Overlooked Traits of Successful Startup CEOs
To build a successful startup is hard. Worth it, but hard. It takes a rare combination of skills and abilities. However, we must expand and add some nuance to the traits we commonly associate with startup CEOs and founders.
Listen to the podcast version of this blog post, an AI experiment.
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In case you’re new here, I’m John Gauch – a seasoned fractional COO, sales coach and mentor. Over 20+ years, I have applied my growth and operations skills to help dozens of startups, building one high-impact venture to nearly $100M in revenue and a second to exceed that benchmark. I began my career as a tech lawyer in New York City. I developed my expertise in progressive roles in business development, finance, sales, marketing and product, working along the way with companies like Amazon, IBM and Microsoft.
Startup CEOs are incredible—superhuman when at their best.
Building a successful and sustainable business is rare; creating one that also scales to the 10s of millions of dollars in revenue is a feat; building an organization where people thrive and love to work too, well, that’s a hat trick. What’s more, as CEO, you put your integrity on the line in persuading others to join you in this challenging task--when there’s no sure way to ensure the desired outcome.
People often highlight as top traits of startup CEOs (also, entrepreneurs and founders) things like:
Creativity and vision. Yes.
Passion for the product. Yep.
Leadership skills. No doubt.
Perseverance. For sure.
Risk taking. Has to be.
Speed. Of course.
I agree, and I firmly believe there are other related traits that are as (or more) essential to startup CEOs and founding teams who want to succeed.
In this blog post, I cover why the first three items above are important but not enough. See next week’s blog post for a discussion of the final three.
Being visionary and creative means looking backward.
Creativity involves combining different ideas floating around our heads into something new (IdeaFlow), and building a new business is as much about the current day and the past as a vision for the future. Startup CEOs need to be experts at using what you already know and looking backward.
Computer scientist Kenneth Stanley uses the analogy of “stepping stones” when discussing breakthrough innovation.
The successful entrepreneur sees what is about to be possible in the world based on what’s already happened and what’s emerging right now. You see when one missing stone (an emerging social phenomenon or technology, for example) is just appearing, which will enable you to create something for the very first time. I imagine a river with two banks. The stepping stones help us hop, from stone to stone, from one bank to the other. The startup “visionary” sees the constellation of stones snap into place that allows us to build a new-to-the-world, high-impact product and business.
The product is important but secondary.
As a CEO, founder, entrepreneur, you need to be passionate about your business idea and product, and you need to commit to another ideal. You need to be dedicated to understanding the problem that your product solves in your customers’ lives. You need to become the absolute expert in the particular struggling situation that leads a large number of people to seek a better way to get something meaningful done in their lives.
This focus on the problem—over the product—serves as a true north that keeps your business focused early on and avoids straying later. The insights from deeply understanding the problem will make all your other decisions—about what to prioritize in the product roadmap, which go-to-market channels you should pursue, how to talk about the product in sales meetings or marketing, and so much more—obvious. It’s a gift that keeps giving.
Leadership isn’t about being the only star.
Of course, a startup CEO is ultimately responsible for the business. This does not mean you need to do all of the work. Early on, one of your most urgent jobs is showing traction with customers, or once you’ve gotten traction, scaling up.
You should prioritize and focus on the work that only you can do, and if that takes up all of your time, you need to get help with the rest. You need to tap into the ingenuity of other human beings you trust.
I’m not talking about you assigning work and telling people how to do what they are tasked with. I’m talking about delegation where you share the outcome you seek and allow your teammate to choose a path to that destination. This may still require and involve a ton of communication and collaboration across the organization, which is completely fine. You need your team.
Read part 2: More Overlooked Traits of Successful Startup CEOs
To listen to the podcast version of
If you’re a startup CEO, founder or entrepreneur, and I might be helpful in some way, I’d love to connect. Learn about my services and please reach out if that makes sense.
What I Need to Know to Make Investor Referrals
These are the six things I need to know to make investor referrals for CEOs and founding team members when we haven’t worked together before. Answering these six questions is also a valuable shorthand for quickly vetting any new business idea.
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In case this is your first time at the site - I'm John Gauch, a consultant with extensive experience in business operations and growth. I specialize in helping startups implement both strategies effectively. As a fractional COO, I work with founders and CEOs through each step, tailoring solutions to your unique needs and objectives.
I love to be helpful whenever I can be. This is particularly true when it comes to supporting startup CEOs and founding teams. Making introductions is one way I can do that.
The intro could be to someone with expertise in an industry or a specific role (etc.). Sometimes, it's to investors. If I haven't worked with a company, it can be a little challenging to make investor introductions, though.
To address that difficulty, I've summarized the essential information I need to know to introduce a company to investors in situations where I haven't worked with that company for an extended time.
It’s also useful as a shorthand for quickly vetting any new business idea.
There are six questions.
The first question is: What is the problem to be solved?
In particular, I want to know whether an unmet or under-met need is arising in people’s lives. I'm looking for something visceral. I sometimes ask people to imagine the first part of a typical Shark Tank pitch, where the entrepreneur describes some hardship they've experienced or observed. People aren’t going to change their ways if they don’t feel a push arising from an uncomfortable situation.
The second question is connected: What are the existing alternatives to solving this problem?
Maybe it's a current something that falls short in accomplishing a task. Maybe there isn't a good existing alternative at all, and people are silently struggling--unhappy and unable to progress toward the better future they imagine.
