Is the Lone Ranger Dead?

Posted on April 24, 2016 by anentrepreneurswords

One of the businesses with which I’m involved is in the venture capital space. We identify, evaluate, vet and fund startup companies in the animal health, agribusiness and human health verticals. As you might imagine, we see everything under the sun. Founders present some pretty unique ideas along with financial projections that are pretty concrete on one end of the scale, to total pie in the sky on the other; slide decks that range from extremely good to extremely poor; business plans that might be exquisite or often are ridiculous; and valuations that are mostly “are you kidding?” though there are a few that are quite reasonable.

We really dig into the details, ask a lot of questions and look at a lot of documents. We pay close attention to whether or not the founder has the right passion and temperament as well as what kind of a problem his or her idea solves. It’s a good sign if the founder has some skin in the game and a vision that goes beyond simply cashing out down the road. And then we get to one of the central Go vs. No-Go questions – is the founder the Lone Ranger or is there a strong team in place?

Believe me when I tell you that there are some amazingly brilliant entrepreneurs out there. These people are scary smart and have world-changing ideas . . . but many won’t get funded because they haven’t (or won’t) put together a world-class team. The risk is too great from an investor’s perspective to make a bet on a Lone Ranger. Growing a business to any scalable level requires some very talented human capital. And the founder that says, “Invest in me now and I’ll go out and hire the talent,” just doesn’t understand. As investors we want to know who is going to be on the team from the get-go. It’s important for us to know if the chemistry is right; if everyone is committed; if the necessary principal skillsets are covered, and if all members of the team are on the same page.

There’s an obvious parallel here between startups looking for funding and our own entrepreneurial endeavors. In fact, we should step back and take a hard look at our own organizations as though we are presenting to venture capitalists. And here’s the hardball question we must ask. If we are hit by the proverbial bus today will our team be able to carry on tomorrow? Will our company survive and thrive or will it die? I know many entrepreneurs who believe their businesses are too small to justify a world-class team. To manage the risks that are inherent in entrepreneurship I think we need to scale to a size where such a team is a must-have. But can we afford not to have such a team in place as we push to scale? Think about it this way. It’s kind of like walking on thin ice across a lake. We hope with every step that we can make it to the other side without falling in. And if the ice breaks and we fall through we’re dead without the team. On the other hand if the team is in place, it can pull us out of the water should we take the icy plunge.

Some of us may be Lone Rangers because we think we can do it better than anyone else. In other cases we may know we need to build a team but don’t know how to find the right people. And there may yet be other instances where we don’t believe we can afford to hire the team at the present time. My response to all of these reasons is a repeat of my previously posed question, “If I’m hit by the bus today, will my company survive and thrive tomorrow?” If the answer is no, then it’s probably time to get busy with developing and implementing a strategy to build a strong team as quickly as possible.

While the Lone Ranger was a beloved fictional character from a different era, it isn’t a concept well-suited for a growing company. Building a world-class team is a solid way to manage risk in today’s entrepreneurial environment.

This blog is being written in tandem with my book, “An Entrepreneur’s Words to Live By,” available on Amazon.com in paperback and Kindle (My Book), as well as being available in all of the other major eBook formats.

Making the Distinction

Posted on May 10, 2015 by anentrepreneurswords

There’s a lot of talk these days about mentoring. Many members of Generation X and Generation Y (Millennials) have told researchers that having a mentor is of high importance to them. As a Baby Boomer, I take great pleasure in being called upon to mentor other entrepreneurs. But as the CEO of our family of companies, I made the mistake of also thinking that I could be a mentor to some of the up and coming leaders in our organization. This realization has just recently become apparent to me and its subtlety is what tripped me up.

By my definition, a mentor is an advisor and nothing more. The mentee can take what the mentor offers and do with it what he or she wishes. A mentor typically has no “skin in the game” where the mentee is concerned. As a result, the mentor is able to freely dispense advice and opinions without an agenda. CEOs should not try to be mentors within their own companies. Why? Because they clearly have an agenda which is first and foremost shaped around what is in the company’s best interest. In my experience trying to be a mentor to a handful of leaders in our firm has not worked effectively. They are deferential to a fault because I’m the CEO. They listen to what I have to say differently than if I were outside the organization. For example, when I challenge them with a particular question or premise, they take it as gospel. The relationship of the CEO to any member of the team is going to be such that a true mentoring relationship will be very difficult.

