Beware The Charismatic Founder

TL;DR A charismatic founder doesn't guarantee company success.

I acknowledge my privileged position of being able to scrutinize companies before joining them. Not everyone has that luxury.

So You're About To Join (or Fund!) A Startup

You're early in your programming career. You're young, excited, and looking for The Next Big Thing™. You passed the main interviews with a trendy startup and the final step is the company founder interview.

In your one-on-one interview with the founder:  They're charismatic, outgoing, well spoken, and they seem to "figure you out" quickly. They possess strong people skills. You're impressed. After all, a founder needs these skills! Good schmoozing ability means a good network, a good network means more talent, more talent means better growth, and so on.

You see a strong, passionate, capable leader. You want to follow them. If you're an investor, maybe you've been sold by this vibrant individual. You join the company without hesitation.

Teasing Correlation From Causation

I've never created a successful startup (and I've tried). I have no clear, objective ideas about what guarantees a company's success. This isn't about how to pick winners, nor is it about how to spot losers. I have no experience in either.

My point: Beware the charismatic founder. Charisma does not guarantee a company's success. It's easy to erroneously conflate the two.

Small companies have big risks. You might take a pay cut. You might lose job security. You might have to personally fight battles with childish coworkers because there's no established processes nor HR department. The deciding factor against these risks shouldn't be how outgoing the founder is.

A charismatic founder isn't a warning sign. It's not a reason to avoid a company. Just don't put too much weight on it. Being impressed by a founder may be important, but there's other variables to consider.

Determining what you value in a company, paradoxically, requires working for a significant time. If you're experienced in your industry, you probably already have a good idea of your core values. If you're early in your career, here's some things to consider:

  • Prior leadership experience of the founders. Is this their first rodeo? If not, what's their past experience, including personal views on leadership? A young founder with a fresh ten million dollars in the bank could be world-changing, or it could be a disaster waiting to happen.
  • The relationships surrounding the founders' lives. If multiple founders, how did they meet? How did they meet the first employees? How did they meet the investors? What are the founder's relationship with the investors?
  • A path towards profit. New startup ideas are incredibly difficult to judge. The investor group Y Combinator famously thought AirBnB was a bad idea (but funded them anyway). An exit strategy is one thing, but the quality of the idea needs great scrutiny. A charismatic founder can sell a flop to anyone. A floundering idea could mean the most frustrating years of your life.
  • Your true belief in the company. Can you tirelessly, sincerely pitch the idea to everyone you meet for years? Could you own this idea as if it were your own? The earlier of an employee you are, the more important this may be.

That's It!

If I knew how to pick successful companies, I'd be living on my space yacht by now. I do know that founder charisma isn't the one true path to company success. It can be hard to tease the two apart.

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