How to be a Great Leader in a Startup
Kristina Proffitt

Great leadership is the difference between success and failure in any business, but with 50% of startups failing within the first five years, having the right leaders in place is critical for new businesses to grow.

It’s up to the leaders of a startup to make decisions that will shape the business’s future, whether that’s who to hire, what direction to go in, or how to approach an important deal. Every person is different, but I was curious to find out if there are any traits that the best startup leaders share.

Our offices are located in Accelerate Places, a thriving co-working environment for Nottingham startups. This gave me the perfect opportunity to speak to the managers of various startups and find out more about their approaches to leadership.

I asked them five questions and here’s what they had to say:

What quality is most important to be an effective leader?

Nearly everyone I spoke to said the same thing: communication.

Cronofy CEO Adam Bird said, “Part of being a leader is assimilating inputs from all sorts of sources and distilling the patterns and insight from it. Your team are inevitably closer to customers, delivery, billing, in fact pretty much any aspect of the business. Unless you’re properly open to listening to what they are reporting to you, both directly and indirectly, you will struggle to help them effectively navigate the challenges ahead.”

What one trait is most detrimental to a leader?

When it came to traits that were most detrimental to a leader, most people said indecisiveness, micromanagement, or arrogance. Olly Betts, CEO and co-founder of Bizfitech, the creators of Handle, said, “The best leaders realize that a wrong decision may be better than no decision at all.”

A lack of direction can ruin a team’s confidence in its leader. You must have confidence in your own skills and decision making. Admitting to your team that you made a bad decision can also show them that you’re not perfect or afraid to admit it. It’s better to fail fast and learn from your mistakes than to never fail or learn a thing.

Adam Bird backed this up by saying, “No matter how confident and adept other people appear, they’re all just making it up as they go along.” For anyone who’s ever doubted their ability to achieve something, this is great advice to keep in mind! Very few people are ever as confident as they appear to be.

What’s the best piece of leadership advice you’ve ever been given?

Leaders are often the face of their department or company, so it’s important that their attitude reflect that. “You’re always on show and your team will read a lot into your behaviour, so keep smiling!” said Mark Sanders from Accelerate Places. “It is indeed a small world, so try to be nice to people on your career journey!”

In a company as small as a startup – where many teams only consist of one or two people – it’s inevitable that you’ll run into your co-workers. It’s therefore important to have a good relationship with them – the better a team works together, the more they’ll be able to achieve.

Things don’t always go according to plan, though. “When you get bad news or something or someone angers you…sleep on it before taking action,” suggested Olly Betts. It’s amazing the difference a good night’s sleep can make – or even just separating yourself from a problem for a while – when it comes to making a decision. A little perspective can go a long way.

What alternative(s) would you suggest to someone who wants to progress in their career without becoming a traditional people manager?

Higher hierarchical positions are traditionally centered around people management, but this isn’t something everyone aspires to. Those that don’t wish to pursue this route and aren’t offered an alternative may leave, and in a startup, this can make a huge difference. Losing these key team members can have a huge effect on productivity, morale, and team dynamic, particularly in a smaller team. But what other forms of leadership could businesses encourage their employees to pursue?

“Leadership can be found having a deep level of knowledge in an area. In the world of IT that can be being an expert in a tool, service, or framework; within a company that might mean being the owner of an operational part of the system or business,” said Cronofy CTO Garry Shutler.

Richard Baker from BakerBaird said to “follow your passion. Whatever you do, it has to be fulfilling, satisfying and something you get a kick out of. Don’t be defined by a title.” Companies such as Experian do this by referring to team members as “experts” or “consultants” when they’re knowledgeable in a particular area. This shows their value to the team without taking them away from the reason they joined the company in the first place.

What advice would you give to someone looking to pursue a leadership role?

When it comes to pursuing any form of leadership, it helps to know where to start. Phil Randall from Userfy suggests becoming “an expert in something and [making] a career from being very good at something.”

Mark Sanders agreed: “Figure out what you’re really good at and develop that skill (assuming it creates value)!”

Antony Broadbent from Salary Finance suggests to “observe thoughtfully and learn.” The best way to learn is from other people – no entrepreneur is an island! Businesses achieve great things because the founders surround themselves with people who share their vision and believe in what they’re doing.

Interpersonal skills are more important in a startup than in any other type of business. The talent a startup hires is their first resource, and it’s therefore crucial that they nurture that talent if the company is to survive. The best leaders know this, and they encourage their team to develop their skills and to work outside of their comfort zone. Doing so is the best and fastest way for everyone to grow.

The importance of valuing your team and listening to what they have to say can never be overstated. It’s only through forming a great team and heeding their advice that startups become successful.