There are a few good things in life that you can never have too much of, and at a startup business that good thing is growth. However, we all know there is always a price to pay for overindulgence. To my way of thinking, the key to being a glutton is to balance your consumption with an equal amount of discipline. If you eat a lot, you gotta exercise a lot. This is the first post in a series that will explore some of the more common startup business growing pains and present strategies and tactics to manage them for maximum success.

A startup business is all about capitalizing on opportunity. When you’re growing, opportunities abound. The challenge is to focus on the right opportunities without getting distracted by all those other shiny objects. The challenge of focus pervades the entire startup business from the big strategic choices of product development and org design to everyday decision making and productivity. Moreover, focus must be balanced with flexibility, because startup businesses generally compete in rapidly evolving markets. Too narrow a focus for too long a time can be just as deadly as no focus at all.

Here are nine battle-tested tips for keeping your startup business focused and on the path to success.

Startup Business Focus Tip #1: Choose to Do a Few Things Very Well

It is the very heart of focus that you should strive to be great at few things, not mediocre at many. This principle is universal, applying to your core competitive advantage, your high level strategic goals, your tactical plans, your everyday priorities and your enduring cultural values. Complexity is the enemy of startup business success. The ability to crystallize the chaos into clear, simple goals and action plans is the essence of focus.

Startup Business Focus Tip #2: Align the Organization to Strategic Goals

There are many complex, competing concerns that go into designing an effective organization for a startup business: markets, products, processes, functions, geography, skill sets, and even personalities. But, the number one criteria is executive accountability for strategic goals.

Startup organizations with strong strategic alignment ensure accountability and focus.
Organizations with poor strategic alignment require lots of coordination on the part of the CEO
and encourage bureaucracy, finger-pointing and politics.

Those few things you choose to do at the highest level must get done cleanly and quickly, without excuses. There is no forgiveness for bureaucracy or finger-pointing in a startup business; you simply fail. Look at your strategic goals and look at your key executives and ask yourself this simple question: is there a single executive accountable for each strategic goal AND is that executive responsible for the essential resources required to deliver it? Save the competing organizational concerns for the next level down.

Startup Business Focus Tip #3: Over-communicate the Strategy

Startup business executives spend hours and hours talking strategy. They think about it on the way to work, in the shower, and when they should be listening to their spouses. Unfortunately, it is easy to forget that most of your team doesn’t. Most of your team members don’t even have the whole picture of what’s going on, because their job’s are only pieces of the larger puzzle. It’s very difficult to over-communicate your strategy, goals and plans and very easy to under-communicate them. Whatever your method, whatever your culture, you should over-communicate the larger goals. Without the big picture, your team won’t know a bad decision from a good one or a distraction from a real problem. A pervasive understanding of your strategy creates leverage, because the more your team understands the larger goals, the more independent and self-motivated they will be.

Startup Business Focus Tip #4: Look for Everyday Reinforcements

Any good trainer will tell you that classroom learning doesn’t stick without practice. If you want your team to stay focused on an everyday basis and recognize distractions that aren’t worth their time, then look for opportunities to point out how everyday activities and progress relate to the larger strategy. When you congratulate your team for launching that new website, remind them how important it is for demand generation and making your revenue goals. When you fix a record number of bugs, remind your team how it contributes to reducing churn.

Startup Business Focus Tip #5: Make Simple, Concrete Plans

Keep your plans simple. Plan only things you will do and avoid over-planning things you won’t do. Wasting time planning things you simply don’t have the bandwidth to get done is a waste of time, but more importantly it creates distractions. Keep your plans concrete. While your strategy may be lofty and difficult to tie to anything short of revenue or costs, your plans should be concrete with very specific deliverables that can be clearly marked done or not done to facilitate execution.

