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Forbes Books presents the Startup Science Podcast
with Gregory Shepherd, brought to you by
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Startup Science dot Io. Greg is
an entrepreneur who has built and sold twelve
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businesses. He's a recipient of four
Private Equity awards and is a featured ten
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X speaker and Forbes author. Here's
Gregory Shepherd my guest this week as Alice
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Betnek. Alice as the co founder
and general partner at entrepreneur First. She's
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also the founder of Code First Girls, a nonprofit organization that has taught thirty
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thousand women to code for free while
they're at the university, making a significant
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impact on increasing diversity in the field
of technology. She's also the co author
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of a new book, How to
Be a Founder. Alice, Welcome to
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the podcast. Thank you so much
for having me. I'm delighted to be
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here. You're welcome. I'm actually
really excited because I spent a little time
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on your website and I was looking
at all of the cool stuff that you
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guys are doing and your background,
and I was very very inspired by what's
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going on. Part of the mission
that I have personally is to help out
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marginalize people, and you're right in
there doing the work that needs to be
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done. I have a question to
start out with, what inspired you to
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co found entrepreneur first and help these
aspiring founders build up startups from scratch?
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From my understanding, as it starts
from vision right, I have an idea?
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Are the people that you work with. One of the unusual things about
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EF is that you don't even need
an idea to apply or to join the
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program. I'm all we're interested in
is an individual's raw talent. And I
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suppose there's a couple of reasons why
we started DF and the underlying belief was
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that the world is missing out on
some of its best potential founders, and
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largely it's because of the ecosystems they're
in and the people they're surrounded by.
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I think if you look at careers
advice, career's advice hasn't really changed for
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the last ten twenty thirty years,
and the people who are giving careers advice
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are often pretty outdated. If you
think how fast the world of jobs and
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careers has changed, particularly in the
last decade or so. And I suppose
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one of the big changes in terms
of how individuals can spend and use their
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careers and think about having impact with
their careers. Is that now, founding
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a startup pretty early on in your
career is not just a viable path,
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it is and should be one of
the most aspirational and attractive paths for the
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very best individuals. And so entrepreneur
Furs was founded on the idea that we
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should be stopping our best and brightest
from going down these very traditional, quite
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corporate career paths and making sure they
not only have the knowledge that founding is
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possible, but also access to the
resources, the co founders, the finance,
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on the structure to turn it into
a reality. You are speaking my
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language, sister, like this is
this is exactly what I tell people.
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I mean, I barely graduated from
high school, you know, so for
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me, college was out of the
question because I have autism and dyslexia.
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And I've started and sold twelve startups, you know, sold two to eBay,
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and I took this path that you're
talking about because I felt like I
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had no other option. And I
think that this is an incredible I mean,
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I can't even tell you how excited
I am to hear that you're that
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you're helping out these these people that
have the the inspiration or the drive the
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folk I call it a handful of
focus, drive, enthusiasm, discipline,
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and optimism to start a business.
I mean, I think it's it's incredible.
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What inspired you to do this?
Like? What was what was behind
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it? You know when you when
you started this, did did something come
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up inside you and say, oh, I absolutely we have to do this.
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Did you meet somebody? What was
the catalyst? So I met my
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co founder at McKinsey, where we
both started our graduate jobs. And both
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of us had done startup staff while
at university. But I think, as
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many individuals find when they're graduating,
sort of you know, you do startup
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stuff while you're at university, and
then you need to go and get a
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proper job, go into a proper
career. And we both became consultants because
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it felt like a way to get
exposure to business and as a way to
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become more clued up so that maybe
one day we could become a founder.
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And I think consulting is an amazing
career path for lots of different people,
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but it doesn't necessarily teach you how
to be an amazing founder. And I
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suppose part of building entrepreneur first was
thinking about how do we create a career
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path that is optimized for individuals to
become founders very early on in their lives.
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And I suppose why do we think
that's impossible import and why do we
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think that's important. So, first
of all, interestingly, if you look
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at our data now that we've been
running for about ten years, individuals with
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less than two years work experience seem
to have the outlier outcomes within our portfolio.
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You know, we've got more than
five hundred companies in our portfolio,
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collective valuations over ten billion. And
if you look at the outlier companies that
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are driving a lot of that portfolio
value, the founders between the two of
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them, between the two founders typically
have less than eighteen months work experience.
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So there's something here about the amazing
naive optimism that you have at the beginning
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of your career. And A Yeff, we really want to tap into that
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at that very early stage, partly
because what we have seen is that as
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you go through your career, as
you become more up skilled, more knowledgeable,
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have a greater network. In many
ways, those things remove the naive
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optimism that enables you to go into
an industry and mentally disrupt it. You
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need to have that naivete and you
need to have that optimism because because you
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if you knew how hard it was, you you wouldn't necessarily do it.
