Building teams is about strategically giving up control

In the early days of a startup, founders design, build, sell, and support their products. But, as a startup grows, founders increasingly solve problems through recruiting and delegation. Founders hire leaders and individual contributors to do a better job of owning the functions they once monopolised. If a startup is successful, this process loops indefinitely: things that founders owned become things that individuals own, which are then owned by teams, and eventually teams of teams. You could say that startup creation is a recursive process of strategically relinquishing control to others.

Sometimes, delegation leads to poorer results, and founders regret giving up certain areas of control¹. Other times, founders retain too much control over duties their team should own. While nobody can get this right every time, startup leaders can improve outcomes if they are strategic about delegation.

Understanding your strengths

Every founder is capable in their own way, which means different founders need help in distinct areas. So, founders must understand their strengths and weaknesses to strategically expand their teams.

The most important responsibilities of a startup founder are to:

1. Recruit the right people to build your business².
2. Build a great product.
3. Sell your product to your target market.
4. Retain customers.

Founders and CEOs don’t need to personally execute these responsibilities. They just need to ensure they all get done. This is why recruiting is the most consequential responsibility of a founder: through recruiting, you can delegate the other burdens.

Some founders are great at sales and good enough at recruiting but need help with product, technology, and customer service. Other founders are strong with product and technology but need help with sales. Some successful founders focus exclusively on recruiting and team building. There is no ideal archetype. Founders should own the areas they are strong in and delegate everything else. As soon as you can afford to recruit someone better than you at any particular function, you should recruit them. For some founders, this means they divest from product strategy reasonably early in the lifecycle of their startup. For others, this means they retain ownership until IPO and beyond.

The mechanics of delegation

The more vital a responsibility is, the more costly a flawed strategy and execution will be. Poor strategy and execution can result from delegating to the wrong people, delegating in the wrong way, or failing to delegate something you should.

This means that:

• Founders should be careful to delegate recruiting to anyone short of fantastic. After the first few hires, many founders consider recruiting a waste of time and leave it to their managers, HR team, or external agencies. But founders often make the best recruiters as they are most passionate about their market, problems, and solutions. If you build a mediocre team, you will create a mediocre startup. Most founders should be more careful when delegating this responsibility.
• Founder-market fit³ is a powerful force. Founders should never delegate product strategy to someone less compatible with the problem they need to solve.
  • For many founders, their superpower is their experience with the problem because they’ve experienced it first-hand. These founders should own product strategy until they find someone better suited to the problem space. Someone who could’ve started the company themselves.
  • Founders with limited experience in their chosen problem space should hire a product leader with this experience. As crucial as founder-market fit is, some startups succeed without it. Industry experience is something you can hire for.
• It is safer to delegate customer service than to delegate sales. It is safer to delegate sales than to delegate product strategy.

Most importantly, founders need to be clear about how much they wish to delegate responsibility. If you only want to delegate execution and retain control of strategy, you need to be explicit about this in your recruiting strategy. They will likely fail if you recruit a leader but don’t give them a good amount of autonomy.

For example, an early-stage founder who wants to own their sales strategy should not hire a VP of Sales. Instead, they should hire a salesperson to execute their strategy (and perhaps eventually a sales manager). An early-stage founder with a specific and inflexible product vision should hire product managers and technical leaders rather than a Chief Product Officer, who will expect to have control over product strategy.

Dictatorships don’t scale

It is impossible for a single person to effectively dictate a detailed product strategy to an organisation of many teams. This is because strategy and execution are not distinct phases in the product development process. As teams build software, they learn new details, and these learnings should impact strategy significantly. Therefore, a lot of product strategy happens during the execution process. In the early days of a startup, founders can be across the execution details of their product development teams. All successful organisations eventually outgrow this, though.

When you have many teams working on many things, you need these teams to be accountable for good decision-making. The only way to make a team more accountable is to give them more autonomy. In this environment, product leaders (often the founders) may still make high-level product strategy decisions. However, these decisions should be increasingly informed and driven by the people close to the work and, most importantly, customers. In large teams, it is unlikely that the best ideas will come from the top, especially if leaders have consistently recruited great people.

For how long should founders own product strategy?

A founder should own product strategy for as long as they believe they are the best person for the job. Founders with fantastic founder-market fit have a massive advantage over anyone they could hire into a product strategy role and should retain ownership for longer. Founders should only hire senior product leaders when they are ready to relinquish control (i.e., trade autonomy for accountability). If a founder wants to own product for the long term, they should take it upon themselves to learn about the principles of good product management because this learning will help them to make good decisions and lead product teams. These founders should also hire an experienced product leader as a mentor and recruit experienced engineering leaders.

Footnotes