One facet of starting a business that all experts agree on is that the quality of the people who start and build a business is instrumental to its success. As one expert put it, “People are the one factor in production...that animates all the others.[1] Often, several businesses are started at the same time that sell essentially the same product or service. When this happens, the key to success is not the product or service but rather the ability of the initial founder or founders to assemble a team that can execute the idea better than anyone else.
A new business’s “team” is the group of founders, key employees, and advisers that move a new business from an idea to a fully functioning firm. Usually, the team doesn’t come together all at once. Instead, it is built as the new business grows and can afford to hire additional personnel. The team also involves more than paid employees. Many new businesses have a board of directors, a board of advisors, and other professionals they rely on for direction and advice.
A new business’s “team” is the group of founders, key employees, and advisers that move a new business from an idea to a fully functioning firm.
There are two issues that you should be particularly sensitive to as you build your team. Your sensitivity to these issues and the way you handle them will send important signals to the people who you’ll approach for access to resources (such as bankers and investors) and will be instrumental to the way in which your new business team takes shape.
Being open to advice
First, the way your new business team is put together indicates the extent to which you’re open to advice and are able to generate enthusiasm for your business. If you start a business and are relying strictly on yourself, you run the risk of conveying to others that you are a “one-man show” and have no intentions of building a team or taking advice from others. In contrast, if you start a business and report that you’ve attended a number of small business seminars, have met with counselors from your local Small Business Develop Center and SCORE chapter, and have a five-member advisory board already in place, you’re conveying a very different impression. These efforts show that you’re open to advice, are willing to share power, and are able to garner support for your business idea. These initiatives may also cause a banker or investor to think, “Wow, if this person ever gets in a bind, he or she’ll have a nice network to lean on for counsel and advice,” or “If this person is able to fill a five-member advisory board before his or her business even starts, I bet he or she will have no trouble selling the business concept to paying customers.”
The way your new business team is assembled indicates the extent to which you’re open to advice and able to generate enthusiasm for your business.
Having a clear sense of how the business will evolve
The second thing to be sensitive to as you start building your new business team is to have a clear sense of how the team will evolve. Almost all new businesses have gaps in the personnel they need. That’s normal. Just make sure you have a plausible explanation for how you’re dealing with the gaps until you can permanently fill them. In addition, avoid the impression that you’re näive or unsure about the order in which to fill the gaps. For example, if you’re developing a new product, such as an accessory for the Apple iPhone, you’ll need access to expertise on marketing and sales during the time the product is being developed, to make sure it’s saleable after it’s produced. For you to say that a marketing and salesperson will be hired after the product is developed shows a lack of understanding of the proper upfront role of marketing input. If you can’t afford to hire a marketing person during your product development stage, that’s understandable, but evidence should be provided that shows where you’ll get access to marketing expertise. This is where aligning yourself with a competent SCORE advisor, establishing a relationship with your local Small Business Development Center, or putting together a board of directors or a board of advisors plays a vital role. You can often mine one or more of these groups, usually for free, to find people with specific expertise who are willing to provide counsel and advice until you can afford to hire full-time expertise.