Pete Daffern and Howard Bell have been guiding founders throughout 2020. These two Octopus Venture Partners have lived through numerous triumphs and crises, building six unicorns along the way between them. From their bird’s eye view, what have they noticed about leaders, their teams and leadership in general over the past few months?
“This is great. Now I can really lead”. This was a founder’s comment to Pete and Howard in the midst of the pressures of the Covid pandemic.
“This is not just about those who can lead, but those who want to lead,” says Pete. “It’s a serial leadership moment.” Of the many CEOs the pair have been advising over the last few months, a distinction is emerging between those who endure the challenge and those who relish it. The pair observed early on that Covid was forcing a new level of discipline. Now they can see those that did the hard work early, dug down, managed their cash, shed costs they couldn’t bare, got tight and focused and are now starting to reap the rewards.
“Being a CEO founder is an incredibly hard job. It’s multi-dimensionally complicated,” says Howard. “The soft skills of humility, listening, leaving the ego at the door – these are the signs of the emotional maturity that’s required to lead through difficult times. To be challenged and tested by Pete and myself – particularly on a Zoom call, when maybe we haven’t even met them face-to-face – reveals a lot.”
A good leader, according to Pete, doesn’t need to be the best at everything, it’s not possible anyway. “True leaders,” he says, “are the ones who say ‘I’m not the greatest VP of Sales, I’m not the top VP of Product, I’m not the best engineer – but I am really good at bringing a great team together.’ It’s about being mature enough to acknowledge your shortcomings as well as your strengths.”
“This is still a golden age for technology”
While addressing the challenges of the pandemic, the pair are keen to highlight the positives. There’s an advantage, Howard believes, to being a startup in a storm. “Good startups can ride it,” says Howard. “because they’re gaining their growth at the expense of the incumbents. They’re either creating a new category or claiming share because they’ve got a better proposition.” And, Howard is keen to remind us, this is still a golden age for technology. “Often Pete and I are talking to companies where we’ve never even thought of the category, let alone the business model,” he says. “There’s a whole world here of new ideas in the realms of big data, AI, drones and smarter uses of software”.
Leadership, Howard says, particularly in the technology sector, can and is building thriving businesses in 2020. “Get the market gap that’s real, a strategy that’s strong and robust, get a bunch a people around you that can do the job, lead the heck out of them and you’ll succeed.”
It’s going to be a long slow recovery, Pete and Howard are sure of that. So leadership, strategy, great business models, bold positioning will all be critical ingredients. “Delusional pitches that talk about last year’s growth and last year’s market will fail,” says Howard.
“If we as a country are going to create the next wave of innovation, we’ve got to seek out the home-grown talent,” says Pete. As leader of Netsuite, he recalls seeking his next VP of Sales, not through head hunters, but from within the hundreds-strong Netsuite sales team right under his nose. “I said there must be someone here who’s crushing it – a sales manager who’s going to teach everyone else how they’re going to be successful.” Really great people are never looking for their next position, Pete continues. A CEO needs to tap them on the shoulder. To this end leaders should be constantly expanding their network and forging connections with the best in the business. “Identify them early, take them out for dinner (when restrictions allow), get to know them, get them fired up about your business – repeatedly – so that when they’re ready, there’ll be no question of them not joining your team.” Leaders, in case it’s not already clear, are master team builders.
Howard has his own reminiscence: “I was 27 years old when I was catapulted four levels up to look after a $300m business. I could hardly spell ‘leadership’. I was told to get on a plane, go to California and sort out the chaos. I had 102 people reporting to me, $50m cap ex to spend in a year and a $2m budget. On my way out, the big boss took me to one side and simply said, “Howard, demonstrate leadership.”
“Now I know what he meant. You’ve got to live it and feel it in your bones.”
“That was good leadership on his part Howard,” says Pete. “He recognised that you had the right wiring to step up. And he gave you that opportunity.”
To know what good looks like, the best leaders calibrate themselves against the best they can find. When things are tight and pressured, it can take guts to carve out space and time to do this. But, as Pete and Howard are saying, leadership is about aligning yourself, not just with the right product or the right strategy, but with the right people.