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And so I suppose it comes from
Matt and I starting out our careers knowing
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that one day we wanted to be
founders, but I suppose believing we had
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to take this kind of circuitous path
rather than going straight into founding, and
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part of our founding belief that the
f is supporting people at the beginning of
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their careers because it is a founding
career. As you say, you know,
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Greg, You've You've started twelve businesses. It's a founding career. It's
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not that you start once, it
doesn't work out, and you never try
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again. It's not that you start
out it succeeds and you never try again.
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It's about building up the collective body
of knowledge, experience, and intuition,
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specifically about founding companies that will enable
you to be a globally important successful
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founder. That is so true.
I mean I always tell people they go,
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I feel like I'm failing, and
I'm like, that is progress.
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You think it's failing, but it's
actually progress. And everybody has sumbles along
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their way as they build a business. But the fact that you're going after
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people that choose this as a career
path is so amazing. And your point
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about most of the people not actually
understanding how to help them. I went
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to a conference and it was all
universities in the conference, five hundred and
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seventy eight universities, and there was
a keynote speaker and at the time,
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the keynote speaker raised his hand said
listen, if you have done a startup,
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please raise your hand, and nobody
raised their hand. Nobody, And
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so afterwards I was like, well, maybe they're just a little shy.
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So then I walked around the room
and I started asking people if they had
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started company, and I went into
their LinkedIn profiles. I didn't find a
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single one that had actually started a
company. So then I went into the
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accelerators and I started interviewing accelerators and
this research, you know, I started
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in twenty sixteen on why, when
and how founders fail and the big thing
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was bad decisions which pinned bad advice. And I was trying to figure out
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where that was coming from. But
you nailed it right on the head and
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in addition to that, the concept
of founders choosing this as a career is
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just absolutely amazing And I'm just so
happy to have you on this podcast for
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all these founders to listen to,
because You're right. What it sounds like
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you guys are doing is you're grooming
people to take on the career of starting
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a business, just like people go
to school to be an attorney or go
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to school to be an accountant or
what have you. So when you're doing
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that, what are the key mindsets
and tools that founders need to succeed that
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you find And I'm assuming a lot
of these things are soft skills. Yeah,
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I mean there are some useful hard
skills. So we mainly work with
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technologists. The majority of our portfolio
over the last decade or so has largely
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been investing in founders who have some
sort of computer science, particularly AI backgrounds,
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And if you look at the majority
of the companies that been created through
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this process, about seventy percent of
our companies have some form of either unique
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and novel artificial intelligence that they use
or they leverage existing AI tools to solve
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a particular problem. So we like
founders who have technical skills. So there
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is a hard component. But there
are many computer scientists out there, and
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there are many physicists and maths grads
and all the rest of it. Not
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all of them will be great founders. So right, it is the soft
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skills that we particularly look for.
There's a couple of things that I think
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are teachable, and then there are
a couple of things that I think are
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more innate. On the teachable side, we look for founders who have or
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look their pre founders by the time
that we're talking to them, who have
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an incredible drive to achieve. So
these individuals who have a very strong biased
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action. They just get stuff done. And sometimes they can't even articulate why
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they have such a strong drive to
achieve. It's not clear what they're trying
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to achieve. They just want to
be the best at everything they do.
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And it means that there's often this
sort of obsessive streak in them where they
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are totally focused on a particular area. I want to become world expert,
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have an amazing growth mindset about learning
everything in a particular area, and then
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once they're done with that, they'll
move on to something else. So I
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think there's these individuals who are hyperproductive
and we see that play out on the
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program. So when they're trying to
find a co founder, when they're developing
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an idea, when they're going out
and speaking to customers, they just produce
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more. They do more than everyone
else around them. And the reason I
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say that's teachable is that I think
a lot of that is innate, but
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you can help people understand what good
and bad productivity looks like. So I
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think often in startup land there's a
lot of bad productivity, so things that
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are things that are done to show
to other people that you're doing the right
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thing, so networking, gathering,
collecting business cards, doing too much press.
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Whereas you know, the best productivity
is when we see individuals who are
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solving hypotheses about what their customers want
at just such a crazy rate, and
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so their rate of learning, their
kind of feedback loop is on overdrive.
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I think one of the other kind
of intrinsics that we see that is harder
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to teach, and well, we
haven't found a great way of teaching it
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yet is this idea of personal exceptionalism. And this is the kind of belief
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that some individuals have that they're going
to be okay, that they will be
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able to make it work. This
isn't sufficient to succeed, but it is
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necessary to succeed. And this may
sound like Bravardo, it may sound like
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arrogance or over confidence, and it's
it's not. It's just a belief that
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their odds of succeeding are different compared
to their peers. And so these are
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typically individuals who have had pretty exceptional
trajectories. I think you have to be
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pretty exceptional to be a world class
founder. To build a truly globally important
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company, you do need to be
exceptional. And it's unlikely that the first
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exceptional thing you do in your life
is building a company. And so we
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are looking for these individuals who have
this high person exceptionism that is normally fed
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by having a track record of doing
unusual and interesting things in the past where
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they've they've outperformed their peers. And
it doesn't necessarily mean being top of the
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class. It doesn't mean getting all
the career promotions. It's usually something outside
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of the usual, you know,
life track. So it's side projects,
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it's counterintuitive decisions that they've made,
and I think that is slightly harder to
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teach. I think often if you've
been if you've fully digested the cultural norms
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around you, it can be pretty
hard to shake that when you're a founder,
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and I think you know, founders
have to challenge the status quote to
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some extent. Yeah, one d
percent, right, I mean that's what
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you're doing. You're you're solving problems
and challenging problems that have been solved every
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day, right to try to try
to build it out. I agree with
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you one hundred percent. And that
exceptionalism is totally true. Like when I
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look at deal flow as it comes
in, we're always trying to figure out,
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like, what did they do?