Startup Business Focus Tip #6: Link Plans to Strategic Goals

It’s common to create high level strategic goals at the top, then create plans and budgets from the bottom up, even if it is the CEO personally creating all three. Bottom up plans tend to be framed in terms of activities, e.g., upgrade product UI, create webinar, expand ppc campaign, etc. and budgets tend to be framed in terms of expense line items, e.g., web development, travel, advertising, etc., neither of which are clearly tied to your strategic goals. Make an effort to tie each concrete deliverable in your plan to at least one strategic goal. Separate out deliverables that do not produce immediate results, but are preparatory, infrastructure or long term in nature, and look for the right balance between immediate progress toward strategic goals and longer term investments.

Startup Business Focus Tip #7: Concentrate on Bottlenecks

These tips are all great in theory, but achieving them in practice is incredibly difficult for every startup business given the natural imbalance between the huge number of opportunities and problems on the one hand and the excruciatingly limited number of resources on the other. You will not do them all well. So, how do you decide what to do? Concentrate on the bottlenecks.

Improvements in areas that are not bottlenecks do not impact final results
anymore than enlarging the bulb of an hourglass or adding more sand increases the flow.

It’s a waste of time to create requirements for a product enhancement that engineering has no time to build. It’s a waste of time to reduce sales cycles when there aren’t enough leads for reps to make quota. Look across your startup business and continually ask yourself this question: what are the primary constraints to achieving our strategic goals? Then, concentrate on removing those bottlenecks like a laser beam to the exclusion of all those other nagging opportunities and problems.

Startup Business Focus Tip #8: Measure Progress against Strategic Goals

Startups are busy places. Good startups exhibit a constant sense of urgency to get things done: to get anything and everything done. Hence the focus growing pain. Aligning your organization and plans against goals is only half the battle, because you must test theory against reality. Are your plans actually achieving your strategic goals? Are your sales reps achieving their quotas? Are your marketing campaigns producing the expected number of leads? Are your new products generating the expected revenue? If you don’t measure it, you won’t know. If you don’t know, you can’t adapt your plan to address the problems. On the flip-side, if you don’t plan to do anything about it, then it’s a waste of time to measure it. Concentrate your measures on your strategic goals and the bottlenecks that are keeping you from achieving them.

Startup Business Focus Tip #9: Filter Distractions, Don’t Create Them

One of the biggest mistakes executives make is to communicate every request and great new idea they have to their subordinates without context or priority. Then of course, the politically savvy subordinate moves the boss’s request straight to the top of the list, regardless of its relative impact on achieving strategic goals or removing bottlenecks. Never underestimate your own ability to create distractions by inserting non-critical projects, when you may be more effective encouraging your staff to focus more exclusively on the most critical ones. When you make a request or share an idea with your staff, be sure to consider the context. Is it more important than current projects? Is it urgent? Or is it just your latest good, but not critical idea?

Keeping a rapidly growing startup business on track in a changing market is hard work. What tips, tricks and words of wisdom have worked for you?
Cheers,
JY

Choosing the right go-to-market sales model for your SaaS startup can be a make it or break it decision. Choose right and you grow smoothly from seed funding to A round to B round and beyond. Choose wrong and you spend precious cycles chasing your tail as cash runs out. While most B2B SaaS startups that offer recurring revenue subscriptions gravitate toward a transactional sales model characterized by inbound marketing and inside sales, this is not always the case as pointed out in this recent article entitled the Debunking the SaaS Sales Model Myth by my esteemed colleague Jeff Kaplan. But, how do you go about choosing the right SaaS sales model for your particular SaaS startup?

Price and complexity define a strategic spectrum of sales approaches for SaaS startups
that gravitate strongly toward three distinct SaaS sales models:
self-service, transactional and enterprise.

Price is Paramount

What’s your average selling price? I don’t know any single statistic that provides more insight on a SaaS startup, or any business for that matter, than average selling price (ASP). Average selling price is the intersection of supply and demand and as such it measures external factors like customer value and competitiveness, while it constrains operational metrics like costs, volume and risk.

