Why I will never be a founder
I’ve been doing the startup thing for over 10 years now. For all of that time, I’ve been in senior roles – leading finance, corporate development, partnering, operations, support, etc. across a handful of great companies. Along the way, people have asked a flattering, yet natural question: when will I found a startup of my own?
The truth is, I have thought about it. Early on, I deliberately exposed myself to areas of my companies that were not my responsibility (even ran development for one scary week when a CEO was away). I was training myself to run a startup. But over time – especially in the last two years, I have come to two conclusions:
1.) I absolutely love what I do and would lose a lot if I was not spending my days advising founders / CEOs and making financial deals happen; and
2.) I believe that founders should be technical.
The 1st point is self explanatory. The 2nd you may or may not agree with it, so lets dig into it.
When you’re creating a startup from nothing you need to build a strong foundation. That foundation is a technical one. It is true that in the era of web 2.0 the technical hurdles have come down. We have frameworks, tools and platforms to help us launch faster and the key to success is less about algorithms and more about user experience. Still, you need to be technical. Its just that technical might mean you’re a product or UI person on the web vs. a developer more generally.
Now, I do work with some CEOs that are not technical. I’m not saying they can’t be successful. And if they come from a marketing background, then they bring another important element to the equation. But, I feel that especially in the early days, if you’re not technical enough you have a big, important blind spot.
How do you know what’s possible with your technology? Do you know how fast you can launch? How do you fully assess the technical hires you make? Do you base your strategy on commercial moves or on an understanding of your technical platform and just how far it can go?
There are many questions that are best answered from a technical or product foundation that are key to startup success. So, for me anyway, I know I will not be running a startup any time soon. And that’s just fine with me.
Have to agree with you David. And am obviously pleased that as a startup finance person, I will never be out of work. I do feel though that to come up with something compelling as a founder, you need to have a strong tech or product foundation. I appreciate both of these elements, but think I lack the depth to be responsible for them as a founder.
Startups aren't *just* about technology. Some are more technical than others, and others still just piggy-back on existing tech. Any startup that doesn't appreciate the basic rules of finance is doomed. Cash flow = Revenues – cash costs. End of. Without an experienced numbers man on board, many promising startups fall at the first financial hurdle.
Not yet
Did you do it? : )
I think that mindset will change Stephanie. Good web investors really do understand the importance of UX. And when it comes to metrics, think UX can be judged through retention / churn. What you focus on makes or breaks a web product. Period.
The interesting thing so far about being a generalist technical founder — I've been a backend programmer even if today I design interfaces and UX — is that it seems very few investors I've spoken to seem to truly understand the merit of user experience and user needs. This isn't the first start-up I'm part of, but even in previous roles, investors asks for "traction" but while traction itself may be a result of good experience design, but I've found it rare that usability metrics get taken into account.
Good idea. Being a CFO I can't argue with that request. May take me a while to dig something up, but I will do it
Great post. I would love to see numbers confirming or refuting your second point — particularly for Canadian Startups!
> require a huge focus on product, user experience
Yep
keith
Hey Keith, most of the companies I am involved with are web startups. Even they have strong technical requirements. And building great community features requires strong product depth (in my opinion). Knowing how standards such as oAuth, Opensocial etc apply to your offering + knowing how to build virality and social features into your business will require you to not necessarily be technical, but will definitely require a huge focus on product, user experience, etc.
Interesting post and discussion Mark. dbTwang has 2 founders, neither technical. The spread is commercial and deep sectoral knowledge. Both of us dabble in tech but lightly. However we pull on an extensive and supportive network of Irish tech startups who cover part of our gap.
However I think your post may contain a hidden qualification in that it applies to deep tech startups – ours is an online venture which is about community, not code.
keith
If you are passionate about technology and follow the latest trends, technology stacks, etc I would hope that you could couple that with 2-3 yrs of Software Engineer work to lead a technical team. Great post, and thanks for answering my question!
I don't think its necessary that a founder can code everything himself. In fact, I find founders that can do that sometimes lose site of the big picture. They're too much into the details. But, you should have been coding at some point in your career and need to know enough that you can manage a technical team and can ask the right questions
Can you expand a bit on the level of technical knowledge? Would you expect a founder to be able to code everything himself, or know enough of the overall architecture & patterns to make informed decisions?
Hi Hendro, For sure technical people need to undersand business. I have seen many startups fail because their (technical) founders did not understand how to work with VCs as just one example
For sure. And with the right partners I'm sure I could get involved at the beginning of a startup. Its just that in the really early days its all about product and user needs. If you are not a deep product person I think you're at a disadvantage. I'm sure I'm approaching it in my overly rigid CFO-like manner though
Hey Heri – I have to say if you can't understand users needs you are guaranteed to fail. This is just so important. Its all about understanding and satisfying user needs
Absolutely Greg. Vision and a passion to create are common aspects of all founders.
I agree with your 2nd point Mark. Remind me of the conversation that i had last week with another company's founder that is more business-oriented. He told me, "I think you have 1 serious advantage over people like me. With the same amount of money, you probably can fly your company 4 times more efficient than me in the early stages". Of course, i believe you shouldn't be purely technical. Having a bit of knowledge around cash-flow, sales funnel, market validation, partnerships, dilution process, pitching etc can make the difference between someone wants to approach you or not.
I have seen great founding teams with a technical founder + a sales & marketing person. Also have seen teams come together around an idea proposed by a Sales/Marketing lead who pulls in technical people with a clear articulation of the vision. I don't think I've seen a CFO founded company though. You make an interesting point.
I have an engineering backround (telecommunications); so it's great to read this I have to say though it's very very (if not impossible) rare to meet a technology-minded person who understands business and understands the needs of users
I think the most important thing to note is that you realize what makes you happy and although the urge to create is still there you have found a way to focus that energy to do what you want. I think if its a passion of yours to create a startup, regardless of how technical you are, you can find away. There is a ton of free advice out there that can answer a lot of the technical issues, and if needed a good founder will find someone that will be able to work with them on any issues that arise. When it comes to being a founder, I think it is because you have a need to create your vision because of your passion and love for it. When you already realize your passion and love for what you do is helping founders, you are probably correct when you say you won't ever be a founder. Little side note: it does help a lot if you are technical too
haha
Absolutely – in a World with two or more co-founders, not all of them need to be technical, but at least one should be.
yes and no would be my definative response to that. With a technical startup it is crucial that a founder be technical but if you can start with two people that are in sync and one is technical and the other is marketing/business – now that will have some legs too.