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How to Align Your Startup Team for Execution

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According to Stanford research 92% of start-ups fail in the first 3 years. There are literally thousands of great ideas out there, but what separates successful companies is the ability to execute and get traction. Failure is guaranteed without execution.

Try to do everything and you will do everything badly – the key is to focus on one thing, do it well and do it until it’s done. Get this right and the whole team will be focused, working together to carry the load and your company will be on its way to being part of the 8%. Get it wrong and everyone will be spread paper thin, trying to do everything, doing everything badly and be en route to being a statistic.

The key is alignment. By using daily huddles, weekly/monthly problem solving and quarterly planning, high performing startups align what the team is doing (OKRs) day to day and week to week, with a quarterly theme, annual milestones, 3-5 year targets and the critical long-term fundamentals – purpose, BHAG, brand promise and core values.

Aged-care SaaS start-up KareInn (Seedcamp) and urban garden start-up Patch (Forward Partners) are both using these alignment tools to execute voraciously and are ahead of plan to their next financing milestones.

Clarity with a 1-Page Strategic Plan

At Forward Partners, we use a tool called the 1-Page Strategic Plan, developed by author and founder of the Entrepreneurs Organisation – Verne Harnish. The framework and the insights I discuss in this article, are in large part developed by his formidable organisation – Gazelles.

As your team grows from 3 to 10, 10 to 25 and 25 to 200, the organisation goes through cycles of change as you learn to manage communication, planning, execution and productivity.

A 1-Page Strategic Plan literally gets everyone onto the same page and allows you to harness the power of the team. Everyone knows that a 20-page business plan is obsolete the moment it is written. No one reads it and it sits on a file server! A 1-page Strategic Plan is a living document that captures on one-page the entire company’s strategy. In the short term, this captures what the team is doing day-to-day, week-to-week, with the top quarterly priorities (rocks) and a number one priority – the quarterly theme. In the longer term, the plan captures annual milestones, 5 year targets, and the really long-term stuff – purpose (mission), vision, your BHAG, and the stuff that binds you together as a team – core values.

Where to begin?

With venture funded startups, I like to focus the mind by getting clear about the founders’ personal objectives and the implications for a “liquidity event”. Most founders are primarily motivated by the passion to “do something” worthwhile, build and create.

For better or worse, the moment you decide you need to do this with the help of an investors money, rather than boot strap yourself, you become wedded to a second set of objectives. This means making sure you are aligned with your investors about what a successful “exit” looks like.

We do this by defining our 3-5 year targets. Most accept that 7-10 years is more realistic for an exit but 3-5 years focuses the mind.

  • What would success look like? What would be your gross revenue? EBIT margins? EV/market cap?
  • Where will your company be playing (your sandbox)? Which markets, products, geographies?
  • What are the 3-5 major capabilities that you will need to build to get there?

Have you done this explicitly with your investors? Surprisingly few companies do.

What next?

Having worked out where we want to be in 5 years, next we “go long!” – financial goals only go so far. The truth is, great organisations are motivated by things much more fundamental than money. It’s important for you to find your “north star” – purpose, core values, BHAG.

A company’s “purpose” is the distillation of what the company is really about. At its core, when your customer buys your product or service, there is really something much more fundamental that they are trying to achieve. It’s often a basic emotion or need. The objective is to get it down to one word, or at most a short phrase. To get to the root cause of a problem Toyota developed a tool called 5 Whys. It’s hard to do this well and it requires persistence, but an example is to be found here.

At Forward Partners we are “an early stage Venture Capital investor”. Why do we do that? Why is it important? Ask and answer that question five times and generally you get down to “to save the planet!” Back up one level and you will find your purpose. At Forward Partners our purpose is “real prosperity”. We are in the business of helping our portfolio company founders achieve their goals and “real prosperity”. Our portfolio companies are “real” businesses, making a difference and doing worthwhile stuff in the world. “Real prosperity” also applies to the limited partners in our fund (our investors) who in turn are trying to deliver better returns for their pension fund investors, and perhaps in turn your grandmother – “real prosperity”. Finally “real prosperity” also applies to our team who we want to have rewarding careers, develop their skills, do satisfying work to support our portfolio companies and enjoy rewarding compensation. All our team members participate in the carry – “real prosperity”.