So you know, sometimes you see
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somebody that's like, oh, they
we're an Olympic athlete, and you're like,
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okay, well they understand discipline and
commitment and they're not going to fold
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up as soon as things get hard
and that sort of stuff. Right.
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Yeah, And we've we've had individuals
who have done pretty incredible sporting achievements,
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whether it be being on Olympic squads. But I think the resilience resilience is
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a really interesting one because you have
to be hyper resilient to be a founder,
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and the roller coaster that happens on
a daily or weekly basis as a
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founder is pretty extreme, and one
of the reasons we believe so deeply in
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co founding teams, particularly co founding
pairs, is that we believe and we've
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seen that it engenders and creates far
greater resilience. Co Founding teams are often
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cited is the most common reason why
startups fail. But I suppose our slightly
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counter intuitive belief in this is that
if you have the right co founder,
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they are the reason why you will
succeed. They will not just make you
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more productive to people are better than
one. They will not just enable you
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to have a better idea, Your
quality of ideation will be better, but
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ultimately they will enable you to be
more resilient because you have somebody that is
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privy to absolutely everything that you're going
through and is incentifized in the same way
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that you are. So I think
resilience as an individual is important, but
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supercharged resilience often comes from the quality
of the co founding team. I mean,
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you're right, it does show up
in y founders fail, But that
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study that everybody refers to is not
really that good at all. I mean
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I looked at it. We went
did a five year study on it.
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And the real reason when they look
at that is because you know, a
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lot of times you say, oh, well, they're referring to this document,
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that was referring to this document that
was referring to that. You're chasing
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this thing down and somebody dis fabricating
a lot of it. But what's really
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fascinating is what you said about the
co founder, right You're right in that
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they'll say that a lot of the
times the team doesn't get along and that's
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why it fails. But there are
reasons why the team doesn't get along,
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and usually those things are identifiable right
away, right like one of them is
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a visionarying, the other ones an
executor, or both of them are executors.
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Are one's a big company type person
and the other person's a gritty founder
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who's willing to roll up their knees
and do the work out of those things.
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What are your advice that you have
available for co founders and founders to
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understand whether they have the right team
to begin with. This is a great
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question, and we've spent the last
ten years really exploring how do you create
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not just stable co founding teams,
but exceptional co founding teams. We've had
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about three thousand people go through EF
across three different continents, and I've worked
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with hundreds of individuals now to help
them find their co founder. What is
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always interesting to see is that often
individuals have quite a fixed idea about who
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they think their co founder will be
before they before they get started trying to
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find one, and often trying to
find somebody in a certain image, with
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a certain skill set, and often
influenced by what they've read in the media
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as to what a good co founder
looks like. In reality, what we
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find is because we bring together small, highly curated groups of individuals who are
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all ready to find a co founder
right now. It's usually between thirty and
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fifty individuals, what we find is
the best co founding teams come from a
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process of testing and iteration. So
you join us, you join this group
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of other very carefully selected individuals,
and you spend eight weeks testing out different
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co founder relationships. It's actually very
hard for us and for the individual to
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predict beforehand who will be the right
co founder for them, the best,
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and pretty much the only way to
know is to start working alongside them.
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For the co founders to work alongside
each other on something they really care about.
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And this can be in very short
sprints, almost like hack up on
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style sprints, but where there's a
clean break point. So after twenty four
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forty eight hours of working together,
they sit down and have the conversation of
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do we feel that we make each
other more productive? Do we share the
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same beliefs about what we want to
create? Do we feel that our working
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styles intersect well together. The reason
we pushed so hard on this testing idea
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is that all of those things you
can have very great, detailed conversations about
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it, but until you're actually working
alongside each other, as if this is
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the startup that is going to turn
you into globally important founders, everyone is
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compromising, and we one of our
big beliefs is that a lot of co
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founding relationships out in the world outside
of the entrepreneur First fail because they are
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a co founder of convenience. They
were the only co founder that was available,
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So ultimately people kind of have to
make it work and they make a
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huge amount of compromises. The thing
that we are so passionate about our entrepreneur
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first is it's not about finding the
convenient co founder. It's about finding the
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right co founder for you, the
one that will turbo charge your productivity,
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your ideations. And I'm ready that
is just through a process of testing,
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iteration, and experimentation. That is
so true when I looked at the data.
