Founder Conflict: the troublesome star in the team

This article is the eighteenth in the Startup Series on FirstPost’s Tech2 section and first appeared on June the 19th, 2017.

Both business and sport celebrate stars. In sport, especially football, star performers are often traded for huge sums of money, without regard to the fact that football is a team sport. The history of player trading shows that too many “stars” fail, when placed in the context of another team than their last one that let them shine. Startups are a team sport too, and founder conflict can sometimes arise from one “star” disrupting the team.

In an earlier column, I had written about a founder and her challenges with the technology lead. She had given the tech lead co-founder status and given him a considerable chunk of equity. Much conflict later, she had to part ways with him. That did not come without a lot of legal trouble and negotiation. The delay in resolving the conflict also derailed some of her timelines.

Are stars, especially uncooperative, uncollaborative and egotistic ones, worth it in a startup founding team? And what happens when you, as a co-founder, find yourself wasting altogether too much time on resolving team conflict due to a disruptive “star”?

Such conflict, if repeated or persistent, obviously does not bode well for the long term future of the startup. It is therefore best addressed when it first arises because if it is not nipped in the bud, you might find yourself expending too much energy on non-value generating activities rather than on core business issues.

Most people however do not relish confrontation, leave alone interfering in conflict and resolving it. So how can one approach this unwitting role of being a “peacemaker”?

As a first step, give yourself some time out. Separate yourself from the situation and take time to think clearly about the long term and ask these questions: Who in the team has a good attitude about working long term in a rapidly changing environment; who brings their competence to the work; whose ego hampers their delivery even though they may be competent; who is likely to be a better ambassador for the company in its growth years some time down the line; whom can you see yourself speaking and working with everyday for the next foreseeable future. These are deceptively simple questions with meaningful answers that bring clarity. In exploring all this, do not just go with your rational mind e.g. thinking the “star” may be irreplaceable or very expensive to replace. Pay heed to your feelings and your gut feeling e.g. does the “star” make you uncomfortable enough to avoid him or her altogether?

Consider the implications of breaking a relationship now on not-very-friendly terms. Can it bring you or your startup reputational damage? Will the break hurt a friendship? Will it shut doors to potential customers and investors for you? How will you protect yourself and the startup from the fallout?

Further, calmly assess the complete cost – legal, time, money – of getting rid of the “star” or indeed people that are conflicting with the start. Does the person have equity? Did the person do a lot of sweat equity work? What legal protections did you put in place for the business? If the person is a shareholder, what is your written and/ or implicit agreement? If you have been reading this column series, you will know we have discussed these issues in various columns and the importance of thinking of these challenges right when forming the startup and creating founder agreements.

Assess also the cost of replacing the person or persons now or later in time. This cost should not just be monetary but also the cost of delays, lost motivation, the risk of others quitting because they cannot bear to work with the troublesome star. The non-monetary costs are not quantifiable but could make or break your startup.

Last but not the least, remind yourself why you are creating the startup. I have often helped concerned founders visualise the possibility of a shattered vision if the bad situation persists. It is remarkably effective in spurring them out of paralysis and into effective and immediate action.

Once you have built a clear picture of the present and the future — with or without the “star” — you will be able to make a decision that is justifiable, fair, and, above all, taken in the best interest of the business and not just to pander to egos at war.

Work and isolation

On the same day that I saw a journalist in London seeking to speak with people about workplace isolation, a friend in California noted that she wanted to have a little social but found that her real world community was either virtual or non-existent.

My friend in California chalked her lack of community down to her being an entrepreneur, where long hours of work mean one’s options to socialise are mainly people who are employees or customers, both of which can be awkward.

When I mentioned workplace isolation to friends in senior corporate jobs, one quipped that this isolation malarkey was all down to people opting to work in the gig economy. Another noted, with a sigh, that the more senior one became in a large corporation, the more isolated one became, with fewer and fewer people seeing one as human, and fewer still willing to speak truths to power, so to speak. Indeed the story of António Horta Osório, the CEO of Lloyds Bank in the UK, and his spiralling into depression that led to a breakdown is well-known and one of the few honest stories of the impact of isolation to come out in public.

Without even reflecting over my own career of over 20 years, I know instinctively that the gig economy did not create workplace isolation. It is an existential condition of human beings to seek both camaraderie and company, and solitude: the former perhaps to generate ideas and to rejuvenate the self, the latter to reflect, create, and indeed, rejuvenate.

