3 leadership secrets every successful startup CEO knows


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Startups embody a nuanced and mostly unexplored aspect of business performance. A promising business venture meets a typically young but passionate workforce, resulting in an intersection between entrepreneurship and the need for strong leadership. But startup teams demand more precise leadership qualities from their management than established corporations, which they typically have limited human and financial resourcesless experienced employees, flat hierarchies and high time pressure.

So how do effective startup CEOs adapt their leadership methodology to optimize business performance?

1. Formulate and maintain a clear vision

Behind every successful startup is a philosophy, a reason the company exists and a purpose it serves. It is the foundation of the organization and provides alignment, direction, focus and unity. While anyone can come up with a great idea, very few people know how to carefully curate that vision from the start.

The most important step in promoting a company vision is to communicate it simply, clearly, and often to the workforce. This is the only way for employees to feel connected to the company and their individual work at all levels. It also gives low-level team members confidence that they are making a difference, boosting morale, productivity and a positive company culture.

Strengthening the corporate vision also protects the startup from burnout and lack of passion – two reasons for the 5% of failed startups, according to a study by CBInsights. A strong vision creates meaning and purpose for team members. As workloads pile up and challenges grow, this meaning supports both leaders and employees through uncertainty.

Additionally, there comes a time for delegation of responsibility and leadership roles when founding CEOs will ask themselves, “Who understands this company, where it’s going and what it takes to get there?” Without a strong vision to support it Permeating organizations, delegating leadership is akin to erecting pillars with unstable foundations that open the door to failure and collapse.

Related: How to engage employees through your company mission statement

2. Accept strategic failure

The most experienced startup executives I’ve worked with understand that failure is inevitable. And instead of avoiding that failure, they willingly confront it on their terms because nobody learns from success.

Strategic failure can play a key role in one of the most important aspects of sustaining a startup. CBInsights reports that one of the main causes (38% of cases) failure of venture companies is a lack of funding. Investors can exit for a variety of reasons. But ultimately it comes down to trust in leadership, making it imperative for novice founders to field test their pitches and instill that trust in themselves and the startup vision.

A common mistake young founders make when looking for funding is to go after the biggest investors with the most capital right from the start. Instead, they should start small and reach out to as many small investors as possible. While this process will most likely lead to repeated failure, it also gives young leaders insight, experience and confidence with less risk. When it comes time to reach out to key investors, they’ll be prepared because they’ve made failure their friend.

See also: Why Accepting Mistakes is Good for Business

3. Eliminate the ego

Another major hurdle for young founder CEOs is removing their ego from the startup equation. Many have worked on their ideas for years and are used to taking 100% responsibility to the extent that every task and decision becomes personal. But once the company is up and running, it can no longer be just about them. And this inflated sense of individualism can lead to disharmony and team problems – the reason behind it 18% of start-up errors.

Since most startups work with limited human resources, being a team player is crucial to running a motivated workforce and a successful business. Great startup leaders learn early on to suppress their ego and accept that they can’t do everything. Instead of hoarding responsibility, they share it. They create concrete management hierarchies to avoid selfishness, but they treat employees at all levels as fellow entrepreneurs, delegate responsibility and show trust in their team.

When the ego is gone, only the company remains. And a company is only as good as its workforce, from C-level executives to analysts and assistants. It is then the manager’s duty, especially within a startup, to invest in their employees. This requires the adoption of aspects of transformative leadership, a method first introduced by James Macgregor Burns in 1978, which includes an element called individualized viewing. Leaders who embrace this quality rely on mentoring, attend to the needs of each individual employee and actively promote growth and development. In other words, great startup leaders improve company performance and culture by optimizing the potential in every employee through personal engagement.

See also: Why a Big Ego Reduces Your Chances of Business Success

Today, most entrepreneurs neglect to consider and contextualize their leadership practices, perhaps because the topic seems trite or irrelevant when weighed against larger startup issues like product efficiency and market alignment. But successful startup leaders know better. They develop and maintain a clear vision, accept strategic failure and suffocate their ego. They take responsibility for their influence and use it to positively influence employees, investors and company performance. They understand that startups are extremely delicate structures and every step they take can mean the difference between growth and failure. Every move they make falls under leadership.


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