After a startup launch, it can be difficult to build the business. Keith Rabois, a Khosla Ventures partner and member of the PayPal Mafia, shared his thoughts on operation and execution at DEMO.
For many startups, it's all about the launch. The excitement and energy of building something new and innovative can overshadow everything else in a founder's life.
Finally getting your product or service to market is a cathartic experience for an entrepreneur, but it opens up a world of new questions to answer and decisions to make. At the 2014 DEMO conference, Khosla Ventures partner Keith Rabois shared his ideas on how startups should proceed after launch.
"Building a company is a lot like building an engine," Rabois said.
You have an idea you start with. You whiteboard it and make blueprints, but it takes massive amounts of work. You, in essence, are trying to build a machine, something that can keep working even if you aren't there.
According to Rabois, building a company is difficult because people are irrational. To further exacerbate this problem, in a startup those people are often working together 12-14 hours a day. For startup leaders, this is the main problem you must be looking to solve.
In setting out to define the role of a leader in a startup, Rabois shared an analogy that has stuck with him through the years. As a leader, what you are really doing is editing. This is editing in the journalistic sense, and he teased it out through a few distinct tasks you need to accomplish.
The first task is to edit as you would a piece of writing. Strip things out that aren't necessary -- simplify. At this point you cannot let people give you excuses.
"If you can change the world in 140 characters, you can certainly run a company that way," Rabois said.
The second task is to ask clarifying questions to better determine actual need and what people are trying to communicate. After this, a leader should allocate resources to ensure that employees have what they need to get work done.
The next aspect of editing is ensuring a consistent voice. Startup leaders must match customer support, email campaigns, marketing, and branding. Additionally, they should work to achieve a consistent voice both internally and externally.
Ensuring a consistent voice seems to be inconsistent with the next task which is delegating, but Rabois said that this is all about balance. You can't be responsible for everything, but you also can't abdicate your duties either. You need to monitor your employees to see what "task maturity" each person has and what tasks they can champion in the business.
The last task is to edit the team. This begins with recruiting an amazing team. Be careful not to hire too many people, as more people won't solve your problems. The team creates the culture that advances your mission, so it is absolutely necessary that you prioritize your people.
"The team you build is the company you build," Rabois said.
Always be recruiting, don't delegate it. You have to be able to describe and sell the vision. Rabois recommends performing a calendar audit on yourself against what you claim are your top priorities -- does your calendar reflect that?
A good rule of thumb, he said, is that you should spend at least 25% of your time on recruiting. Don't aim for perfection in recruiting, because if you aim for zero defects in potential employees you probably won't get any stars.