My experience of isolation in corporate life came from many sources. One  of them was being a gender minority. I even wrote a piece about my experience in Cosmopolitan magazine’s India edition around 1996-97. While my male colleagues were good people, it was tricky to socialise with them weekend after weekend. The city I lived in, Delhi, did not then have public transport so it was expensive, unreliable, unsafe, or all of the above to go across town to attend book readings or see films etc.  My solution was to start learning German on the weekends, which earned me much mockery but also a career break into Europe to open a new country office.

That unfortunately brought its own flavour of isolation. This time I was in Switzerland’s German speaking region, as a gender, ethnicity, and apparently age minority in the IT industry. My coping was hugely eased by my friendship with two others in a similar boat, both foreign to the German speaking regions in their own ways.

I then transitioned to a role in the UK where my team was spread across time zones. That was splendid isolation indeed as I began work at home at about 4.30am to catch my Asia-based team members as they began the day and the work day rolled on all the way to California. Going into the office was an option but I needed a few hours in the day unplugged. This is the bit of my experience now cited in this FT article the journalist mentioned earlier was writing.

You see, there are many ways the structure of corporate work and workplaces can be isolating.

My life as an independent consultant and advisor, an entrepreneur if you will, after the corporate stint, has been a solitary experience, save for meeting clients at lunch and sometimes friends for coffee. This fits the cliched image of the gig economy that I mentioned earlier.

Yet somehow we cope. And many of us continue to thrive.

My sense is that women cope better. Most women are socialised to seek and build communities, “to tend and befriend” not just in times of great stress. The web is helping break geographical barriers and enhance some sense of community. MumsNet is a well-known example of such a community. Several closed and secret groups of women founders and leaders thrive on Facebook. Some such as Blooming Founders and NOI Club have physical world components too. With the burdensome expectations of performance of masculine behaviour, men suffer silently — and alone — in their loneliness. This does not help workplaces or society.

Institutionalised solutions are emerging too. The gig economy worker, the entrepreneur and the small-corporate worker alike now have options. WeWork provides co-working spaces, designed to foster serendipitous and organic networking. The company has diversified into providing co-living in a few cities around the world too and it is branded WeLive.

Some criticise WeLive as an extension of dormitory or student halls living but really now! In the face of all this evidence of loneliness and isolation, that is the best criticism you can come up with?

As I said to Emma in that FT article, loneliness can have an existential quality. It forces us to examine the meaning of life in ways being surrounded by people all the time does not make feasible. From that isolation emerge creativity and ingenuity. But it can also foster mental health and addiction problems for many.

The real solution for us all lies perhaps in Goldilocks’s perfect porridge — not too much isolation, not too much cacophony of human company. Each person’s “perfect” however will differ.

What does all this mean for the design of work and workplaces? And indeed for our lives and societies?

As I see it, we may need a complete rethink of our shared and personal spaces. For workplaces, it could mean the provisioning of both open spaces to socialise and banter, and closed, quieter spaces to think and do actual work, sometimes energised by that interaction. Our living spaces need similar possibilities, if not within our own homes, then within the larger context of our neighbourhoods and cities we live in.

Politically and socially, we seem to be in an upheaval worldwide. Many are selling us the nostalgia of a glorious past, which, some argue, keep us from imagining better futures.

In this churn, could we hope to create a new order of things that are actually designed to serve the humans that use or inhabit them? Much like the Arts & Crafts movement’s thinking on spaces, a hundred years on?

I need to reflect on this. Alone. Perhaps you do too. Let’s convene later!

Cosmetic counter sales staff: a counter view

A dear friend of mine recently spoke of how, while making an impulse purchase for a lipstick at an airport, she ended up having a fascinating conversation with a male counter sales guy, who seemed to be a lipstick connoisseur with a massive collection of his own. She noted how he had great insight into how lipstick should be bought, ideally for personality not just skin tone. Was it her gender bias, she wondered, that she was so delighted by this surprising encounter? She travels globally and had never experienced such a knowledgeable and passionate counter sales guy.

The story made me wonder about gender biases in talent hiring for specific roles especially in industries seen as gendered.

Across the world, cosmetics counter sales staff is rarely male (the exception: perfume counter sales staff is rarely female). The field sales force, however, is rarely female, as I note both from occasionally bumping into field sales staff of brands in SpaceNK and Liberty in London, and from my earlier experience in my first and extremely short-lived first job in a well-regarded Indian cosmetics company.

The brand managers in the company were almost all women whereas, barring a couple of stellar exceptions, the field sales force was all men. These men, otherwise traditional, old-fashioned, sometimes married, were the definitive experts on both our products and our consumers. In my short stint, it became quite clear that their job brought them in contact with wholesalers, retailers, and consumers, and whenever a new product was launched, they also gave trial products to their family and got unfiltered feedback from them. This gave them a wealth of knowledge and insight. Whether the company was harnessing it in a structured way, I couldn’t say.

