Platforms and Networks: Managing Startups: Best Posts of 2012

Sunday, December 30, 2012

Managing Startups: Best Posts of 2012


Here's my compilation of 2012's best posts about managing startups. I assembled similar lists at the end of 20112010 and 2009. Many thanks to all of the authors. The generosity of the startup community is amazing, and these insights are invaluable to those of us who teach and coach aspiring entrepreneurs.

Apologies to authors whose work I've omitted. Please use comments below to suggest additional posts. Happy New Year!

Lean Startup

Business Models
Customer Discovery and Validation
Marketing: Demand Generation and Optimization

Sales and Sales Management
Viral Marketing
PR Strategy

Branding/Naming a Startup
Product Management/Product Design

Business Development

  • John O'Farrell of a16z describes how quality trumps quantity and clarity regarding mutual objectives is crucial in doing business development deals, using Opsware's transformative distribution agreement with Cisco as a case study.
Scaling

Funding Strategy

Founding Process
  • My colleague Noam Wasserman published his book, The Founder's Dilemmas, that describes tradeoffs that founders confront when deciding when/with whom to found, how to split equity, how to divide roles, etc.
  • Blake Masters' summary of Peter Thiel's Stanford CS183 lecture on the importance on early founding decisions.
  • Charlie O'Donnell of Brooklyn Bridge Ventures on questions that co-founders must address ASAP and the concept of the "minimum viable team," i.e., the smallest set of skills needed to get traction in an early-stage startup.
Company Culture, Organizational Structure, Recruiting and Other HR Issues
Board Management
Startup Failure
Exiting By Selling Your Company

The Startup Mindset and Coping with Startup Pressures

Management Advice, Not Elsewhere Classified

Career Advice (Especially for MBAs)
Startup Hubs
  • Brad Feld of Foundry Group and TechStars has published the book Startup Communities, a guide to building an entrepreneurial ecosystem.
Tools for Entrepreneurs
  • Beyond Steve Blank's Startup Owner's Manual, a book he co-authored with Bob Dorf, here is a list of the fantastic resources Steve has made available to the startup community -- mostly for free.

31 comments:

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  1. I'll bookmark this for the next time you say you're "too busy" for X :)

    Just kidding -- thanks for consolidating this.

    ReplyDelete

  2. Will: Maybe a kick-ass coder like you could figure out how to automate this so I can spend more time with my students? ;)

    ReplyDelete

  3. Awesome list. Tom, I hope you're kidding about the automation because it's your comments and "seal of approval" that make this a worthy list.

    ReplyDelete

  4. Great list. The automation will not have high quality of content compared to hand curated list.

    fyi,
    I run http://www.founderweekly.com/ which sends out the best hand curated content related to startups and entrepreneurs every week.

    ReplyDelete

  5. This is a kick-ass list. Thank you. Please don't wait another year for the next one. How about a quarterly update? Happy New Year!

    ReplyDelete

  6. This is just flat awesome. I'll be staying up nights for the next six months!

    ReplyDelete

  7. Thanks so much for the links - what a fantastic list! I've sync'd most of them to my kindle so that I can read them for the next month or so!

    ReplyDelete

  8. Great stuff Tom, one for the bookmarks. Big fan of Steve Blank's work on open source entrepreneurship. I think you can reach a lot more people if you can reproduce the post on Quora and LinkedIn. Thanks again for taking the time and making the list.

    ReplyDelete
  9. Thanks for the suggestion Sudarshan. I've been in touch with LinkedIn about this.

    Delete

  • Hey, great list. I really appreciate you including me on it. Thanks.

    ReplyDelete

  • TOM : Great stuff. Great service by pulling it together. @margaretmolloy (HBS Class 2000).