Your ASP places a ceiling on your customer acquisition cost, which in turn limits your SaaS sales model options. If your ASP is $500 annual recurring revenue (ARR), then you are unlikely to be able to fund a direct sales force, because your sales rep would need to sell 1000 deals per year to come close to covering your customer acquisition costs. Whereas if your ASP is $500,000 ARR you only need to close a single deal, so you can afford to fly out and wine and dine your prospect to your hearts content.

Price has an inverse relationship to deal volume. For example, achieving $10M in total revenue with a $1K ASP requires 10,000 customers, whereas a $10K ASP only requires 1,000 customers. The volume requirement implied by ASP flows back through the sales process to put pressure on every upstream metric. Low ASPs require large target markets, more leads, more pipeline, higher conversion rates, shorter sales cycles, and so on to deliver a high volume of customers. High volume also requires more customer self-service, more automation and less labor, because labor is expensive, slow and has poor economies-of-scale.

Conversely, price has a direct relationship to risk. High ASP means high risk. The more risk, the more your customers will desire a personal relationship. It is the rare customer that will part with $50,000 through a self-service portal (although the Google AdWords customer does come to mind). Lacking the brand security of an established player like Google or Salesforce.com, a SaaS startup must put a human face on its service to overcome this fear. Luckily, high ASP pays for the sales and support labor required to create the personal relationship.

Complexity Constrains

How difficult is it for your customer to buy your product? Is your SaaS offering easy to find, easy to understand, easy to try, easy to buy and easy to use? Every hurdle that stands between your product and your customer reduces your sales velocity, decreases close rates, and increases your costs. The more complex the purchase, the more help the prospect will need. And, the fewer choices you will have regarding your SaaS sales model.

You can make every effort to eliminate complexity, but at any given time the amount remaining must be surmounted by your SaaS sales model. For example, a new social collaboration SaaS may appear so foreign that prospects have difficulty understanding what it is, let alone what it can do for them. Onboarding a SaaS ERP might require the customer to alter internal business processes before any value is realized. In both cases, it will fall to your SaaS sales model to help prospects navigate the complexity.

Three SaaS Sales Models

Price and complexity define a strategic spectrum of sales approaches for SaaS startups that gravitate strongly toward three distinct SaaS sales models: self-service, transactional and enterprise. While a mature SaaS business may employ all three, a SaaS startup will have the resources to master only one. However, this choice is not always straightforward when you are entering or creating a new market, because you must first find balance between price and complexity.

Price and complexity are natural adversaries. Higher complexity means higher costs, thus requiring higher ASP. But just because your product is difficult to buy doesn’t mean your prospect is willing to pay more for it. Getting the right alignment between price and complexity means ensuring the value customers place on your product always exceeds the price, time, fear and frustration they must pay. Once you achieve the right balance for your market, your choice of SaaS sales model will be obvious. Fail to find it, and you end up in the Startup Graveyard.

Customer Self Service
Achieving significant revenue at a low price point naturally entails driving complexity and cost out of the purchase to clear the floodgates for high volume. The ideal SaaS sales model is complete customer self-service. However, this requires that your customers be willing and able to service themselves. Able such that they understand the value of your product, how to buy it and how to use it. Willing such that they see little or no risk or frustrated effort in the purchase. Good examples come from well understood commodity office productivity tools that are easily adopted by a single user or department manager, such as those offered by Zoho and 37signals. The customer self-service SaaS sales model typically breaks down across customer-facing functions as follows:

• Sales: None.
• Marketing: Full revenue responsibility, creating awareness, educational content and automation capable of driving business through the entire purchase process from awareness to close.
• Support: Provides automation and tools for easy on-boarding, plus templates and educational content that allow customers to resolve any issues they encounter on their own.