In contrast, the counter sales staff only ever encounters a consumer primed for some purchase, even if not in the exact category she ends up buying. This means the encounters are more narrow in scope, and only if a consumer ends up at the counter in a slow time of day, can she expect a fulsome and deep conversation about the products and the anthropology and psychology of purchasing one colour over another.

In all this, the consumer is, of course, key. Not only does she, peripatetic as she is, encounter the brand in many more locations, she also gets to see the non-uniformities, the vagaries of the brand’s operations in many ways. These can be revealing about the brand’s values and prejudices.

What is stopping the cosmetic industry hiring more men as counter sales staff? Do men not seek out these roles? Or are they actively rejected in an act of gender bias, unless, as my friend noted in the case of the sales guy she met, they are “flamboyant” in their presentation?

And since everything needs to have a business case, by not having male sales staff, could brands be missing a trick in capturing the growing male interest in cosmetics and skin care? The male grooming and beauty market is estimated to be $50Bn and growing.

One could cynically note that keeping men and women segregated helps companies as they persist in charging women, in cosmetics and skin care, a whopping 37% more than they charge men. This is frankly not sustainable as the web is transparent, and women can read labels and buy substitute products and brands.

Change however is coming, slow but steady, it appears. Even if it is in the form of YouTube influencers.

Men could, of course, watch YouTube videos privately but coming to the cosmetics counter in a city centre store is still uncommon. Andrew Snavely, who runs a magazine focused on men’s grooming, thinks this is unwise and notes: “… young professional men find trial and error with products to be an expensive and time-consuming process…”. Could this be because men feel unwelcome at beauty counters to discuss their needs with the mainly female staff? Airport stores, such as the one my friend was visiting, are probably more welcoming because a man could always pretend he is buying for a woman and engage in a conversation about lipstick.

On a philosophical note, everything that frees women frees men too. And vice versa. That includes the freedom to discuss, try, buy and use cosmetics.

Cosmetic brands would do well to watch watch their gender biases and actively hire male counter sales staff, thus welcoming male customers more.

May be over time, both men and women will get better at speaking openly across gender lines about gendered topics.

Because we are worth it .

Attracting talent

This article is the sixteenth in the Startup Series on FirstPost’s Tech2 section and first appeared on May the 25th, 2017.

Apart from having a strategic direction and enough money to execute on the vision, the key challenge for founders is talent. Based on my experience, I will go out on a limb and say this: talent is not scarce. No matter what we hear about the “war for talent”. What is scarce is the ability to know what talent you need, find that talent, and find that talent efficiently, quickly, and affordably. This is truer still of the earliest hires, who shape your vision and your startup’s culture.

Here are some pointers based on my experiences with helping founders find people for their teams.

Making a successful hiring decision requires a process: knowing whom you seek, where they hang out, whether they see and notice your call for talent or otherwise know of your need, whether your call for talent is attractive enough, whether they are interested enough to apply or reach out, whether your hiring process confirms a mutual fit, whether you agree terms and, finally, whether they are still interested and have not been poached by a better offer in the meanwhile. This step-by-step looks obvious when one lays it down in black and white. In reality, most founders founder when it comes to hiring because they are haphazard and their follow-up is poor. Avoiding disorganised thinking and the ensuing chaotic hiring process, which can repel many a good candidate, is therefore the first thing to aim for.

The second thing is to avoid obvious and easy answers. At every step.

Most founders look in one type of spaces e.g. online startup communities or mailing lists or Slack groups. These are also spaces where your target talent is most likely to see all the other competing possibilities. Avoid being so narrow and niche. The wiser thing to do would be to tap your IRL network too. Ask the people you know who are not connected to the startup space and you may unearth several new possible candidates. As a bonus, your contacts would also have vouched for you and your startup before those candidates agree to talk to you.

People have CVs and people have side projects. These side projects in many cases provide insight into a person’s thinking as well as their skills. The obvious mistake is to not probe these side projects and thus miss possibilities. In two instances that I have been involved with, the side projects pursued by potential hires showed how those hires were perfect for the company’s international expansion plans.

Falling back on unconscious biases is another obviously easy thing to do in hiring. And avoidable. It has been shown that women get hired on proof, while men get hired for potential. If you are not finding or reaching talent of the kind you want, it would be foolish to let your unconscious biases against an entire gender make your hiring outcomes worse. Unconscious bias training goes some way not the whole way in addressing these flaws in thinking although it would be advisable for your own personal growth as a leader and entrepreneur. Emerging hiring technology could give a helping hand too. For instance, Blendoor enables merit based matching by hiding irrelevant data and thus widening your candidate pool.