    ReplyDelete

    Replies

    1. Thanks, Margaret: we've all come a long way since Marketspace!

      Delete

  • Amazing list-- love it. Under "Lean Startup" you might add a recent TC article, "The Maximum, Beautiful Product" as a good alternative voice / counterpoint. http://techcrunch.com/2012/12/31/the-maximum-beautiful-product/

    Jason Goldberg of Fab.com has been writing some great articles on viral marketing, pivots, and scaling a fast growing ecommerce business: http://betashop.com

    Under "Tools" keep an eye out for Foundersuite.com...clever tools for startup founders (fin, ops, IR, etc.)...launching in 2-3 weeks. :)

    ReplyDelete

    Replies

    1. Thanks, Nathan: I added Glenn Kelman's "Maximum, Beautiful Product" post. The message that founders need a strong vision to guide their pivots is an important one, and one that Eric Ries would agree with 100%. Thanks as well for pointing us to Jason Goldberg's blog. There's some fantastic, very useful data on Fab.com's performance there.

      Delete

  • Tom - thank you for including my post on the One Metric That Matters. This is a great, and very valuable compilation.

    ReplyDelete

  • awesome list! missing advice on advisors, best series of posts i know is here: http://marcoullier.com/blog/2011/09/date-your-advisor-before-getting-married/

    ReplyDelete

    Replies

    1. BB: thanks, the advice to use a trial period for advisors is good, and holds for other venture participants, too, including many employees.

      Delete

  • Nice list of startup posts. Will go through the other years to see what is similar and what is not to try to spot some trends. Question to you - what is your criteria to determine what is a good startup post and what is not.

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    Replies

    1. There's no science behind the choices; e.g., they aren't based on traffic. I read a bunch of blogs regularly, and follow links to posts on blogs that I don't follow. I capture posts I might want to refer back to in Instapaper. Then, I spend a day sorting through the best stuff. My criterion, essentially, is: Did I learn something that seems worth passing on to my students and other aspiring entrepreneurs?

      Delete

  • Great list, Tom. Thank you for including me.

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  • Great list Tom...you are clearly really organized as this was a ton of work to pull together. I wish more women were writing things you find worth sharing...to encourage the next generation of entrepreneurs. Maybe we are all too busy building our businesses and haven't graduated to VC/Board/Advisor world. :)

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    Replies

    1. Jules: I do share your concern -- fewer than 10% of the posts are by women. But that may reflect the demographics of the startup community. A study by VentureSource showed that women represents only 7% and 3% of senior managers at successful startups (IPOed or sold) and unsuccessful startups, respectively http://buswk.co/Uobt7F Likewise, according to Kauffman, women represent fewer than 10% of VC partners http://bit.ly/UobPen So, we have a long way to go. But there's some good news at the top of the funnel: in the last few years, the % of HBS MBA grads joining startups has been about the same as the overall % of the class that's female, i.e., about 40%.

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  • Great list, thanks for sharing!

    ReplyDelete

  • This is an exciting list, Tom, and I intend to read or re-read each post.

    Given my work, I went straight to the posts on recruiting and hiring and wanted to mention a couple more. One of the most memorable posts on hiring that I read this year was by Steve Blank: "Hiring: Easy as Pie" http://steveblank.com/2011/08/22/hiring-easy-as-pie/

    Also, you mentioned a couple of excellent posts from Fred Wilson's MBA Mondays series on "People" including posts by Fred and by Chad Dickerson. Although there were several other great posts from that series, there is one that I believe deservs special mention, by Dr. Dana Ardi: http://www.avc.com/a_vc/2012/08/mba-mondays-guest-post-from-dr-dana-ardi.html

    Again, thank you. This is a remarkable resource!

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  • Thanks, Donna: I missed the Steve Blank post in my 2011 roundup. And I like the emphasis on looking for candidates' emotional commitment and self-awareness in the Dana Ardi post.

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    Replies

    1. Sorry, Tom, missed that the S. Blank post was from 2011 -- thought I had read it this past year! Well, it definitely made an impact if I still remember it so vividly.

      Again, thank you for this gem of a list.

