Looking at the rain outside my posh Sand Hill office, my co-founder Jay Bhatti and I wondered how we could assemble the right team to build the company we had envisioned. Every entrepreneur confronts this challenge. The vision, in my opinion, is the easy part. Getting it done is a lot harder. My experience in venture capital had taught me first-hand that building a market leading company requires a great team and a great company culture. That is what separates winners from also-rans! But it’s also a lot easier said than done.
Every founding team brings different skills to the table. Knowing your strengths and weaknesses is really important. Jay and I were past our productive engineering days, and were now business guys. As a VC at Clearstone, most of my current network was other entrepreneurs, execs, and other VCs. Jay, an exec at Microsoft, was moving from Seattle, and didn’t bring too much local engineering talent to the table either. But we had great chemistry, and trust, dating all the way back to B-school. And that was a great start.
The first move we made was put together a strong advisory board. We looked through our network, identified the strongest people we knew, and began pitching them. We realized that some got the vision instantly and some didn’t.
I have noticed that in technology we’re surrounded by very smart people. IQ is virtually a commodity. However, there are those who are analysts – can ask 1 million questions, and be skeptical of everything; then there are doers, people who apply their intellect and resourcefulness to find solutions. Find those people and keep them close to you. Stay a 100 miles away from the former.
We got Siva Kumar, serial entrepreneur, who had started 8 companies not only to advise but also take a board seat. We got Suneet Wadhwa, also a serial entrepreneur, and a friend to encourage us, and push us to to think more deeply about the user, and what problems to solve first.
Being at Clearstone was also a strong asset. Clearstone’s David Stern and others there were active and helpful in introducing us to well connected people. However, our engineering network was weak! We knew no great search guys personally.
Therefore, Jay and I next set about becoming full time “head hunters” - calling all the engineers in our network and asking them to recommend others. We got some leads, some relevant people, but not everyone is into taking risk. They loved the concept but didn’t want to leave their cushy jobs, especially when we’d raised no money.
Just like any large endeavor in life, we set up a process, and fine-tuned it over time. Pushing our contacts and cold calling people become the tasks of the day. We used LinkedIn, and Google, both great resources, judiciously. Each person, and each email was researched and personally crafted. Soon we began to build a large pipeline of qualified talent. Our advisors became a great resource not only to interview candidates, but also introduce us to others.
Siva introduced us to Jeff Winner, a well known VP Engineering with search and consumer background, who was sought after by every VC on Sand Hill Road. We knew we couldn’t close him right away, so we enlisted his help in interviewing candidates. This was a perfect arrangement for both parties. Try before you buy.
In a matter of 60 days, we had contacted over 200 engineers, spoken to about a 100, interviewed 40, and got 7 good guys who very interested. Hongche Liu was the star. He was a hands-on engineering manager and superstar at Yahoo!, a PhD with 10 years of complex IR product experience, in addition to research. Most importantly, he was excited about doing a startup and had a great work ethic and attitude. We put all our force into convincing him to forget his high paying job, de-prioritize his wife and 3 kids, and take a whopping $90k salary!
Vision and concept aside, Hongche, like most engineers who aspire to join startups, realized that the risk of not joining a startup was way greater than being a cog in the wheel at a large company. His learning and therefore value would be a lot greater by being a key member of a venture backed team.
We got lucky with our next hire. Wayne, a teenage entrepreneur, who had built dawsonscreek.com in high school, with over 2m page views a month, was at Microsoft working on the undo button in Powerpoint! He was aching to get back into the web, learn Ruby, and apply his energy while having fun. He blew us away within 15 mins of interviewing; he signed an NDA; 15 minutes later he was blown away by the service Jay had mocked up in Powerpoint.
Wayne was very smart and decisive, and so joined us after his two weeks notice. I realized that the most valuable people are those who are decisive, smart, and have a great attitude. Wayne had all three. Jay calls this the BAD principle – Brains, Attitude, and Drive.
The one thing that frustrated me was that I’d find Jay searching Craigslist for engineers and sending email upon email, with no responses. I pleaded with him not to waste his time doing “stupid” things. I called it adverse selection. I was proven to be the idiot!
Jay found Sam Williams, a young Caltech CS guy, who had goofed off two years in Europe, but was a Ruby on Rails star. Jeff interviewed him, and within 30 mins he walked into my office and said, this is one of the smartest guys we’ve interviewed. He’s a consultant but loves the Spock idea and can start immediately. Like Wayne, Sam was smart and decisive. The only difference was that he started in two days.
Meanwhile, Jeff Winner was spending more and more time with us. He helped us interview and hire. He began to spend more time architecting the product, and in the process began to evolve our product concept. He was also now fully sold on the vision and the team (that he had helped hire). He threw in the towel, and joined full time.
We were now a very strong 5-person core team. On the way we had raised $1m from my colleagues at Clearstone, and were off to the races. Today we have 16 full time people, have raised $9m, and get over 50 resumes a week.
As a VC, I had seen my investments do well when the teams were outstanding and the culture was great. But having gone through it myself, I realized the vast difference between analysis and doing. I have now internalized a few key lessons:
Lessons summary:
1. Find good co-founders, people you trust. Don’t be greedy. In my venture and entrepreneurial experience, many people mess this up.
