Leadership in a start-up will largely be in the hands of the founder or owner. In my case it was starting up ShredBank with my great friend and business partner James. That’s James and I in the photo – we are flying on a helicopter over Vegas :-). The experience in a helicopter was a bit like a Start up – you are unsure if you are doing the right thing, you are much more comfortable with someone who is smarter than you, and it is a bumpy ride initially but ultimately a very fulfilling and enjoying ride 🙂
To lead a start-up is to lead entrepreneurially. You are creating and building an environment on a very time bound struggle (usually twelve months) to rebalance cash from internal sources (loans, investment, overdraft and personal money) with external cash (payment from customers). You will be likely leading a little team, with very little money and with few customers, but you will have big hopes, dreams and aspirations of taking on the world. Leading a start-up is getting out there and evangelising the world about the good news of what your business has to offer and inspiring and motivating your little team for true greatness! At this stage the leader’s primary concern is selling and cash. That is it – selling and cash! Everything is about securing customers to justify the organisation’s existence and to generate enough money from new customers to end the flow of internal funding (loans, investment, borrowings), and become self sustaining. It is a race against time because funding from internal sources no matter how much you have, will eventually dry up. So there is an urgency to establish a viable market before the initial cash runs out.
In terms of organisational systems and processes, there are very few of them because there are likely only a few people floating about and organisational charts are those things you read about in text books! Are there organisational policies, systems, procedures, and budget? No, not a one! There are none! Why? Because at this stage the leadership cares only about two things – get sales and cash! That’s it and that’s the priority. Oh, of course, we will talk the talk about putting in good systems and processes, but in my experience of leading six start-ups it is, and only ever will be at this stage about getting sales that will deliver the cash needed to survive. So at this point in the life cycle, the organisational structure is as flat as a pancake. Every man and his dog report to one person – the founder owner! That is the leader! Relationships at this stage are all personal; everyone knows each other and the few employees that may be about do everything that needs to be done with an intimate understanding of their customers – because there are only three of them!
So when it comes to leading a start-up here are some thoughts:
• Sustainable profitable market
That is your mantra as a leader. You are there to find a “sustainable profitable market.” You have established that your product or service solves a problem, and you have identified a number of people or organisations suffering that problem; you have a solution to their problem and you can provide it to them at a price less than the cost of enduring the problem in a way that delivers a customer experience that keeps them coming back for more and telling other people. And if you have that, then you must find this market, and make sure that you price and structure the solution appropriately, so that it is a profitable market that you can acquire, grow and become the leader in.
• Brand awareness
If there is no brand awareness, then selling your products or services is nightmarishly difficult! The more brand awareness that there is for your products and services then the easier it will be in selling them to the market. Simple! Easy example is Coca-cola. It has huge brand awareness so I suspect selling Coke to the local restaurants and retailers is not that difficult! Through whatever means is relevant, right and legal, make sure you lead the charge in making your brand the go to, only option, forget all the others, I will pay the extra, brand that will enable you to create that long term sustainable profitable market that you need.