E140A 2005: ABCs of TalentA. Recruiting Key Players in Start-UpsQ&A with VC John Doerr of KPCBMasayoshi Son CEO of SOFTBANK CORP. (Japan)Understanding Rewards In High Potential VenturesMajor Compensation Components in Start-UpsC: Culture … The Secret to Long-Term Success?Culture: Major Challenge to Create a Fertile Environment for Innovation1E140A 2005: ABCs of TalentE140A 2005: ABCs of TalentA. Team … RecruitingB. Compensation… RewardsC. Culture … Norms2A. Recruiting Key Players in Start-UpsA. Recruiting Key Players in Start-UpsInternalKey issues: When to hire? Experience versus passion and energy? Qualifications versus motivation and character? Founders or Initial Partners CEO and VPs Designers, Developers, “Architects” and Managers of Products & Services Sales and Marketing Operations and Administration Others?External Key issues: How to select? How to manage? Board Of Directors Investors Advisory Boards Professional Services and Suppliers Others?3Q&A with VC John Doerr of KPCBQ&A with VC John Doerr of KPCBQ. What is the most important part of any business plan?A. “I always turn to the bios of the team first. For me, it’s team, team, team. Others might say, people, people, people -- but I’m interested in the team as a whole.”4“The way I attract these people to SOFTBANK is to explain what my dream is. It is not money because they actually come to work and we never talk about payment. They come to work, then a week passes, or longer, then we finally get around to talking about money. I’ll ask them, by the way, how much do you want? And they say, whatever you want to give me. Then I ask them, how much were you making last year? Then I give them the same amount. So they don’t come to SOFTBANK for the money. It’s for the dream that everyone has together. The dream of making the company successful.”Masayoshi SonCEO of SOFTBANK CORP. (Japan)B. Compensation and RewardsB. Compensation and Rewards5Understanding Rewards Understanding Rewards In High Potential VenturesIn High Potential Ventures•Status Often Determined by Contributions to Improving Culture and Increasing the Value of the Company•Hence, Rewards Tend to Be Value-Enhancing such as Stock Options (Employees Have Equity Ownership)6Major Compensation Major Compensation Components in Start-Ups Components in Start-Ups •CashSalary and BonusBenefits•EquityCommon Stock Plans (Incentive Stock Options Have Favorable Tax Rates)Vesting Schedule and Stock BudgetTax Implications (IRS in USA) and Security Laws (SEC in USA)Will Cover in Great Detail in the Bonnie Bryte Case7C: Culture …C: Culture … The Secret to Long-Term Success? The Secret to Long-Term Success? Definition“A strong system of informal rules that spells out how people are to behave most of the time”Two Great Quotes “The most durable asset of a venture is its culture” (Cook)“First four letters of culture spell c-u-l-t” (Collins)8Culture: Major Challenge to Create a Fertile Culture: Major Challenge to Create a Fertile Environment for InnovationEnvironment for Innovation•Develop Sense of Teamwork•Understand Personalities of Key People•Develop Open Internal Communication •Remain Open to Ideas & Suggestions from Anywhere•Be the Customer•Be Willing to Experiment•Include Creative and Unusual People•Address the Issue of AutonomyReference: Collins & Lazier, Beyond
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