Achieving success often feels like chasing a mirage in the desert. But what if there was a single factor that could significantly enhance the likelihood of a venture not just surviving, but thriving?
Recent research by colleagues at Babson College has found something interesting: successful businesses often have founding teams with members from different industries and areas of expertise. This discovery suggests that having a variety of knowledge from different backgrounds is really important for a company to do well.
But how do you make such a strong partnership? In this article, we look at the main things you need to succeed, such as finding the right person, setting clear goals, making sure everyone understands each other, and creating common ways to measure success. These things can help create a strong partnership in business.
Come with us as we go through the important parts that could really change the game for your business.
The Power of Interdisciplinary Teams
It’s common to find robust founding teams that blend business-savvy generalists with technical experts in the realm of successful startups. The notion of a single founder who can handle every aspect of a business is rare, and for good reason. The skills needed to excel in technical fields, such as development or science, are quite different from those required to secure funding and manage business operations.
The most effective partnerships unlock the doors to innovation and success. However, partnerships can go sour if business promises surpass technical realities. Take, for instance, Theranos, the fraudulent blood-testing startup, where the claims made to the public and investors didn’t align with what the product could actually deliver.
Lessons from Theranos
The cautionary tale of Theranos serves as a stark reminder of what can happen when business promises surpass technical realities. Elizabeth Holmes, the founder of Theranos, claimed that her company had developed a revolutionary blood-testing technology that could perform a wide range of tests using only a small amount of blood.
However, it was later revealed that the technology did not work as promised, leading to the downfall of the company and criminal charges against Holmes.
Theranos serves as a sobering example of the dangers of overpromising and underdelivering. The discrepancy between the company’s claims and the actual capabilities of its technology ultimately led to its demise. This case underscores the importance of ensuring that business promises are grounded in technical realities.
Interdisciplinary teams, with their blend of technical and business expertise, are better equipped to navigate this challenge. Here are three approaches to establishing and expanding successful partnerships and companies:
1. Set clear expectations
Finding the right co-founder is akin to finding the perfect puzzle piece. It’s essential to the success and longevity of the venture. For innovators seeking to launch a product or business professionals on the hunt for their next startup, the journey begins with setting clear expectations. The process of finding the right person to team up with is not just about skills and expertise; it’s about alignment in goals, timelines, ethics, and roles.
First and foremost, it’s essential to recognize that not all prospective partners share the same aims. Therefore, when meeting a potential co-founder, transparency regarding economic and mission-driven motivations is key. By being upfront about expectations and motivations, both parties can ensure they are on the same page from the outset.
Asking each other about the pace at which they want to proceed is crucial. If one person is eager to go to market while the other prefers a slower pace, serious problems may arise. Thus, verifying that both parties are on the same timeline is paramount to avoid future conflicts.
Partnerships thrive on compatibility, but they also flourish because each person brings different strengths to the relationship. It’s important not to feel pressured to settle immediately. If a prospective partner doesn’t share your expectations, it’s best to continue the search.
2. Create A Common Language
Before finding a partner in a business venture, entrepreneurs should understand the field they’re exploring. It’s not about being an expert; it’s about knowing enough to discuss its potential. You can’t position your company to succeed if you don’t understand what your product does and why it’s better than existing solutions.
For example, if you’re entering the healthcare industry, attend medical conferences and follow scientific discoveries. Similarly, for those getting into the gaming industry, attend gaming events, read industry reports, and listen to leading podcasts. In 2024, there are plenty of accessible options to learn more.
At the same time, it’s crucial to find a technical partner who is open to understanding the business side. Before teaming up, offer a basic explanation of your expected revenue model, customer base, and market size.
Once you find an expert who understands your language, keep the conversation going throughout the partnership. Reserve time for regular updates on how the product is progressing.
Genuine curiosity from entrepreneurs makes technical experts feel understood and helps them to do their job better. When entrepreneurs understand the technical aspects of their product, they won’t be tempted to fluff over the details when pitching to investors — a tactic that could eventually catch up with them.
3. Develop Shared Measures of Success
Establishing a common understanding and agreement on shared measures of success is crucial for ensuring the success and longevity of any entrepreneurial endeavor. By tracking progress together and setting clear expectations, entrepreneurs and their co-founders can establish a solid foundation for the future.
The initial agreement on expectations between you and your co-founder will serve as your North Star when setting product and financial milestones. As an entrepreneur, it is your responsibility to ensure that fundraising does not outstrip results.
If a company reaches series B and C funding rounds without keeping track of product development, problems are bound to arise. For example, a 2022 study led by researchers at investment firm Rock Health and Johns Hopkins University found that 44% of digital health startups had no clinical trials or regulatory filings to stand on. This demonstrates the importance of tracking progress against agreed-upon milestones to avoid such pitfalls.
Moreover, it is essential to help technical experts understand financial measures of success, such as revenue and customer win rate. Sometimes, an engineer or scientist might feel that the businessperson is pushing the timeline too fast. In such cases, it is crucial to listen to those concerns. If disagreements arise, explaining how your approach contributes to your organization’s goals is essential.
Profit and purpose can go hand in hand when entrepreneurs and technical experts are on the same page. However, achieving this alignment is not always easy. Making these relationships work is an art. By setting expectations upfront, communicating clearly, and working toward shared measures of success, partnerships will reap rewards both for the individuals involved and for the business as a whole.
In conclusion, developing shared measures of success is a crucial aspect of entrepreneurial partnerships. By tracking progress together and ensuring a common understanding of both technical and financial aspects, entrepreneurs and their co-founders can establish a solid foundation for success.
Remember, in the world of entrepreneurship, effective communication and a shared vision are the keys to unlocking the full potential of any partnership.
