Do you ever wonder why some entrepreneurs manage to stay at the helm of their creations while others are relegated to supporting roles. Why were Bill Gates, Michael Dell, and Mark Zuckerberg able to stay as CEOs while other founders of companies such as Linked and eBay were not? Why were Larry Page and Steve Jobs able to return as CEOs to companies they founded when they had been replaced years before by hired CEOs? It all comes down to what is essentially, an entrepreneur’s journey.
Stage 1 – Technology
When you start a business, you have to be technically astute, able to understand the technical complexities of your product, able to translate product ideas into a product that works. For this reason, most founding entrepreneurs have a strong technology background. They are able to tackle the myriad details necessary for the creation of a product with technical superiority.
Stage 2 – Business Skills
As the technology becomes ready for the market, an entrepreneur must shift to being a business person. S/he must gain knowledge about marketing, sales, finance and legal issues that will determine whether the product can be turned into a business. The entrepreneur must acquire all sorts of business skills in this second part of the journey. Some entrepreneurs can make the leap from being a technologist to being a business person. This leap isn’t that hard as for a bright entrepreneur, this is simply the acquisition of another body of knowledge. Someone with the brains to be a good technologist can acquire the knowledge of business needed to get into the market successfully.
Stage 3 – Leadership
The last stage of the journey is that which turns an entrepreneur into a successful leader. Becoming a leader however isn’t about acquiring skills, it is all about behaviour and this is where many good Stage 2 Entrepreneurs fail. Being a leader means getting things done through other people. To do this, technology and business skills are not enough.
A good leader must be able to set a vision, communicate that vision and motivate people to buy into that vision. This requires emotional intelligence, not technical intelligence and is hard to learn.You can’t learn this from a text book or from a class. It is especially hard to learn if you don’t have anyone to serve as a role model.
Gates, Dell and Zuckerberg were obviously able to make the leap from Stage 1 to Stage 2 to Stage 3 with out skipping a step. Unfortunately, Reid Hoffman and Pierre Omidyar couldn’t make the leap. What was great to see however was that with experience, Larry Page and Steve Jobs were able to return to the job of CEO, having become effective leaders in the interim.