Having distilled your purpose, next we look for a BHAG (Big Hairy Audacious Goal) a concept developed by author Jim Collins. There are lots of resources available online to help you better understand the concept, but the objective is to find a measurable goal that really raises your sights. If done well, it might result in a sharp intake of breath and the response “wow, if we really achieved that, that would be mind blowing!” The classic BHAG was Microsoft’s “a PC on every desk” (which for a time they basically achieved!)

Powerful also is brand promise – what are the three fundamental reasons why your customers would choose you over your competitors? We then look for three brand KPIs that measure how effective we are at delivering on those promises. Southwest Airlines is a great case study for a focused brand promise.

Finally we distil our core values. Before you roll your eyes, what we mean by core values in this context is definitely NOT the “motherhood and apple pie” that masquerades as core values at your average big corporate – honesty, integrity and team work. Within the context of the 1-Page Strategic Plan, what we are looking for is truth about the real values that define the organisation. Objectively, they can be “good” or even “bad”. Often we look to the founder for core values. What was their original motivation for starting a business.  Secondly we look to high performers in the team – who are those individuals that you wish you could clone? Often a core value lies in their conduct.

Bringing it back to the here and now

Having articulated the long-term vision for the business, it’s time to start bringing it back to the present. I often find myself using the analogy that your company vision (purpose, BHAG, Brand Promise and Core Values) is equivalent to “which mountain the company is going to climb”. The quarterly and annual milestones are like deciding to tackle the summit via “basecamp two and basecamp five”.

So next we determine where the company needs to be in 12 months time? For example, what milestones do we need to deliver to raise our Series A or Series B? We could define this in terms of:

  • Users
  • Subscriptions
  • Unit sales
  • Revenue targets and profitability.

We underpin this with 3-5 key initiatives or milestones and 1-2 critical numbers for the team to monitor; ideally one that is people or balance sheet related and a second that is process or P&L related.

Having determined where we need to be in 12 months, we then bring the focus back to the next quarter, more or less looking for a similar set of metrics to deliver in the next 90 days. Here we focus on the top 3-5 priorities or “rocks”. The term is borrowed from a fable about the most important things in life. If you are to fill a bucket with rocks, pebbles and sand, don’t put the sand in first as there will be no room left for the pebbles and rocks. Of the dozens of things that the company needs to do every quarter, the “rocks” are identified as the most important. A company’s rocks might include “launch a new product”, the pebbles are “make payroll” and the sand is “respond to my slack messages”. The analogy is used to focus the mind and carve out time to work “on the business” rather than just “in the business”.

Next we focus the team with a quarterly theme. Ideally this has everyone in the company focus on the most important (number one) of the top five priorities. When this process works really well companies will identify a theme that is humorous, a bit irreverent and fun. At Forward Partners this quarter our theme is “Unleash the Beast” – code for us documenting and clearly articulating the way we help our portfolio companies build their MVP. We have a scoreboard and while there is a core team, everyone in the company is contributing to the process. If we deliver on the theme the company will celebrate by going white water rafting together!

Finally, everyone in the company captures their own individual priorities and KPIs that underpin the company’s quarterly theme and quarterly rocks. At Forward Partners we use Google’s OKRs – objectives and key results.

Maintaining Alignment 

The process described above is conducted during a 1-2 day (!!) offsite. The whole team contributes to building the plan. This not only creates buy-in and team alignment, but often generates insights that senior management had not considered.

The key to using a 1-page Strategic Plan is to recognise that it is a process (run quarterly) and not a static output. Each quarter the team comes together and rebuilds the plan from the ground up. In between we take the plan out to the market and test it. Tzun Tzu says “no strategy survives first encounter with the enemy” and the same is true for strategic planning. Each quarter the team brings back learning and insight that helps refine the plan. Next quarter we may still be climbing the same mountain but this time we will “bypass basecamp two and go straight to basecamp three”.

