how to build your startup team & advisors

Building Your Team and AdvisorsBy, George DeebDecember 8, 2015

@RedRocketVC www.RedRocketVC.com 312-600-7560

Managing Partner (2010 to Date)

Chairman & CEO (2008-2010)

Founder & CEO (1999-2008)

Investment Banker (1991-1999)

BBA-Finance (1987-1991)

About George Deeb

http://www.redrocketvc.com/content/ourteam/

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Building Your Team

The Single Most Important Thing You Will Do- The primary reason 9 in 10 startups fail: the wrong team- Bias A+ team with a good idea over B+ team with great idea- Leverage the proven expertise of others

Do You Need a Co-Founder?

Assess Yourself- Do You Have the Skills Needed to Succeed Alone- Can Your Personality Embrace Another Equal Voice

Assess Business Needs- Co-Founders Can Fill Needed Talent Voids- Co-Founders Can Be Sources of Capital

Common Pitfalls- Set Clear Role Sort Right From the Start- Just Like With Any Marriage, It Can End in Ugly Divorces- Set Long Term Vesting of Equity, With Protections at Exit

Is a Team Needed to Launch?

My Immediate Answer . . .

Investors Back Teams, Not Individuals- Can’t have all their eggs in one basket if you are hit by bus

A One-Man Show Can Only Take Business So Far- Just not enough hours in the day- One person doesn’t possess all the needed skills

Roles of a Startup Team?

Leader of the Business and Vision (1st)Head of Product or Technology Development (2nd)Head of Customer Acquisition or Sales (3rd)Head of Customer Fulfillment or Operations (4th)Head of Finance and Administration (5th)

Do Roles Change Over Time?

My Immediate Answer . . .

CEO’s Focus Shifts from Internal to External With Scale- Once product and process scalable, go find the growth

Others Evolve From DIY Contributors to Team Managers- Not all contributors are good managers, and vice versa

How to Find Right Team?

Networking- Leverage the people you know- Always best to hire a known success

Job Boards- Big sites: LinkedIn, Monster, Career Builder, Craigs List- Targeted to Chicago: Built In Chicago, Hired- Targeted to role: Dice (for tech), CIMA (for marketers)

Startup Incubators and Accelerators - 1871, Tech Nexus, Catapult

Startup Events and Websites- Techweek, Startup Weekend, Technori Pitch- Founder2Be, TechCofounder, Co-Founder Lab

Recruiting With Limited Budgets?

How to Address Recruiting Costs- To start, do it yourself—but expect a drag on your time- Much less expensive than using recruitment firms (use later)

How to Address Compensation- Incent key team members with equity, to help reduce salary- Look for candidates that can work for free or bring capital

How to Address Benefits- Traditional employee benefits not needed in very early stage- But most likely needed after 50 employees

Recruiting Metrics to Track?

Hiring Speed- It should take 3-4 months to fill a typical role- If longer, something may no be right with process or offer

Employee Satisfaction- Establishing the right startup culture is key- Constantly talk to staff about what they like/dislike in biz

Employee Retention- A revolving door with talent means something not working- Or, you didn’t hire the right person in the first place

How to Identify Right Advisors?

Who Has Been There and Done That Before- People with past startup success in your space

Who Has Complementary Skillsets- People who fill holes in the resumes of current team

What Best Serves the Business Strategy- People who have sold into desired industries, clients, titles

Where to Find Them- Just like with hiring, leverage your personal network- Research on LinkedIn—search by industry, company, role- Research on Google—past funding or exits in your space

How to Manage Advisors?

Set Clear Expectations- How frequently will you meet—by phone or in person- How frequently will you call them in the interim

Respect their Time- Good advisors are typically very busy—be efficient- Limit group meetups quarterly, calls to one hour monthly

Set Clear Roles- Will they be doing any formal work (leverage them)

Incentivize Them- Offer small equity stake (1%) in biz or cash ($5K/quarter)

Further Reading

http://www.RedRocketVC.com

Lesson #2: Building the Right Team for Your StartupLesson #9: Spreading Equity to Key EmployeesLesson #12: Structuring Your Board of AdvisorsLesson #14: Role of a Startup CEOLesson #34: Recruiting Best Employees for Your StartupLesson #45: Finding a Mentor or Business CoachLesson #83: Startup Roles & ResponsibilitiesLesson #156: How to Find a Co-Founder for Your StartupLesson #176: Filtering Conflicting Advice from Multiple MentorsLesson #196: CEO’s Role Must Change As Company Scales

@georgedeeb