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You know, this massive research product. I had five people working on
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this thing and it started in two
and sixteen, still going today. You're
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totally right about the convenient co founder. I love them. I love the
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language there. It occurs almost every
time there is a situation where the founder
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and the co founder split up,
and you know, they call it it's
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under bad team. I believe that
that there is a situation between the conflict
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that they're both the same types of
personality, so instead of you know,
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fitting together like a puzzle, they
just run into each other constantly. So
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I'm wondering. You know, you've
looked at and helped over two thousand individuals
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right become successful founders. What are
some of the key lessons that you've learned
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that you can pass to the founders
that are listening about what is the components
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of a successful relationship that they should
be looking for based on their own personality
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type, Like if you're this type
of a personality, you're going to want
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to look for somebody like this,
that sort of stuff. Can you provide
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some advice for the founders listening,
I think you're exactly right here that often
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the pushes to find somebody who is
your total opposite. What we encourage founders
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to think about is there needs to
be a sufficient overlap between the two of
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you so that you can effectively work
together. One of the reasons why we
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take so many technologists onto the Entrepreneur
Furst program is that if you have a
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technical background, if you've been taught
to think in a scientific way, it's
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actually much easier for you to work
with other people who have been taught to
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think and who naturally think in a
very similar way to you. I suppose
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the adage that is often pushed if
you know you need the business person and
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you need the tech person, This
doesn't work because they're coming at the problem
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like they come out the way of
problem solving, the way of working from
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such different angles. One of the
almost hilarious common challenges we've found where you
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have a very technical co founder and
a non technical co founder is their preferences
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around working hours can often cause a
lot of conflict. Often the technical co
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founder. Maybe this is a bit
of a stereotype, but often they will
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prefer to be working later in the
evening. Often the non technical co founder,
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again it's a stereotype, often has
a preference to be working more typical
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business hours. And it's amazing how
something like that may seem inconsequential but can
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actually cause a huge amount of friction. So every team to be successful needs
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somebody who can act in the CEO
role, and need somebody who can act
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in the CTO role. And we
have a very strong belief around pairs and
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having the individuals take one of those
two roles. I'll push the CEO though,
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is that you don't have an MBA
business type. Instead, what you
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have is somebody who has at least
a lightly technical back ground, but who
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is interested in and has some of
the intrinsics to be able to be in
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the what is for a venture backed
company are typically a fundraising heavy role.
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The CEO of a venture backed company
often surprises people will spend sixty seventy percent
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of their time fundraising, so raising
the next round, closing the round,
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and preparing for the next fundraise,
and so ultimately, if you have two
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deeply deeply technical individuals, and neither
one of them wants to play that role.
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Again, we've seen that that team
formation doesn't work. So you're not
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looking for somebody who is identical to
you, but you're looking for somebody where
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there's sufficient overlap that both of the
roles are covered, both the CIO role
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and the ctro role, and both
of you can both thrive in those roles
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and have enough context to be able
to support the other individual on their role.
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Yeah, that's exactly what I was
talking about. Is and you're right
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about about the stereotyping, but it
is true. I mean, I used
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to be a code or you know, so when you sit down and you
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want to code, doing that at
night with your headphones on when everybody else
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is asleep, But when you're doing
business development and those other more social activities,
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you're doing those during the day.
And you're right about the balance.
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A lot of the stuff that we
saw in our study also was that you
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see these disagreements and then you go
and interview. We would go and interview
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the two people and we would say, can you explain what the disagreement was?
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And one person would be like,
well, they just weren't pulling their
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weight, and the other person would
say, well, I was working at
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night. They couldn't tell that I
was pulling my weight, you know,
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and a lot of those those sort
of disagreements, So it fits right in.
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I mean, you clearly know exactly
what you're doing. I'm really really
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impressed, and we have much more
to get to, but we have to
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stop right there. Coming up in
the second part of my talk with Alice
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Bentnik, the co founder of entrepreneur
First, Alice shares the simple fact every
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founder needs to understand. You don't
need to be an expert to start a
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start up. You need to be
an expert in your particular idea, and
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your particular idea hopefully is unusual enough
and new enough that you can be the
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world expert in what you're doing in
the particular problem you're solving. The Startup
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00:23:11.400 --> 00:23:17.839
Science Podcast with Gregory Shepherd is brought
to you by startup Science dot Io.
