There are a number of reasons for why some start-ups sink, while others swim to success. Setting wildly optimistic targets, miscalculating funding needed and overspending to achieve the targets are a few. The main one though is people problems.
According to Noam Wasserman, a professor at Harvard Business School, big egos, personality clashes and poor hires are to blame for around two-thirds of all early stage failures. And intrapreneurs can be as disruptive a force as anything.
Intrapreneurs are just like entrepreneurs, expect they don’t like the risk attached with running a company. They want to lead, create and innovate, but to do this they need a boss who knows when to both give them the freedom and space to run with an idea and rein them back in when they’re inviting conflict and mistrust.
This type of relationship needs to be built on mutual respect, but finding common ground isn’t always easy. The problem is that the recruitment process can leave a lot to be desired.
"When assessing a new recruit, companies tend to be very vigorous at making sure a candidate has the right hard skills [such as the ability to use software programmes], but less so when it comes to assessing more qualitative aspects of whether that person will fit within an existing team," says Tom Marsden, CEO of Saberr, a platform that is helping businesses of all sizes to revolutionise the process.
By studying the patterns and characteristics of what makes a good working relationship, Saberr devised an algorithm and list of arbitrary questions to predict how potential employees would get on with employers. Answers to the survey are assigned a resonance score - a feature that you’d expect to see on a dating app.
The company believes that the mistake employers are making is not focusing on the shared values a potential employee has in common with their ethos and culture. Marsden says they are a key indicator of team fit. A mutual understanding, or at least acceptance of each other’s values, can inspire better performance and facilitate greater communication, and is less likely to lead to a clashing of egos or personalities.
"One key factor in early stages is compatibility with the value of the founders and other key stakeholders. Most successful start-ups are those that already have strong founder-team value alignment. As a company grows, the [need for this] peer-to-peer alignment gets increasingly stronger."
As well as a number of fast-growth start-ups and SMEs, Saberr has worked with multinationals, including Coca Cola and Microsoft. From his experience, Marsden has found that once a company grows to a certain size, there’s a similar chance of clashes regardless of the number of employees. Teams bigger than 10 are also more prone to disruption.
"The larger an organisation gets, the more important building relationships across teams becomes. Employees who can build these relationships are essential in preventing silos developing."
Does this mean that the Saberr algorithm and other predictive analytics are more effective tools for start-ups with a skeleton staff structure? Not necessarily, but the impact they have on smaller teams can be more pronounced.
Marsden explains: "The key difference is that the consequences of mismatched personalities for small companies are easier to spot externally, compared to larger companies where signs of such clashes can be buried within organisational layers."
Baacco is a start-up challenging the traditional e-commerce model by connecting consumers directly with specialist wine merchants. Encouraging the leadership and innovation needed in intrapreneurs is central to its operations, says co-founder Tai Alegbe, who uses tools such as MindTime when recruiting.
"Our approach to bringing talent on board is based very much on thinking styles, as well as the more traditional factors," he adds. "We're big believers in a predictive analytics framework called temporal cognition. It ensures we're working with, past, present and future thinkers."
Past thinking tends to be reflective and is concerned with gathering data and drawing up conclusions. Present thinking is focused on observing the here-and-now. Future thinking is about considering outcomes and identifying opportunities for change.
Alegbe says that having a mix of thinking styles doesn’t just ensure that all the team are on the same page; it can help in every aspect of business, from engineering to B2B sales - even allowing the company to gain a better awareness of its target market.
"This temporal cognition framework provides insights into a wide range of human behaviours, needs, preferences, perceptions and potential attention spans," explains Alegbe. "As a result, we can look to measure and understand the potential relationships between our team members, their assigned roles, performance and job satisfaction. This means we can quickly and accurately understand where and if people may thrive within our company."