Jumping off a cliff and assembling an airplane fast enough to not smack into the ground. That’s how Alex Valdes of Trust Stamp describes launching a startup company. If things don’t go exactly right, they can go horribly wrong.
Alex joined Josh to discuss what it takes to do the extraordinary: Build a business from the ground up into a thriving publicly traded company.
Here are 3 things every successful startup knows:
1. Timing is everything
You see that play out when it comes to fundraising. If the timing is off, then efforts are going to flop. Each fundraising cycle needs to bring in enough money to get you to the next milestone while enabling you to execute on ambitious goals and a lofty vision. There must be a well thought out plan to make that happen. If any part of it breaks down, then you’ll miss targets and likely fall short in the next fundraising cycle.
At the same time, there is a balance to maintain between having enough and having too much. Having an abundance of funds doesn’t sound like a bad thing, but there’s a risk of diluting yourself depending on valuations. It comes down to having the right processes in place with the right people to pull it off at the right time.
2. Like Clockwork
Speaking of timing, Alex learned early on to embrace a concept borrowed from Jim Collins: Clock Building.
Leaders within organizations often fall into either being a clock builder or a time teller. Clock builders focus their time on building a machine that others can use to tell time. Time tellers are the center of the organization and are depended on to let everyone else know what time it is.
Issues can arise when the time teller is disengaged from the process or isn’t able to tell time properly. That’s when you end up with a company not producing the output needed to reach the goals and milestones.
Alex dedicates a large portion of his energy to teaching people the difference between these two roles and what it takes to build a clock that works well. His goal is not just to cultivate great time tellers, but skilled clock builders.
3. The Right Piece
To build a quality clock, you need quality pieces. Each cog and wheel selected must be the right part for that function. When it comes to hiring a great team, it’s important to analyze each candidate from three perspectives:
Sometimes hiring managers find candidates who seem great and they’ll want to fit them into the role because they really need it filled. Greasing the wrong cog won’t make it fit any more comfortably into the slot. It’s a better use of everyone’s talent and time to make sure that person is the best suited for the role, otherwise you’ll throw the whole machine off.
To keep from gumming up the works, Josh recommends focusing on the company culture and mapping the business need to the job description. This can avoid hiring candidates that are misaligned for the positions they’re filling. When the right person understands what success looks like, the whole machine will run more smoothly.
Early stage startups can stumble over this piece, creating more barriers for themselves. When operating agreements, employee agreements, and success metrics are aligned properly, you’ll avoid potentially significant miscommunications and conflict.
Startups can be exciting and profitable, with the right approach.
There are big ideas with thrilling potential. It’s nearly impossible to bring them profitably to fruition and success without adding the right people. Finding, attracting, and adding the right people will, without doubt, be some of the biggest and best decisions you will make in your business.
If you have questions about ensuring you make great hiring decisions, we’re happy to connect and help. We’d also love to hear what you’ve struggled with most as a new or growing company?
Contributors: Alex Valdes, Chief Financial Officer and Executive Vice President at Trust Stamp
Josh McAfee, Co-founder and Managing Partner of Humans Doing and WSJ & USA Today bestselling author of Measure Up: Mastering Your Career Search Like a Boss
Josh McAfee is the Co-Founder and Managing Partner at Humans Doing. With over 26 years of recruiting and team-building experience, Josh has worked with startups, SMBs, and large companies to determine hiring needs, develop our recruiting strategies and processes, and connect top talent to fuel growth. In 2021, he became a Wall Street Journal and USA Today bestselling author with his book Measure Up: Mastering Your Career Search Like a Boss.
Humans Doing is an expert team of highly skilled recruiters specializing in filling critical tech and leadership positions for growing companies. Our greatest measure of success is the success of our clients and the candidates we place with them. We help people make great hiring and career decisions. Our team is ready to partner with you to find the right people for the right roles.