Hope is a must for startup employees. They have to have hope to motivate them to continue their creative hard work. When they lose hope, you will lose them.
I had a recent discussion with a serial entrepreneur about what to do when employees sense a startup is drifting sideways. She had past experience with good people leaving when that happened.
Over the past two years I have had similar discussions with very smart CEOs of startups. So she is not alone, nor are you if you are facing this situation.
My experience is that when this happens, the CEO is then confronted by the company culture with a decision: to continue on as is, or decide to work together in a fresh way to find something that moves the startup from a destiny as a small, dull, private business into a growing, exciting startup that can go IPO within five years.
That inflection point may not be obvious to the CEO, especially not to the enthusiastic founder.
But it is an inflection point that demands a decision. Employees agree. So do investors.</p><p>It is also an opportunity for you to think out of the box, to consider your alternatives.
It is also a time for you to be bold in your thinking.
It may save your company. Without the good employees, you are going to find it harder and harder to lift the business out of its dull sideways movement.
So let me give you some things to dwell on, to discuss with your leaders, your core team, perhaps at an off site location where you will have a fresh perspective on the business:
- Sift your market: Can you think of fresh markets to apply your idea/service/product/technology to? These would be rising, large markets that are open for you to enter in which you can pick a segment to dominate. This would most likely be a related market, but could be a radically different one. Example: the late arriving Japanese facsimile manufacturers moved from police and defense contractors (small but fat profits, dominated by American companies) to consumers (sending hand drawn directions to get people from one place to another in confusing Japanese roads and cities).
- Change business model: Are you offering a product? Consider offering a service instead. Example: Software.com set the example for moving from selling software to renting it and morphed into creation of a new category, software as a service, SaaS.
- Jump on a solution for a big problem in a hot rising wave: Can you solve a big problem for social networking? Or how about video content delivered over the Internet? How about smart energy grid solutions? Those are a few of the tsunamis we are experiencing. You can ride the energy of one of them and not have to push so hard to get your current market started. Example: My Space leapfrogged pioneer Friendster and then Facebook leapfrogged My Space. Each of the leapfrogging companies won huge market share of huge, different market segments.
The hard part for you will be to make a decision that moves your startup in a radically different direction. That is why it is so important for you to have objective friends and mentors and advisors who can be frank with you about what you are thinking and how you are behaving. They can give you perspective and wisdom that may sting and hurt a bit, but it can give you what you need to make a critical decision when you find your employees losing hope.
BOTTOM LINE: All your employees need hope in the outcome of your startup. So do your investors. It is more than hanging on and surviving. It is about how to make a critical decision to alter the business so it can move from dull to exciting, from moving sideways to growth. That is what CEOs are hired to do, even if you are the founder CEO. Letting go can be very frightening. But dropping the dream and moving on realistically can save not only the business and your job, but also can give your people hope once again. That is key to building your unfair competitive advantage.I wish you a great weekend and The Best on your Adventure!