Which styles of leadership work well and which don’t?
Start ups may be founded by an individual with a grand vision but almost as soon as they raise the first pound a founder is joined by a nascent and fast growing team. The founder must rapidly transition to being a start up leader. Part of being a useful investor is to help spot people that can make that change, and support those that need to make that change.
A great leader is an individual who not only has a compelling view of where the company is going but is able to communicate that to diverse audiences and bring them along. They are able to explain the narrative whilst assimilating different and perhaps contradictory advice to help navigate that path to growth.
Some personalities don’t succeed. Authoritarian CEOs don’t flourish for very long. Top-down leadership can be successful in some circumstances, notably when robust change is needed, but a startup is likely to have a team of bright and motivated people and personalities can clash. Keeping the team motivated and engaged is difficult if they are not empowered.
Stubborn and inflexible personalities are a challenge. A company needs to know where it wants to go, but leaders must recognise if a plan is failing. Being dogmatic won’t help if you need to change direction or refocus priorities quickly. A good leader knows if they are failing – the most successful founders hire around them to fill skills gaps. Showing the confidence to build effective teams and ultimately perhaps, their replacement as a company grows to a different stage and needs different skills in its leadership team.
Combining great attention to detail with a strategic mind is a rare but defining characteristic. CEOs of young companies must be hands on, taking up the slack but must maintain the ability to step back and view progress rationally. Over focusing on small details risks missing the big picture and for individuals coming from a deeply academic background they can be more comfortable buried in the science than in the commercial reality of running a company.
It is worth noting that different stages of a company’s growth will require different skills and it is not uncommon for the founding CEO to transition to a different role over time, often moving to CTO/CSO or working as CEO but alongside an experienced Chair.
How can leaders build and develop their leadership skills?
Over the years, we have witnessed leaders developing and growing hugely. People vary widely but in general the biggest change is in developing their ambition and risk acceptance, in planning multiple steps ahead whilst delivering against targets and in maintaining their motivation and in motivating others in the face of set backs.
UKI2S offers Horizon 37 coaching, which identifies skill gaps and helps people find ways to improve them. Structured around real life situations and networking with fellow CEOs, it encourages ambition, strategic thinking and team building.
What challenges do you think that science and deeptech leaders face compared to other industries?
An expression that we use sometimes is, “Don’t tell me how, tell me why.” Transitioning great technology to customer and commercial needs is an ongoing challenge for leaders of a science company. Successful founders spend time talking to customers and understanding the market in detail and if developing products and building new markets they understand the need for scale and avoid technology push. The role of a CEO is to drive the company to growth by building the narrative about why the technology is important.
A lot of the companies in the UKI2S portfolio come from academia – how does this impact leadership?
There are many benefits to leaders from academic settings. Often academics, certainly very successful senior professors, are extraordinarily good at telling the world about their science. However, transitioning to think like a company can be difficult. As a business, you need to think in terms of milestones and market need, rather than exploring or explaining exciting applications of the technology. They also need to be aware of competing and alternative solutions. Developing technology to the next milestone, perhaps leaving certain applications unexplored is key to reaching market as fast as possible. Fundamentally the role of a venture backed company is to take product to market and in doing so have a positive impact. It is no longer purely to extend the depth of scientific know how, rather it is about applying cutting edge science to real world and intractable challenges.
What other pitfalls can leaders fall into that could be detrimental for the company?
Under stress, there’s a temptation for leaders to batten down the hatches and disengage with people. Ignoring financial or technical challenges and dodging hard decisions. Sometimes things break and plans need to change. Leaders need to keep talking to people, no matter how hard it might be. To that end, we are fans of our portfolio CEOs talking to each other. It can be lonely being a CEO and it is good to be able to relax, sit in a room and just say, ‘this is hell’, or ‘this is great’, and throw ideas around.
How closely do you consider leadership when investing in and supporting companies?
Most VCs will consider the team and leadership heavily. For a lot of investors the team can make or break the investment decision. At UKI2S, we invest in very early-stage ideas which means sometimes the team is incomplete. We work with teams that are going to grow and are hands on in helping build the team. We often appoint board members, CEOs and Chair positions. We work with companies to get their team and technology ready for the next stage of investment.
What would be your advice to aspiring leaders who are looking for investment?
Don’t be surprised by how much time and effort it takes. It’s a full time job, raising money. Pick the funds you are talking to and ensure they are a good fit. It’s a long-term relationship and you must be able to work with the investors just as your company must be in scope for the fund. Avoid silly errors and understand a fund’s investment scope (stage of investment, territory etc). Work your network but don’t be afraid to apply to funds without an introduction if they seem a good fit (we operate a web based process to ensure referrals and speculative applications are treated equally). Seek investor feedback and if possible push beyond platitudes such as too early, too late to get the real reason. Especially at the moment, fund raising is taking time so ensure you are in a financial position to run the process for six months and don’t lose sight of the fun – once you have the investment the company can start to develop the technology.
