One of the many things that stuck with me from the excellent annual Sequoia Capital Founder/ CEO summits was an astute comment about scaling growth stage companies by Sequoia partner and early President/ COO of VMWare Carl Eschenbach that went something like this:
Think very carefully about whether you want to hire someone who grows into the role or if you should be really hiring leaders that the company grows into.
It shaped how I sourced and interviewed candidates over time and also gave me the fundamentals to build from.
Even if we do intentionally look for that person that the company can grow into, the most promising candidate at least at a startup, is most likely someone who has the best vocational competency and cultural fit but played a divisional responsibility in his/her prior role.
Meaning, we do well when it comes to “I want to go from $40M to $150M and I need a leader who has operated a $150M+ function and is a cultural fit.” But we don’t dig deep enough to ascertain whether the person has the needed organizational, systems and strategic tone to scale the scaffolding of the company and create the right kind of space under him or her. That’s where the benefits of scale truly come from. And it is these DNA altering traits that will determine if you truly scale the business consistently and grow valuation beyond hitting even 4-5 consecutive quarterly targets.
Typically, this leader comes from a bigger company where they likely owned a cog in a much larger wheel – a region, a unit, a market, etc. and is looking to move up. Being a cog in a much larger wheel means that said rockstar likely did not have to deal with a lot of resiliency issues that one has to, as the person in charge.
When you are the cog, the operating scaffolding is in place, allowing you to come to work and focus on capitalizing on “the system” and on maneuvering around inefficiencies and obstacles. And scaled down for proportionality, the candidate would most likely have a much smaller role if they were inside your company right now, doing that same job. This is a very different mindset from what’s needed when you own the wheel.
The good news is that once you actively look for these traits, it literally takes the first 10 min or less to suss out if the leader has the presence, the compassion, the compass and the gravitas to immediately assume a position that truly sets the marker for what the company will grow into. The things they want to discuss quickly expose where their current center of gravity currently lies and what they will focus on as soon as the immediate fires are put out.
So, don’t get seduced by vocational competency exhibited in their last role. Be 120% sure that this leader can move from being a cog to designing and championing the whole wheel.
(Cross-posted @ Pretzel Logic)