So what is an appropriate role for a CEO to play in developing leaders within his or her company? I have found that becoming a coach is the right path to take. Let’s use sports as the metaphor here. The coach is a teacher. He/she may call the plays from the sidelines until a sufficient level of expertise and trust is developed with the players to allow them to call their own plays. A coach should be wise and compassionate; yet there are times when he may be appropriately demanding and exacting.

Gen Xers and Millennials are well-served to understand the distinction between coaching and mentoring. I believe that a future leader should have both. Find a mentor who is older and has plenty of experience outside the company. By building extensive relationships throughout the community, one can usually connect with someone who may be willing to serve in a mentoring capacity. Then, try and establish a coaching relationship with a superior inside the company, assuming that the individual has a coaching personality. Unfortunately this isn’t always the case with certain people in positions of authority who are insecure and have power issues. I submit that it is healthy for the organization to move away from the boss-employee mentality and develop an attitude of coach-player.

CEOs and members of their teams can be fulfilled by a healthy coaching relationship. And an outside mentor can be the icing on the cake.

Hero or Not?

Posted on April 19, 2015 by anentrepreneurswords

I grew up in an age where the hero of the day was a cowboy or someone like Superman. I think my favorite was a character named Paladin played by Richard Boone in Have Gun Will Travel TV western series that ran from 1957 to 1963. Paladin wore a black hat, but he was definitely a good guy. He took care of the bad guys with his cunning and his fast gun. He wore a stoic expression and generally solved the problems he faced by himself. You never saw him flinch. There were no high fives; no fist bumps; no complaints, and he was always the gentleman. Many of us grew up idolizing macho heroes of this sort.

Paladin is a wonderful metaphor for today’s entrepreneur. How many of us take the “never let ‘em see you sweat” approach and soldier on to the finish line regardless of the obstacles we encounter? I know that I certainly have felt responsibility for the hundreds of employees and their families that are integral to the success of our companies. And as a result, there have been times when I have sacrificed mightily to make certain that my colleagues are safe and secure. After all, isn’t that what a leader is supposed to do?

We entrepreneurs often spend more time working in rather than on our businesses. I will stand at the head of the line to admit that in the past I handled things that others could have been doing because I a) wanted to set a good example, b) figured that I could get it done more quickly than showing someone else how to do it, or c) wanted it done properly. After a while I began to wonder why everyone stepped back and let me do these things not realizing that the example I was setting was encouraging people to believe that I would handle it! I suppose at the time that there was a feeling of indispensability on my part. I needed to be in the middle of things to pave the way to victory.

So what did I learn following this path? I learned that no one saw me as “the hero.” They became reliant upon me and they also felt that I didn’t have confidence in them. Apathy became a real problem. The quality of work slipped because the “Lee will fix it – he fixes everything” syndrome was in full swing. I was burning out and not having as much fun as I had in the past.

As I’ve gotten older I’ve come to realize that if I really care about my team members and their families – and I really do – the most important thing I can do for them is to create a sustainable organization. Companies where the founder or key principal micromanages everything and strangles everyone are doomed to die when the leader retires or dies. I can’t bear the thought of that happening to the people I’ve worked with for decades. My solution has been to develop a culture of empowerment and coaching. I now spend time helping my teammates learn how to fish as opposed to doing the fishing for them. It’s my responsibility to hold the vision for our companies, but that has become a shared vision rather than just my vision. Delegation is a key element to sustainability and all team members now have clearly defined roles and accountabilities with training and resources devoted to helping them succeed.

Heroes come from the battlefield or burning buildings and not from the boardroom. Sharing responsibility is the best way to create a sustainable organization.

The Anti-Bulldozer

Posted on October 26, 2014 by anentrepreneurswords

Many of us entrepreneurs have a tendency to be a bit aggressive at times. The appropriate analogy might be something about a bull in a china shop. Speaking for myself I know there have been times when I pushed through a situation and likely ran roughshod over others who were involved. It’s not that we do so intentionally, but we are naturally assertive and want to get things done . . . right now!

