The job of startup CEO is often idealised. In reality it’s a hard, time-demanding job and you’re constantly on the grind. Here are some quick tips to help you out:
1. Start With a Vision
A clear vision should be a starting point for every founder. Too often people start with a business idea without really thinking why are they doing it and what are they hoping to change. But vision is what makes a difference between great and mediocre companies. Consider the following:
- “To organize the world‘s information.” — Google
- “To be the pulse of the planet” — Twitter
- “To be earth’s most customer centric company.” — Amazon
In his book Simon Sinek argues that people don’t buy what you do but why you do it. The “why” is where the definition of company vision starts and it’s what affects what you do and how you do it. See more on this topic in his great TED talk.
The CEO is a keeper of company’s vision. She needs to be able to keep things on course, inspire the team, the customers and see the upcoming efforts as a piece of the large puzzle for the bigger vision.
2. You Will Grow What You Measure
Startups are about growth. To stay focused set specific goals and measure them on weekly basis. Be sure to focus on metrics that matter. For example traffic means nothing if users don’t convert. Startups typically measure revenue, user growth, engagement, net promoter score, customer acquisition costs and lifetime value of customer. Different metrics matter at different stages of a startup.
Paul Graham of Y Combinator recommends YC startups to pick a target weekly revenue growth (e.g. 5%) and focus on hitting this number and nothing else. If you don’t have a clear monetization model yet, the second best thing to measure is user growth.
3. Don’t Mistake Activity for Growth
Growth = growing revenue or user base. Everything else – adding features, hiring, media mentions, new office and company events can become deadly distractions if you confuse them for growth. As a startup you need to stay focused on the bottom line, because the clock is ticking and cash is being burned.
There is a positive and a negative side to determination. While “fail fast” became a popular mantra in past few years, there is a difference between failing fast and quitting too early. Ability to fail fast, adjust and keep going is what determination is about. If you look at some of the hugely successful startups it’s fair to say that determination is one of the best predictors of long term success. For example – when failing in early days AirBnB founders were selling cereals to keep going. Likewise, Instagram failed in their original idea to create a FourSquare knock off and PayPal failed 5 times before it became a payments company.
5. Focus on Tasks that Matter
As a startup CEO, you’re probably in constant struggle to prevent your backlog from growing too fast. The best way to boost your productivity is to differentiate between productive and unproductive tasks. Some tasks seem productive while other actually are. In his book “7 habits of highly effective people” Steven Covey talks about a productivity method used by the former US president Eisenhower. It effectively combines employs saying “no” and delegation of tasks to prevent your backlog from growing.
6. Don’t Focus on Competition Too Much
You will never build something remarkable if your focus is directed at your competition. Startups are about finding new, fast growth markets and ways to scale. If you merely react to what your competition does you’re effectively a follower in a crowded space. Focus on your users and the product instead, if you do it right you will find your own way to become a leader and make your competitors irrelevant.
7. Build a Great Advisory Board and/or Board of Directors
As a startup CEO you will talk to investors, customers and potential partners. As a new startup with no history you will often find that people aren’t always willing to take a risk with someone new. They have surely been approached by many startups like you and found that some of them didn’t last for too long. Great advisory board composed of respected people in your industry will not only provide the necessary social proof but also a network of contacts and personal experience to help you move forward.
8. Cater to a Specific User
He who tries to please everybody pleases nobody. Too often entrepreneurs try to make their product for everyone hoping it will increase their chances to make more sales. In reality mainstream market will never buy anything new with no history, brand recognition and social proof – unless it’s remarkable and specifically tailored to solve their problem. If you look at Facebook, it first catered to Harvard users. AirBnB first catered to people travelling for conferences to SF, Tesla started with a focus on very wealthy tech enthusiasts. If you know your users and build a product just for them, they will build your brand and give necessary social proof to expand to mainstream.
According to G. Moore’s theory “crossing the chasm” new products must first dominate early adopter markets to succeed in mainstream.
9. Hire Slow, Fire Fast
Great startups are built by great teams. Studies from US navy show that recruiting one person with bad fitness can decrease overall fitness level of the entire crew. In your early stages you’re planting seeds for what becomes a company culture, make sure you surround yourself with people who share the same values as much as you do, to create a great workplace for you and your team.
To learn more about elements of successful startups, download our whitepaper:
If you liked this post, please share it with friends!