Several months ago, at a Board meeting, as we were discussing hiring needs for one of our startups, one of the Non-Exec Directors, herself a very successful entrepreneur, looked the CEO in the eyes and said:
“You keep talking about hiring talent to help you run yesterday’s business. You need to start hiring talent to help you run tomorrow’s business.”
The comment has stuck with me since and I have played the quote back multiple times in evaluating teams, talking to portfolio CEOs about their scaling needs and thinking about how to best support them through access to our network.
Dear Founder, I know it has to be hard to accept that Joe, who was with you from Day 1 and took the risk to build a company is likely not going to be the right person to run a $10, 50 or $100 million dollar sales channel. It’s challenging to accept that Susan, your rockstar full-stack dev who built versions 0.1 through 2.1 of the product might not be the right person to take the mantle of CTO to help you scale. Most importantly, it is really hard to accept that even if you, as the CEO, have a deep personal background in Product, Eng or finance you should definitely replace yourself as Head of Product, VP Eng or CFO… or perhaps even as CEO.
Your bandwidth is finite (no matter if you’re working “Chinese style” seven days a week, 17 hours a day, that’s likely going to lead to burn out). Your knowledge is finite: You might have been the best modeler in your I-Banking associate class, but that doesn’t make you a CFO.
Your roles and responsibilities also evolve as you scale: You are the leader setting the strategic direction (not necessarily driving its daily implementation), you are the head fundraiser (not necessarily the one building the model to validate the $30M Series C), you are defining the product vision (not likely coding the new version of the app), you are the head salesman (brought in to close the deal, not open the door).
I have been most impressed with founders (that we have backed or not had the luck to) who have realized this early on and who have hired for the future. I have also seen others blame not doing so out of concerns of “increasing burn”, not “being ready for that level of seniority” or “wanting to see whether [Joe/Susan] can scale into that role.” If done right, hiring for the future will make burn, seniority concerns and Joe/Susan a non-issue.
The story of Sheryl Sandberg joining Google early is a great example of hiring for the future. There was no “management” role for a manager so she was skeptical. Eric Schmidt turned to her and said “Don’t be an idiot…Get on a rocket ship. When companies are growing quickly and they are having a lot of impact, careers take care of themselves.”
Your job should be to convince someone as impactful for the future of your business as Sheryl was for Google and later Facebook to believe that she needs to be joining YOUR rocket ship.
…And you know what, Joe/Susan as early shareholders of your business will benefit and be thankful for the change in trajectory that hire will have made.
(But yes, I appreciate it’s one of the many hard calls you have to learn to make)