Notes and Takeaways from Understanding Start-Up CEOs
When I read it: September 2021
Why I read it: Understanding Start-Up CEOs is required reading for new employees at Windfall. I decided to take notes on it so it would be easy for everyone at the company to revisit the key points. As a former startup CEO, I can relate to a lot of the material in this book.
Go to the Amazon listing for the book or scroll down for my notes.
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My notes
About Dan Slagen
Dan Slagen is the author of Understanding Start-Up CEOs. Dan is a four-time startup executive specializing in scaling global go-to-market functions from early stage to $100 million in annual recurring revenue (ARR). He is currently the CMO at Tomorrow.io.
Startup jobs are harder than typical jobs.
There's more pressure, higher stakes, less time, and fewer resources. There's also constant change. It's no surprise that CEOs of high-growth startups often demand higher levels of performance than their non-startup peers.
All that being said, startups are rewarding and provide unique career-building opportunities.
What’s going through the mind of my startup's CEO?
When you work for a startup CEO, you may find yourself wondering what are they thinking about you and your team. Are they satisfied or disappointed with me? Happy or unhappy?
The CEO's job is lonely. Empathizing with your CEO will improve your working relationship.
Startup CEOs bet their life.
When you're a startup CEO, your company becomes your life and often defines your being and legacy. Startup CEOs eat, sleep, and breathe their work.
A startup CEO's short-term and long-term success depends on the success of her current startup. When a startup falters, raising capital, influencing the board, and recruiting talent all get harder. This applies to both the current startup and future startups run by the CEO.
It's high risk and high reward. If her current startup fails, a CEO may lose people’s money, ruin lifelong relationships, damage employee careers, and face deep regret over misused time. If her current startup succeeds, a CEO may create financial windfalls for her family, employees, and investors. Also, a successful outcome often leads to unique professional opportunities for both the CEO and her employees. For the CEO this might mean founding another startup with bigger aspirations. For employees, it might mean founding startups of their own.
Startup CEOs reject "no" and "that's not possible" as answers.
Two of the more annoying things for a CEO to hear from team members are “no” and "that's not possible." When a startup CEO asks if you can do something, don't say no or claim it's impossible. Instead, focus on how you might be able to say yes and what the tradeoffs of saying yes would be. Sometimes it makes sense to say "not now" so you can focus on more immediate priorities. The key is to keep an open mind and avoid shutting down your startup CEO's ideas.
Startup CEOs are loyal to early hires.
In the early days, startups are understaffed and underfunded. Help is a scarce resource. That’s why early hires mean so much to founders.
In a startup, the early hires are the people who believed in the CEO early on. They took the risk and came on board, often with below-market compensation and no perks. The CEO will go out of their way to help these employees, even when the startup has moved beyond their ability to contribute.
Don't complain to your startup's CEO about early hires. Instead, acknowledge their historical hard work and loyalty. And find ways to help them succeed.
Identify the employees in your startup that your CEO cares the most about and learn why. You can learn from these people.
Startup CEOs know what's broken.
When you join a startup, don't start by pointing out all the things that are broken or going wrong. The CEO almost always already knows.
If you're going to point out a problem, offer possible solutions and volunteer to implement them.
Startup CEOs remember everything.
Startup CEOs remember when you said you were going to do something and they remember whether you did or didn't do it. They are masters in behavioral analysis and pattern recognition.
Startup CEOs are constantly assessing your reliability and whether you can take on more responsibility. They want people who always deliver on their commitments. If you establish yourself as trustworthy and reliable, your CEO will offer you opportunities to expand your role. On the other hand, if you establish yourself as untrustworthy and unreliable, it's often impossible for you to recover. Loss of trust is the beginning of the end.
Trust is the most essential factor in a sustainable relationship. If you don’t have trust, it's difficult to succeed at your work and impossible to enjoy it
Startups CEO hear everything.
In a startup, low-performing team members bring others down, threatening motivation and momentum. Similarly, hiring a new high performer elevates the team.
Startup CEOs are obsessed with making sure the right people are in the right positions at the right time. Due to the high-change environment, startup CEOs must reevaluate roles and responsibilities as the business evolves. "Is this person still the right fit?"