Google’s chaotic hiring process in the early years has now passed into tech industry legend. It is also something best avoided and not emulated. It is crucial that founders build a creative but robust hiring process that scales, including for collecting candidate data, made simpler by platforms such as Workable, and conducting telephonic and face-to-face interviews. Equally it is important to make references as systematic and methodical as interviews themselves. Not asking meaningful questions and failing to listen actively to what the referees say is unwise, although it is easy to do cursory checks and feel you are done.

Last but not the least, avoiding firing people who aren’t a great fit is not a great move. Especially early hires, who will shape your startup’s culture, have to enable your vision and not sabotage it. If they are being disruptive or otherwise do not fit the startup, the founder has to learn to let them go. There are laws of the land that will cover firing within and outside probation periods. Of course this assumes you have given people employment contracts! It is also useful to talk to people in “exit interviews” before they leave to understand what you might have contributed to the disagreements.

Hiring is a contact sport. Putting this advice into practice will take commitment to solving the talent puzzle for your own startup.

How to be a valuable non-tech co-founder

This article is the thirteenth in the Startup Series on FirstPost’s Tech2 section and first appeared on April the 3rd, 2017.

The excessive media focus on techies as startup founders often makes non-techies doubt their ability to found and build a startup and create value. Many non-tech persons I meet believe that they won’t get investment without a tech co-founder whom they then spend considerable time trying to find. Many techie founders on the other hand seem to not think of finding non-tech co-founders with the same keenness. Both approaches need a rethink.

For starters, both the tech and non-tech founders have to stop using the term “non-tech”. The term suggests the primacy of tech skills which, while not inaccurate, does not highlight its limitations i.e. unless the technology is solving a problem and can create a product or service for which someone will pay, there is no business there. “Non-tech” in other words is the business person in a startup team.

A well-known story where a “non-tech” leader changed the fortunes of a “tech” company is of Mark Zuckerberg, the tech founder of Facebook, bringing Sheryl Sandberg on board as the Chief Operating Officer. At the time, Facebook was privately owned, valued at $15 billion, making nearly $56 million annual loss. Within eight years, under Sandberg’s leadership, Facebook grew its revenue more than 65x, made nearly $3.7 billion profit, did a successful IPO and, at $320 billion, now ranks as the fourth-most valuable tech company in the world.

So, how to be a valuable business co-founder?

Bring an understanding of the target customers. Talk to as many as you can. Listen with an open mind. Don’t look for patterns too early. Don’t challenge their reported lived experience even if it clashes with research data. Just listen, with attention.

But what if you are building is something truly path-breaking such as Henry Ford’s car? Ford famously said if asked for what they want, customers would have asked for faster horses! Even in such a case, you will still need to listen, evangelise, recruit champions, and build an organisation to reap the rewards for the startup. That was the magic Sheryl Sandberg brought with her operational nous to growing Facebook!

In an early stage startup, the business co-founder would translate the understanding of the customer to the tech team building the product. Being the champion of the customer and the community through the development process is not easy and will require great empathy with the tech team and the development process as well. At the same time, it is important to emphasise how some tech decisions should not be made before the business issues are resolved. A startup I advised learnt to its considerable cost that it is wise to get the payment gateway sorted before signing up to the customisation of a shopping cart and e-commerce platform. This folly of putting the cart before the horse was also quite expensive.

Test your product, service or app yourself first, and do so remembering the customer feedback you collected. Go further and involve some of your strongest critics in that testing. Enable iterations with an eye on the customer’s concerns, balancing the customer journey with technological feasibility. In a startup I was involved in, the business co-founder wanted the website to be designed to be accessible even on low bandwidth as many consumers were likely to be. Her concerns were overlooked to such an extent by the tech co-founder that the end result was an unusable website, the death knell for the e-commerce-only venture.

Examine all the processes, interfaces, “touch points” where your customer and community interact with your business. Ask if you are treating them well – addressing their concerns, reducing friction in how they can pay for something or raise complaints or indeed give feedback to the business.

In another startup, customers wanted the ability to consult a human being on the phone or chat before completing a purchase. The lack of such a possibility was frustrating customers and ending up in no sales being made. Neither the tech nor the business co-founder had paid attention to that feedback from the customer testing phase, as they were both used to eschewing human contact in favour of online experiences while shopping.

Examine the processes and organisation design for whether they are fit for purpose, efficient, and scalable. Does your business have seasonal cyclicality? Will you need more staff to ship thus increasing costs in your high season? How will you process returns if all your staff is dedicated to shipping faster and more? These questions are often not thought of in advance, as I saw in case of a fashion startup, whose success exceeded their expectations.