      Delete

  • Fantastic list Tom, thank you. Surprised however that there isn't much on engagement and user habits.
    Here's a quick video: http://www.nirandfar.com/2012/09/desire-engine-in.html
    and my posts on Techcrunch on the topic: http://techcrunch.com/tag/nir-eyal/
    Thanks again!

    ReplyDelete

  • That's a great list. Too much to read :)
    I would say gapingvoid.com also provides really inspiration stuff for entrepreneurs. Though Hugh MacLeod draws cartoon but they hit soul of every entrepreneur.
    In addition to that I feel there are several entrepreneurs who have done 1 or 2 not startups and when they blog they write ground level wonderful experiences without too much jargon. StackOverflow.com founder's www.codinghorror.com is another asset.
    thanks a lot again.

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  • Great post Tom. Thanks for sharing!

    ReplyDelete

  • Awesome list of best posts in 2012

    2012. Hard Lessons Learned. | Ben Milne

    # Written mostly after Thanksgiving. Wrapped up sporadically for whatever reason, on whatever flight, or on whatever couch I seem to find myself on. Today it’s a couch in Denver after a day in the mountains… In a rented Jeep. #

    Dwolla is coming up on its 2 year anniversary. There are a million huge milestones for us to celebrate—hundreds of millions in some cases.

    I believe the most value I can offer you this week is not giving you a list of everything I want you to know about the last few years and only sharing what is beautifully perfect and what was apparently predictable only to us. I don’t believe there’s value in that.

    The last two years, and the two before, weren’t easy. Very few things just happened. There are more than a few times I wondered if the sun would come up, and I’ve had more than one person come up too fast, or didn’t have relevant knowledge and give me really bad advice. I own each decision I made. Polling people for their thoughts has helped me make better decisions.

    There are a few things I want to leave with my team and my community. We’re riding a wave, but the wave isn’t big enough yet. We have much work to do and much to learn. So as we enter this next phase, the best thing I can do is be honest about the harder lessons I’ve learned as a founder this year.

    The apparent timelines to building companies are more often than not complete fallacies. I think my contribution can be more honest than leading you to believe otherwise. Building a company is lonely and much worse in the beginning. Reading about all the breakthroughs everyone else has (who live somewhere else) doesn’t make it any easier.

    So here are some of my harder lessons learned. More than one has come close to costing me everything once or twice over. Some I had to relearn this year.

    Most people will not tell you when they are pissed off at you. Value those who do.

    Passive aggressive people suck, and they’ll cost you a fortune—metaphorically, emotionally, and literally. Start appreciating the people who tell you what they think from the get go. Learn to question those who are always complimenting you.

    Compliments don’t teach you much. Unless you’re Prince William,  Ashton Kutcher, Justin Bieber, Elon Musk, or a very humble Ben Silberman … you’re just not that great, and you have a lot of work to do.

    Even then, I’d put every dollar I’ve ever earned in this lifetime  on the fact that every one of those people I mentioned know the difference between ass kissing and necessary feedback. The more successful you become, the more you have to say no and proactively surround yourself with people who contribute to your company’s goals, don’t burn time talking about yesterday or plans they’ll never act on.

    Find the doers who tell you the truth. Then find more of them. When you recognize passive aggressive behavior, point it out. If it doesn’t get resolved, end the relationship.

    People will make promises. When they don’t keep them, it’s on you.

    Advice and promises will come in like a river once you start hitting milestones. Initially, you’ll want to hold those promises and favors until you need them. The easiest way to manage that, in my mind, is never rely on them. Most promises and favors aren’t as genuine as you’d like them to be. Remember, this isn’t personal for the other guy. It’s not their company. It’s yours.

    The right people will respond when you need them, but most people won’t. There’s nothing wrong with that. People get busy. Don’t beat yourself up about it.

    You’ll be wrong most of the time. Try to make the right decisions all of the time.

    As a team member in an early stage company, you’ll astound yourself by the number of times your assumptions are complete garbage. You’ll make the wrong decision only to have to redo it later.

    Recognizing mistakes and acting on them are more important than being perfect.

