Knowledge Transfer: Jeff Hoffman On Responsibilities And Challenges For CEOs

Photo: Jeff Hoffman and Harambean Fellows

Two GAP and three Oppenheimer Fellows joined a Knowledge Transfer Session with Jeff Hoffman, the Chairman of the Global Entrepreneur Network. Jeff is a successful entrepreneur in his own right with a number of well-known successful start-ups, including and

Leadership and what I wish I’d known back then

As a founder/CEO of a company, you believe your job is to run the business. You take responsibility for every functional area, especially when you’re small and don’t have the money to employ more people. Success can be misleading because you start thinking that you’re good at everything. The fundamental truth is that no one hires an engineer who can also manage the finances, tax and write the marketing copy. CEOs are no different, but can believe they’re good at all those things, especially when things are going well. As a CEO, your job is to build companies that grow across your country and continent and perhaps even have the opportunity to go global. If you want to grow and scale your company, there are some important lessons to learn.

None of us are as smart as we think we are
We’re only really good in one area regardless of our title. The key to success is not working out how you can do everything – you can’t. The key to success is surrounding yourself with people who are smarter than you and to get out of the way. That is what true leadership looks like. Your job is not to run the company every single day, it’s to spend time finding those smart people.

Find people you can trust
You can’t scale until you can get out of the way. You can’t get out of the way until you can trust and empower people. Once you find people you can trust, you need to empower them to run pieces of your business while you do what you do well. You need to be the leader and not the bottleneck. Beware of thinking that you can do the finances/marketing, etc. until you hire a professional. While it may be possible in the early days of your start-up, you can’t be successful doing everything yourself. The quality of your team is everything.
Your job is to design yourself out of a job. If you’re on holiday and your phone keeps ringing, you’re not important, you’re inefficient! You’re a good leader when you can go to the beach and no one calls you, because everyone you hired was trusted and empowered and put in the right job. Your goal is to build an engine so smooth that you don’t have to steer it every day. You should aspire to being the ‘Chief Dreamer’ again on how to take your business to other markets, global, etc.

How to find rock stars
Don’t be so busy that you don’t have time to go and hunt for talent. Rock stars are not going to find you and you’re probably not going to find them in traditional ways either. People who respond to a job post have usually lost their job. The people you want to hire are not looking for a job. You need to go and search for talent and make time to do this – go out and network. An example is people who speak at conferences – they’re the industry leaders and the place to start. You win when you have the best people. Your job is to build the company where the smartest people in the industry who could work anywhere they want to, want to work for you and never leave.
In every city and country, there are rock stars. You just need to find them and get them to want to work for you. Remember that four rock stars will far outperform ten average people. The traditional wisdom was head count, which is not a good measure of contribution. You want to measure the value of the contribution of each individual. You can’t build greatness on the back of mediocrity.

How to hire top talent with limited resources
People do care about getting paid. If rock stars think that they will be part of making your company great, they want a piece of that in exchange for a higher salary. There are three levers to employing a rock star – salary, incentives, i.e. performance-based bonuses and equity. If the rock star wants to maintain a high salary, then the equity lever goes down. The person who doesn’t believe in themselves or the company will want as much cash as possible. The person who will work for a lower salary and take the rest in incentives and equity, believes in themselves and your company. Rock stars are willing to bet on themselves and don’t care only about money. People driven by passion and purpose far outperform people driven by paychecks. Equity is more powerful than salary alone for people who believe your company is going to be successful.
If finding rock stars is not your strength, find someone who is good at networking, has a network and likes talking to people to do it for you. Find people to do the things you’re not good at.

What skill sets should CEOs have?
As CEOs in your early twenties, you may be hiring people in their 40’s. Important skills to have are empathy and the ability to listen. You can get a lot further by listening than talking. Take the time to understand what your employees want to achieve and do with their lives. This also applies to your customers. Listen really hard to what they are saying before talking about your product. Good leaders listen to everyone and everything else first before they say a word.

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