2. Have an exciting vision. It’s the only thing you have to offer. If you’re not super stoked, nobody else around you will be either.
3. Have conviction and be passionate about your vision especially in the face of adverse feedback. High IQ analysts are a dime a dozen, and will raise a million exceptions. Ignore them; both as employees and as advisors.
4. Get the best and most experienced advisors around your company who share your passion. If u don’t know anyone, cold call until you find them.
5. Have a very high bar for recruiting, both talent and motivation. Don’t let fear and temptation get the better of you. It’s easy to convince yourself that the person has worked at other places and is probably good enough. Good enough is not good. You’ve got to be excited. Remember Jay’s BAD principle.
6. Pay lower than market in the early days; it’s a great filter.
7. Age is not a factor but motivation is. People who don’t work hard, will never be the key drivers in your startup. Perfection comes from hard work.
8. Don’t undervalue engineers from top schools. We got guys from Berkeley, MIT, Stanford, Caltech, etc. and they are all really good. There are lots of great engineers from average engineering schools (like myself) too, so don’t over-emphasize school either. It really is about talent, hard work, and great attitude.
9. There are those who look for problems and those who look for solutions. This becomes clear in interviews very quickly. Hire people who look for solutions.
10. Grow a thick skin for rejection.
24 Comments
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Ben Kleimark said:
This is pretty basic non-controversial advice, but I’m getting really tired of reading “how to” articles from people who haven’t actually had any major success. Another good example here. Seriously, launch your product, and if and when it’s a runaway success then come back and tell us how you did it. But for now I have no reason to take your “lessons” seriously.
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Bob said:
Ben, Why not?
Jay, Lead on! Spock is going to be a hit!
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Mike Rundle said:
I don’t think I read anywhere in this entry about you hiring someone with user interface design or usability experience. To be honest, I just checked out Spock.com (and some screenshots at TechCrunch) and that hole in your team is incredibly obvious.
The first thing that new users see when they visit your site is your interface, and if no real time was spent making it look decent then it doesn’t matter how many PhD engineers you have working on the app because it won’t be used.
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Kristine Nally said:
Great article, it points out the obvious, but somehow it is always the obvious that we forget. I will definitely keep in on file.
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Janice said:
Ben - the article is about building a good team, not about building a good business or business model. That is usually another seperate matter. From the article, it appears that Spock has build a good team. Wheather it becomes successful will be another test for the founder.
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Jay said:
JAIDEEP,
What an absolute great post. I’m actually in the planning phase of opening two companies, one of which I just started my due diligence list. The information I found last night was rather disappointing. Here is an exact replica of what I’m trying to create http://www.agingtech.org/item.aspx?id=378&CA=2
Unsurprisingly this concepts all ready exists. My question, would be worth pursing such a venture when N.A.S.A is working on a similar prototype?
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Jaideep said:
Jay,
i’m not an expert in medical devices. But in general, I don’t think you’ll be competing against NASA. The real competition will be metrohealth system. If you feel you can make a much better product, i would say go for it, don’t be afraid of competition. if you’re not that confident, think of something else. There is always something else. Don’t be too quick to settle on the direction.
Jaideep
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Jesse Pujji said:
Jaideep,
Phenomenal article… what others may call obvious I think is ‘genius’ when actually put down on paper. Makes me get the itch… not sure how much longer I’ll last in corp. america.
Jesse
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JTreiber said:
Jaideep,
Great post! I think that your basic guidelines are only obvious to people who haven’t gone through the exercise of building a team. As a VC, you aren’t always challenged with building a team from scratch and being resourceful. It is incredibly time consuming and should be one of the things any start-up does first. Like you’ve said, at OnCard Marketing (our start-up) we feel that you should get the best talent involved early on in a part-time capacity to help sell the vision and increase the chances of getting them on full-time. The only thing you mention that seems “too perfect” for a regular start-up (one without all the capital and rich friend connections) is being able to raise a cool million without a prototype and another $9MM without substantial adoption. I guess that’s the different between starting a business on Sand Hill road versus Chelsea NYC… Keep the advice coming.
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Tubby said:
SP0C|
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Tubby said:
SP0CK t0taIIy ROXXORZ d00d. Jaideep FTW!
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Steven said:
Ben Kleimark (first comment) sounds like the high IQ analyst described above - full of cynicsm.
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Adam Bruce said:
Jaideep,
This article could not have been any more timely for us. We’re about to double down and grow our team, and this was some great advice. I’m not sure why the other commentators were so cynical in their reply, I for one think we all need to help each other out especially while we’re all still small. -
Matt said:
Jaideep,
This is a great article. I will pass this to many of the young technology companies I work with. Anyone starting a new company should read this.
Let’s catch up when it’s time for you to move out of your space.
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Bill A said:
Great article! Some may call in common sense, but you EXECUTED it and built a strong team. Great work, and thanks for sharing how you did it.
