Tips for Strategically Growing a Team

As startups and small businesses gain customers and expand into new customer markets, founders need to consider how to strategically grow their teams in order to keep pace. In a recent panel discussion “Growing a Team,” hosted in partnership with the Cornell Engineering’s Entrepreneurs in Residence program, Cornell Engineering and Rev Entrepreneur in Residence, Dr. Stephen Sauer, discussed best practices for scaling up with entrepreneurs from the region.

“We tend to have this romanticized view of entrepreneurship as being the purview of the lone genius – people like Steve Jobs and Mark Zuckerberg come to mind – but the reality is that most startups succeed or fail not because of one leader’s talents, but because of the collective skills, brainpower, and effort of a team of people working toward a common objective,” states Sauer.

“Building that team strategically – identifying areas where specific expertise is needed, understanding the role that each person will play, and hiring the right people to fill those roles – is a crucial undertaking for any new venture.”

In addition to his role as an Entrepreneur in Residence at Cornell Engineering and Rev, Sauer is also a senior lecturer of management and organizations at the SC Johnson College of Business at Cornell University. His research and instruction focus on leadership, team processes, entrepreneurship, and strategy. His work has been published in a number of academic journals including Leadership Quarterly, Organization Science, Journal of Applied Psychology, and Human Resource Management, as well as a variety of mainstream media outlets including The Wall Street Journal, Harvard Business Review, Forbes, and USA Today.

For this discussion, Sauer was joined by panelists and fellow Cornellians:

• Linda Alvarez and Stephanie Schrauth, co-founders of LEVELLE. The startup is on a mission to create nutritional products tailored to the individual needs of female endurance athletes. Alvarez and Schrauth are both candidates in the Executive MBA Metro NY and members of W.E. Cornell. Levelle recently won the AgTech & Food track for the New York City Regional Business Plan Competition.
• Adele Smolansky, founder of A-I Learners. AI-Learners is an e-learning platform designed to help children with learning disabilities improve their math skills through personalized games. Smolanksy, ‘23 is a student of Electrical and Computer Engineering and a current member of eLab.
• Adam Maher, founder and CEO of Ursa Space Systems. The satellite intelligence company, which is a long-time Rev member, provides business and government decision-makers with access to on-demand analytic solutions. Maher is an alumnus of Cornell, obtaining his Master of Engineering in 2007.
• Brian Schiff, co-founder and CEO of RedRoute. Schiff ’18 launched RedRoute, a voice technology company capable of automating phone calls to reduce costs and create a better customer experience, while participating in eLab’s 2016 cohort.

As panelists shared their experiences growing teams at various stages of their entrepreneurial journeys and fielded questions from the audience, some key themes emerged:

• Starting a company with a friend is common, but it’s not always the best for your business…or your friendship. A fairly recent study of 10,000 technology and life-sciences startups revealed that 40% of these businesses were founded by friends. It makes sense: Entrepreneurs want to start a company and know that the “lone genius” approach is not likely to succeed, so they team up with a classmate, friend, co-worker, or partner from the research lab;  however, the same research revealed that companies with friend-founders were less likely to work, and each social connection on the founding team increased the likelihood of a founder leaving by 30%. Friend-founders assume they know one another, but are unlikely to know each other in a work context. And when the company has a setback—as it surely will—founders who are friends may be less likely to engage in the tough conversations that need to happen in order to get things back on track. It may be a better idea to build your company with a team of strangers, each with a specific skillset and a unique perspective, and keep your friends where you need them most—away from the business.
• When it comes to team size, every company has its own sweet spot. As a business grows, founders need to build a team that bring critical skills on board at the right time. But as headcount grows, so does the need for coordination and control. Once a new venture crosses a certain threshold (usually around 40 employees), additional layers of management will be needed, and determining the appropriate “span of control” becomes an important consideration. This number can vary widely depending on the jobs to be done and expertise involved, but Jeff Bezos’ “Two Pizza Rule” is probably a good metric: No matter how large your company gets, work teams shouldn’t be larger than what two pizzas can feed.
• Leveraging networks for finding talent. Identifying which skills and what expertise will be needed to grow the business is the easy part—finding the people who have those skills is a whole other challenge. This is where networking plays such an important role. Whether it’s in-person connections within the local entrepreneurial ecosystem, online, or through social media, knowing people who can put you in touch with potential hires is vital. Happily, today’s networking tools make that job much less daunting. Consider this: The average LinkedIn user has just under 1,000 connections, and each of those connected people has 1,000 connections of their own. There may be some overlap, of course, but it’s possible that any single LinkedIn user can reach a million people through their “friend of a friend” network—that’s huge.
• Storytelling is key for attracting passionate team members and building a cohesive team. Once you find the right people, you have to get them on board. While a clear mission statement helps to establish a common goal for everyone already on the team, it has limited reach in attracting new talent. The ability to tell the story of what this business is all about—who we are, what we do, and where we’re going—is the key to igniting passion and drive among team members, no matter what role they play.

Interested in learning more about how to strategically grow a team? View the “Growing a Team” panel discussion to hear from Dr. Sauer and entrepreneurs in Cornell’s entrepreneurial ecosystem.