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How not to run a team – my first big lesson as a cofounder

Moving from VC to startups

I’ve been a founder for about 90 days. I used to be a VC. I watched and worked with founders for almost three years while at AirTree Ventures. Now I am one at Spaceship.

Each fortnight I want to dive deep with you, dear reader, on what’s working and what’s not working at Spaceship, particularly in how operations really works in small teams with limited resources.

The first big thing I learned was compartmentalising.

What didn’t work?

When I started at Spaceship, everything was group work.

We met on every decision. We came up with ideas together. We always had a say in each other’s work, no matter how developed it was. Good news was enjoyed together. Bad news was felt by all of us.

It didn’t work. You find that people love to sit around and talk about things rather than do them. It’s hard to push things forward when everyone is involved, but no single person accountable. And the absolute worst thing was watching strong views get watered down prematurely through committee-based decision making.

What did work?

We found the best way to operate was to completely segregate activities and communications amongst the team.

People need to be protected from the news (noise) flow to maximise focus. Devs should dev. Promoters should promote. There should be one person handling investor relations. One person handling hiring. One, not anyone.

This allowed each of us to own an outcome. Idea generation went from brainstorming for hours in front of a whiteboard to bringing a strawman to the group for feedback and collaboration. The

quality of ideas has improved, because someone is in charge of them and had to think on their own before approaching the whole group.

Bad news stays with the person who discovered it. That person only communicates it to the CEO. They together propose a path forward protecting the productivity of the rest of the team. Bad news is debilitating to a startup team and there’s generally a lot of it.

To make this work, each person owns a distinct bucket of activity. Someone owns product, marketing, operations and investor relations. These are pretty much the only buckets that really matter in the first twelve months of a startup. The CEO owns a bucket but also sits across all activity to be the first port of call for each person.

The CEO sets the priority, provides resources and removes roadblocks for each person. The CEO also sets the priority for the team as a whole. The team can only have at most 2-3 priorities each week.

The CEO celebrates the good news with each person separately and helps deal with the bad news as it comes. The CEO chooses what bubbles up to the rest of the team in relation to good and bad news. Unfortunately, both good and bad news is disruptive to individual productivity.

It sounds terrible but keep group chatter down to a minimum, it’s disruptive. The most destructive thing for someone to do in a team is communicate a success or roadblock in front of the team. Everyone stops work and wants to celebrate or contribute. Never allow that.

People individually identify a problem and come up with a proposed solution, but communicate in private to who they report to. Agree the solution together and execute it. No one is disturbed. Output and outcomes continue unabated.

Compartmentalising increased our pace and the quality of our outcomes by two to three fold. Try it yourself.

Paul Bennetts is a cofounder of Spaceship, a new tech-focused Superannuation fund launching soon.

Startup Daily