Much earlier in my career I was totally oblivious to how others might be reacting to me. I had not yet learned how to “read” people. I thought I was doing things the right way, but apparently was stepping on a lot of toes in the process. When this was pointed out to me I became a bit defensive and thought, “It’s not my problem if others have such thin skins.” Perhaps this was true in a literal sense, but how others feel and perceive us becomes reality – regardless of what we intend. What I didn’t realize is that being the bulldozer caused my colleagues and others to resent me and not want to work with me.

After many years it became apparent that others weren’t going to change – I needed to instead. Fortunately this didn’t require me to compromise my principles. But I realized that not only did I need to understand how others were responding to me, but also that I needed to adjust my approach accordingly. I began to pay close attention to “reading” people and modifying my approach away from a “one-size fits-all.”

Reading people is multi-faceted. It requires us to listen not only to what others say but how they say it. If I am laying out a strategy and asking for feedback, I need to pay attention to voice inflection, pitch, cadence and tone. I need to watch facial features. Does the other person’s jaw clench; is there an eye twitch; does the color change in his or her face, and do the nostrils flair? I must observe other body language tells. Is there a stiffening or turning of the body; do the arms fold or gesture in some way; do the fists clench; does the head raise or drop; is eye contact lost; what do I see in the eyes, and does the person literally shrink in position? How exactly does the person verbally respond? Is there hesitation before speaking? What words are selected by the person in his or her response?

People reads are only part of the sensitivity process. How do I conduct myself when receiving feedback? Is my body language open or closed? Do I keep a smile on my face or do I send signals that I don’t really want to hear what is being said? Am I truly listening or just giving the appearance of doing so? I have found that repeating back what the other person says helps send the message that I am listening. Then it’s important for me to acknowledge what is being said in a positive manner. For example, “I hear you when you tell me that you aren’t in favor of reaching out to the client in the manner I suggested and understand why you feel the way you do. Let’s come up with a different way of handling this.” In the old days I would simply tell the person to “just do it.” Today, it’s become much more important for me to be flexible and help others find different ways to reach the same end goal than just the way I want to do it.

Sensitivity is not a weakness. Instead it is an effective leadership trait. Reading people; listening to them; understanding what they are saying, and making the necessary adjustments engenders the trust and confidence of our team.

Stylin’

Posted on April 20, 2014 by anentrepreneurswords

Question: I am fascinated by different leadership styles. Which style seems to work the best?

Answer: Of course there is no one particular style that works for all situations. So let’s focus on a few common approaches.

In the “olden days” the leader led by dictate. The process was autocratic. Organizational hierarchy was respected at all costs. The phrase “it’s lonely at the top” was an ingrained belief system. All eyes were on the man (seldom a woman) in the corner office. The leader rarely sought input from the management team. It’s possible that he had a “consigliore” or confidant. He made the decisions and issued orders to his troops. Often he valued fear and intimidation as techniques for maintaining order in the ranks. Imagine how today’s millennials would respond in this environment. There would be a mass exodus of biblical proportion! Thankfully the autocratic era has passed.

Some leaders use a consensus approach. Perhaps they have a senior leadership team or an executive committee where ideas are presented and discussed by everyone sitting at the table. Participants are able to express their thoughts with impunity and feel as though their opinions count. The real test of this style comes in how decisions are made. Does the leader ask for a vote of his/her team on the issue at hand and then carry forward with the results of that vote? There may be certain situations where following the majority-rule is appropriate. But in many cases this is simply management by committee and an abdication of leadership.

The style that I believe shows strong leadership involves the leader soliciting input from the various stakeholders. She/he listens to and weighs the opinions and the evidence . . . and then makes the decision. Sometimes the decision may be contrary to what the senior team or executive committee wants. The leader must be willing to fully explain his/her decision and have a valid reason for not following the advice of the group. Perhaps the leader has more information and a broader perspective. Or there could be a legitimate philosophical difference. But the leader makes the ultimate decision and will be held accountable accordingly.

Leadership is about a clear vision and purpose. It involves effective communications. A strong and effective leader shows sensitivity for others and values their input. A good leader considers the facts and overlays his/her moral compass on the situation at hand. And finally, a true leader makes the decision when it’s appropriate and doesn’t abdicate it to others.

Sound leadership principles empower us to make decisions even when it’s tough to do so. As leaders we should model the opportunity to make tough decisions which in turn will help others learn how to become strong leaders.

An Entrepreneur's Words to Live By

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