Putting together the best team for your business is anything but simple. Starting day one you want to find the right partners, if any, to embark on a long-term journey. This doesn’t stop at seeking the right co-founder(s), if any, to join you in your endeavor. It continues into setting up the governance and control of your business in terms of having a diverse and qualified board of directors or board of managers and proper upper-level management and officers to, among other things, manage the company books and records, day-to-day operations, product and service development and engineering, as applicable, and sales and marketing.
At the start founders should ask partners what their expectations of the business are and the expectations of the partner roles. Everything should be on the table and partners should be agreed as to expected time commitments, roles and allocated responsibilities based on the strengths of each partner. Having the right team will mean the company has the edge necessary to succeed and also to appeal to investors or acquirers, if desired or required. This takes into consideration experience and a shared passion for the company goals. That sounds simple but it rarely is. Key partners and key employees should have similar passions for the company vision, especially since startups often confront significant challenges and pivot points along the way. That vision should relate to the problem that’s being solved by the business- the distinguishing solution- the product or service that will make the business stand out from others in the same or similar competitive landscape. A passion for solving the problem rather than a strict focus on an initial vision for solution is important. Startups often need to shift as they navigate the market and receive feedback from the market. If the business is not solving a problem or providing something others are not providing by way of solution, it will be harder for it to succeed. This may mean a product that stands out among the rest or an angle or brand that has some other unfair advantage over its competitors. These are concepts that early partners and early employees should understand and align on. A team that is dynamic and covers multiple areas of strength will be better suited for proper adaptation to market challenges and everyday business.
At Rogoway Law we regularly help companies make decisions about efficiently structuring their businesses and setting up their teams for success, including, without limitation, advising on the method and manner of issuing equity and creating employee and consultant incentives; suggested board composition matters; and suggested officer characteristic and team matters; as well as compensation-related and title-related advice.
Even if your company is not preparing for an acquisition, the company should always be acquisition ready. What that essentially means is: