Myth buster - Don't hire rockstars
He worked at NASA before
Dear readers, welcome to the first issue of MythBusters.
The systematic venture is a serialized book/journal, or at least it aspires to be one. A challenge I face is the need to follow a somewhat rigid structure, as each chapter and section should ideally flow smoothly into the next.
This year, I'm launching a few special short issues, too lengthy for an email yet too brief for a full article. This one is Mythbusters, dedicated to debunking the biggest myths in startups that almost every founder seems to repeat without thinking.
The other is Byte down, focusing on technical challenges faced by SaaS startups.
Now, let’s dive into the first myth I want to debunk: the rock-star myth.
Ex-big-name won't do jack
This is a classic scenario: a young startup, fresh off the tracks, launches, faces new challenges, and doesn't know what to do. That’s normal, nobody knows what to do.
At this stage, some newcomers create a solution to a problem and are now facing new types of problems. However, in the startup world, a classic solution is to try and find somebody who seems to have worked on a similar problem elsewhere and can essentially bring a ready-made solution. This person usually has a big name on their resume, like a large bank for a CFO, Google for a CTO, or a cash-burning startup for a product manager.
Well, it pretty much always fails. Let’s explain why.
Your startup is usually attacking an existing market in a new way or creating a new market entirely. Problems faced by startup founders, whether they are bootstrapped or VC-backed, usually have the following characteristics:
Tied to the emergence of an innovative solution, they have never been encountered by most executives of big companies. No good idea was born in a conference room.
Must be solved quickly, as a large number of them may threaten the very survival of the company.
Cannot be solved entirely, and a small team will have to quickly push minimum viable solutions to validate the market.
Solutions cannot be too expensive, as your company has limited runway and cash.
Ex-executives at big companies or overfunded startups usually meet the following criteria:
They enjoyed close to monopolistic situations and had no rush to innovate, as their solution would be the solution by market positioning.
They had all the time in the world and don't know how to focus on the priority.
Only solve the problem once the solution fits with all the other building blocks of a massive bureaucratic ship.
Have just too much funds, time, and no skin-in-the-game in solution execution.
Uniqueness
Big companies and overfunded startups usually produce an army of individuals whose jobs are extraordinarily obscure to laymen. Typically, some overfunded companies and corporations will stack tons of product managers and sales strategists who actually execute nothing and bring nothing but ideas to the table.
When you work in a startup approaching things in a new way, the learning curve is such that after 3 to 6 months, any junior profile working at your company will probably be more qualified than anybody for the given role. Startups are the best application of specific knowledge, the type that can't be taught or duplicated from any other experience but only learned through experience.
Hiring or funding rock stars is almost never a solution. Funding ex-members of big companies is a shortcut because some people thought all unicorns had a PayPal-level team. PayPal is a unique story, written by incredibly original profiles like Max Levchin and Elon Musk in a crazy market. Profiles hired post-PayPal had long years of massive struggle in the company, with mergers, CEO coups, FBI prosecutions, Russian cyberattacks, and threats of shutdown by eBay.
Current unicorns are not filled with the same type of profiles, precisely because their unicorn status is not always preceded by great market achievements. The story is not the same; the rock stars are no longer rock stars.
In a word, those who you think are rock stars are usually no more qualified than somebody willing to compound knowledge and time on a specific problem. At the end of the day, persistence and repetition of effort and trial and error are the only things that matter.