In the last article, I shared on courting exceptional talents to form the startup team, and in my opinion, the toughest problem for a founder is to evaluate if a particular hire is a suitable talent. This is because it is impossible to find out everything from just a single interview, thus resulting in modern corporate practice developing many proxy indicators to help. These could come in the form of education levels and branded names.
However, I would like to draw insights from another story from Chinese history on evaluating the right talent for a startup.
This famous story deals with how supposedly perceptive individuals could make wrong judgements to a particular talent. There is a chance a person may be placed in the wrong position when there is a misjudge of talents. Here are some points I would like to make:
- Talents comes in all shapes and sizes
- Technical competency does not necessarily equate to having relevant skill sets for the purposes of a startups
- Founders need to be clear on the kind of team they are trying to build
Bringing this context to China, startup founders in China tend to have a tendency to prefer talents who have a bias for action and real life experience. They would actually place the pedigree of the startup talent of a lower priority. One example is Zhou Hongyi, the founder of the search engine company3721. He sold this company to Yahoo China in 2004 and started a new company Qi Hu 360, an antivirus company.
Zhou mentioned that after he sold the first company to Yahoo, he felt that the professionals from Yahoo, those of whom were from branded universities, were not startup-ready. He said, “We are startup people, and are here to fight and go into battles, not long drawn discussions and hiding behind powerpoints dealing with frameworks. These are not exactly relevant to the actual battle we have.” What he saw during this period led him to start up a different company, Qi Hu 360.
Another example would be Jack Ma, who initially hired a lot of candidates from branded universities as he felt that Alibaba required some professional experience. However, he got his first shock experience when one of his marketing vice presidents gave a proposal of around 2 million US dollars for a particular marketing campaign. When he was told that Alibaba only had a much smaller budget of less than $1 million, he replied that it was impossible to do anything with that budget. Jack Ma once observed that most of the candidates from the branded universities took flight and left very readily when there was a crisis, and concluded that it takes a special breed of individual to be able to withstand the ups and downs of a startup.
As Ben Horowitz once said, “There will be a wartime CEO and a peacetime CEO.” The point here is that, in a startup environment, there will be a wartime team in the early stages, and it is imperative that the founders know which stage they are in, what kind of team and skill sets they are looking for.
Joining a startup is extreme, and it takes a certain type of personality. It is important to focus on finding out the personality, especially in the early stages. Skills sets can be built and formed along the way, but it is those that are humble and hungry enough who will bring a startup further.
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Old Chang CHATS is a podcast that seeks to bridge between the differences of business culture of East and West. In each podcast episode, Old Chang will pick a topic which will interest English speaking founders and professionals by seeking out relevant lessons from Chinese history.
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