The third question is: When does this situation arise?
What's the specific context when this unmet or under-met need shows up? Again, the idea here is to be very specific. Who are the people this happens to? When do they face the situation? What are they doing at that time? Why are they doing it?
You'll notice very little about the product so far, which is by design. Most important is whether you have identified and can describe a compelling problem worth solving. That's what we're trying to understand with these first three questions. Once you've gotten this far, you should tell an in-depth, true story about a struggling situation in which people find themselves.
Read also: How to Learn Jobs to be Done
Now you can answer question 4: What does your product do?
The description should detail how the product bridges the current gap between what people are trying to do and what they can achieve now.
Part five follows: How big is this opportunity?
Is this a $1 million revenue opp or something much bigger? Ash Murray suggests entrepreneurs start with a back-of-the-envelope calculation and then move onto a more detailed estimation, in each case looking at your annual recurring revenue in month 12 of year 3 after your launch. I like his approach.
I created my own step-by-step guide (originally for a University of Hawaii startup program) that you can find here.
Ideally, you’ll also show the total addressable market size, and how it was determined (hint: it should be based in part on the information you’ve described in questions one to three).
Read also: Estimating Product Market Opportunity
The last question, and it’s often a hard one to answer: Why now?
Why could your product only exist now versus a year ago or 10 years ago? There are many intelligent and creative people in the world, and many are struggling to progress in different aspects of their lives. A compelling “why now” answer suggests you’re working on a problem that could only be solved recently. This increases the attractiveness of the idea significantly because it could be a genuine new-to-the-world innovation.
It raises questions if your product could have existed anytime in recent history and hasn't or did but doesn’t now.
Maybe there isn't a problem to solve after all. People have tried and failed, and you’re just the latest making an attempt.
Maybe there's an issue with feasibility. People have tried and failed because the product can’t be built or the business model math doesn’t work.
Maybe the product isn’t differentiated from a bunch of current alternatives. It’s just one more product in a long list of similar products that have been around for a while.
If there’s not a good “why now” answer, it doesn't mean you can't continue to build your business and maybe even thrive, but it suggests it may not be an explosive new opportunity with tons of growth potential.
Could you have discovered an enormous opportunity that others have missed or failed to execute? I suppose so, but in that case, could you explain why that may be.
If I could only ask an entrepreneur one question about their company and product it would probably be this.
Answering these six questions will help ensure your new business is on the right track and help me or anyone else share your message with others.
What's the unmet or undermet problem?
What are the current alternatives that are falling short?
What is the context?
What is the product?
What is the scale of the opportunity?
Why is this idea coming into existence now?
For my covering intro email to investors, I’d also love to highlight the traction you've gotten so far (e.g., notable customer numbers, wrapping up a round, a brand-name investor) and what you’re looking for from the meeting (e.g., a networking meeting to talk about the space you’re operating in or a call to see if they’re interested in participating in a fundraising round). Sot let me know that too.
Read also: Navigating Startup Fundraising: Insights from an Experienced COO
With this information, I can make an informed and meaningful investor introduction that will serve both parties well.
I’m always happy to chat about business building. Please reach out to learn more about my work or just to be and stay in touch.
How to Learn Jobs to be Done
Find out how to get started with Jobs to be Done, do your first JTBD interviews, get colleagues on board with the concept, and deepen your outstanding of the framework, methods and tools--to start and grow a business and align a team.
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In case this is your first time visiting - I'm John Gauch, a consultant with extensive experience in business operations and growth planning. I specialize in helping startups implement strategies effectively in both areas. In my work as a fractional COO, I work with founders and CEOs through each step of the process, tailoring solutions to fit your unique needs and objectives.
Creating and sustaining a successful business entails doing countless things right. Knowing the Job to be Done (JTBD) of your customers and how your product helps them may not make it easier to start and grow a company, but it will make what you should be doing more obvious--and less subject to guesswork.
Co-architected by Clayton Christensen and Bob Moesta, a "Job to be Done" is the progress someone is trying to make in a struggling situation. Putting the JTBD framework to use effectively requires a commitment to understanding people's lives.
It is less about, "How do I make people want my product?" More about, "How do I make a product people want?"
It is less about, "How do I 'sell' more of my product?" More about, "How do I help people make the progress they are seeking?"
Applying the JTBD framework tells us why people pull your product into their lives, how to communicate with them compellingly, and how to satisfy them after they make a purchase. It can also tell us whether a brand new product idea is likely to work or not. In a May 2012 interview with Horace Dediu, Christensen contemplated: "10 years down the road, people will look back at my research, and they might say this idea of Jobs to be Done is a bigger idea than was 'disruption'," the theory that initially brought Christensen to the business world's attention.
Today, people around the globe put JTBD to use at companies of all sizes across industries.
Not only will applying JTBD and the associated mindset help you grow a business and innovate. When combined with practices and tools such as customer experience mapping and complementary metrics, leaders can articulate a clearer vision, dial in the organization's value proposition, align the team, and develop accountability among team members.
Read also: Estimating Product Market Opportunity
To learn all about JTBD, and how do do and use customer interviews, read my series of posts on the topic at Medium.
If you’re a startup CEO or founder, and you feel it would be interesting to chat, I’d love to connect. Learn about my services and please reach out.
This blog post appeared originally on LinkedIn.