Between quarterly planning sessions, alignment is maintained with Meeting Rhythm. The best teams huddle daily (no more than 15 minutes stand-up), problem solve weekly, assemble to work on strategy monthly and plan quarterly.

Summary

All together this is the process of executing well by maintaining alignment and using a 1-page Strategic Plan – huddle daily, meet weekly/monthly to problem solve and plan quarterly. In your planning, align what the team is doing (OKRs) day to day and week to week, with a quarterly theme, annual milestones, 3-5 year targets and the critical long-term fundamentals – purpose, BHAG, brand promise and core values. Simples.

Finally, a word from one of our highly talented founders at Forward Partners – Freddie Blackett at Patch

“For Patch, the 1PSP has been great because:

  • It’s a simple, not-too-scary way for a startup to get down on paper their Strategy 1.0. Tools like the lean canvas are super at first but they can be inferred as static. LC is a portrait of the business’ proposition as it is/wants to be. 1PSP is a portrait of the business, where it is headed and how it’s going to get there, with clear implications for everyone involved.
  • Consulting tools can feel a bit daunting and consulting-y but what’s been great for Patch is that the shorthand for our quarterly theme has been deliberately light-hearted and catchy, for example “BIGKEN65” and “Barbara Windsor”. That might sound flippant but actually it’s been really important for it to catch on across the team.
  • We had a great facilitator! Like with all things strategic, it’s vital to have someone asking the right questions of you to draw your team out of the day-to-day and into the bigger picture. Unless you have someone experienced in group facilitation, it’s difficult to get that. The obvious risk being that you might end up with the wrong plan.”

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About the Author

Written by Steven Gledden of the Path Forward. The Path Forward was developed by Forward Partners, a VC platform that invests in the best ideas and brilliant people. Forward Partners devised The Path Forward to help their founders validate their ideas, build a product, achieve traction, hire a team and raise follow on funding all in the space of 12 months. The Path Forward is a fantastic startup framework for you to utilise as an early stage founder or operator.

Callum Connects

Benjamin Kwan, Co-Founder of TravelClef

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Making music to create a life for his family, Benjamin Kwan, started an online tuition portal and his music business grew from there.

What’s your story?
I am Benjamin and I’m the Co-Founder of TravelClef Group Pte Ltd, a travelling music school that conducts music classes in companies as well as team building with music programmes. We also run an online educational platform which matches private students to freelance music teachers. We also manufacture our own instruments. I started this company in 2011 when I was still a freshman at NUS, majoring in Mechanical Engineering.

I was born to a lower income family, my father drove a taxi and was the sole breadwinner to a family of 7. I have always dreamed of becoming rich so that I could lessen the burden placed on my father and give my family a good life.

After working really hard in my first semester at NUS, my results didn’t reflect the hard work and effort I put in. At the same time, I was left with just $42 in my bank account and it suddenly dawned on me that if I were to graduate with mediocre results, I would probably end up with a mediocre salary as well. I knew I had to do something to gain control of my future.

During that summer break, I read a book “Internet Riches” by Scott Fox and I knew that the only way I could ever start my own business with my last $42 would be to start an online business. That was how our online tuition portal started and after taking 4 days to learn Photoshop and website building on my own, I started the business.

What excites you most about your industry?
Music itself is a constant form of excitement to me as I have always been an avid lover of music. As one of the world’s first travelling music schools, we are always very eager and excited to find innovative ways to a very traditional business model of a music teaching.

What’s your connection to Asia?
I was born and raised in Singapore and I love the fact that despite our diversity in culture, there’s always a common language that we share, music.

Favourite city in Asia for business and why?
Hands down, SINGAPORE! Although we are currently in talks to expand to other regions within Asia, Singapore is the best place for business. I have had friends asking me if they should consider venturing into entrepreneurship in Singapore, my answer is always a big fat YES! There’s a low barrier of entry, and most importantly, the government is very supportive of entrepreneurship.