Transactional Sales
As price increases, customers become less willing to part with their cash without at least knowing there are actual trustworthy human beings behind your website URL. Higher ASP brings higher expectations for the business relationship, such as signed contracts, premium SLAs, invoicing, and the ability to speak to a human when problems arise. The risk-driven need for a more interpersonal business relationship drives the SaaS sales model away from customer self-service into a transactional sales model characterized by efficient, high volume sales and support operations, short sales cycles, and rapid onboarding—all supported by automation that allows for as much customer self-service as possible were customers willing and able to service themselves, which they are neither. Good examples come from products that automate a well-defined business process or function with a bit of an Internet twist, such as those offered by Marketo, Zendesk, and Xignite.The transactional SaaS sales model typically breaks down across customer-facing functions as follows:

• Sales: Inside sales reps supported by online content and automation, tools, training, incentives and metrics that enable high efficiency and many transactions per rep.
• Marketing: Feeds highly qualified leads to the sales team to build pipeline and improves efficiency by removing roadblocks through educational content and automation that drive complexity out of the purchase.
• Support: Inside support reps that meet a range of SLAs from limited pre-sale support through premium post-sale support with tools, training and metrics that enable high efficiency and many transactions per rep, complemented by customer self-service tools, templates and educational content.

Enterprise Sales
While most SaaS startups gravitate toward transactional sales or customer self-service, some SaaS startups have products that provide so much value per customer and are so complex to buy that their natural starting point is traditional enterprise sales. Two good example categories are cutting-edge Internet marketing tools employed by big brand consumer marketers, such as BazaarVoice and BrightEdge, and feature-rich suites that automate strategic, core business processes for mid-to-large enterprises, such as Netsuite, Workday and Passkey. The enterprise SaaS sales model typically breaks down across customer-facing functions as follows:

• Sales:Territory sales reps focused on a narrow set of target prospects directly supported by product marketing and sales engineering resources at a deal level.
• Marketing:High-end marketing that facilitates brand awareness, education, relationship building and trust, complemented by direct support of the sales team, including telemarketing speeding access to target prospects and detailed sales tools such as product roadmaps, ROI calculators, etc.
• Support:High touch support up to onsite issue resolution complemented by educational tools and training tailored to the specific needs of individual customers.

Avoiding the SaaS Startup Graveyard

Regardless of your price, your SaaS sales model must provide sufficient support to enable prospects to navigate the complexity of the purchase or you will not close business. You can give your product away in a Freemium price scheme, but if the purchase is too complex, you can still find yourself hand-holding every single free customer akin to an enterprise sale. You just can’t give away complex software. Only customers that are willing to pay an exorbitant price for your hugely valuable service will also pay exorbitant amounts of time, fear and frustration to wade through the complexity of getting it. When complexity forces you into a SaaS sales model where the costs exceed your ASP, your business is destined for the SaaS Startup Graveyard.

SaaS startups that combine low price and high complexity end up in the SaaS Startup Graveyard.

There are three strategies for avoiding the SaaS Startup Graveyard, all of which amount to aligning price and complexity, so you can gravitate safely toward a viable SaaS sales model.

• Increase Velocity: The goal of this strategy is to reach a customer self-service SaaS sales model by holding your price point low and driving out complexity to build volume rapidly. To succeed at this strategy, you business must be capable of overachieving on both SaaS Do #1 Choose a Large Market and SaaS Do #3 Accelerate Organic Growth, and you must absolutely avoid SaaS Don’t #3 Launch without Online Trial.
• Increase Value: The goal of this strategy is to reach an enterprise SaaS sales model by adding value through product innovation and restricting your market to target prospects that see the most value in your offering. To succeed at this strategy, you business must innovate as in SaaS Do #6 Reach Across the Firewall without falling prey to SaaS Don’t #1 Chase Elephants that ruin your economies-of-scale, and preserve the core SaaS cost advantage through SaaS Do #8 Enable Mass Customization.
• Increase Profit: The goal of this strategy is to reach a transactional SaaS sales model by finding balance between ASP and CAC (customer acquisition cost) through operational efficiency and focus on the most profitable market segments. To succeed at this strategy, you should follow SaaS Do #4 – Craft a Compelling Story to attract only the prospects you really want to sell to, and then make it easy for them to find you by SaaS Do #2 Create a Hub on the Web and get them through the purchase efficiently by SaaS Do #5 – Build the Business into the Product.

