Sunday, September 1, 2019

“Challenge of making a start-up succeed - and why the era of the 'brilliant jerk' is over - ArabianBusiness.com” plus 1 more

“Challenge of making a start-up succeed - and why the era of the 'brilliant jerk' is over - ArabianBusiness.com” plus 1 more


Challenge of making a start-up succeed - and why the era of the 'brilliant jerk' is over - ArabianBusiness.com

Posted: 31 Aug 2019 11:13 PM PDT

When a startup fails, it's easy to look towards spreadsheets and financial figures for the answers. But it's often the case that such failings are not caused by a lack of strategic execution.

Instead, firms are increasingly being failed by the characters of their founders – the very founders who were so passionate about building up their businesses in the first place.

After experiencing fast initial growth, usually fueled by a strong type-A personality, start-ups can quickly fall into the trap of burning through money and talent by failing to create a broader corporate culture that supports the overall vision and the employees who are making it a reality.

The challenge now is not so much investing in ideas as it is investing in the right teams to surround chief executives who have often been suddenly handed a senior management role without a chance to hone their people skills. These skills are essential to foster an internal culture, nurture talent and ultimately create a sustainable business for those who work so hard to keep it alive.

When a customer uses an app it may seem like a seamless transaction, but that simple action relies on an array of talent – from software engineers to user support teams and the receptionist on the front desk. And while engrossed in the excitement of growth and funding and all the trappings of a successful startup, it's easy for a chief executive to become so narrowly focused on driving forward their vision that they lose sight of the people who make it happen.

Balance

Ultimately, it's all about finding a balance in creating the right team to put around the founder – and having a founder who listens to those around them. This means finding the correct mix of different, complementary skills that are rarely within the range of one individual – especially ones who are often keen on complete control. For example, it's no good having a prudent CFO if the 'brilliant jerk' founder won't listen to their advice that the runway is coming to an end.

We are beginning to see increasing recognition of this trend more broadly. Investors are thinking about the internal culture of a company, about teams and how they work together. Moreover, there is a growing trend among the investment community to 'professionalise' startups once they reach a certain size, seeking to fill their boards and C-levels with executives from more mature and established organisations.

Much of the discussion in business circles over the last 10-15 years has been what we can learn from founder culture, and arguably businesses and investors were too uncritical of the downsides of that culture. But this is changing. The tech firms that pride themselves on disruption are seeing the value in demonstrating their responsibility.

UK fintech challenger banks Monzo and Revolut have both been trawling the more traditional financial services world, building C-suites of alumni of more established names, such as Barclays, HSBC and Goldman Sachs. At these established corporations, people management and corporate culture is a whole division of its own – with the leadership also understanding the value of having a system of checks and balances in place to prevent one individual from derailing the whole operation.

Innovative founders can kickstart a business, but that doesn't mean they can run one. Investors – and employees – have started to notice. While the premium will always be on returns and performance, investors are more and more interested in the twin strengths of managerial responsibility and a strong internal culture than ever before. The era of the brilliant jerk is over – the great founders of the future will be the ones who admit they cannot do it all.

Areije Al Shakar is director & fund manager, Al Waha Fund of Funds

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Overcoming the Challenges of Software Startup Growth - DevPro Journal

Posted: 28 Aug 2019 11:53 AM PDT

Every new business wants to succeed and grow, but software startup growth can bring new and sometimes unexpected challenges. Saleem S. Khatri, Chief Executive Officer of Lavu Inc., shares insights and advice on meeting those challenges head-on and building a successful organization.

What was the biggest challenge you encountered as a startup?

Saleem S. Khatri,
CEO,
Lavu Inc.

Khatri: Maintaining the fast pace of a startup is always demanding, but with each stage of growth comes additional hurdles. Early on, your task is to find a product-market fit before running out of money. Once you make it past that stage, you're going to encounter challenges revolving around growth and scaling, and that's where Lavu is now. The challenges associated with scaling a startup deal primarily with going to market fast(er), overseeing people, and handling organizational issues. A mentor of mine once told me that, as with any manager, "50 percent of your job is HR related," and this has proven to be true. Half of my job will always be managing the needs of my team. If you can serve your team, your customers, and your shareholders, you're going to find success.

Which areas of your business were most affected by fast growth?

Khatri: When a company like Lavu, growing as fast as we are, is in full-on scale mode, every challenge impacts the entire organization. HR issues in one department affect the ability of other departments to produce results. In order to drive more sales, you need more support staff, and better product that addresses customer pain points, and more efficient marketing to increase conversions. So serving the needs of the team must be a holistic effort that truly serves the whole team. Think of it as a symphony orchestra, where each part must be in sync in order to achieve harmony.

Were the challenges that Lavu faced unique?

Khatri: I came into my role at Lavu with previous startup and managerial experience, so I knew what to anticipate. The challenges we've seen at Lavu are challenges that every startup sees at some point. I've been lucky to have extensive mentorship as well as support from Aldrich Capital Partners, Lavu's private equity partner/sponsor.

What do software startups need to overcome challenges associated with growth?

Khatri: Success at startups requires a "Founder's Mentality," meaning grit, perseverance, and a can-do attitude. Problems need to be solved quickly, with creative solutions and constant iteration. To persevere, you must continue testing and refining, and realize that the process never ends. This mentality needs to be instilled in the organization as a whole, not just in leadership. We've done that here at Lavu.

What has adopting the Founder's Mentality meant to Lavu?

Khatri: Lavu has been incredibly successful. Thanks to the dedication of our team, business is growing at an escalating rate, and while scaling to that incredible gain, we've still been able to launch a new product, LavuPay, which is taking off like a rocket ship. We have several initiatives in the making that will further accelerate growth, and there's just no limit to what we can do.

What advice would you give a software startup ready to take their business to the next level?

Khatri: I can't overemphasize the need for grit and perseverance as a founder. You're heading for a roller coaster ride, and you'll need to be able to manage your emotions and work through whatever comes your way. Just make sure you're taking one step forward every day, and keep your head up. 

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