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Leanne said:
This is more civil than the image that Spock portrays on their web site about their hiring practices where they write that the number 2 reason to work at Spock is to work with Jay. According to Spock’s web site, working with Jay includes sexual innuendo and drinking on the job. Here are a few examples:
Reason #6 for “Why Spock Employees Like Working With Jay”
Jon - “When I interviewed with Jay and told him about Ruby on Rails, he thought it was an adult video.”
Reason #7
Oleg - “When Jeff complemented me on how nice my server rack was configured, Jay gave us both HR warnings.”
Reason #11 has been changed within the past 2 days — it used to have an age-old hateful joke — see
http://valleywag.com/tech/cubicle-culture/spocks-frat+geek-humor-253380.php
Reason #14
Joe - “At first, I was really impressed that the head of product at Spock also knew how to code. But when we were shorthanded and Jay volunteered to do some Ruby coding, we shouldn’t have let him deploy stuff while he was drinking.” -
Bob said:
This article is a joke. The guy they hired to run engineering, Winner, who was supposedly in hot demand by every VC on Sand Hill road is the same guy who ran engineering for Friendster when they couldn’t manage a page download is less than 40 seconds.
The same guy who then blamed Java and fired the developer who blogged about their perf problems. Um…yeah…what a superstar leader!!
Maybe he should have spent less time drinking and blaming the CEO/Board, and more time on performance of his site.
Good luck Spock. He seems like a real winner.
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kirra said:
I think it is kind of cool that they are banking their VC\’s investment on a competition. Check it out - it looks like a great idea.
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Craig Hubley said:
The only obvious bullshit here is this:
“9. There are those who look for problems and those who look for solutions. This becomes clear in interviews very quickly. Hire people who look for solutions.”
This is a variant on the old “don’t come to me with a problem unless you have a solution” drool. There are problems that are so small they should be called inconveniences, and for those you might rationally apply this approach.
But for anything that’s an actual business PROBLEM, you need to think about it a while, and you need more than one perspective on it, you don’t need an analysts’ idea of what to do about it either. Let the analysts analyze but make them discuss amongst themselves, and if you can get analysts you aren’t paying to do that hard work, great. But most companies are going to need at least a few internal analyst types or they’ll spend a LOT of time going down dead ends.
I’ve come up with solutions to difficult design problems in interviews, and I can do it any time in any interview. But I’d never work for a clown who thought he could pigeonhole me as a “problem finder” just because I am in fact aware of many problems (orthogonal persistence, semantic link consistency, naming conventions) that are so open-ended that they defy solutions of any general nature at all. I know where not to step… and the “quick solutions” guys are constantly falling over cliffs I know to avoid.
It’s sad because there’s a lot of useful stuff here including the banking on competition.
But anyone who thinks they should be rooting out people who ask difficult questions and admit not having answers, at the interview stage, is only interested in placing more and more people in jobs they can’t do. After the poorly-thought-out “solutions” fail again and again, and the incorrectly-framed “problems” recur over and over again in different forms (because no one got to debate them in depth in the company or outside), and there’s an endless circle of hires and fires,
There’s a name for people who ask lots of questions and try only those relatively few things that weem to fit all the constraints: scientists.
There’s another name for people who ask few questions but try to come up with something that “works”: tinkerers.
Inventors and innovators always have some of each type of DNA.
No scientist DNA? Hey, I’d call them lemmings. They might get lucky but they’re unlikely to have any idea when they’re opening a can of Pythons.
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liz said:
A friend of mind worked at Friendster, and the VP of Engineering there did nothing to fix their woeful performance problems.
Instead, he just blamed the executives above him. That is lame.
As a woman, I know I wouldn’t want to work for someone photographed while arm wrestling…who then proudly posts the photo on the web site…and stands by while borderline sexist comments are posted to the company’s web site.
Maybe he will do what he always does, which is blame the CEO. Maybe he should try founding his own company and take the heat of the CEO job. Or maybe he just can’t so he needs to finder point.
It is hard enough being taken seriously as a woman developer in the valley, but jerks like this just make it harder.
Thanks but no thanks.
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Mark Wendman said:
BAD is Good.
BRAINS - obvious prerequisite (but not alone sufficient - e.g. a violinist won’t code)
ATTITUDE - envision & actualize success
DRIVE - start, continue and persist through to the finish line, with evident enthusiasm feeding your motivation (see a problem, work with it, hammer on it to solve, or just drive around it)
the Wendman modifiers are
( not a jingo TLA - sorry )SKILL - do you know what you are doing in the required domain of expertise (not necessarily transferable across various domains, and not the same as BRAINS - ie the smart violinist)
INSIGHT - you effectively problem solve in the required solvable challenges [see the Force/(path) LUKE]
JUDGEMENT - know what challenges you can win, and understand and identify the unwinnable - ie enthusiasm does not compensate for the less possible
http://mark-nano.blogspot.com/2005/10/wisdom-of-paolo-gargini-process.html
Excellent Article !!!
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Wil Schroter said:
Tough crowd. I thought the advice was useful, I’m not sure why people were so bitter on the comments.
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Raj R said:
Great article!
True, all the stuff here is obvious and basic but that’s the reason it resonates. The underlying gist is timeless. As they say” after all that is said and done, more is said than done.”
