Shifting from Specialist to Founder

Shifting from technical specialist to founder brings a bottom line responsibility and the need to manage a host of new challenges.

Shifting from Specialist to Founder

Q: I worked in industry for a decade and was a mid-level professional when I decided to strike out with a partner on a new venture. I understood the practice details and he was a versatile developer. We have been at it for a little over three years now and are shipping a software solution that is in daily use at more than two dozen consulting firms. We are profitable and growing. Neither of us is–as of now–making as much as we were in our old jobs—but we enjoy being in charge of our destiny. One challenge I did not anticipate was that now I am at the helm I must not only steer the ship but keep a weather eye on the horizon for storms and icebergs.

When I was working at a larger firm, I delegated many of these challenges upward and focused on the projects I was responsible for. Now I manage projects and worry about longer-term business challenges. I don’t tend to worry about the technical challenges my partner has to solve, but he looks to me to take point on sales and the overall business.

I feel that I’m running in high gear too much because I don’t want to be blindsided. If something goes wrong, I want to be able to tell my partner–and tell myself–that we were proactive in managing the risk.

There are many variables to manage and possibilities to consider. How do I tell when my actions are prudent–preventing problems, solving them before they get bigger, or preparing a contingency plan if they occur–and when I am worrying needlessly.

You’re not alone—this is a common founder transition

A: When you leave a mid-level role to run your own venture, the shift from “focused contributor” to “chief generalist” can be jarring. You’ve gone from executing a defined strategy to also formulating it and keeping operations on track. That anxiety you’re feeling is normal, it means you are taking your new responsibilities seriously. Three years of experience in your new role has given you a much better awareness of all that can go wrong.

Here’s how I’d break down some practical next steps for shifting from specialist to founder:

Move from worry to sensemaking
Adopt a rhythm of reflection
Manage your energy like a limited resource
Use conversations to test assumptions
You’re already doing the hardest part right

1. Move from Worry to Sensemaking

The challenge is to react to specific concerns and engage in sensemaking so that your worry does not become diffuse, unstructured, and ultimately unproductive. I don’t think it’s a waste of time to write down your concerns and assumptions because it makes it much easier to review them with others, revise them as events unfold, and reference them as part of later reviews and retrospectives.

Document concerns: write down potential risks or uncertainties. Capture specific events, facts, and indications you will monitor. It’s also helpful to note key assumptions that you are making and document them so you can test them and perhaps revise them in light of new information.
Assess likelihood and impact: which risks are worth planning for?
Create “tripwires” that are leading indicators or thresholds that, when crossed, trigger deeper analysis or a prepared response.

This shifts you from ruminating to planning, which is healthier and more effective. It’s also important to remember that startups are inherently risky. You need to distinguish between risks specific to a particular course of action or one aspect of your business that can be addressed by fine-tuning your approach or declining to move forward and those inherent in your overall situation that must be managed by policies.

An initial sense of concern or even fear about a new event or situation is an intuition of risk. It’s often your experience telling you to slow down and pay close attention, and measure twice before you commit to a course of action. But I think it’s important to distinguish between fear and worry.

I like Tim Keller’s explanation in “Praying Our Fears;” he says, “Healthy fear is specific and constructive. It sparks physical energy and mental clarity. It enables you to summon your deepest capacities to protect something that you value that is threatened. Fear is specific and constructive. Anxiety is diffuse. Where fear galvanizes you into action, anxiety debilitates you and paralyzes you so that you are unable to make a decision or act.”

The need for sensemaking can be simplified by adopting policies around recurring decisions. Your revenue forecast is one common context that runs through many decisions you must make as an entrepreneur. New customer acquisition is one key contributor, as is customer churn. Both can be hard to predict. One way to manage this uncertainty is to establish policies that guide sales and spending. Two examples:

You can establish a policy that you don’t let any one customer contribute more than a third of your revenue to minimize the worst-case impact of the loss. This policy can be hard to follow because your largest customer is often the easiest to expand.
You can commit to maintaining a ready cash reserve (and perhaps a line of credit) that gives you funds to operate for four to six months. This reserve can act as a common buffer for many of the potential setbacks you may experience. Maintaining a reserve can be hard to do because you can use that money to grow faster by hiring more people or investing in more lead generation.

2. Adopt a Rhythm of Reflection

It’s good to set goals to be able to monitor your progress but it’s also a good idea to pause and reflect periodically on how far you have come. It’s important to identify where you have been successful and actively prospect for new customers whose situation and challenges rhyme with where you have been successful.

While many things may go wrong, most problems won’t happen or will only have a small impact if they do. Capturing your intuitions and keeping a log of your observations gets them out of your head, reducing your anxiety and allowing you to focus more fully on the present. These written notes can be more easily shared with team members and lay the groundwork for improving your predictive capabilities and the effectiveness of your mitigation strategies.
Writing down your concerns makes your reflection more effective because it’s not just memory, and it primes you to look for things you anticipated but did not happen. Some of these may be near misses that are worth continuing to address/mitigate. Some of these are mistaken assumptions and must be revised and perhaps eliminated. A list of “near misses” prevents you from living with a false sense of invulnerability.
Reflection also allows you to see how far you have come. Entrepreneurs often focus on how far they are from their idealized vision of their product or startup, which can be demoralizing. It’s good to consider how much progress you have made: what were problems three months ago or a year ago are now routinely handled, or at least much less daunting.
When you make a decision, write down your expectations for the likely outcomes and potential best and worst cases. Also, estimate when you will likely see results and schedule a review of the course of action your decision committed you to.

