So, you’ve decided to start a tech company. To avoid the fate that nearly 75% of start-up companies face (failure), you’re going to need much more than ingenuity and hard work. There’s no simple formula to having a successful company, but one angle to your business that you definitely don’t want to mess up right from the start is your employee and partner choices. During the crucial first stages, there are a few rules of thumb that must be kept in mind while choosing who to involve with your company.
How to Choose Your Partner
Getting the right cofounder is essential to having a successful business. Disagreements between partners, whether they’re monetary or visionary in nature, are the main causes of start-up failures. Choosing a partner who compliments your strengths and makes up for your weaknesses is important. For example, if you are an expert in a certain field, make sure your partner isn’t. You don’t’ want to have the same biases as each other.
Employees are the foundation of every company. They produce ideas and products, and are the driving force behind every organization. Choosing employees, particularly in the beginning stages of a company, is an important task. Since the cost of employee turnover is so high, it’s best to try to get it right the first time.
Here’s how you don’t choose employees: as a favor, because you’re friends, because you have a shared experience (i.e. you went to the same school). It’s well worth your while to take your time and find someone who’s good for the job, not just because you know them. Key positions include
Chief Technologist. Your company’s technologist is going to have a ton of work cut out for him. Start-ups are one misstep away from failure and success is just around the corner. You want your chief technologist to be smart and incredibly driven toward success, because without his work, you won’t have a product. He should be smarter than you and have the overwhelming motivation to drive the product from concept to creation.
Product Person. You’ll need to hire someone with an intimate knowledge of the market space your product is going to occupy. He needs to know exactly how it’s going to fit, how to make it wanted, and how to make people excited about it. He has to be a realist and a dreamer who will be able to give you advice and assurances about the proper directions to take both the product and the company at different points in time.
Keep Staff to a Minimum
Until you’re at a stable place, you don’t need superfluous workers. You’ll need them later, but not as a startup. Such positions include PR people and finance leads. They’re simply unnecessary at the beginning. You want to be sure you can offer essential staff the best possible wages, equipment and supplies to ensure their success. After a time of moderate success, you can start to expand your staff as needed.
Don’t Over Plan for Growth
If you get to the point where you’re turning away orders because you can’t keep up with demand, that’s the time to start scaling up your systems. In the beginning, it’s foolish to over plan when you don’t even have a single customer.
It’s very easy to find the money to expand later, once you have your company’s foundation properly laid. You should always remember that, although you have the best intentions and are optimistic about the future, it’s a statistical fact that almost three-quarters of start-ups are unsuccessful. You don’t want to lose more money than you, or your investors, have to, if you fail.
- Photo credit: smartphotostock.com
Sergeo Kozak is the founder of Edictive, he leads his team of “freedom fighter” employees to win business and support existing clients.