Setting Goals for a Startup
Startups Need a ‘Guiding Star’
All tech startups need a ‘Guiding Star’ vision that everyone involved (including customers!) buys into. Otherwise, what’s the point?
When you’re just starting out, competing on product features and functions is very challenging. You need to establish a strong vision for where you want to take your customers and persuade them to go with you on the journey.
But vision alone is not enough — you need to ensure that you’re able to execute on your vision and move as quickly as possible towards that star.
“Vision without execution is hallucination”
This is one of my favorite quotes. It’s been attributed to multiple people from Edison through Einstein and Ford to Steve Case (AOL). Whoever came up with it, it should be top of mind for every startup CEO. If your team doesn’t know what to do to implement your vision, you will fail.
On the flipside, there’s an old Japanese proverb “Action without vision is a nightmare”. If you don’t communicate your vision or get your team to buy into it, you will also be on a path to failure.
However, if you do manage to align vision with execution, you will see many benefits:
- You and the rest of your executive team will find it much easier to delegate, because your team members will have a better understanding of what you expect of them and the direction you want them to generally go.
- You will get a lot more done as a team, since you’ll all be heading in the same direction.
- You will be far more agile.
- Morale will be much better and more sustainable, because your employees will feel that their work is meaningful.
In other words, you will be able to reap all the upside of being a true startup.
So, how do you go about making sure everyone is on the same page? There are, of course, many elements to achieving this, but the rest of this post will focus on setting clear goals for the organization.
Make setting and reviewing goals a part of your company’s ‘heartbeat’
I’m a great believer in having a fairly strict meeting schedule to give your startup a ‘heartbeat’ of regular communication. I’ve found the approach in Patrick Lencioni’s “Death by Meeting” to be particularly effective, with the addition of town hall style meetings a la Google’s now infamous weekly TGIF’s that were recently scaled back after a series of leaks.
I also recommend adding quarterly goal setting and review meetings that follow on from the quarterly offsites recommended by Lencioni. At the end of the offsite, make sure you set clear goals for the organization for the coming quarter — and then make sure your exec team follows through with their own team members so each ends up with a set of goals that flow from those of the company.
The end result should be no more than 3–4 layers of goals (e.g. company, department, individual) that link together in a pyramid structure so everyone can see why they are being asked to do something. Each layer should involve no more than the classic 7 plus or minus 2 number of goals.
Set different types of goals
In a startup, it’s especially important to differentiate between long and short term goals so that your team keeps their “eye on the prize” of the long term vision and understands what they need to do to keep moving towards it, while also having clarity on what they need to do in the short term to keep the lights on.
It’s also vital to highlight volatile goals that may change, since nothing hurts morale more than someone feeling as though their work was wasted — especially when they don’t know in advance that the goal might become redundant. A common example in a startup is when some of the team is working on a proof of concept or feature for a customer that doesn’t ultimately go ahead with the project. It can feel like everyone is being jerked around and that their efforts are being wasted or unappreciated. However, if it’s clearly communicated upfront that the goal is volatile because it’s dependent on an external decision, people will be much more understanding when the goal is changed or cancelled — especially if they are kept up to date in the meantime.
Here’s an example of how this might work for my own startup, Geminos Software:
It’s easy to see how company goals feed into department and individual goals. You can also see the dependencies between the goals for Engineer1 and Sales & Mktg. The volatility is caused by the fact that we can’t control the closing of a pilot. Engineer1 might spend a fair amount of time assisting sales with the pilot for ABC, Inc only to find that they decide to go with a competitor halfway through the sales cycle. It’s obviously helpful if the dependencies and volatilities are explicitly understood from the beginning.
Making sure that vision and execution are aligned is critical for any company, but it’s particularly important for startups — and it won’t happen by itself, especially as you grow. Put the effort into setting, communicating and reviewing clear goals for the entire organization. It’s not always easy to do this as a CEO, given all of the myriad other things you need to do, but the payback in the longer term will be huge.
About the Author
Stuart Frost has 30 years’ experience in founding and leading successful data management and analytics startups. He has raised over $300m in funding and founded/co-founded 30 startups. Successful exits have included IPOs and acquisitions, including one by Microsoft.
In the last eight years, Stuart has created and incubated some of the leading companies in the IIoT market, including Maana (IIoT knowledge platform), OspreyData (oil and gas analytics), NarrativeWave (wind farm analytics), ThinkIQ (food traceability) and SWARM (AI agents for IIoT). During this time, he saw the market go from its very early gestation to the point where major industrial companies are starting to make significant, long term commitments to digitization. Through this unique experience, Stuart has developed deep knowledge of the market’s needs and how to successfully create and sell key technologies to meet those needs.
His latest company, Geminos Software, has created a platform that is designed to improve productivity of developers building AI-driven analytics by 10X.
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