The SaaS startup holy grail lies on the opposite end of the spectrum from the SaaS Startup Graveyard. High ASP combined with low complexity characterizes the most wildly successful SaaS offerings like Google Adwords and Amazon Web Services (cloud in this case), where customers routinely write six figure checks with the most minimal amount of personal interaction with sales and support reps.

SaaS Startup Evolution

As a SaaS startup evolves into a mature SaaS business, growth aspirations naturally lead to the desire to expand market reach to new prospects and to expand product footprint with current customers. The SaaS startup that enters the market with a customer self-service SaaS sales model represents the origin of a natural evolutionary path. The theory is straightforward. The nimble SaaS startup that has built a large self-service customer franchise for a super simple product starts pumping in new features, develops modular pricing schemes, adds a few sales reps and sets off on a quest to increase ASP from $10MRR to $100MRR to $1000MRR to $10,000MRR and beyond!

A SaaS startup that aspires to evolve beyond a single SaaS sales model
faces the challenge of mastering multiple competitive strategies.

However, the straightforward tactics belie the tectonic strategic, operational and cultural shifts required for success. Underlying the simplicity of the customer self-service model is a mass market, low cost competitive strategy. Whereas, the enterprise sales model assumes a highly differentiated product, usually characterized by cutting-edge Internet-enabled innovation. Maintaining the simplicity of the customer self-service model as a successful SaaS startup introduces more complex products and purchase processes in close proximity to the originally simple, self-service product and purchase process requires careful planning and execution. Should the products be separate offerings or modules of a single offering? Should transactional sales arise by skimming the cream of customer self-service prospects, or should entirely new lead generation vehicles be put in place. Are enterprise customers just transactional customers who are all grown up, or an entirely different species? It is often said that it is easier to move up market than down market. This is probably true, but it is NOT easy to move up without inadvertently abandoning the down.

There is always more work to do in a startup than there are people in the company or hours in the day to do it. Everyone has heard horror stories about endless twelve hour days, all nighters and death marches. Some startups fail not because the idea is bad, but because they just can’t seem to focus effectively on turning the idea into a profitable business. This is the second post in a series entitled Startup Musings that discusses managerial challenges unique to the startup executive. This post covers a few handy tips on how to make the most of the few resources you’ve got.

Choose What NOT To Do
When you’re small, and looking to get noticed in a much larger crowd, it is far better to do one thing exceptionally well, than to do a lot of things mediocrely. In a startup, this simple rule of thumb applies to the highest level of strategy all the way down to the lowest level of day-to-day activities. In a word, FOCUS! Given that there is always more to do than you possibly can, the most important organizational skill of the startup executive is the ability to look an idea square in the eye and say, “We don’t need to do that, because it won’t impact revenue, save money, or make us more competitive.” You’ll be surprised how quickly this little acid test will shorten your to-do list.

Sounds Like a Volunteer!
Getting focused is hard, but staying focused throughout the organization is even more difficult. Bringing a good idea to fruition is something like 5% strategy and 95% execution. In a big organization, that might be more like 5% strategy, 45% execution and 50% waste, but you can’t afford that in a startup. Keeping the organization focused on your short list is crucial to success. Unfortunately, many startup executives fall back on micro-management when they see their staff straying from the important goals. But, I think the better solution is to show your staff how to choose what NOT to do for themselves.

