One of the hardest things for an entrepreneur to do is to build a team. While you may be able to get co-founders when you are starting off, it’s very challenging to attract high-quality people to work for you. While starting a startup is considered to be cool, most people are reluctant to work in one, because of the short life most startups have.
Joining a startup is a risky proposition, and the salaries you can afford to pay are limited. Not only is it a constant struggle to meet your monthly payroll, there’s always a lot of competition for talented employees. Since people are your most important asset, how do you build your human capital, when you are forced to operate under so many constraints?
How do you get the right people on your team, and how do you groom them? You need to nurture them, so that you can move on to bigger and better things, and ensure your company continues to grow, without your daily supervision.
Sandeep Senan, one of the smartest entrepreneurs I know, is the founder of Evobi, a startup I have invested in. They make BiBox kits, and he has grown tremendously as a CEO over the last one year, after recovering from a near-death experience. His team now has over 60 people and is growing rapidly. Here are the insights he shared with me.
You need to craft your company culture so that your employees have a sense of ownership, accountability, and responsibility – they should think of the company as their company. Now you can’t give ESOPs to all your employees, so how do you get them to behave as owner- leaders?
I have created separate business lines for our company, based on where I think the company is likely to be positioned two years from now. These are our future growth engines, and I have invited my high potential employees to take ownership of these particular business units, and run them autonomously. If they do well, these will become independent profit centers in a few years, and could even be spun off subsidiaries of the parent company.
I am offering them ownership of 30% of their vertical, and the company will own the rest. This frees up my bandwidth and allows them to focus exclusively on growing these high potential areas. This way, I am creating new products; new service lines; and new opportunities for growth. As a result, the company is well-positioned to grow and evolve, to meet future challenges. Even better, I am offering a great career path for ambitious, motivated employees. They would otherwise perhaps have moved on and left because they want to do their own thing.
This way, by working within the company, not only do they get the benefit of my guidance, coaching, and mentorship, they also have a security of a salary. Even better, they are building on a sound base, so their chances of success are much better. Everyone benefits as a result of this innovative approach, where I am growing the pie for all stake-holders.
Not only does the company grow, the employees grow as well, and my investors are also happy, because so much more can be accomplished by a group of highly motivated, engaged and energized employees, who own a share of what they are creating, over and above their salary.
This innovation has also become a great tool to attract new hires, who can get their cake and eat it too, by being an intrapreneur in a rapidly growing startup!
I love the way Sandeep has taken entrepreneurship to the next step. He is allowing his employees to become the stars of his company, which allows them to bloom and blossom, and they repay his trust by being fiercely loyal and hard-working. By growing the next set of entrepreneurs within his own company, so he acts as a real-life hands-on mentor as well, while continuing to run the company![This post first appeared on LinkedIn and has been reproduced with permission.]