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Tuesday, August 2, 2011

Are You Involved or Committed in a Startup?

Entrepreneurs in startup companies may spend years working before the company becomes financially stable or a reasonable exit turns up.  The entrepreneur is the one that devotes significant time to attract advisors, mentors, employees, board members, and investors. Each of these company participants will have their own attractions and interests in the company.  Everyone will be involved in the business with some having higher levels of involvement and others not so much.  However, not all of the company participants will be committed to the company.  One hopes the employees and founders are committed but sometimes this is not the case.  

So what is the difference between being involved and committed?  Think of having ham and eggs for breakfast.  The chicken is involved in your breakfast. But that pig, well he is committed!

Most employees will have a need to maintain their salary. They may have other interests that can dilute their attention to the company.  They may have a heavy involvement, but commitment can be difficult.  For example, employees that live day to day on the salary will leave if they see finances become an issue for the company.  This is only natural, they have to protect their family and they do not get the same incentive as the founders for the company success.  They also are not likely to have the same resources to survive in lean economic times.

Your investors and board members certainly have other obligations.  They are not likely ever going to be fully committed to the company.  An investor may participate in several companies hoping for one big success.  Board members may sit on several companies’ boards.  All of these important company participants are going to be heavily involved, but none are likely to have the same level of commitment as the founders.

As the founder, it is essential you are committed to the company.  Things that take your attention away only dilute your efforts in the company.  Founders are often distracted by family issues, other business interests, hobbies etc.  Many with these distractions start to lead to potential issues developing in the business.  The issues may be fixable later, or may not be fixable ever.  When the founder spends time on areas not related to the company, sometimes the company loses out; for example, timely decisions may not get made, errors are missed and not fixed, staff may miss critical project timings, projects may get dropped, and costs could get out of hand from lack of monitoring, etc.  Keeping ones attention on the business is essential to reduce errors and increase chances for success.

It is the commitment that makes the founder strives to succeed and work long hours.  A committed founder will seek every possible means of making the startup a success. A founder with more than one startup will not have the level of commitment toward each company and is likely to slight one for the other when difficulty comes.  The singular company commitment is essential to ensure the founder give the business everything and every chance to succeed.   It is not enough to be involved in your startup.  You really need to be committed if you want to enhance the chance for success.

Taffy Williams is the author of:  Think Agile:  How Smart Entrepreneurs Adapt in Order to Succeed to via Amazon