What’s the best piece of advice you ever received?
I have been blessed by many people and mentors who constantly give me great advice but right now, I would say the best piece of advice that I received would be from Dr Patrick Liew who said, “Work on the business, not in it.” This advice is constantly ringing in my head as I work towards scaling the business.

Who inspires you?
My dad. My dad has always been my inspiration in life, for the amount of sacrifices that he has made for the family and the love he has for us. He was the umbrella for all the storms that my family faced and we were always safe in his shelter. Although my dad passed away after a brief fight with colorectal cancer, the lessons that he imparted to me were very valuable as I build my own family and business.

What have you just learnt recently that blew you away?
You can not buy time, but you can spend money to save time! With this realisation, I was willing to allow myself to spend some money, in order to save more time. Like taking Grab/Uber to shuttle around instead of spending time travelling on public transport. While I spend more money on travelling, I save a lot more time! This doesn’t mean that I spend lavishly and extravagantly, I am still generally prudent with my money.

If you had your time again, what would you do differently?
I would have taken more time to spend with my family and especially my father. While it is important to focus our time to build our businesses, we should always try our best to allocate family time. Because as an entrepreneur, there is no such thing as “after I finish my work,” because our work is never finished. If our work finishes, the business is also finished. But our time with our family is always limited and no matter how much money and how many successes we achieve, we can never use it to trade back the time we have with our family.

How do you unwind?
I am a very simple man. I enjoy TV time with my wife and a simple dinner with my family and friends.

Favourite Asian destination for relaxation? Why?
Batam, it’s close to Singapore and there’s really nothing much to do except for massages and a relaxing resort life. If I travel to other countries for shopping or sightseeing, I am constantly thinking of business and how I can possibly expand to the country I am visiting. But while relaxing at the beach or at a massage, I tend to allow myself to drift into emptiness and just clear my mind of any thoughts.

Everyone in business should read this book:
Work The System, by Sam Carpenter. This book teaches entrepreneurs the importance of creating systems and how to leverage on systems to improve productivity and create more time.

Shameless plug for your business:
If you are looking for a team building programme that your colleagues will enjoy and your bosses will be happy with, you have to consider our programmes at TravelClef! While our programmes are guaranteed fun and engaging, it is also equipped with many team building deliverables and organizational skills.

How can people connect with you?
My email is [email protected] and I am very active on Facebook as well!
https://www.facebook.com/benjamin.christian.kwan

This interview is part of the ‘Callum Connect’ series of more than 500 interviews

Callum Laing is an entrepreneur and investor based in Singapore. He has previously started, built and sold half a dozen businesses and is now a Partner at Unity-Group Private Equity and Co-Founder of The Marketing Group PLC. He is the author two best selling books ‘Progressive Partnerships’ and ‘Agglomerate’.

Connect with Callum here:
twitter.com/laingcallum
linkedin.com/in/callumlaing
Download free copies of his books here: www.callumlaing.com

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Entrepreneurship

Before you enter a Startup or before you choose your founding team or new hires read, “Entering Startupland” by Jeff Bussgang

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Before you enter a Startup or before you choose your founding team or new hires read “Entering Startupland” by Jeff Bussgang.

Jeff knows how to spot and groom good culture, as the book session was held in Zestfinance a company he invested in and now, “The Best Workplaces for Women” and for “The Best Workplaces for Tech”, by Fortune.

These are the questions during the Book Launch.

How to know if a hire including the founder is Startup material?
Jeff says to watch for these qualities.

First, do the hires think like an owner?
Second, do the hires test the limits, to see how things can it be done better?
Are they problem solvers and are biased toward action?
Do they like managing uncertainty and being comfortable with uncertainty? And comfortable with rapid decision-making?
Are they comfortable with flexible enough to take in a series of undefined roles and task?

How do we know if we are simply too corporate to be startup?