The first step is to make sure everyone knows how their individual goals tie to the big picture through regular company meetings and the like. But, I will guaranteed that before these goals are achieved, you and yours will be be assailed by a multitude of new ideas for new projects and recurring ideas for projects you have already passed on as things NOT to do. Often these competing non-goals show up in subtle little complaints like these: “I don’t know why we don’t do X and get rid of this headache?” and “Yeah, the right way to do this would be Y, but we’re always taking shortcuts, so it never gets done right.” I’ve found that the best way to stay focused on the priorities at hand, while maintaining the flexibility to jump on a valuable new idea is to reply “Great, sounds like a volunteer! Still think we should do it?” If you complain, you volunteer. Works like a charm.

Size Matters….Keep It Small
Startups are big, risky financial bets. The best way to manage this risk is to break it up into lots of little bets that allow you to reap immediate results, and quickly adapt to opportunities and threats. Flexibiliy is key. You should aways be focused on goals that will yield immediate value, however you measure it: revenue, users, network partners, etc. And, you should break projects up into smaller and smaller increments, so that you don’t commit all your resources to monolithic endeavors with long time-lines and uncertain results. Stay nimble, be opportunistic and evolve through continuous learning and improvement.

Be Different. Be Creative. Get Leverage.
It’s not enough to have a great product, there are far too many great products and people have far too little time to try them all. You’ve got to get noticed, you’ve got to be remembered and you’ve got to be something worth talking about, Seth Godin’s so-called purple cow. Unfortunately, you’re always outnumbered by the competition in a startup, so you can’t compete on muscle. You’ve got to work smarter, not harder. While your left brain is focused on squeezing the highest possible ROI out of 90% of your limited resources, your right brain should take some creative risks with the remaining 10%. If you don’t buy the ticket, you can’t win the lottery. You never know what will work and what won’t, so its good to experiment and place a few bets that have potentially huge payoffs throughout the business.

For example, at Xignite we sell market data via Web services. Nine out of ten readers probably read right over that last sentence and didn’t get it. Don’t be upset if you were one of them. Web services are not well known to anyone but software developers and their benefits are NOT easy to describe. It requires education and trial to really get the value proposition. Once customers get it, they really get it, but we need them to pay attention first. We considered the usual approach to this problem, whitepapers, webinars, flash presentations, etc., but it all seem so….frankly boring…for anything but the most interested prospects who are probably registering anyway. So, we’ve decided to place one of our bets on in-house video capabilities. Our competitors Web presence is rather old school, so we are going all out to stand out. Not just a demo video…we’re converting the core of our website communications to video, and we’re doing it in-house…on a shoestring.

Resourcefulness is Golden
I have in mind a future post in this series on hiring tips for startup executives, but I couldn’t complete this list without at least touching on this topic. In a startup, everything is fuzzy. Rarely is there an established process to reinforce focus and ensure productivity. Constant hand-holding can be an excruciating drain on resources. There is nothing more comforting than people who can get $#!t done. And, I don’t mean simply completing well defined assignments on time. I mean given the basic business problem with no idea what the ultimate solution is and no idea where the resources are going to come from, they take the initiative, stay focused, get creative and deliver unexpected value to the organization. They find solutions, not problems. There are lots of qualities you can look for when hiring for a startup, but for me, good old resourcefulness is always at the top of my list.

For the past couple of years I’ve been active in an up-and-coming CMO-only professional group called The CMO Club. It’s simply one of the best marketing executive groups I’ve encountered, so I thought I would pass along the tip. It was started by Pete Krainik, a former CMO himself of M&M Mars, Avaya, and DoubleClick, with the intent of keeping it CMO-centric, vendor free and focused on high-value peer-to-peer sharing.

CMO Opinions on The CMO Club

Pete treks around the country hosting local CMO-only dinners with great conversations and guest speakers. There is a social networking site with increasingly good content and the dinner schedule, but the real action is interpersonal at the dinners and bi-annual leadership summits.

