Wednesday, March 30, 2005

Factoring in Founders

The more I think about it, the more I realize that The Founder Factor™ ought to be interesting reading to more than just the founders and their venture capitalists. Just as most people don’t wake up in the morning saying, “I think I’ll be a jerk today,” I'm guessing that most do not begin working for a startup wanting for it to fail.

Now that I’ve read the book, I can say with all confidence that it’s very worthwhile even for people who have no intention of starting a company of their own. With a clear understanding of the Founder Factor, we can more appropriately assess the leaders of the organizations with which we intend to align ourselves. We can also better plan for the transitions that will inevitably take place if the business is to succeed. And if we’re fortunate enough to have the ear of our founder, we can help coach that person to be more successful in their role, which will help us be more successful ourselves. In short, it gives us greater control over our own destinies, even if that control is limited to having a better understanding of when the ship is sinking and knowing that it’s time to get out.

The understanding helps from the moment we find out about an attractive-sounding position within a startup. It helps, for instance, to understand that founders, by nature, tend to be arrogant and difficult to work for – if you want something different, it might be better to find a company that’s already crossed the chasm. Nancy Truitt Pierce describes in her book the paradoxical relationship between the "founder factor" and this business of crossing the chasm - how they are defined and influenced by one another.

Understanding that relationship also helps explain that while we may be very connected with the founder in the early stages, it’s not helpful later in a company’s maturation process. I’ve lost count of the number of people I’ve had to counsel to give up trying to talk directly with the founder to get problems solved – that goes for customers as well as employees. Sure it works, sort of – for a while. The trouble is that it’s destructive to the long-term health of the organization to go at it that way and so that behavior really should not be rewarded.

The reason it doesn’t make good business sense is because it’s not scalable. Believe it or not, there are reasons why bureaucracies are part of the evolutionary process. The trick is not to eliminate them entirely but to embrace them in a healthy way, in a way that helps the business scale up.

Not everyone will get that. Those that do have a big job ahead of them trying to help everyone else understand. Their reward usually comes in the form of getting to stick around longer and often it means they get to increase their level of responsibility within the organization too. Fortunately, this is usually a good thing.

Those who don’t understand have a limited shelf life. Even if no one understands exactly why that is, their managers usually have some instinct that this is true. People who whine about how things are no longer the way they used to be come to mind as the sort of people who don't last as long as they might if they weren't whining. Things rarely stay the same, so it seems pointless to spend too much time mourning the past. Instead, it’s far better to use that energy to help create a viable and worthwhile future or go find someplace else that suits you.

If you can't help yourself, it may be useful to know that whining in this situation is the same as painting a bulls-eye on your chest and carrying a big red flag identifying you as "incapable of adapting" at a time when adapting to big changes is critical.

Whether you prefer the relative stability of a larger organization or the relative intimacy of a smaller one or are looking for some suitable compromise between the two, you’ll make more informed choices if you understand what Nancy’s talking about with regard to founders and emerging companies. Nancy herself does a great job helping the founders keep their wits about them. For everyone else, if you need help understanding where you fit in or how to manage in the midst of the kinds of changes she describes, I suppose I’m pretty good at that part of it these days, having been through many stages and permutations of the evolutionary process of an emerging company.

I'm curious what you've noticed regarding trends and issues as companies scale. As always, you can reach me at to send me your thoughts.

What does adaptibility mean for you?