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00:23:18.519 --> 00:23:23.160
Founders can log on to startup science
dot io and use code Forbes to get
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00:23:23.200 --> 00:23:29.759
free access. To connect and find
out more about Greg go to Gregory shephard
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00:23:29.799 --> 00:23:34.160
dot com. The Startup Science Podcast
is a production of Forbes Books
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00:00:01.320 --> 00:00:07.120
Forbes Books presents the Startup Science Podcast
with Gregory Shepherd, brought to you by
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00:00:07.200 --> 00:00:13.199
Startup Science dot Io. Greg is
an entrepreneur who has built and sold twelve
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00:00:13.279 --> 00:00:18.719
businesses. He's a recipient of four
Private Equity awards and is a featured ten
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00:00:18.839 --> 00:00:24.879
X speaker and Forbes author. Here's
Gregory Shepherd my guest this week as Alice
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Betnek. Alice as the co founder
and general partner at entrepreneur First. She's
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also the founder of Code First Girls, a nonprofit organization that has taught thirty
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thousand women to code for free while
they're at the university, making a significant
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impact on increasing diversity in the field
of technology. She's also the co author
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of a new book, How to
Be a Founder. Alice, Welcome to
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the podcast. Thank you so much
for having me. I'm delighted to be
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here. You're welcome. I'm actually
really excited because I spent a little time
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on your website and I was looking
at all of the cool stuff that you
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guys are doing and your background,
and I was very very inspired by what's
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going on. Part of the mission
that I have personally is to help out
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marginalize people, and you're right in
there doing the work that needs to be
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done. I have a question to
start out with, what inspired you to
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co found entrepreneur first and help these
aspiring founders build up startups from scratch?
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From my understanding, as it starts
from vision right, I have an idea?
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Are the people that you work with. One of the unusual things about
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EF is that you don't even need
an idea to apply or to join the
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program. I'm all we're interested in
is an individual's raw talent. And I
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suppose there's a couple of reasons why
we started DF and the underlying belief was
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that the world is missing out on
some of its best potential founders, and
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largely it's because of the ecosystems they're
in and the people they're surrounded by.
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I think if you look at careers
advice, career's advice hasn't really changed for
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the last ten twenty thirty years,
and the people who are giving careers advice
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are often pretty outdated. If you
think how fast the world of jobs and
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careers has changed, particularly in the
last decade or so. And I suppose
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one of the big changes in terms
of how individuals can spend and use their
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careers and think about having impact with
their careers. Is that now, founding
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a startup pretty early on in your
career is not just a viable path,
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it is and should be one of
the most aspirational and attractive paths for the
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very best individuals. And so entrepreneur
Furs was founded on the idea that we
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should be stopping our best and brightest
from going down these very traditional, quite
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corporate career paths and making sure they
not only have the knowledge that founding is
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possible, but also access to the
resources, the co founders, the finance,
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on the structure to turn it into
a reality. You are speaking my
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language, sister, like this is
this is exactly what I tell people.
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I mean, I barely graduated from
high school, you know, so for
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me, college was out of the
question because I have autism and dyslexia.
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And I've started and sold twelve startups, you know, sold two to eBay,
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and I took this path that you're
talking about because I felt like I
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had no other option. And I
think that this is an incredible I mean,
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I can't even tell you how excited
I am to hear that you're that
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you're helping out these these people that
have the the inspiration or the drive the
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folk I call it a handful of
focus, drive, enthusiasm, discipline,
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and optimism to start a business.
I mean, I think it's it's incredible.
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What inspired you to do this?
Like? What was what was behind
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it? You know when you when
you started this, did did something come
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up inside you and say, oh, I absolutely we have to do this.
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Did you meet somebody? What was
the catalyst? So I met my
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co founder at McKinsey, where we
both started our graduate jobs. And both
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of us had done startup staff while
at university. But I think, as
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many individuals find when they're graduating,
sort of you know, you do startup
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stuff while you're at university, and
then you need to go and get a
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proper job, go into a proper
career. And we both became consultants because
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it felt like a way to get
exposure to business and as a way to
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become more clued up so that maybe
one day we could become a founder.
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And I think consulting is an amazing
career path for lots of different people,
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but it doesn't necessarily teach you how
to be an amazing founder. And I
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suppose part of building entrepreneur first was
thinking about how do we create a career
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path that is optimized for individuals to
become founders very early on in their lives.
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And I suppose why do we think
that's impossible import and why do we
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think that's important. So, first
of all, interestingly, if you look
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at our data now that we've been
running for about ten years, individuals with
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less than two years work experience seem
to have the outlier outcomes within our portfolio.
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You know, we've got more than
five hundred companies in our portfolio,
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collective valuations over ten billion. And
if you look at the outlier companies that
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are driving a lot of that portfolio
value, the founders between the two of
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them, between the two founders typically
have less than eighteen months work experience.
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So there's something here about the amazing
naive optimism that you have at the beginning
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of your career. And A Yeff, we really want to tap into that
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at that very early stage, partly
because what we have seen is that as
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you go through your career, as
you become more up skilled, more knowledgeable,
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have a greater network. In many
ways, those things remove the naive
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optimism that enables you to go into
an industry and mentally disrupt it. You
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need to have that naivete and you
need to have that optimism because because you
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if you knew how hard it was, you you wouldn't necessarily do it.
