Sometimes the founder of a business is not necessarily the best person to run the day-to-day. But trying to work out if this applies to your business is a very difficult call to make. Fresh Business Thinking has collected a series of insights from members of entrepreneur community The Supper Club — those who have changed direction and gone on to build rapid scaling business.
Derek set up Coffee & TV, a visual media company, which specialises in design, CG animation and visual effects with three co-founders in 2012. At the beginning it wasn’t run by Derek, who – along with his partners – wanted to hire a managing director to run the business: “Near the beginning we hired a ‘brilliant’ MD to run our growing startup. The thinking was that this would allow the four founders to continue concentrating on revenue generation.”
However, the hire turned out to be a disappointment. “It seemed to make sense at the time, but the guy we chose was from a much larger company and didn’t really understand the ‘roll your sleeves up’ mentality of a new startup. So, after nine months we had to change direction.”
They really needed the MD to get involved and not look to delegate to grow all areas of the business. “In the early days of a start-up it’s all hands to the pump, from sales efforts, through to service delivery,”
This predicament led Derek to realise how important it is to think long and hard about bringing in an external MD. If you are looking to hire an MD from outside of your company, you need to make sure they are prepared to muck in and really contribute to the company culture.
Following the departure of the MD, Derek took over the role and had to quickly upskill to take the reins. But, it paid off: the business now has a leader who knows exactly what everyone does. Derek said, “I’ve caught up on the bits I was missing around finance, management and leadership, and the company is in a much better place because of it.”
Since then, Coffee & TV has grown 500 per cent by focusing on hiring the best artistic talent and learning a valuable lesson: “No one understands your business as well as you do.”
Derek believes that more founders should assess whether they are the best person to run their company. “When it is your business, you have the best insight into the production, offering and strategy. You also know where you need to take the company. If not, find someone amazing who does. James Dyson is a great example of someone who is much happier engineering than being the CEO. So, as soon as he could, he put a brilliant management team in place so that he could focus on what he was best at.”
After all these years of hiring, Derek’s advice to other business owners looking to hire an MD is thus:
“You need to first be very clear on your own culture and what your values really are. Don’t take a risk and hire someone who doesn’t already feel like a good fit. Working for an SME isn’t for everyone, especially if they’re used to a larger and more established company.”
For more on the The Supper Club