The next CMO Leadership Summit is coming up in San Francisco on November 13th and 14th and yours truly will be orchestrating a breakout session focused on the unique challenges of the Startup CMO (had to be a plug right?) The summit is an investment at $995, but for nearby CMOs there are upcoming dinners right before in Orange County 10/19, San Diego 10/20, and Bay Area 10/21, so you can decide for yourself if it is for you (dinners are a more modest investment…about $100).

Here is the session description….anyone following my Startup Musings series will find the angle familiar. Hope to see you there!

So You’re a Startup CMO, Now What?
Whether by choice or by chance, CMOs find themselves in startups for many reasons: to follow a dream, to strike it rich, career change or simply as the victim of economic circumstances. Whether you are coming into it from a fortune 500 company or right out of B-School the creative, managerial and leadership challenges are unique and if you’ve never done it before, there are lot’s of ways to fail. This session will tackle trials and tribulation of the startup CMO and provide a open forum to share experiences from the trenches, lessons learned and secrets of success. Topics covered will include gaining leverage through creativity, getting stuff done on a shoestring, building something from nothing, managing rapid growth, budgeting when cash is king, overcoming a technical handicap, making yourself essential, developing relationships with the board, how to choose the right startup, and managing career transitions.

Lots of Smiling CMOs at the last CMO Summit in NYC May 2009

The aspiration of most technology startups is to grow from virtually nothing to a billion dollar company. But, if you examine the typical billion dollar company you find something that looks very much like a factory. People are divided up into divisions, departments and job descriptions. And, crossing these boundaries are well defined processes and support systems that sew up the pieces into a business value chain that drives revenue. Lot’s of round pegs and round holes for them to fit into that in the best companies provide a vehicle for talented individuals to drive superior organizational performance and a safety net for weaker performers to ensure that things keep humming along no matter what. In other words: NOT a startup.

Getting from here to there is like growing a fully functioning human being with a brain, a heart, lungs, legs, arms, and fingers from a single, blank zygote. In nature, this miracle is accomplished through stem cells. Which according to Wikipedia are “characterized by the ability to renew themselves…differentiating into a diverse range of specialized cell types.” I think I would be hard pressed to come up with a better analogy of what it takes to be a successful startup executive. I say this for two reasons. First, it is the job of executive management to build the organization, processes, and jobs that will be the billion dollar company. Second, until you achieve the revenue growth that will allow you to pay for all these offices, people, and systems—-you must do it yourself.

One hat is not enough for successful startup executives. Startup executives must demonstrate breadth across functions and depth within roles. In it’s simplest form, breadth across functions means understanding the basics of the functions adjacent to yours, so that you can work with other managers to define the organization, processes and systems that will enable the business to scale. In the extreme, you may find yourself managing multiple areas, simply because there is more work to be done than there are people to do it. Depth within roles means being able to actually do the work, not just manage it. I like to call this the McDonald’s requirement. If the employee doesn’t show up, the manager works the counter..or the fryer …or the drive-thru…or whatever it takes to keep the doors open. And, you won’t always have the luxury of hiring highly paid, senior staff. So, you must be an effective mentor to grow them from more junior staff. I always look for these characteristics when hiring executives. In addition to the primary functional skills, I assign extra credit for multi-functional, general management and entrepreneurial experience.

Note:
As this post implies, when you work at a startup you often find your attention pulled back and forth between the highest levels of company vision and business strategy to the lowest levels of operational detail and execution. On occasion, I’ve even found that the mental gymnastics can actually give you a headache. So, in deference to this fundamental challenge of startup management, I am kicking off two new series of posts with distinctively different flavors.
Startup Business Musings which will focus on the principles that help shape a successful startup business and successful startup executives…of which this is the first. And, SaaS Marketing Tips where I’ll attempt to expand upon the SaaS Success Top Ten Do’s and Don’ts by exploring concrete, actionable ideas and examples (first post tomorrow).