Corporate mindsets more interested in going deep into a particular functional area? These corporate beings are more comfortable with clear and distinct lines of responsibility, control, and communication? They are more hesitant or unable to put in the extra effort because “it’s not my job”.

If you do still want to enter a startup despite the very small gains at the onset, Jeff offers a few key considerations on how to pick a right one.

He suggests you pick a city as each city has a different ecosystems stakeholders and funding sources and market strengths. You have to invest in the ecosystem and this is your due diligence. Understand it so you can find the best match when it arises.
Next, to pick a domain, research and solidify your understanding with every informational interview and discussion you begin. Then, pick a stage you are willing to enter at. They are usually 1)in the Jungle, 2) the Dirt Road or 3) the Highway. The Jungle has 1-50 staff and no clear path with distractions everywhere and very tough conditions. The Dirt Road gets clearer but is definitely bumpy and windy. Well the Highway speaks for itself, doesn’t it?

Finally Please – Pick a winner!

Ask people on the inside – the Venture Capitalists, the lawyers, the recruiters and evaluate the team quality like any venture capitalists would. Would you want to work for the team again and again? And is the startup working in a massive market? Is there a clear recurring business model?

After you have picked a winning team and product, how would you get in through the door?

You need to know that warm introductions have to be done. That’s the way to get their attention. Startups value relationships and people as they need social capital to grow. If you have little experience or seemingly irrelevant experience, go bearing a gift. Jeff shared a story of a young ambitious and bright candidate with no tech experience who went and did a thorough customer survey of the users of the startup she intended to work with. She came with point-of-view and presented her findings, and they found in her, what they needed at that stage. She became their Director of Growth. Go in with the philosophy of adding value-add you can get any job you want.

And as any true advisor would do, Jeff did not mince his words, when he reminded the audience that, “If you can’t get introduced you may not be resourceful enough to be in startup.”

Startupland is not a Traditional Career or Learning Cycles

Remember to see your career stage as a runs of 5 years, 8 or 10 – it is not a life long career. In Startup land consider each startup as a single career for you.

Douglas Merrill, founder of Zestfinance added from his hard-earned experience that retention is a challenge. Startup Leaders to keep your people, do help them with the quick learning cycles. Essentially from Jungle to Dirt road, the transition can be rapid and so each communication model that starts and exists, gets changed quickly. Every twelve months, the communication model will have no choice but to break down and you have to reinvent the communication model. Be ready as a founder and be ready as a member of the startup.

Another suggestion was to have no titles for first two years. So that everyone was hands-on and also able to move as one entity.

Effective Startupland Leaders paint a Vision of the Future yet unseen.

What I really enjoyed and resonated with as a coach and psychologist was how Douglas at the 10th hire thought very carefully what he was promising each of his new team member. He was reminded that startups die at their 10th and their 100th hires. He took some mindful down time and reflected. He then wrote a story for each person in his own team and literally wrote out what the company would look like and their individual part in it. In He writing each of the team members’ stories into his vision and giving each person this story, it was a powerful communication piece. He definitely increased the touch points and communication here is the effective startup’s leverage.

Douglas and Jeff both suggested transparency from the onset.

If you think like an owner and if you think of your founding team as problem solvers. Then getting transparent about financials with your team is probably a good idea. As a member of a startup, you should insist on knowing these things
Such skills and domain knowledge will be valuable. There is now historical evidence of people leaving startups and being a successful founder themselves because they were in the financial trenches in their initial startup. Think Paypal and Facebook Mafia.

What drives people to enter a startup?

The whole nature of work is changing. Many are ready to pay to learn. Daniel Pink’s book Drive showed how people are motivated by certain qualities like Mastery, Autonomy and Where your work fits into big picture. Startups do that naturally. There is a huge amount of passion and the quality of team today and as it grows then the quality of company changes.

The Progress principle is in place, why people love their startup jobs is not money rather are my contributions being valued? Do I see a path of progress and do I have autonomy over work and am I treated well?

Find out more about StartupLand on Amazon

And learn from Zestfinance

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