People or Performance? Both!

3 min read
Article by Andreea Chis
Product Consultant

It is well known that most early-stage startups fail because they don’t solve a real need in the market. However, why do most funded startups fail, or are less successful?

The answer comes from a study conducted by Google for Startups – The Effective Founders Project. According to their (nicely designed and beautifully put together) paper, 55% of funded startups fail because of people problems

Having this in mind, what do ‘more effective’ founders do? 

  • Treat people like volunteers. ‘The best people are like volunteers – they’ll work passionately for a hard, meaningful mission.’ Having a sense of purpose might be overlooked. However, this is exactly what keeps the team together, leading to productivity, task persistence and work satisfaction.
  • Protect the team from distractions. Effective founders create a sense of direction and prioritisation. They don’t jump from one idea to the next – which might create confusion among team members – but are rather mindful in what they invest their time in and in what’s being projected to the others.
  • Minimise unnecessary micromanagement. There’s a time for micromanagement and there’s a time for macromanagement. While both are essential in certain moments, effective founders focus on delegating and scaling their business.
  • Invite disagreement. Differences among team members spark up different perspectives, and conflict (or just disagreement) is inevitable. Effective founders encourage this type of dialogue (when ideas are debated, rather than personalities). Moreover, it is already proven that social diversity (used well) increases performance.
  • Preserve interpersonal equity. Co-founders’ unmet expectations is one of the aspects that lead to major conflicts within the team. Effective founders openly discuss responsibilities, they document them and do check-ups on interpersonal-equity periodically.
  • Keep pace with expertise. 93% of the most effective founders have the technical expertise to effectively manage the work.’ They must understand each role so as to be able to hire the right people.
  • Overcome discouragement. You might say that effective founders have a high(er) level of self-confidence. Data suggests that this is actually the opposite. Self-confidence decreases as effectiveness increases because only then founders acknowledge how far from being skilled they are. Thus, building a support system is vital.

If I had told you that the results surprised me, I would have lied.

I am a firm believer in people. At the same time, I am also a firm believer in performance.

Perhaps a couple years ago I would have said that choosing between the two is tough. Now I can confidently state that there is no such thing as one or the other – they should always go hand in hand. Especially in the long run, when just getting along well or just focusing on delivering are not enough anymore.

People or performance?

Some questions to reflect on:

  • If you are a (funded) startup founder, what are your strengths and weaknesses when looking at the abilities of an effective founder? How can you make the most out of your strengths? What’s the plan for working on the less developed ones?
  • If you are a (funded) startup team member, what are the most important aspects for you in your career path? What do you currently have and what is kind of missing? Is there anything you can do to improve the situation and develop new skills?

So, to sum up, what should you focus on, people or performance? The simple answer is both. They are more interconnected than we think.

Andreea Chis Product Consultant

Andreea has fallen in love with entrepreneurship and the entrepreneurial mindset at 17. Ever since then, she’s been part of teams launching new services or products, both within companies and as a startup. She currently works as a Product Consultant within Tapptitude.