To ensure all team members are a fit, startup CEOs regularly inquire about and observe employee behavior, tone, and commentary. Startup CEOs will talk to other team members about new team members, especially during their first 90 days. So assume that anything you say will get back to your CEO.
Startup CEOs don't have time to waste.
In a startup, time is a CEO's most precious resource. Don't waste your CEO's time.
If you’re going to ask for your CEO’s time, use it to get buy-in on how you're thinking about solving a problem; not the solution you have in mind. Getting aligned on how you’re thinking about solving a problem is often more important than solving it.
Speed is a startup's primary advantage. Beware of introducing processes and frameworks that slow things down. And focus on fixing root problems instead of treating symptoms.
When your startup CEO gives you time, be grateful.
Startup CEOs should focus their time on four things.
Progressing the company goals, mission, and vision.
Hiring and people.
Making sure there's money in the bank.
Culture.
When a startup CEO spends time on something other than these four priorities, it means they don't think they have anyone at the company they can trust to do it right. This creates an opportunity for someone to step in and help.
If you work at a startup, pay attention to when the CEO volunteers for something outside these four things. Assuming you have your own house in order and you have the ability to contribute, offer to help. Sometimes the CEO may say no if it's a passion project or involving you will slow them down, but more times than not they'll appreciate the offer and welcome your assistance.
Startups CEO want help reducing cultural friction.
According to Dan Slagen, cultural friction is "any change in the company or its people (often as a result of growth), causing a reduction in team efficiency."
Cultural friction reduces a startup's speed. When team members don't get along, it slows down projects. When a team member feels overlooked, they disengage. When a toxic employee joins a team, performance declines. If left unchecked, cultural friction can build up beneath the surface until it explodes.
Startup CEOs need help spotting cultural friction before it festers.
Startup CEOs often circumvent their direct reports.
In the early days, startup CEOs value speed more than process. So, sometimes they will reach out to a non-direct report and start working on something. When a CEO circumvents a direct report, the goal is almost always to advance the business, not to hurt feelings.
If this happens to you, avoid getting defensive. It's more productive to adapt to the situation than to attempt to revert it. If your CEO's behavior starts to cause friction, address it directly without emotion. CEO circumvention is normal behavior in the early days. But as a startup matures, it should become less common.
Startup CEOs want to hire door kickers.
Hiring is the hardest and most important activity at a startup. If you get hiring right, your business accelerates. But if you get it wrong, it can lead to all sorts of opportunity costs. If you're a department leader, who you hire will determine your success. Your CEO will judge you based on who you hire.
Hire door kickers. According to Dan Slagen, a door kicker is the startup CEO's ideal employee. A door kicker is a high performer who raises the bar for everyone else. They take on responsibilities beyond their job descriptions. They aren't afraid to try new things and they get excited by hard problems. They're intellectually curious and they share knowledge with others.
Door kickers are owners. They take full responsibility for success or failure and they do the right thing even when nobody’s watching. They set big goals and challenge themselves. They're collaborative and foster trust-based relationships. They've figured out the right work-life balance for them. They have grit and don't quit. When they don't know how to do something, they ask for help or figure out how to teach themselves. They don't let ego get in the way of the right answer. They value time and they know how to prioritize what's most important. They continually improve and increase their responsibilities.
Startup CEOs want functional leaders to manage them.
Startup CEOs have a limited amount of energy each day. They need their reports to energize them.
Startup CEOs don't want to tell functional leaders what their departments should be doing next. CEOs want their functional leaders to align their roadmaps to the high-level company business plan. Yes, CEOs will have strong opinions on key strategic points, but they don't want to lead the conversation.
Phase planning is a great way to focus your CEO on what your doing now while also aligning on what you want to accomplish in the future. Make it clear what phase your department is in today. Then, outline how you will move the department through its next few phases.
Startup CEOs don't want to worry.
When a startup CEO is worried about a functional area, they have no choice but to step in and act. Worry is usually driven by either poor performance or a lack of information.
To minimize worry, functional leaders should overcommunicate to their startup CEO, especially during periods of low performance.
CEOs want to know what plan their direct reports have for their department's future. When a CEO has to build a department's plan, that is a bad omen.
