The Four Elements of Company Building

In my post last week, I defined “company building” as the stage after the company has nailed product-market fit and distribution and it needs to scale as an organization. This phase is tough because it isn’t as clearly measurable as building product or growing distribution.

It’s helpful, therefore, to have a framework to separate out the different aspects of a successful organization. I believe there are a number of ways to think about it, but my personal framework consists of four components:

  • Strategy: Does my organization have the right vision, goals & tactics?
  • Execution: Can I accomplish the strategy as I’ve defined it?
  • Team: Do I have the right team, and are they motivated and informed?
  • Leadership: How do I become the leader my organization needs?

Let me expand a bit on the above topics below.

Strategy:
In my mind, great strategy is defined by having the right vision, goals and tactics – and then communicating it to your team and ensuring that they understand it. Crafting strategy is a difficult exercise – it requires synthesization of a tremendous amount of data, drawing the right conclusions, and then simplifying and communicating them, along with goals and a plan of attack.

Execution:
Great strategists come in all shapes and sizes – some are entrepreneurs, some are investors and some are academics. But what makes an entrepreneur an entrepreneur is their ability not only to craft the right strategy, but then to execute against it; to proverbially “get shit done”.

Team:
To use a football analogy, if strategy is your playbook and execution is how flawlessly you run those plays, it still matters a lot how fast your running back is. And so recruiting, retaining, motivating and aligning your team are all critical elements of building a successful company.

Leadership:
A coach can have the right playbook, the team can run them well, and the GM can have recruited superstars – but sometimes that’s not enough. Injuries happen, competitors call audibles and sometimes you have to play in bad weather. Great leadership is an essential part of crafting effective strategy, flawlessly executing and building strong teams, but it’s also critical to guiding a company through changing conditions. Sometimes a great locker room talk can be the difference between success and failure.

I’ll use this framework to explore these areas (and my journey through them) in future posts.

A New Blog Series on Company Building

One of the great things about being an entrepreneur, founder, and CEO in Silicon Valley is that there is no shortage of people and resources to learn from. For the first four years of WePay, I was able to refer to my own startup “playbook” by meeting people and reading content on Hacker News, Quora, and Paul Graham’s archive.

In hindsight, however, most of this content was written for a startup in one of four categories — startups that were looking for seed funding, startups that were pivoting, startups that were iterating to achieve product-market fit, and startups searching for tactics around growth and distribution. As it turns out, these four categories actually map well to the first four years of building WePay: In 2009, we got into Y Combinator and raised a seed round; in 2010, we pivoted away from group payments; in 2011, we found product-market fit with simple payments for small businesses; and in 2012, we figured out our distribution via API partners like marketplaces and SMB software companies.

2013 brought a different set of challenges — centered around scaling an organization — and after searching offline and online, I came to the conclusion that the answers I was looking for weren’t readily available. For a guy like me, whose previous leadership experience peaked at being a Senior Patrol Leader in his boy scout troop, it felt a bit overwhelming to be the CEO and co-founder of a venture-backed payments technology company that was scaling.

The good news is I was fortunate to hire very smart people, attract strong board members and helpful advisors, and have a supportive network in friends and the YC alumni community — and with their help and guidance, I’ve been able to craft an initial playbook for this next phase of WePay — the “Company Building” phase..

My goal with this new blog series isn’t to transform into a regular blogger, but rather to humbly share my thoughts on my “Company Building” playbook and to promote discussion on this topic. I define “Company Building” as when a startup has cracked product-market fit and distribution, and the leadership has to shift gears and learn about scaling the organization.

My goal here is to write twice a week, every week, between now and the end of the year, and cover a range of topics that help me think through and reinforce principles around Company Building. With so many first time leaders running so many really exciting companies here in Silicon Valley, I believe it’s an important topic, and I’m excited to see what I learn from the process.