

Startup founder evolution (or, the biz guy *is* valuable, just not at first) - ph0rque
http://www.tonywright.com/2008/startup-founder-evolution/

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ryanwaggoner
Excellent post. Too often, product guys and business guys don't really
understand each other or the value that each bring to the table. I've lost
count of the number of times that I've watched business entrepreneurs try and
hire a code monkey to build their vision for a tiny fraction of the equity,
knowing that they'll probably fail because they place too little emphasis on
the product and technical vision, especially in the early days. Similarly,
I've seen a lot of disdain for business entrepreneurs from the hacker side of
the tech community, probably partly due to backlash from the "code monkey"
mentality described above, but also due to a fundamental misunderstanding of
the value of marketing and sales. Both sides are important, but which is more
relevant is determined by the phase you're in.

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rgrieselhuber
Great post, and a great reminder for builder entrepreneurs. I agree that the
best biz people are the ones who come from a technical background and have
successful transitioned into a biz dev mindset. I've seen it many times. The
people who understand both how to build products and how to sell them are rare
and extremely valuable.

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jwilliams
> I agree that the best biz people are the ones who come from a technical
> background and have successful transitioned into a biz dev mindset.

Not disagreeing with you, but if I'd probably not like to be called the "tech
guy". Or the "biz guy" for that matter. I'd feel it too pigeon-holing.

Maybe works for others, and when the division is very cut&dry - I'm probably
just being oversensitive - but I'd personally find labels like that too
limiting - especially in a startup where you only have, say, 2-3 people...
each with multiple skills and differing, overlapping levels of proficiency.

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rgrieselhuber
Good point.

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pxlpshr
Hmmm, I would be hesitant to say the 'biz guy' isn't valuable at the start. If
you're bootstrapping a company and there's 4 of you crammed into a room, it's
probably not the time and place for him yet... But, I've seen teams dismantle
themselves over disagreements about features, direction, or quite simply drown
in incomplete and unfinished objectives. Your typical hacker is usually not
the best manager or leader.

I think it's good practice to have a few friends/mentors/advisors to make sure
you're not drinking too much of your own kool-aid, and provide advice from
time to time.

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anamax
> Your typical hacker is usually not the best manager or leader.

Is your typical biz guy?

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danielhodgins
Come on techies- why so few responses? Is it because he's right? Is it because
you all think you're so smart, precious, and valuable that no 'suit' could
ever add any value? Well, looks at Jobs and Gates. Those techies-turned shrewd
businessmen show that smart developers learn the business side of things as
well. Conversely, business guys should be learning as much about the technical
side as possible without having to directly own it. I have attempted to do
just that, and it has helped me immensely in my own startup. I would also add
that understanding the design and copywriting end of things is quite valuable.
In the end, the sales copy is what replaces you and brings in cold, hard cash.
That's why the top copywriters in the world charge up to $500/hr- they create
words that generate cold hard cash in your bank account. And they are worth
every penny of that investment.

The best way to increase the odds of startup success is multidisciplinary
teams that cross-pollinate and respect other disciplines. The developers
should understand customers, marketing, and visual design and the business
guys should always be learning anything they can about workflow and technical
vision. In addition, design adds a lot of value, and both the techies and
suits should enjoy learning lots about design.

Thanks again for a fascinating read and great graphs. Drop some comments
people!

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timr
_"Come on techies- why so few responses? Is it because he's right? Is it
because you all think you're so smart, precious, and valuable that no 'suit'
could ever add any value?"_

I'm just going out on a limb here, but maybe it's because this was posted less
than three hours ago, on a Saturday afternoon?

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danielhodgins
Fair enough, you got me there.....I was so excited about the post I forgot to
question why there might not be any comments.

Sometimes that's what happens when you are doing design/biz
dev/recruiting/hiring/marketing/testing/metrics/admin/coordinating
freelancers/articulating the vision/project management/etc/etc.....7
days/week, 12 hours/day. Execution is a lot of hard work, and there are lots
of painful lessons learned through trial and error that look obvious in
hindsight. Onward!

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jmtame
I'm a technical guy, but I don't think this has to be a polarized debate. I
think business founders might have a few roles to play early in the startup:

1) Hire new talent 2) Raise capital 3) Handle day to day things (frees the
technical co-founder from much of the time-intensive due diligence)

The business guy cannot conduct technical interviews, however. He also needs
to be extremely reliable if he's negotiating term sheets. And he needs to stay
active with business development stuff, probably leave it to the CTO to manage
the technical people.

Maybe it's possible to have both business and tech people, but I do agree that
it's best to have more technical people early on. After all, how do you forge
business relationships without a product? I would say if anything, the
business guy should be responsible for going out and pitching every day. Get
those business terms down to a tee, and make it a goal to have many high-
quality and interested investors. That is something that itself can take up
all of a technical founders' time.

I met with one of the guys who started and sold EUNet (one of Europe's larger
ISPs). He said "you know what makes a really good executive? It's the people
who know to do the right things. Leave it to the middle-level managers and
product developers to know how to do things right." Perhaps one of the goals
of a business co-founder is to be absolutely sure about the market and the
idea, or to always challenge it. Someone has to ask "are the engineers
building something people want?" Most of the time, engineers are building
something cool to them. And they're usually eager to work on challenging
things. But is it something people want? I would say you're very lucky if the
technical co-founder has this type of aptitude. I can only think of a few who
do. Levchin has it, Zuckerberg has it, Gates and Jobs (Jobs being arguably
less technical, but extremely product-driven) both have it too. Those are
difficult people to find.

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ojbyrne
While I agree that a good business person is invaluable, I just read moneyball
and I think the following quote captures what I see as a difference between
the biz people and the tech people (but in terms of baseball staff and
baseball players):

"Anyone who wanders into Major League Baseball can’t help but notice the stark
contrast between the field of play and the uneasy space just off it, where the
executives and scouts make their livings. The game itself is a ruthless
competition. Unless you’re very good, you don’t survive in it. But in the
space just off the field of play there is no level of incompetence that won’t
be tolerated. There are many reasons for this, but the big one is that
baseball has structured itself as a social club."

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nir
I think this relates to a recent discussion here about Customer Development as
something that should be done from the very early stages, closely tied to the
product development effort. (
[http://startuplessonslearned.blogspot.com/2008/11/what-is-
cu...](http://startuplessonslearned.blogspot.com/2008/11/what-is-customer-
development.html) )

As a tech guy, if I were starting a company I'd like to have a biz person with
me from day one, talking to potential customers, bringing in feedback and
helping make sure we build something people are actually willing to pay for.

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trapper
It's easy to build something that can't be sold. So while you might not think
the biz guy is valuable at the start, many of us would think so. Otherwise
you'll end up with YAW2ATWF (Yet another web2 app that will fail).

