The Good, the Bad and the Ugly: Helping to Recruit and Build Teams

Post originally written by Ryan Floyd, Managing Partner at Storm Ventures

It is a personal goal of mine to help wherever I can and get out of the way when I can’t. Helping to recruit and build teams is one way I can do something other than write a check. All great investors make team building a priority, as such, folks here at Storm are no different .

I try really hard as a venture investor to really help. I view it as critical to my ultimate success as a venture investor at least for the long game. Sometimes I do better than other times — though always paying attention to do no harm (read the (venture) hippocratic oath). Sometimes there is little I can do. For example, I can’t really help define a product or even dissect the friction in a sales process besides sharing stories of past experiences.

But over the years, one area that I have found I can help a lot with is hiring executives for our portfolio companies and spending time with employees that are trying to think through career decisions. Some might argue its not a great use of my time — and time as we all know is limited. But I have come to the conclusion that at least for me, it is one way to provide some value for all of our portfolio companies when they need the help. Its not altruistic — the reality is that with great teams my job as a venture investor is greatly simplified. As a result, helping to build and support those teams is a very good use of time. Sometimes I find myself introducing folks to potential hires or even potential new customers.

So why the Good, the Bad and the Ugly? It’s because I think it’s important to be completely honest. I have no problem telling people the good, the bad, and the ugly. When I was younger, it drove me crazy listening to venture investors spew mindless optimism about their companies. I quickly learned that most venture investors I knew were loose with the facts, and I made a decision early on to never do that. Why? Because most of the people I meet are smart. They’ll figure out the full picture at some-point, and if I’m loose with the facts today, I’ll lose on my reputation tomorrow.

I’m not trying to suggest that having optimism is a bad trait in the venture business — in-fact I’d argue that it takes eternal optimism to survive day to day. But I remember that during those conversations I often found myself feeling like a second grader, this was especially true when I was leaving my last operating role. I couldn’t believe that people thought I had no other context for the opportunities — and generally those conversations made me want to run from the company because I assumed that this was how the investors (or CEOs) thought about the world. Who wants to work for someone who is delusional? I know that smart people will eventually discover all the challenges of any company (and every company has them) so better to discuss them in the process as it relates to fit and avoid surprises. I know of a recent situation where an executive was recruited into a company having been sold on certain sales numbers and customer contracts. The reality when he got there was that none of it was true. He left and everyone lost. Its not a unique situation.

One of the hardest parts in hiring, recruiting and retaining the best people is to balance giving a different perspective as an investor but at the same time do my best to act just like anyone else on the executive team — because ultimately its not my decision who we hire and who we don’t at a company. There are some situations where I have a strong opinion on someone but I try hard to not cross that imaginary line where a CEO or VP might think it would be a mistake to hire someone simply based on my view. I need to respect the relationship. You cannot help if being critical is the only club in your bag.

I am fortunate in that most of the time when I am interviewing potential hires, I am not the initial screen so the people I am meeting are generally somewhat qualified at least on paper. Most of the time I am focused on fit — is the company the right place for the new hire in the role that they have in mind (scope, experience etc.) and does the role fit the career path and match against the passion of the individual. I have found this is a great way to get into the detail without the grind of typical interview questions. I have different discussions with different roles and I do have some basic questions. For instance, if I am talking with a VP Sales, I want to understand how they have built teams, what sort of quota they carried, deal size etc. But I find this is a natural conversation for the pros. They never hesitate and its an easy discussion. As a venture investor, I can offer up a different perspective as an investor — why I invested, what has worked, what hasn’t worked, how I think about the market etc.

Every company has issues. Its much better to put them out in the open and have everyone join the company with their eyes wide open. That way, while things may still not work out, it won’t be because expectations were not in line with reality. I think it makes a stronger case for the company and treats everyone like a professional — which all ultimately lead to a better outcome.