What Should I Work On As A Startup CEO?

0:00 What should I work on as a startup CEO? I used to really look forward to entering in the end of the month raw sales data. To me, the analysis of the data gave me a tremendous insight into what was working and what wasn't working. Yet, it was completely the wrong thing for me to do as a startup CEO. Not only wasn't I leveraging my resources properly, I knew I wasn't leveraging my resources properly. And that's what I want to talk to you about today. I see smart, capable CEOs make the same mistake all the time.

0:39 In today's video, I'll explain how you can use the combination of leverage and filtering to make yourself a more effective CEO and marketkedly increase your company's chances of success. Hi, I'm Brett. On my channel, I help earlystage startup CEOs like you raise money and grow your startup. So, if this sounds like you, hit the subscribe button and the bell so you get notified every time I release a new video. Let's get started. Today's video is broken into three parts. Part one is about what startup leverage actually is. Part two is about how you can lose leverage without realizing it. And part three is about what happens when leverage is used correctly. So let's start with part one.

1:31 Part one, what leverage actually is. There are many parts to being an effective startup CEO. One of the biggest and most misunderstood parts of the job is learning how to use leverage effectively. So let's start with problem number one. Problem number one, leverage is not about dependency. You're a first-time CEO and you're worried about job security. So even though you have a team around you, you try and do everything yourself. Now everything is dependent upon you. And that's the exact opposite of what you want. You'll have an unhappy team and you'll have trouble scaling. You may be busy and the company may be dependent on you, but you're creating a liability for the company. Remember, your investors don't care who gets things done in your company. They do care that stuff gets done. This leads us to problem number two. Problem number two, examine why you're busy. I had a million things to do and there I was happily entering in the raw sales data.

2:45 Was this the best use of my time? Of course not. And that's the tell that I wasn't using leverage correctly. Obviously, none of us are perfect. However, when you consistently don't use leverage correctly, you're hurting your company because less critical work and strategic long-term work doesn't get done. And that moves us to the third problem. Problem number three, leverage is always relevant even when it's limited.

3:18 Obviously, when you're just getting started, your ability to use leverage is limited. However, just because you don't have a lot of leverage doesn't mean that you shouldn't be thinking about leverage. For example, let's say you're spending 50% of your time on basic marketing. You know, you can find someone else to do that job, but you just don't have the money at this time. Your thought process should be that your next hire should probably be this marketing person. Now, let's move to part two. Part two, how you can lose leverage without realizing it. This part is all about how you can accidentally become the constraint. Let's start with failure mode number one. Failure mode number one. Comfort is how leverage dies. We all have our safe zones. Unless your safe zone is something only you can do, then it's likely costing your company leverage. For me, as we've already discussed, my safe zone was data analysis.

4:27 I could make a case it was valuable work because the analysis showed us what to do. However, it failed the test. Others could have done the work. Now, let's move to failure mode number two. Failure mode number two, founder dysfunction collapses leverage. I remember interviewing a really good engineer that worked for a failed startup. I asked him what happened. VJ said, "The founders were always giving us different directions. My boss would tell me to work on one thing. Then the next day, the CEO would come in and tell us to do another thing." This happened all the time. When you and your co-founder aren't working well together, you lose leverage and then the work likely ends up back with you.

5:18 Your protection against dysfunction is the who will do what by when methodology. Here's how it works. For any project, there is one and only one owner. That's the who. The what is the deliverable action and the when is the date the project will be complete. Now let's move to the third failure mode. Failure mode number three. Delegation without leverage is a trap. Let's say you've launched your product to market and you have a customer support organization in place. However, you haven't given the organization authority to make any decisions like authorizing refunds. So the ownership still lies with you. That's not how you gain leverage. You gain leverage by delegating authority down in the organization.

6:08 Now let's move to part three. Part three. What happens when leverage is correctly used? Leverage used correctly can transform your company. Let's start with result number one. Result number one. Recruiting is how you continually gain leverage. In order to continue gaining leverage you, the CEO must always be recruiting. My view is that recruiting is a muscle and just like any good muscle, you need to continually exercise your recruiting muscle. Recruiting is also a leadership skill. Every manager on your team needs to be able to recruit. So, if you're not prioritizing recruiting, how can you expect your team to prioritize recruiting? The result of continuously recruiting even when you don't have any openings is you'll have a bullpen of potential future employees ready to join you. These future employees allow you and your team to do more higher level activities as you add more people. That's how you continually increase your leverage over time. Now let's move to result number two. Result number two, you learn how to filter your work. There's a very simple but very powerful rule you should use to manage what tasks you work on. Is this something only I can do as CEO? If the answer is yes, then it's something you might want to work on based on your priorities. If the answer is no, then you want to delegate the work to someone else. The beauty of working this way is you are leveraging your time. The benefit for your team is they get to work on more highle activities and the benefit for your company is you move faster and your company is less dependent on you. Finally, let's move to leverage number three. Leverage number three, your company moves faster and smarter. It's amazing the power of properly using leverage gives your company. For example, Len used to have all engineering decision-making go through him. He had a major initiative that needed to get done quickly. I suggested he build a small expert team and give them the authority to make the day-to-day decisions. Len would check in and help as needed. He told me a few weeks later that this team was moving at 10x the speed of the other engineering organization.

8:43 That's the payoff. L's now changing everything to this decentralized pushing the decision-making down in his organization way of working. Now, if today's video resonated with you, then please hit the like button right now. One final thought, it's about the company. I hope it goes without saying, but everything you do is for the benefit of the company. That holds for using leverage, too. If you're using leverage to give yourself only the fun tasks to do, then you're using leverage incorrectly. For example, you handle fundraising not because you like it, but because it's something only you can do.

9:26 Now, speaking of fundraising, that's what we do in zero to pitch. If you want to build a pitch that gets the details right, then join me in zero to pitch. It's where startup CEOs like you create the first draft of a pitch investors want to see. Inside Zero to Pitch, our free community, you get the structure and support to take your pitch from idea to draft so you can finally see what is working and what needs to be improved.

9:57 Scan the QR code to join. Now, if you want to fix your pitch and build a company investors will trust, watch the free 20-minute training over my left shoulder. I'm Brett at brettjfox.com. Thanks for watching today. Take care. Bye.