people who may be a good fit for your company, you may contact them directly and pitch this opportunity.
6. Prioritize Passion and Alignment
Hiring individuals who are passionate about their work, and have experience in the industry, can be more valuable than simply hiring for technical skills. Passionate team members are more likely to go the extra mile for the success of your business. They bring a good vibe to the team, contribute to building a culture inside your start-up, and may build a community that can have a great impact on the retention of your employees. This may be necessary especially if your business is in one of the industries that have a steep learning curve or have experience as an entry barrier.
7. Conduct thorough interviews
Even if you may find between your connection a person that seems to be a good fit, with the right experience and skills, do not skip interviews.
If you do not have any experience in conducting interviews, do the necessary research. Is an important step, and needs to be taken seriously.
Alternatively, you may find a collaborator to help you recruit and interview the right person for your company. It may be necessary if you do not have enough experience.
8. Consider equity and compensation
If you need people highly skilled, and with vast knowledge, you may need to build a package salary that is slightly better than the one of other companies in the industry.
An attractive way of motivating people with experience to join your team may be to have a stock option program, that rewards employees who came and built the business with you.
This is necessary because they take some of the risk, choosing to come to work for you.
9. Establish clear roles and responsibilities
In the beginning, your business may experience a high period of changes and uncertainty. It is your job to bring as much clarity and predictability as possible.
One of the biggest mistakes that entrepreneurs make in their business, which causes confusion and frustration among their employees, is not having a clear organigram and description for the roles inside their team.
Anyone needs to know where there responsibility starts and ends, and who is responsible for every aspect of your business.
Further, every role must have a clear list of KPIs against which each employee can measure his/her performance.
Make sure that the KPIs are objective and realizable. Also, have a clear bonus structure for those employees who are exceptional, and can do more than the job requires.
To keep them motivated, you need to find a balance between results and bonus structure.
10. Foster Team Collaboration
It is important to understand that you build a business because you think that together you may build something faster and better.
With this in mind, you need to build a bonus system that promotes collaboration and encourages members of your team to work together, share information, and knowledge, and give support to one another when needed.
The cases in which you need to build a competitive environment are rare. If this is your case, you need to adapt the bonus system to reflect the comportment that you want to promote.
11. Develop a Compelling Company Culture
Now that you have a team, is time to put the first bricks of the base of your culture. This culture may need to start from the values of your business. Make sure that your employees have common values with your business.
Also, you need to have a compelling way of constantly working with these values in mind. Find ways to encourage the ones that are self guided by those values.
Conclusion
Knowing how to build a team for your startup is an essential step in your entrepreneurship career. Is the kind of step that involves many soft skills. For this reason, I would recommend you to seek advice if you don’t have the necessary experience yet.
In time, you will gather the necessary skills to navigate by yourself through this, but at the beginning, you may lack the necessary expertise and experience to do so professionally and efficiently.
Taking into consideration that the future of your business is at stake, try to gather as much information as you can before going through this process. You may even take a course on LinkedIn learning about this topic. The most efficient way would be to find a mentor who can guide you through this. If this is not possible, try to seek advice from people in the industry that have done it already, and done it with success.
Alternatively, hire a HR professional to help you! they already know how to build a team for your startup, and they will use their experience to speed up the process?