Founders who have been at it for several years, as you have, often expect that things should start to get easier. It seems reasonable. I suspect a retrospective would show you are executing much better in many dimensions that matter to yourselves and your customers. But I have yet to see things get easier in any team I have been a part of or supported, principally for three reasons:

As the team’s capabilities grow, so naturally do their ambitions. They take on harder projects with tighter deadlines and higher quality expectations from larger customers.
Managing a larger organization with management layers brings challenges and complexities that were not in evidence when the entire team could fit around a small conference table.
Your success in a growing niche attracts larger competitors who now find your market attractive and well-funded startups who anticipate further growth and view it as a stepping stone.

3. Manage Your Energy Like a Limited Resource

Your creative problem-solving energy is a scarce resource. One way to focus it on where it will offer the most value to your customers and your startup is to refine your creative solutions into standard procedures, checklists, and methods that turn most of your day-to-day work into routine operations. Some entrepreneurs resist this because they like the excitement of creative problem-solving. New customers and new competitors will bring new challenges soon enough.

I think there are two kinds of customer projects.

Those where you are learning together with your customer or a partner. You are essentially doing joint research and development where they get early access and the business advantages that flow from that.
Those that are predictable and perhaps somewhat boring for you and your team. You can make firm commitments to customers about results on a timeline at a fixed cost. Customers find this very reassuring, making these engagements easier to sell and more profitable because you make few mistakes and help the customer avoid mistakes you have seen others make.

Starting out, almost every engagement is of the first type. Life is exciting because it’s full of surprises, but you are learning a lot. The secret to success is to limit 80 to 90 percent of projects you take on to the second type as soon as you can. You are building on what you have learned and can execute smoothly. When you worked at a larger firm, you were embedded in a system that ensured the vast majority of the projects you took on were of this type; it’s how they could pay your salary reliably.

You can still take on a few learning projects as part of your research and development budget. However, your baseline revenue forecast must be built on “routine” or “complicated but predictable” projects that allow you to promise a prospect a short time to value realization. Your promised time to value is how they evaluate the risk in your offer.

4. Use Conversations to Solicit Perspectives and Test Assumptions

The buck stops with you but you don’t need to go it alone.

Start with your team: Stay in sync. Develop a shared situational awareness and a working consensus on shared assumptions, a range of hypotheses, risks, and next steps. You don’t have to agree on everything. You can agree to disagree as long as you find a way to move forward together, to disagree but support
Talk to customers, partners, and advisors. Sometimes a 30-minute chat can dissolve a week’s worth of worry. They are interested parties and can offer trusted feedback. Remember to ask if you are missing anything.
Solicit perspectives from knowledgeable but disinterested parties: other founders, founder groups, and entrepreneur communities. While you may need to be guarded about what you disclose and talk about challenges in a more general way, this group of people can offer an informed perspective and an appreciation for the challenges you are facing even though they are not directly involved in your business. These conversations are much more helpful than talking to folks who are full-time employees or who have never been entrepreneurs. They have a much better sense of the pressures that a startup places on the founders in particular and everyone involved in general.
Gather information. Treat business development and customer discovery as ongoing “weather forecasts.” The more you’re talking to the market, the fewer surprises you’ll face. Making the shift from specialist to founder means you have to be more willing to ask basic questions.

Each of these different types of conversations can reveal blind spots and suggest new alternatives to consider or new resources you may not have been aware of. Your ability to have these conversations and get people to give you the benefit of their experience and know-how is a function of how helpful you have been in the past. As busy as you are building your own startup and as challenging as it is, you need to be a good friend, a valuable supplier and partner, and a member in good standing of relevant entrepreneurial organizations and communities. All of this takes time, effort, and care. Two other benefits of helping others, beyond having them reciprocate when asked, are that they will offer useful advice and valuable resources without you having to ask, and the act of helping them will often provide insights into your challenges.

5. You’re Already Doing the Hardest Part Right

You have a good working relationship with your cofounder and have gone from a standing start to profitable and scaling in three years. You’re shipping. You’re profitable. Those are not small wins.

You haven’t passed the “opportunity cost” test yet (you could have stayed where you were and be making more money), but the psychic income from charting your own course is not to be minimized–it’s just hard to use it to pay for a cup of coffee at Starbucks.

Keep in mind: “Good judgment comes from experience, and experience comes from bad judgment.” You’ll make mistakes. The key is to notice and adapt before small cracks become structural failures.

“The art of living is more like wrestling than dancing, in so far as it stands ready against the accidental and the unforeseen, and is not apt to fall.”

“Never let the future disturb you. You will meet it, if you have to, with the same weapons of reason which today arm you against the present.”

Marcus Aurelius, Meditations

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Shifting from Specialist to Founder