    The more times you’re right, the faster the company grows and the better off everyone else is as well. Pretty simple.

    Appreciate when you’re right, but don’t think it’s a common theme. Tomorrow you’ll be wrong about something. Assume it was a fluke and push yourself to be right again and again.

    Everything really does cost twice as much. no matter how good you are.

    All your assumptions are garbage (like your business plan), and recognizing that early will keep you humble. It’s unlikely your spreadsheet is right three years from now.

    • Someone will cost more to bring on.
    • Someone will cost less.
    • You’ll get sued.
    • You’ll end up refiling patents.
    • Healthcare costs will rise.
    • You’ll misunderstand a software license that will cost a fortune.
    • One machine you budgeted for won’t cut fast enough, so you’ll need two and more space.

    This will all happen at virtually every moment when you’re awake. You can control product, and a lot of other things, but there’s more you can’t control.

    You typically plan for the best scenario in your head. Most of the time it doesn’t go that way.

    Life isn’t as linear as a business plan.

    be careful who you sell your company to

    This was the most brutal lesson for me, because I couldn’t do anything about it once it became obvious things were borked. It has cost me months of sleeping and countless hours wondering what I did wrong.

    I spent ages 19 to 25 building my first company.  While most of my friends were in college, I had employees to pay.

    When I left the company, I rationalized it this way:

    I had grown up and it was time to do something bigger. It was a part of life similar to when you enter school as a college freshman and come out a doctor or lawyer. You’re not the same person on the other side. I figured why couldn’t the same be said for being an entrepreneur?  I went in green and came out a much better person.

    It is amazing what you learn.

    I put everything into building the parts of that company. Anyone close to me can attest to that. It’s taken me months to realize it’s not mine anymore. There are no next steps for me there. My heart might be in what I built, but the day I signed that contract I had no power to change anything.

    Learn to let it go the day you sign it over, or else you’ll be forced to let it go when you least expect.Be thoughtful about how you do it, and even if you think it’s done perfectly, you’ll probably find the new owners do a lot of things you don’t love. That’s life.

    Just because someone has more money than you, It doesn’t make them smarter

    The earlier you are in the process of founding companies, or having some huge breakout, (measured differently where you’re living) the more harmful this can be. You run the risk of taking advice from people who know absolutely nothing about your business.

    I can’t count the number of times a wealthy individual gave me advice that I couldn’t wait to hear and put straight to work. In retrospect, most of it was really bad advice, but there were a few golden nuggets that changed my life.

    Truth is, they probably know more than you about something, but you know a lot more about your company. Have the confidence to push on their advice. You’ll be amazed how fast they’ll sit up and dig in. Many times, the advice will change the more context you give, and you walk away better off.

    Feedback with no context is a bullet into a dark room full people. I don’t see how it ends well.

    middle men are expensive

    In many situations there are moments where someone says “I don’t know, but I’ll go find out”. These personalities should be applauded given they actually do what they say. These folks typically don’t make things up, and they get to people with answers. There are two things to be self aware of…

    1. Do they come back with a solution in an acceptable amount of time?
    2. Is the answers always “I don’t know, but I’ll go find out”?

    These two things are indicative of much bigger problems. If you cater to it, you’ll end up doing the work yourself. Nip it quickly.

    When in doubt. Ship.

    Which is what I’m doing with this post after weeks of pondering it’s relevance.

    If you’re not shipping, you’re dead.

    That’s it. You’ve reached the end of my mini novel. Hopefully one of these results in one or two people having a “ah-ha” moment that saves them some time in 2013!

    go. BE AWESOME.

    Top 5 Reasons Entrepreneurs Fail - CapLinked

    Are You Mark Zuckerberg, Colonel Sanders, or John DeLorean?

    Nobod

    y likes to talk about failure. It’s not fun or sexy. We live in a culture that worships success, no matter how you get there, and is disgusted by and afraid of failure, no matter what the reason. This is especially true of entrepreneurs. We live in age that believes in overnight success. The mythology of Mark Zuckerberg starting a business at nineteen, immediately succeeding, and becoming a billionaire by age twenty-five is now considered a template for millions of young aspiring entrepreneurs.

