I have a hobby. I like to race my 33-foot sport sailboat. I am a pretty good sailor, our team wins more than it loses, but we are nothing to write home about. My main job, besides trying not to hit something, is to buy drinks at the bar afterward. And from time to time, I have been fortunate to have a couple of rock stars on my boat.
“Bob” is a very accomplished sailor. When he was younger, he designed sailboats, and he has won world championships in major regattas that feature lots of other high-performance teams. He told me this story.
It was the Melges 20 (type of boat) World Championships in Ft. Lauderdale this year, and Bob organizes a dream team — three other rock star sailors and himself. They are coached by an Olympic gold medal winner. In other words, if you were a venture capitalist looking to make an investment, this team had the color of money. They had the pedigree, the skills, and the medals to prove it.
At the regatta, Bob and his team did not do well. What went wrong?
Bob says, “I made a classic mistake. I had too many talented people on the boat, and they all wanted to do someone else’s job. They were sure they could do that other job better than the guy who was doing it. Too many medals, too much ego. I had monster talent, but they bickered and were unhappy in their roles.
“There are four positions on this boat. Before I built the team, I explained what each person was going to do, and it seemed like they agreed to do their job, but when we got on the water, it didn’t work the way I planned. I know I could have managed better, but in the end, I had too much talent and I couldn’t keep them swimming in their own lanes.”
Now I tell this tale not to give a short course in sailboat racing, but to point out that this dilemma applies directly to your company. How you hire people and the roles you place them in is the CEO's job. The tendency is to hire up, to try to get the best brains and talent you can. We all get blindsided by the resume, by the previous track record, and by the idea that if we hire this person and put him/her on the investment deck, the VCs will swoon. It’s he’s been there/done that syndrome. Smoke and mirrors, you want to dazzle the investor with a dream team.
But the question remains: Can you manage them? Will they do the job you hired them for, or is there an unspoken mutiny brewing after you miss the forecast revenue number at the first board meeting?
Nota bene: Every financial prospectus has the magic phrase — “past performance is no guarantee of future results.”
I have a client who faced this dilemma. He had hired an existing team, a group that had worked together for a couple of years. His deal was with the team, not with each of the individual members. Shortly after launch, it became clear that he either needed to break up the team and create individual responsibilities or fire the team — lock, stock, and barrel.
This was a nuanced negotiation, to say the least. To the credit of the team, they saw in this instant that the success of the company was best served by “disbanding” and reconfiguring as individual performers, each with different roles and compensation.
It is easy to fall in love with the resume, with the brains, with the style. We try to hire the smartest person in the room, and then we tell ourselves that even though that person is either over-qualified for the job of janitor or has never pushed a broom in his entire life, somehow it will all work out. Insanity.
Figuring out how many swim lanes your company has, and then putting the right people in the lanes, and convincing them that each lane adds real value and without all the lanes, we will lose the game, that is a test of real leadership.
It explains why the bat boy and the locker room attendant also get championship rings.
Rule No. 727: Beware the bias in seeking talent.
Senturia is a serial entrepreneur who invests in early stage technology companies. Please email ideas to Neil at neil@blackbirdv.com