Human Capital in startups. Struggles of the founders.
This interview with Jeffrey Paine - Managing Partner of Golden Gate Ventures, is one of the best articles I read about Human Capital in startups and the struggles of the founders, which is precisely what I experience working in this sector.
"Running a company—managing people, leading a team— is like a sport. You need a coach. But we never think of that in the world of business. We always rely on the boss to teach us. But for startup CEOs, they are the boss. And there is no one to coach them."
GGV is thorough about the Talent element when deciding on an investment, and are "making sure that the founders know how to hire the right people at the right time and then retain them. And whether they know how to get rid of people fast. " The fund pays attention to such details as the vibe in the office, observing the co-founders - are they getting on well and civil to each other, even doing a reference check with the senior team members who have left, asking about their reasons for leaving, which tells a lot.
Maybe that is why GGV is one of a few VCs in SEA, having dedicated Head of Talent, Ollie Wood, supporting the portfolio companies post-investment. Even globally it's not a common practice and founders are often left to figure out how to tackle their HR and Talent strategy themselves.
It is of great value to the ecosystem, when VCs explain the value of it even at the early stage, nudging the founders to think about their own values and hire based on that self-awareness. Indeed, the first 10 people are critical, because the next 10, 20, 100 will follow the pattern that this first team establishes and Human Capital is the main competitive advantage these days.
It does not mean you need to hire an HR when you are still a small structure with limited resources. Would disagree about the scarcity of good professionals who can be your mentors and, what is important, have worked with startups before. I have a few good names in mind (feel free to reach out and I'll gladly connect you), moreover, some are offering such support for free during COVID-19.
Tag the names of HR mentors you've personally worked with and found their input of value in the comments. Let's share this with the ecosystem.