    Of course it is a cruel myth for anyone to believe that kind of success can be replicated. People would actually have a greater chance of winning the lottery. Most entrepreneurs fail. Sometimes they fail many times before they ultimately succeed. Only a few entrepreneurs have ever become billionaires before the age of forty, and so far only one person in history has achieved what Zuckerberg did at such an early age. That puts the odds at hundreds of billions to one. If anybody likes those odds, we have to play poker together some time.

    Here are a few more real life entrepreneurial stories. Colonel Sanders didn’t start Kentucky Fried Chicken until he was sixty-two years old. If you don’t believe that, check Wikipedia. Many entrepreneurs never succeed even if they try over and over for an entire lifetime. Do you remember Jon DeLorean? His car company was sort of like the Tesla of thirty years ago. He was arrested for selling cocaine. Why? So he could raise money to save his dying company. Even the enormously successful Elon Musk had run out of cash before Tesla went public. Rupert Murdoch was out of cash in 1990. He survived because Marvin Davis loaned him money. Stories of extremely delayed success, nearly losing it all, or outright failure are not what people want to hear, but they’re important. As much fun as it is, nothing is learned from easy success. Failure and near failure is how people learn.

    All of this begs to the question everybody running a business or thinking about starting a business wants to understand: Why do some entrepreneurs succeed while most of them fail? Here are a few key reasons.

    1)     Excessive optimism – Entrepreneurs have to be optimistic to succeed. However, too much optimism is also one of the most common reasons they fail. Entrepreneurs need to remember that only the paranoid survive. As much as you need to believe in your own success, at the same time you must never forget all the things that can go wrong and plan accordingly.

    2)     Inflexibility – Entrepreneurs need to be stubborn. They are often surrounded with people, even their loved ones, who tell them to give up and go get a job rather than trying to build something. Nevertheless, the inability or refusal to change and pivot kills many entrepreneurs.

    3)     Lack of creativity – A good entrepreneur learns from and often copies what others are doing if it’s working. As long as you aren’t stealing anything, that’s just good business. However, if you have none of your own ideas and are simply a copycat of what others are doing, you aren’t creating any value. Your business has nothing about it that is special, and your customers and others in the market will know it. A commodity business with no unique value proposition is much more likely to fail.

    4)     Greed – A good entrepreneur should be greedy and not just for money. Entrepreneurs should have a big appetite for risk, glory, fame, misery, power, and fortune among other things.  However, many entrepreneurs allow their greed to get the better of them. They allow it to blind their judgment and make bad decisions that destroy their businesses or themselves personally. The best entrepreneurs know how to balance their greed with discipline, prudence, and humility.

    5)     Bad luck – Yes, a successful entrepreneur must be lucky. This is just a basic fact even as it may be offensive to many people who think that you have to make your own luck and everything that happens people deserve. As nice as that is to believe for some people, it isn’t true. Luck is usually the single most important factor that distinguishes the most successful entrepreneurs from those who just do ok and survive. It is extremely rare for an entrepreneur to achieve great success without luck, and there is no way for anyone to control that variable. This is why many successful entrepreneurs are superstitious.

    Why become an entrepreneur when success is so uncertain? The most important reasons to become an entrepreneur aren’t success, money, fame, power, or glory. The entrepreneurial life is about being your own boss, doing what you love, and creating value. Hopefully if you create enough value, the money, fame, and glory will follow. Regardless, nobody can take away from you the enjoyment you derive from what you do. If you’re just in the game for the hope of hitting it big, you shouldn’t be in the game.

        

    Which ones will get us?...NONE (they missed out hubris...)

    Startup Mantra: Hire Fast, Fire Fast | Both Sides of the Table

    If you're new here, you may want to subscribe to my RSS feed, follow me on Twitter, or subscribe via email. Thanks for visiting!

