BUSI 701 Artistic Entrepreneurship Class 6 Building the Team Hawkins culture Khosla team Kawasaki soulmates

Go or No-Go? Vernon’s Razor

Go or No-Go?

Team The #1 to mitigate risk in a new venture: proven team Most VCs have “team” as #1 ingredient Can you answer: Why you? –(Not being an expert is a management problem)

Why You? Google search: “Are you an entrepreneur quiz”Google search: “Are you an entrepreneur quiz”

Attributes of Entrepreneurs Leader –Vision –Communication –Integrity –Loyalty Driven Resilient Risk tolerant Creative Inquisitive Resourceful Team-oriented Khosla risk video

How to Attract VCs Article Passion Tenacity Flexibility Commitment Teamwork Coachability Knowledge “How to Attract VC investors” by Jim Casparie If team is #1, then demonstrating these attributes should be a high priority.

Team – Vernon’s Razor Management risk is #1, so building a team should be #1 Share, share, share Don’t over-protect your idea –Protecting idea vs. #1 team

Team – Develop Your Network Good news: talented people like meeting talented people Play the student card E.g., on the Challenge executive summary application, you’ll be asked who has helped you and how

Developing your Network Advisors/Mentors Professional services, particularly lawyers Investors Partners Customers Suppliers Service providers Keyword: networking

Co-Founders Diversity of skill sets Discuss ownership up front Have an equity plan based on: –Money investment –Time investment –Long-term commitment –Value to firm Don’t use 50/50 default

Entrepreneur’s Guide Article Qualities of Co-Founders Intellectual curiosity Independent thinking Analytical thinking Likes to work Works efficiently Dedicated Emotionally stable Ability to focus Responsible Integrity OK with no salary Shared goals Shared product areas Compatible personality Essential Qualities of a Startup Company Team

Why Have Two Founders? (Not all of team are founders) Vs. One –Bandwidth –Reality check –Inspiration –Knowledge Vs. Many –Hard to get consensus –Split “the take” –Risk of imbalance in efforts Get a great partner video.

Early On Not everyone is a “co-founder” Consultants (paid) and advisors (unpaid) Incentives for early employees –Equity –Stock options –Deferred salary –Culture of new venture –“Ownership” of their piece of the pie Kawasaki video Kawasaki video (4:30)

Harness the Power of Advisors No business is too small Management “think tank” Where to find: –Recently retired executives (SCORE)SCORE –Business people you admire; aim high –No harm in asking Regular meetings (maybe quarterly) “Harness the Power of an Advisory Board” by Susan Ward, Keyword: networking

Evaluating the Team – Mullins Ability Personality Connectedness Source: Mullins New Business Road Test

Team – Ability What are the few critical success factors (CSFs) in your industry? How can you validate that you have identified them correctly? How can your team demonstrate their ability to execute the CSFs? What are the missing links? Sales orientation? Source: Mullins New Business Road Test

Team – Personality Mission Aspirations Risk To work for yourself? To build something small or big? Is the passion really there? Will you risk the security of a job and a salary? Will you risk losing control of your venture? Source: Mullins New Business Road Test Hawkins, passion

Connectedness Suppliers Customers Competitors Source: Mullins New Business Road Test