Guest column

Here's what Houston startups need to keep in mind when building their teams

Teamwork can make the dream work, but lack of a solid team can be a startup's downfall. Pexels

The top two reasons for startup failure are no market need and running out of money, respectively. But the third reason for failure is not having the right team in place. Like market need, evaluating the management team is on virtually every venture capitalist's list of what they look for in their target investments and you need to get it right.

It is well known that new technologies have a limited window of opportunity to succeed and there are rarely second chances, whether choosing the right strategy, market, customers, partners, or raising rounds of financing. If a particular window is missed a chance to pivot may be available, but that typically requires a good, experienced and nimble team that is right for the overall opportunity.

Luck and timing are factors largely out of your control in a startup, but good-to-great teams are capable of dealing with fast changing conditions or lessons learned along the way.

There's not one "right team"

It is easy to say you need the right team, but the same team is not the right team for every startup. Any team needs some basic skills, and of course have the ability to deliver a solution to meet its customer's needs.

In addition to a diverse technical team, a startup needs different skill sets, including various business, professional and soft skills. It is obvious that software is different than medical devices, but within "software" there are a wide variety of skills needed from user interface to security and everything in between. Within medical devices, the variety ranges beyond technology from working with the FDA to medical reimbursement.

Similarities between standard business processes like customer billing, collections and capital asset management often do not vary much across some otherwise pretty diverse businesses. On top of that, the needs of the team change over time as startups progress from concept, to prototype development to launch and through growth phases.

Having experience with many different startups, I have had some recurring team members with whom I worked with again in my next venture. I have also experienced significant turnover of individuals and growth within individuals that where ready for a new challenge to keep them motivated. The right team varies from venture to venture.

Know your industry

One lesson is to have a few cornerstone roles in the organization. First learned in my consulting days, a talented team member might serve in a kind of cornerstone role where you know that job is "solved" and you will not have to worry about it. You then complement and build around him, adding more experience in a complementary role if the first individual has raw talent and enthusiasm. You would add young talent with plenty of room for growth around an experienced individual that has the ability to mentor those around them. No one way exists to create a good team, other than the best practice of mixing experience, talent and diversity in creative ways based on who based on availability.

However, patterns should be identified and assessed to complement customers when deep engagement is a key part of your model or with partners, distributors, channels, or other strategic parts of your extended business model. Some customers will accept less experienced staff; others will not. Some markets can be targeted successfully by inexperienced sales or customer service representatives, while others require field experience or at a minimum extensive targeted training.

Finding support

Beyond patterns, consider some other best practices that are appropriate for various markets; for example, the risk incurred by having an inexperienced FDA process lead in an FDA regulated product. Having little real experience with FDIC, SEC or similar relevant federal or state agencies creates a lot of risk in FinTech companies. In any startup, some areas can be easily contracted out while others need to be core internal strengths, even if developed over time.

That last word is key, the "time" component of startups. Early stages of a startup have parallels to my consulting days. It is a project that is managed like any other project, balancing the big three assets: resources, money and time. Any project is a balancing act of acquiring and managing those three assets, at least when you take out administrative details like payroll and the like. The next stage is more operational in nature, whether stabilizing operations or managing for growth, but it is common for a startup to have two or more CEOs between founding and exit as needs change.

Since VIC primarily is focused on university technology startups, the inventor is often a university researcher with decades of experience in the field of the invention. We follow a best practice of bringing in one of our senior team members as CEO, an experienced business savvy entrepreneur who complements the inventor well in those early technology de-risking phases.

We support those key team members with a shared service team to handle finance, accounting, legal, websites and more, outsourcing specific areas of expertise like intellectual property in a given technical area. We then fill out gaps with select hires. Over time, we work ourselves out of a job when the technology has progressed to a point that different skills are needed, such as handing off to a growth-stage CEO.

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James Y. Lancaster is the Texas branch manager for Arkansas-based VIC Technology Venture Development. Lancaster, who lives in College Station, oversees business there, in Dallas, and in Houston.

The oil and gas industry has been hit by a trifecta of challenges. This local expert has some of his observations. Getty Images

In the matter of a few weeks, COVID-19 disrupted life across the globe, but the oil and gas industry was hit especially hard with the triple impact.

First, there was the direct impact of COVID-19 on the workforce. Next, there was a dramatic drop in global demand as countries and cities around the world issues travel restrictions. Finally, there was a global increase in oil supply as OPEC cooperation disintegrated.

As energy companies raced to set up response teams to address all three concurrent issues, something that no one was quite prepared for was the speed at which all direct lines of communication for the industry were shutoff. Seemingly overnight, industry conferences and events ground to a halt, corporate offices were reduced to ghost towns, and handshakes were replaced with virtual high fives.

To fill this inability to interact, connect, and collaborate as we used to, my company, Darcy Partners, stood up a series of executive roundtables for the exploration and production community to come together and share ideas on how to approach this unprecedented series of events.

Each week, over 25 executives from various oil and gas operators (and growing) gather virtually to share best practices around COVID-19 response plans, discuss the broader impacts of the turmoil on the industry and learn about innovative technology and process solutions others are implementing to help mitigate the impact of the virus and associated commodity price volatility.

We've seen the priorities of these executives shift and evolve with each phase of COVID-19 and the market impact. In early discussions, the main focus was on taking care of their workforce and what plans were being instituted to help minimize the disruption to operations while also ensuring that no one was exposed to any unnecessary risks. Participants shared best practices and policies they had in place for communication both internally and externally as well as their transition to work-from-home.

At later roundtables, the discussion turned to commodity prices and market response. Although this industry is quite accustomed to the inevitable ups and downs, this time is notably different. The market dynamics during this cycle are far more pronounced than in past downturns – largely due to the concurrent supply and demand imbalances coupled with the broader economic uncertainty. Most operators are taking action by making cuts, and some have already decided to shut-in production. Additionally, the importance of technology and innovation came to the forefront, whether discussing tools to facilitate working from home or remote operations to ensure the continued safe operations in the field.

The future is largely unknown; all of the information and analytics and millions of outcomes being modeled do not create the full picture needed for leaders to make the difficult decisions that are necessary. But there are a few things we know for sure. First, there will be an oil and gas industry on the other side of the current turmoil. Secondly, technology will play an increasingly important role going forward. And, finally, the complex issues the industry is dealing with today can be more effectively understood and managed by coming together to share ideas and best practices.

Nearly 5 years ago, Darcy Partners was founded on the premise that there was a missing link in the oil and gas Industry for the adoption of new technologies. Today, there is a missing link for an entirely different reason. Darcy Partners has rapidly mobilized our vast network of operators, technology innovators, investors, and thought leaders to come together and create a shared level of certainty, in an entirely uncertain world. To help leaders make the decisions that must be made and prepare for a new future, one that might not have been expected, but one that the industry will evolve to succeed in.

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David Wishnow is the head of energy technology identification and relationship management at Houston-based Darcy Partners.