    This post originally appeared on TechCrunch.  I have often said that what separates real entrepreneurs from pundits and bystanders is a bias towards getting things done versus over analyzing things. My credo has always been JFDI.

    It’s the hardest thing to teach people who come out of big companies, out of conservative jobs. At the big consulting firms, investment banks and established large technology companies we’re taught to produce long reports, make sure that every document is perfect quality and that every possible bit of diligence has been done. Good enough isn’t.

    And so things operate on a CYA basis.

    That doesn’t work in a startup.

    There’s a certain cadence that you can feel when you spend time hanging any well-run startup company. The management team has to have a bias toward making decisions. They know that a 70% accurate decision made quickly and based on sound principles is better than a 90% decision made after careful consideration.

    The startup entrepreneur knows that they’re going to be wrong often. They’re flexible and willing to admit when they’re wrong. They don’t create a culture of punishment for mistakes. They live be the credo that if you’re never making mistakes you’re not trying hard enough.

    In my mind the sign of a great entrepreneur is the one that spots the 30% scenario quickly and adjusts but doesn’t get gun shy about rapid decision-making in the future.

    In fact, analysis paralysis drives me fucking bonkers. It is not uncommon in a meeting for me to say, “There are three choices: A, B, C. My gut tells me that we ought to do B. But let’s decide as a group. I don’t care if my view isn’t selected. Let’s make a decision and move on.”

    Many people find this uncomfortable. The world is filled with people who don’t like having to put their neck on the line and say what they think. I don’t really care if I’m wrong as long as I’m not dogmatic if evidence later shows we need to change course.

    So that was a long walk into the topic of recruiting. But given that I believe the success of startups is almost entirely correlated with having extra-ordinary talent, the ability to source, select and inspire new staff to join is one of the greatest early tests of entrepreneurs.

    There is an old management adage that says, “Hire slowly, fire fast.” The idea has become conventional wisdom. It says that you need to take due care in selecting team members. It also says that you need to act quickly when your instinct says somebody isn’t working out.

    Only half of this adage is accurate for startups.

    Hire Slowly?
    This is the bit I have a problem with. I don’t think that recruiting is any different than any other decision process in a company. You’re never really going to know how somebody is going to perform in the role, how good of a cultural fit he or she is going to be and how motivated they’re going to become until they’re on the inside.

    I’m not arguing that no screening is required. There are obvious questions you have give staff to get a gut feel on cultural fit, intelligence, aptitude and the like.

    But here’s the thing. I see many teams that feel the need to interview another 3 candidates just to be sure. They suffer the decision on the way in. They over think the decision framework.

    I come from the “Blink” school of recruiting and decision-making. If you haven’t read it, you should. As humans most of us are inherently good at reading people and our innate instincts for “fit” are much better than our ability to analyze humans on a spreadsheet.

    I also subscribe to the views that you should always be recruiting (ABR) and when great people pop up you hire them and then find a way to make the role fit. I’d much rather have the super bright, super ambitious, great cultural fit in my business now than look for the “perfect” person who’s done this job before and maybe find them in 3 months. 3 months is a lifetime in a startup.

    If you haven’t read it I’ve written before on these topics:
    1. Attitude over Aptitude
    2. Only Hire A+ People
    3. Hiring at a Startup

    And just as my gut feel about the likely success of startups is often determined by looking at their velocity of product development and market progress of their product, so too is recruiting a factor in my assessment.

    Great leaders and great teams have the ability to find potential staff, evaluate their fit, inspire them to join and onboard them. They have good recruiting velocity.

    Any team that I work with that struggles to hire people quickly knows that I’m likely frustrated because I have many other companies that I work with that aren’t so slow.

    And when we didn’t ship product on time, didn’t get the biz dev deals we wanted competed, didn’t get our market messages out and the founder says, “sorry, I had too many other priorities – like fund raising” they know it will fall on deaf ears with me. Time spent onboarding new talented team members always yields more productivity than doing everything yourself.