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And so I suppose it comes from
Matt and I starting out our careers knowing
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that one day we wanted to be
founders, but I suppose believing we had
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to take this kind of circuitous path
rather than going straight into founding, and
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part of our founding belief that the
f is supporting people at the beginning of
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their careers because it is a founding
career. As you say, you know,
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Greg, You've You've started twelve businesses. It's a founding career. It's
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not that you start once, it
doesn't work out, and you never try
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again. It's not that you start
out it succeeds and you never try again.
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It's about building up the collective body
of knowledge, experience, and intuition,
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specifically about founding companies that will enable
you to be a globally important successful
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founder. That is so true.
I mean I always tell people they go,
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I feel like I'm failing, and
I'm like, that is progress.
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You think it's failing, but it's
actually progress. And everybody has sumbles along
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their way as they build a business. But the fact that you're going after
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people that choose this as a career
path is so amazing. And your point
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about most of the people not actually
understanding how to help them. I went
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to a conference and it was all
universities in the conference, five hundred and
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seventy eight universities, and there was
a keynote speaker and at the time,
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the keynote speaker raised his hand said
listen, if you have done a startup,
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please raise your hand, and nobody
raised their hand. Nobody, And
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so afterwards I was like, well, maybe they're just a little shy.
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So then I walked around the room
and I started asking people if they had
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started company, and I went into
their LinkedIn profiles. I didn't find a
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single one that had actually started a
company. So then I went into the
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accelerators and I started interviewing accelerators and
this research, you know, I started
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in twenty sixteen on why, when
and how founders fail and the big thing
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was bad decisions which pinned bad advice. And I was trying to figure out
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where that was coming from. But
you nailed it right on the head and
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in addition to that, the concept
of founders choosing this as a career is
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just absolutely amazing And I'm just so
happy to have you on this podcast for
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all these founders to listen to,
because You're right. What it sounds like
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you guys are doing is you're grooming
people to take on the career of starting
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a business, just like people go
to school to be an attorney or go
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to school to be an accountant or
what have you. So when you're doing
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that, what are the key mindsets
and tools that founders need to succeed that
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you find And I'm assuming a lot
of these things are soft skills. Yeah,
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I mean there are some useful hard
skills. So we mainly work with
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technologists. The majority of our portfolio
over the last decade or so has largely
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been investing in founders who have some
sort of computer science, particularly AI backgrounds,
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And if you look at the majority
of the companies that been created through
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this process, about seventy percent of
our companies have some form of either unique
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and novel artificial intelligence that they use
or they leverage existing AI tools to solve
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a particular problem. So we like
founders who have technical skills. So there
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is a hard component. But there
are many computer scientists out there, and
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there are many physicists and maths grads
and all the rest of it. Not
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all of them will be great founders. So right, it is the soft
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skills that we particularly look for.
There's a couple of things that I think
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are teachable, and then there are
a couple of things that I think are
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more innate. On the teachable side, we look for founders who have or
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look their pre founders by the time
that we're talking to them, who have
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an incredible drive to achieve. So
these individuals who have a very strong biased
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action. They just get stuff done. And sometimes they can't even articulate why
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they have such a strong drive to
achieve. It's not clear what they're trying
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to achieve. They just want to
be the best at everything they do.
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And it means that there's often this
sort of obsessive streak in them where they
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are totally focused on a particular area. I want to become world expert,
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have an amazing growth mindset about learning
everything in a particular area, and then
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once they're done with that, they'll
move on to something else. So I
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think there's these individuals who are hyperproductive
and we see that play out on the
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program. So when they're trying to
find a co founder, when they're developing
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an idea, when they're going out
and speaking to customers, they just produce
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more. They do more than everyone
else around them. And the reason I
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say that's teachable is that I think
a lot of that is innate, but
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you can help people understand what good
and bad productivity looks like. So I
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think often in startup land there's a
lot of bad productivity, so things that
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are things that are done to show
to other people that you're doing the right
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thing, so networking, gathering,
collecting business cards, doing too much press.
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Whereas you know, the best productivity
is when we see individuals who are
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solving hypotheses about what their customers want
at just such a crazy rate, and
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so their rate of learning, their
kind of feedback loop is on overdrive.
