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When you’re starting a business, what kind of team members do you need to have?
I want my team there for the start, operation and end/exit of a business, so for me, it’s important to focus on finding the right fit from the get-go.
The most valuable person to have on a team, when starting a business, is someone with money. You want a person who either has the resources at their disposal to finance the company, or who can secure financing. The No. 1 rule of business is “stay in business,” and running out of money has been the end of many good businesses.
You need capital to provide you with time to evolve. Some people spend all of their money before they figure it out. This is why you need someone who can finance your business out of their own pocket, or knows how to raise capital for the business. Everything else will stem from there.
Heed my dad’s partnership rules.
My dad shared some advice with me when I was looking into getting involved in my first partnership as an entrepreneur.
- Never get into a partnership.
- If you’re going to get into a partnership, make sure your partner has more money than you.
- See Rule No. 1.
Yes, it’s funny, but the precept does teach the importance of having enough capital.
A business that has enough capital has fewer limitations on innovation and more options for growth. More potential paths to take and fewer opportunity costs.
Related: 6 Steps to Build a Strong Team
Once you take care of financing your business, the next step is to ensure that the people joining you share your values.
Sooner or later, the truth will come out. No matter how much capital you have, your business will not function in the long term if your team isn’t aligned with the company’s values and goals.
A problem such as a lack of communication can be painful and counterproductive, resulting in a costly waste of time and energy.
Follow the leader.
After getting those first people with access to money and shared values, you then need to fill a leadership role. Every business must have a leader, someone to be a coach and a manager, and who knows the difference between the two.
Leaders set an example for everyone in the way that they work. We’ve all heard the phrase, “First one in, last one out.” Well, I look at things a bit differently: A leader is someone who’s the first one engaged in the business and who’s the last one engaged. He sets the example. It is also a leader’s responsibility to determine which team members are engaged or not, then act accordingly to get everyone on the same page.
Leaders set the tone for an organization, which is why they need to focus on filling that role right out of the gate.
Can they sell?
After finding financing and leadership, the next step is to find a go-to salesperson. As much as you need someone with access to money, you also need someone who can generate more revenue through sales of your service or product to the consumer.
You need someone who can sell a “B product” because they are an “A salesperson.” Being able to prospect and grow your pipeline is key.
Your sales team needs to be empowered to sell, to ask and attract. And to be good closers. Companies with sales teams who can nurture leads generate 50 percent more sales-ready leads, and they do it at 33 percent lower cost. Nurturing these leads can make a big difference over time. I can’t tell you how many deals I’ve inked recently that started several years ago.
Find other necessary additions.
So, you’re financed and have a leader and a salesperson in place. What comes next? When you’re starting a business, it is always advantageous to have a “utility player,” someone who can contribute in a variety of fashions. Ideally, she can contribute as a copywriter, social media coordinator, graphic artist, videographer, editor and/or accountant, or bring some mix of specialized skills that you can leverage in order to drive revenue.
One of the biggest mistakes that I’ve seen leaders make is not forming a board of advisors. This board of advisors needs to be comprised of people who have situational knowledge specific to your business. These individuals will have very little responsibility for your operations and no legal liability or obligation to you. Add board members who bring expertise to the table and don’t ask them for too much.
Ask your board to meet, or get on a conference call, for at least one hour, once a year (or every six months). Listen closely, take good notes and let your advisory team guide your company as it progresses. Failing to have the right board in place is the biggest, easiest mistake that many small companies make. Don’t let this be your mistake – be prepared to ask others for their help, their advice and their suggestions. These people have been there, done that. They know the most treacherous pitfalls to running a business and can steer you clear of them.
Once you have financing in place and are aligned with your leader, “go-to” salesperson, utility player and advisory board, your team is ready to go. Now that you have your squad in order, you’re locked and loaded. It’s time to execute on your plan for success.