The best innovators are the people who are experiencing a problem. What’s the connection between legendary founders and passion? What is the difference between finding investors on the East and West Coast? After cash flow, what is the next thing companies have to care about?
Here are the top takeaways we learned from Matt Straz, CEO of Namely, the HR and payroll platform for the world’s most exciting companies during our recent conversation for my Legends & Losers podcast. (Click here to listen to the entire podcast.)
- There’s a correlation between legendary founders and inexperience. When you unpack legendary innovators and entrepreneurs, they are the people experiencing the problem. Passion around the problem is the real thing that makes them unstoppable, not experience in the space. The entrepreneur that has relevant pain and the insight is actually more capable than someone who knows all about the space.
- At a certain point, people and talent start to get more important than financials. When a company has between 10 and 50 employees, cash flow is king. Your finance system is your major and primary system of record because you have to stay in business. Once you get over a certain size, it’s actually the talent that will decide how much bigger you will grow. Without the ability to measure the data, and evaluate performance you can’t be sure you have the best talent.
- In every company, almost everyone is supposed to get on and off at a different point. The people you work with can only scale to a certain amount, so it’s normal for people to get on and off the bus because they are more tuned to one stage than the other. The only problem with people is that getting off the bus makes them angry, but we should accept that businesses go through stages. If we are all self-actualized we won’t take offense, because we are clear on our strengths and weaknesses. What makes the most impact is having passion around a problem and finding its solution. We should be self-actualized enough to know what our strengths and weaknesses are, and recognize that the people who get a company off the ground won’t usually be the same people to scale it. Remember that leaders are evaluated by the talent around them.
Christopher Lochhead is the host of “The Podcast Silicon Valley Needs”, Legends & Losers, co-author of Harper Collins’ Play Bigger: How Pirates, Dreamers, and Innovators Create and Dominate Markets, and a retired three-time Silicon Valley, public company CMO.