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I think one of the other kind
of intrinsics that we see that is harder
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to teach, and well, we
haven't found a great way of teaching it
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yet is this idea of personal exceptionalism. And this is the kind of belief
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that some individuals have that they're going
to be okay, that they will be
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able to make it work. This
isn't sufficient to succeed, but it is
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necessary to succeed. And this may
sound like Bravardo, it may sound like
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arrogance or over confidence, and it's
it's not. It's just a belief that
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their odds of succeeding are different compared
to their peers. And so these are
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typically individuals who have had pretty exceptional
trajectories. I think you have to be
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pretty exceptional to be a world class
founder. To build a truly globally important
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company, you do need to be
exceptional. And it's unlikely that the first
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exceptional thing you do in your life
is building a company. And so we
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are looking for these individuals who have
this high person exceptionism that is normally fed
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by having a track record of doing
unusual and interesting things in the past where
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they've they've outperformed their peers. And
it doesn't necessarily mean being top of the
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class. It doesn't mean getting all
the career promotions. It's usually something outside
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of the usual, you know,
life track. So it's side projects,
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it's counterintuitive decisions that they've made,
and I think that is slightly harder to
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teach. I think often if you've
been if you've fully digested the cultural norms
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around you, it can be pretty
hard to shake that when you're a founder,
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and I think you know, founders
have to challenge the status quote to
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some extent. Yeah, one d
percent, right, I mean that's what
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you're doing. You're you're solving problems
and challenging problems that have been solved every
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day, right to try to try
to build it out. I agree with
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you one hundred percent. And that
exceptionalism is totally true. Like when I
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look at deal flow as it comes
in, we're always trying to figure out,
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like, what did they do?
So you know, sometimes you see
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somebody that's like, oh, they
we're an Olympic athlete, and you're like,
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okay, well they understand discipline and
commitment and they're not going to fold
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up as soon as things get hard
and that sort of stuff. Right.
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Yeah, And we've we've had individuals
who have done pretty incredible sporting achievements,
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whether it be being on Olympic squads. But I think the resilience resilience is
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a really interesting one because you have
to be hyper resilient to be a founder,
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and the roller coaster that happens on
a daily or weekly basis as a
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founder is pretty extreme, and one
of the reasons we believe so deeply in
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co founding teams, particularly co founding
pairs, is that we believe and we've
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seen that it engenders and creates far
greater resilience. Co Founding teams are often
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cited is the most common reason why
startups fail. But I suppose our slightly
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counter intuitive belief in this is that
if you have the right co founder,
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they are the reason why you will
succeed. They will not just make you
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more productive to people are better than
one. They will not just enable you
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to have a better idea, Your
quality of ideation will be better, but
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ultimately they will enable you to be
more resilient because you have somebody that is
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privy to absolutely everything that you're going
through and is incentifized in the same way
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that you are. So I think
resilience as an individual is important, but
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supercharged resilience often comes from the quality
of the co founding team. I mean,
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you're right, it does show up
in y founders fail, But that
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study that everybody refers to is not
really that good at all. I mean
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I looked at it. We went
did a five year study on it.
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And the real reason when they look
at that is because you know, a
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lot of times you say, oh, well, they're referring to this document,
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that was referring to this document that
was referring to that. You're chasing
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this thing down and somebody dis fabricating
a lot of it. But what's really
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fascinating is what you said about the
co founder, right You're right in that
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they'll say that a lot of the
times the team doesn't get along and that's
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why it fails. But there are
reasons why the team doesn't get along,
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and usually those things are identifiable right
away, right like one of them is
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a visionarying, the other ones an
executor, or both of them are executors.
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Are one's a big company type person
and the other person's a gritty founder
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who's willing to roll up their knees
and do the work out of those things.
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What are your advice that you have
available for co founders and founders to
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understand whether they have the right team
to begin with. This is a great
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question, and we've spent the last
ten years really exploring how do you create
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not just stable co founding teams,
but exceptional co founding teams. We've had
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about three thousand people go through EF
across three different continents, and I've worked
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with hundreds of individuals now to help
them find their co founder. What is
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always interesting to see is that often
individuals have quite a fixed idea about who
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they think their co founder will be
before they before they get started trying to
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find one, and often trying to
find somebody in a certain image, with
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a certain skill set, and often
influenced by what they've read in the media
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as to what a good co founder
looks like. In reality, what we
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find is because we bring together small, highly curated groups of individuals who are
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all ready to find a co founder
right now. It's usually between thirty and
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fifty individuals, what we find is
the best co founding teams come from a
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process of testing and iteration. So
you join us, you join this group
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of other very carefully selected individuals,
and you spend eight weeks testing out different
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co founder relationships. It's actually very
hard for us and for the individual to
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predict beforehand who will be the right
co founder for them, the best,
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and pretty much the only way to
know is to start working alongside them.
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For the co founders to work alongside
each other on something they really care about.
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And this can be in very short
sprints, almost like hack up on
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style sprints, but where there's a
clean break point. So after twenty four
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forty eight hours of working together,
they sit down and have the conversation of
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do we feel that we make each
other more productive? Do we share the
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same beliefs about what we want to
create? Do we feel that our working
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styles intersect well together. The reason
we pushed so hard on this testing idea
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is that all of those things you
can have very great, detailed conversations about
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it, but until you're actually working
alongside each other, as if this is
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the startup that is going to turn
you into globally important founders, everyone is
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compromising, and we one of our
big beliefs is that a lot of co
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founding relationships out in the world outside
of the entrepreneur First fail because they are
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a co founder of convenience. They
were the only co founder that was available,
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So ultimately people kind of have to
make it work and they make a
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huge amount of compromises. The thing
that we are so passionate about our entrepreneur
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first is it's not about finding the
convenient co founder. It's about finding the
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right co founder for you, the
one that will turbo charge your productivity,
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your ideations. And I'm ready that
is just through a process of testing,
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iteration, and experimentation. That is
so true when I looked at the data.
