The first thing you need to know is that the team you hire to run a corporate-backed startup is inherently different from the team staffing the corporate innovation department.
- Corporate innovation teams identify new growth opportunities, strategise to turn ideas into ventures and get different corporate departments and stakeholders on board.
- Corporate startup teams focus on everything that happens after, e.g. launching, developing and scaling the ventures handed over by (or co-created with) the corporate innovation team.
Although the two share some key traits —passion for innovation, creativity, resourcefulness, etc.— startup leaders are adept at working in small agile teams while innovation profiles know how to get things done from within the corporate maze. Check out my previous post to learn more about how to hire this core corporate innovation team.
We have learned a lot about hiring startup leadership teams over the years, helping companies like Belgian telecoms company, Telenet, find the management for their startup The Park Playground, and I've tried to condense it here. This is who you need to hire, and in what order — as well as some tips on how to check if that non-obvious hire is actually a good fit.
Corporate startup leadership teams typically include three profiles to start off with:
- Chief Executive Officer (CEO) – They ensure everything is in place structurally – the startup entity, financial structure and operational toolset – ultimately providing a strong foundation to grow.
- Chief Product Officer (CPO) – They set out the product vision and continuously validates it with real customer data. The aim is to build lifetime value in the offering and reduce development costs.
- Chief Marketing Officer (CMO) – They focus on acquiring new customers, validating new value propositions with customers, and setting up automation systems for greater efficiency.
These are big titles, but it won’t seem that way in the beginning when the company is made up of just these three people. Regardless of the size of the team, these three roles play a fundamental role in the new venture, operating at its core on a day-to-day basis.
In fact, the recruitment of these roles is in many ways as important as the business concept itself.
External startup vs internal innovation profiles
When building your startup team, it can be tempting to appoint a member of the internal corporate innovation team to take the lead (e.g. as CEO for example). At first glance, they can seem uniquely suited to the role because:
- They’re familiar with long-term corporate goals and strategies.
- They know how to attain resources from relevant corporate stakeholders fast.
- They helped come up with the concept, and have a deep understanding of its potential.
In reality, these initially attractive traits can hurt your venture in the long-term. Corporate innovation team members aren’t used to working with small groups, in an agile environment, where there is zero structure. They’re used to bigger corporate environments, making startup life a bit counterintuitive.
For example, let’s say some new validation data has come in, suggesting a pivot that doesn’t really align with the corporate strategy. An internal corporate person might shy away from the change or compromise in a way that might hinder growth for the new startup.
External startup leaders, on the other hand, are 100% focused on making the new venture profitable. Their experience in the field makes them adept at finding creative ways to make the pivots needed while still proving to the board that the venture is profitable and worth their continued investment.
One of the key ways to ensure the success of your startup leadership team is by setting up a venture board. This type of board usually consists of corporate stakeholders or sponsors that meet with the venture team regularly to provide strategic advice or guidance.
They operate as an added layer around the team to help ensure their success — linking the startup to the parent company and leveraging corporate assets quickly and efficiently.
The recruitment process
The recruitment process for corporate startup teams vs corporate innovation teams is quite similar with one key exception: the innovation challenge that we ask candidates to complete.
Challenges presented to corporate startup leadership profiles should always reflect their day-to-day tasks (e.g. designing product/service roadmaps, acquiring first customers, creating an operational structure etc.). Challenges designed for corporate innovation team members, on the other hand, measure skills like exploring new areas for growth, early concept validation, product design, etc.
In the case of startup leadership profiles, the ultimate goal of the challenge is to get a sense of:
- The candidate’s long-term vision for the venture.
- The goals and strategies they’ll use to get there.
- An initial roadmap with a rough timeline and milestones.
At Bundl, we let our candidates tackle challenges remotely and send them back within a predetermined deadline. Top-performing candidates are then invited to pitch their ideas in person, enabling us to get to know them better.
The results give us a pretty accurate idea of the experience, proficiency and understanding that each candidate has in specific areas like scaling a venture or creating a customer journey.
Recruiting a CEO for The Park Playground
In 2017, Bundl joined Telenet (one of Belgium’s biggest telcos) and 9.5 Ventures, in a collaboration that led to The Park Playground, an entertainment park that offers free-roam virtual-reality adventures.
The venture reached profitability within six months of its launch and has since expanded to six locations in Belgium and the Netherlands. This is due in large part to the stellar leadership of CEO Philippe De Schutter.
Recruiting Philippe to take on the CEO position wasn’t an obvious choice at first glance, considering his background as Country Manager for Uber Eats in Belgium. After all, what does virtual reality entertainment have in common with an online food delivery platform?
After assessing his challenge results, I quickly realised that Philippe had a plethora of skills and traits that made him perfect for the position. This included a strong entrepreneurial drive, tech skills and most importantly, the ability to successfully scale a venture (which he had already done at Uber Eats).
The challenge we assigned gave us a good understanding of how our candidates envisioned the business case, the future of the venture, the offering and the team they would lead. It all came down to three top candidates, one with experience in scale-ups, one with expertise in VR and Philippe with his own successful track record.
In the end, it was unanimous, with Bundl, Telenet, and 9.5 ventures all agreeing that Philippe was the right person for the job.
Here are just a few of the qualities that put him at the top of our list:
- Exceptional leadership, business and entrepreneurial skills.
- A proven record successfully scaling a venture and carrying out a long-term vision (e.g. Uber Eats).
- Enormous drive and passion which made him a great fit for the Telenet culture.
Here are a few tips from my own experience building and growing corporate ventures that I believe will help you select the right leadership team:
- Start with the CEO - They should be the first hire so they can take the lead in hiring the rest of the team.
- Provide incentives - The right incentives will help ensure long-term commitment to the success of the new venture e.g. KPI driven bonus models and equity shares.
- Timing is everything - Hire your team after you validate your MVP, but not too early in the discovery phase. By that time you should have clear goals and a set direction to shape the job descriptions.
- Start small - Leverage your internal resources and external partners for the first part. They’ll give you the flexibility you need to change direction and adapt quickly if required.
- Ensure a smooth transition between the initial team and any new hires. Proper knowledge and leadership transfer are critical to the long-term success of a venture.
An excellent way to start is by envisioning the kind of company culture you want to create, the goals you want to achieve and the resources you’ll need to get there. Choose your candidates based on the growth path they see for the new venture as well as the support they’ll need to get there.