A good departmental plan makes it easy for the CEO to understand where the department has been, where it is now, and where it is going. A good plan answers the following questions:
What have we accomplished and what did we learn?
Where are we going?
What risks should we be on the lookout for?
Startup CEOs want you to anticipate their needs.
In a way, startup CEOs expert their direct reports to read their minds. They want their department leaders to anticipate their expectations and plan out how their departments will evolve to meet those expectations.
Answers to the following questions will help you anticipate your Startup CEOs thoughts and expectations:
Where is the business going from a vision and mission perspective?
How does your role and area of ownership fit into that mission?
Which phase is the company or your department in today, and what’s the roadmap?
How is your department supporting the current company phase, and how could it be doing more?
What are the next phases likely to be, and how does your department need to adapt to support them?
Where do certain numbers need to be by when?
Where is your CEO going next strategically? What about after that?
What’s keeping your CEO up at night?
What is your CEO most worried about or interested in with your department?
What ideas do you (and your team) have to continue moving the business forward?
In what areas is the business lacking today that could hurt you in the future?
What should the company do next, and what details are most important?
Use conversations with your CEO to validate your assumptions and don’t leave your meetings until you have the clarity needed to move forward.
Startup CEOs want team members to show customer empathy.
Customers are the lifeblood of every startup. Startup CEOs want employees to empathize with them, not against them.
You're able to show customer empathy when you understand what delights your startup's satisfied customers and why dissatisfied customers are churning or not getting value.
The best way to build customer empathy is to understand what your customers are trying to accomplish and what challenges they face. You want to understand how they’re using your startup's solution and where it's falling short. One way to do this is to listen in on sales and customer success calls. Another way is to make sharing customer success stories and case studies a regular practice company-wide. The best way is to talk to your customers!
Startup CEOs want team members to acquire and share knowledge.
What percentage of your startup's employees are working on the business instead of in the business? To build a company over the long term, you need people working on the business. But in a startup, most employees work in the business due to limited resources, automation, and specialization. As a result, startup CEOs rely on all employees to work on the business when they can.
One of the best ways to work on the business is to share your knowledge and help new team members get up to speed.
Startup CEOs dislike lingering problems.
When an executive is repeatedly talking about a problem they own, it means it's not getting fixed. Lingering problems compound over time and distract the entire leadership team from moving the business forward.
Startup CEOs aren't great managers.
Startup CEOs are often distracted. They expect their reports to manage themselves and their teams. Don’t worry if your CEO cancels one-on-ones or doesn’t talk to you for a few weeks during some stretches of business.
Startup CEOs won't tell you you're doing well.
Most startup CEOs don't want to talk about how you're doing every week. So, when you work for a startup CEO, you often won't know where you stand. Instead of asking for feedback on your personal performance, seek feedback on business outcomes and infer from there. For example, ask your CEO what projects, behaviors, and performances they have seen in the last 30 days that they would like to see more of or less of.
Startup CEOs expect constant change.
Whether a startup is succeeding or failing, change is normal and change is good. A startup will face different changes with each new phase of growth. For example, as a startup moves from the seed stage to the Series A stage, new challenges will arise. The same is true from Series A to Series B and so on and so forth.
All startups are crazy and chaotic behind the scenes. Don’t get overwhelmed; just learn to take it all in stride. Change creates opportunities for everyone to take on more responsibilities, increase knowledge, and develop new skills.
Startup CEOs want you to stay in shape and live your life.
Startup employees work long hours, nights, and weekends. When you work at a startup, you miss out on things. That doesn't mean your startup CEO doesn't want you to have a personal life. Nor does it mean she wants you to stop taking care of your personal health.
It’s OK to have a personal life and to take care of yourself. You just won't have time for everything. So, prioritize what's most important to you and let go of the rest.
Random anecdotes
Sometimes books can start from simple emails you send as advice. This happened to author Dan Slagen when his friend asked for advice on how to better work with his startup's CEO. The email Dan sent his friend laid the foundation for his book Understanding Startup CEOs.
When deciding whether to join a startup, make sure you fit with the company culture. You want to be able to act like yourself.
When you move on from a startup, don't burn your relationship with your CEO or fellow team members.
Working for a startup can be frustrating, but be grateful for the opportunity in front of you. You may not get a chance like this again.