7 decisive questions LEADING ventures

Asking the right questions is crucial to advance a business. During my career as CEO of several growth start-ups, some questions turned out to be decisive. Not least because there is never certainty of having pursued the right answer. Worse. The right answer even changes with the development of your venture. That’s why you have to ask them regularly.

1. When to give a chance, when to exchange?

Talents don’t fall out of the blue. They develop with challenges, and even more with failures. In Europe* in cases of «normal» underperformance we tend to give longer and more chances than wise. In significant failures, we tend to bar people from a second chance, although it would be mutually beneficial. This is true for entrepreneurs as well as leaders and experts.

2. When to make, when to partner?

To defend a unique selling proposition, you have to own a relevant part of your value chain. Most companies in early stages tend to build too much by themselves. This behavior is rooted in the true believe that they must have their value chain fully under control to be fast enough iterating. In a networked economy based on dominant platforms, this becomes a great disadvantage in the long run.

3. When to go global, when to conquer a market?

With a critical mass of customers and density of recommendations within a specific market, you reap the fruits of a market leader. If you grow out too early, you have no supporting leg for your adventures in other markets. If you are too cautious, you will miss the chance to have a long-lasting perspective. One day, markets will consolidate, and you will be a target.

4. When to open a new site, when to stay close?

Opening a new office floor in the same building is already a cultural challenge. This increases exponentially with different buildings in the same street, with different locations, different time zones and different cultural backgrounds. On the other side, you don’t want to limit your growth, or to be too far away from your customers in different markets.

5. When to focus, when to take an opportunity?

During the life time of a start-up, there are plenty of business opportunities. You often seize them because of business necessity or because it’s too tempting and promising. You don’t know which opportunity will turn out to be the breakthrough. If you pursue too many opportunities at a time, you overstretch your team and endanger the very business you want to create.

And two personal questions.

6. When to lead, when to follow?

We talk a lot about modern leadership. Thereby we either overload or confuse leading people. Leadership means daring to lead forcefully in certain situations, even though not everyone agrees. Additionally, the corresponding competence becomes equally important in leaders. To entrust ourselves in the leadership of others and follow them – even as CEO.

7. When to be with customers, when with the team?

Time is precious. An alarmingly high percentage of our time goes into processes, reporting and kicking the can a little bit down the road to someone else. We should maximize our time listening to our customers and our team. There are phases in the development of ventures, when one requires more time than the other.

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This article is a preprint of my article in "Governance of Ventures", edited by Michael Hilb. (To be published in autumn 2019.)

* In other regions, the question stays the same, the pitfalls change. In the United States, we tend to fire too fast for low performance and love second chances to colossal failures. In China, we tend to give too little chances – small and big.

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