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You know, this massive research product. I had five people working on
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this thing and it started in two
and sixteen, still going today. You're
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totally right about the convenient co founder. I love them. I love the
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language there. It occurs almost every
time there is a situation where the founder
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and the co founder split up,
and you know, they call it it's
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under bad team. I believe that
that there is a situation between the conflict
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that they're both the same types of
personality, so instead of you know,
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fitting together like a puzzle, they
just run into each other constantly. So
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I'm wondering. You know, you've
looked at and helped over two thousand individuals
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right become successful founders. What are
some of the key lessons that you've learned
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that you can pass to the founders
that are listening about what is the components
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of a successful relationship that they should
be looking for based on their own personality
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type, Like if you're this type
of a personality, you're going to want
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to look for somebody like this,
that sort of stuff. Can you provide
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some advice for the founders listening,
I think you're exactly right here that often
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the pushes to find somebody who is
your total opposite. What we encourage founders
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to think about is there needs to
be a sufficient overlap between the two of
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you so that you can effectively work
together. One of the reasons why we
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take so many technologists onto the Entrepreneur
Furst program is that if you have a
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technical background, if you've been taught
to think in a scientific way, it's
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actually much easier for you to work
with other people who have been taught to
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think and who naturally think in a
very similar way to you. I suppose
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the adage that is often pushed if
you know you need the business person and
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you need the tech person, This
doesn't work because they're coming at the problem
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like they come out the way of
problem solving, the way of working from
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such different angles. One of the
almost hilarious common challenges we've found where you
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have a very technical co founder and
a non technical co founder is their preferences
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around working hours can often cause a
lot of conflict. Often the technical co
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founder. Maybe this is a bit
of a stereotype, but often they will
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prefer to be working later in the
evening. Often the non technical co founder,
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again it's a stereotype, often has
a preference to be working more typical
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business hours. And it's amazing how
something like that may seem inconsequential but can
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actually cause a huge amount of friction. So every team to be successful needs
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somebody who can act in the CEO
role, and need somebody who can act
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in the CTO role. And we
have a very strong belief around pairs and
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having the individuals take one of those
two roles. I'll push the CEO though,
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is that you don't have an MBA
business type. Instead, what you
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have is somebody who has at least
a lightly technical back ground, but who
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is interested in and has some of
the intrinsics to be able to be in
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the what is for a venture backed
company are typically a fundraising heavy role.
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The CEO of a venture backed company
often surprises people will spend sixty seventy percent
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of their time fundraising, so raising
the next round, closing the round,
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and preparing for the next fundraise,
and so ultimately, if you have two
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deeply deeply technical individuals, and neither
one of them wants to play that role.
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Again, we've seen that that team
formation doesn't work. So you're not
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looking for somebody who is identical to
you, but you're looking for somebody where
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there's sufficient overlap that both of the
roles are covered, both the CIO role
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and the ctro role, and both
of you can both thrive in those roles
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and have enough context to be able
to support the other individual on their role.
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Yeah, that's exactly what I was
talking about. Is and you're right
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about about the stereotyping, but it
is true. I mean, I used
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to be a code or you know, so when you sit down and you
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want to code, doing that at
night with your headphones on when everybody else
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is asleep, But when you're doing
business development and those other more social activities,
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you're doing those during the day.
And you're right about the balance.
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A lot of the stuff that we
saw in our study also was that you
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see these disagreements and then you go
and interview. We would go and interview
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the two people and we would say, can you explain what the disagreement was?
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And one person would be like,
well, they just weren't pulling their
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weight, and the other person would
say, well, I was working at
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night. They couldn't tell that I
was pulling my weight, you know,
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and a lot of those those sort
of disagreements, So it fits right in.
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I mean, you clearly know exactly
what you're doing. I'm really really
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impressed, and we have much more
to get to, but we have to
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stop right there. Coming up in
the second part of my talk with Alice
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Bentnik, the co founder of entrepreneur
First, Alice shares the simple fact every
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founder needs to understand. You don't
need to be an expert to start a
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start up. You need to be
an expert in your particular idea, and
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your particular idea hopefully is unusual enough
and new enough that you can be the
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world expert in what you're doing in
the particular problem you're solving. The Startup
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00:23:11.400 --> 00:23:17.839
Science Podcast with Gregory Shepherd is brought
to you by startup Science dot Io.
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00:23:18.519 --> 00:23:23.160
Founders can log on to startup science
dot io and use code Forbes to get
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00:23:23.200 --> 00:23:29.759
free access. To connect and find
out more about Greg go to Gregory shephard
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00:23:29.799 --> 00:23:34.160
dot com. The Startup Science Podcast
is a production of Forbes Books