    “But we don’t have budget!”

    Great entrepreneurs find a way. Recruiting cadence matters.

    Fire Fast?
    I’ve written in the past about changing jobs too frequently and I received a lot of blow-back from technical people who said, “I had asshole CEOs. When we hit a bump in the road he was very quick to slash-and-burn.”

    I was trying to argue that it’s OK to change jobs a few times when you’re young and that “things happen” but that if things happened 5-6 times there is probably a pattern that isn’t completely the fault of some asshole boss.

    But people don’t like to hear about firing or job cuts, so I was flamed.

    So I have been reluctant to weigh in again on the topic publicly. Brad Feld and I were discussing the topic at lunch at the most excellent Glue Conference this week in Boulder.

    He encouraged me to write this post and after smoking me out on Twitter I had no choice. ;-) Outed.

    So here goes.

    I have never regretted firing anybody. Not once.

    I have on many occasions regretted not firing somebody quickly enough.

    I don’t take any pride in letting somebody go. I recognize that it affects somebody economically, can affect somebody’s personal life and is one big blow to the ego. But if you’re afraid of firing people you shouldn’t be an entrepreneur. No startup company has any spare capacity for dead weight.

    I’ve made every excuse to myself in the past, “I can’t fire him now, he owns the customer relationships and it’s a crucial point in our sales process.” Or, “I haven’t given him a long-enough chance to prove himself – let me see how he develops” or even, “it will have a big impact on morale because she is well liked. I can’t afford that right now.”

    I’ve heard VCs use similar rationale, “We knew the CEO wasn’t working out but we couldn’t fire him because it would have made it too hard to get a fund raising round done” only to later regret not moving more quickly and reacting to the obvious discontent of the rest of the startup team.

    I’ve lived through every excuse. And for every firing procrastination I’ve made, one month afterwards I’ve always felt the exact same way, “Why didn’t I do this three months early?”

    Trust me: if you know, you know. If you know, do it now. Things don’t get better. Your “Blink” instincts are right. You won’t patch things up. Delaying the inevitable is not going to make things smoother with your investors, biz dev partners, customers or employees.

    There is only one answer: fire fast.

    Firing somebody is no different than the other 10,000 decisions you need to make in your company to survive. You free up much needed budget. You free up the org chart to bring in new blood. Almost universally your staff will come out of the wood-works and say, “thank you, he needed to go.”

    When people aren’t pulling their weight other members who are know it. And they’re grateful to work in an organization where they’re valued and slackers aren’t.

    When you have to fire somebody, don’t pussyfoot about. Don’t make up fake excuses about why they’re going or try to pretend it’s a redundancy or something. Tell them specifically what isn’t working. Don’t be mean for the sake of it. Give them suggestions of how they might think about the situation differently at the next company. Give them honest and constructive feedback.

    If the sacking is legitimate, chances are they knew in their gut it wasn’t working and will appreciate the candor.

    Obviously make sure that you’re following a legal process. In the US and UK if the termination comes reasonably quickly you’re almost always OK but please double-check with your legal advisors.

    To be clear – I’m not advocating creating a slash-and-burn employee culture where there is a constant revolving door. I do believe that you set the tone in your company that you as a founder work your arse off and expect it of others. You make sure people know it’s a meritocracy and the best staff will rise to the top. Age and experience are irrelevant. Good people get ahead, bad people get asked to leave.

    So there you have it. Most companies hire slowly and fire slowly – the exact opposite of best practice for startups.

    Pick up your recruiting cadence. Take a risk on people who you think will be a good fit. Don’t look for perfect resumes. Take some chances. Trust your gut feel. And when you got it wrong you move on. You’ll recover.

    Move fast. Don’t delay the inevitable. Check your legal framework. Get your papers in order. Treat people with respect and professionalism. Be open and productive. But honest with them about their shortcomings or why they aren’t working culturally. But fire them quickly.

    Flame away.

    Image courtesy of Joeff via Flickr.

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