What’s Different About Leading Startups?

https://triplecrownleadership.com/whats-different-about-leading-startups/What’s Different About Leading Startups?

Interview with Stephen Von Rump 
Co-Founder and CEO, Giraff Technologies
Leaders Speak Series 

Stephen Von Rump is Co-Founder and CEO of Giraff Technologies AB. Giraff brings people together in the care of those living at home (e.g., the elderly). Giraff allows you to virtually enter a home from your computer via the Internet and conduct a natural visit by moving a robotic device with a video screen. You can move freely about the home simply by moving your mouse, and interact with the people there via videoconferencing. Those in the home don’t have to do anything.

Von Rump has extensive consulting experience in startup and turnaround organizations, and has also held various R&D assignments at MCI and AT&T Bell Laboratories. He has served as the CEO of Be Here Corporation, Metreos Corporation, and VTEL, Vice President of MCI’s data and Internet services business, and co-founder and General Manager of internetMCI. He has spent much of his career in Internet communications, including the launch of numerous audio, videoconferencing, and streaming products and services.

He and his wife Paula relocated from their home in northern California to Västerås, Sweden to launch Giraff Technologies. The company moved from Silicon Valley to “Robot Valley” (an enclave of robotic startups in Sweden) to enter the Scandinavian market as its beachhead.

Here are excerpts of our interview with Stephen Von Rump for Triple Crown Leadership:

How would you describe the organization’s leadership approach?

Von Rump:

My leadership style is really pretty simple: lead by example.

We are a small company right now. There are just four of us plus some various part-time people who come and go. I’m able to have direct daily contact with everyone. More than anything, they pick up on my cues for whatever it may be: passion for the application, the market that we’re going after, intensity of going after the results, passion for customer support, a sense of urgency to get the next production run finished.

Whatever the task is, more than anything they’re watching me and looking for my cues. So I try to make every interaction with the team meaningful. I try to advance the ball in some small way in every interaction by getting them to adopt those same values and take them as their own and push the ball forward themselves.

What are the most important results that Giraff strives to achieve?

Von Rump: There is a short-term and a long-term answer to that question. In the short term, for a company at our stage, right now we are striving to build our products, our “Giraffs,” get them out in the field, and sell them to customers. So we’re trying to grow the business, not just from a revenue point of view, but also in terms of gathering knowledge. We’re trying to gather experience in the market and see how various organizations and users use the Giraff and how they react to it.

There are many, many details that are required to make that happen. There’s development work, production work, marketing work, but the overall goal is to get Giraffs out into the world.

How about longer term?

Von Rump: In the long term, our goal is to be part of what we believe will be the future smart home: a home that allows elderly and others being cared for at home–but primarily the elderly–to live in their home safely, independently, and with a good quality of life for as long as possible. That’s the goal of this industry, if not a major goal of today’s society, when you think about the aging population.

Our long-term goal is to be a centerpiece of the smart home of the future, and we think we have the road map to do that.

How do you ensure you’re making progress towards those outcomes?

Von Rump: It’s a matter of continuing to drill down on the details, the execution steps, continuing to break them down into smaller and smaller pieces while at the same time keeping everyone’s eye fixed on the bigger target.

I use our weekly staff meeting, for example, as a way to try to pull us back up for a moment and make sure that what we’re doing is still consistent with the big goal. It is very easy for these things to slide off track when you’re stuck down in the details, which is where you have to be on a day-to-day basis. It’s easy to say, but the discipline to do it is rare. You’ve got to take the time on a periodic basis–daily, weekly, monthly, whatever–to pull the team back up above the trees and make sure that we all still understand the bigger goal and are aligned to it–often enough to keep the alignment, but not so often that it distracts everyone from the daily grind, which is what’s necessary to drive a business.

Have there been conflicts between the results imperative and some ethical line or some core value that would potentially be violated?

Von Rump: Yes. Most of the conflicts are what I would call at the tactical or operational level. It’s maybe a disagreement over priority. I make a decision that we’re going to provide support for a particular customer event and someone else may question whether that is really the best use of our time. We have those kinds of operational conflicts on a daily basis.

In a small company, you have the luxury of being able to afford some debate on them because you can all gather in one spot and have the debate and make the decision.

But it’s also important, in terms of culture, that everyone understands when it’s time to align. There’s a time when the debate is over now and this is the decision and then everyone gets behind it. There’s no malicious compliance. Everyone gets behind it heart and soul and gets it done.

They’re not only expected to get behind the decision, but they’re expected to abstract a little bit from that and, when we come to the next similar customer situation, they already know the answer.

Then there are the strategic conflicts that are more about the higher level vision for the company. Those sometimes bring ethics into question.

Giraff had a recent crisis in which we were making a decision about whether to accept an investor deal or not and there was clearly a misalignment amongst the founders about what their real vision for the company was.

There was a fundamental misalignment among the owners about fundamental values and vision. There was a conflict between, on the one hand, the passion for the business and what we are doing for the world and, on the other hand, the financial value. We all do this at some level because we hope to make a lot of money, but I happen to think we are doing something extremely important for the world right now. This was a case where clearly those values came into conflict. There was no common anchor point. The only resolution, unfortunately, was to part ways.

[Von Rump and the new investors bought out the other founders.]

How do you approach it when you’ve got a misalignment?

Von Rump: If the alignment is anywhere but at the most fundamental level, if the alignment is anywhere down the food chain, there is always a higher goal that you can agree on, and you can use that as your anchor point to resolve the conflict. At least there’s a point of agreement that we can start from: “Yes, we agree that the goal is passionate, rabid customer support. If a customer has a problem, we’re going to be all over it. We’re going to swarm to the ball. We agree on that.”

Now, we may have a conflict underneath that about how to deal with a particular situation, but at least we have a common reference point. If you can point to a higher goal, that’s how you resolve it. You start from there and you can resolve the conflict even though the CEO may have to make the call in the end.

Sometimes, though, you have a misalignment of vision that is so fundamental that there is no higher goal that you can point to. That, unfortunately, is what happened in the case of Giraff.

Earlier you used the term “malicious compliance.” Have you faced that here or in other ventures where you had to deal with people who were sabotaging or undermining in some ways?

Von Rump: Yes, there have been situations in which we have agreed that a particular feature of a software release was really important because our customers told us it was, but the developer writing the code wasn’t behind it. He would say, “Okay, if that’s what you want, I’ll do it,” but then suddenly the time needed to complete the release increased by thirty days because of this feature. They say, “Yeah, I’ll do what you say, but you’re going to pay for it.”

What kind of actions do you take to address these situations?

Von Rump: Usually the answer depends very much on the chemistry of the relationship between you and that person. Whenever possible, I try to go straight into it and just say, “Hey, look, I know this was not your vote, but this is what we’ve got to do and I’m frankly having a hard time believing that we are really going to let this thing slip thirty days because of this feature.”

I can’t challenge him on the technical details, so all I can really do is challenge him on the value and say, “Are we aligned that this release is important for our customers?” (Yes.) “So we align that customer support is our number one priority?” (Yes.) “Okay, why don’t you go back and see if there’s another way to do this that will take less than thirty days?”

Have you had to remove people from the organization because you couldn’t ultimately get them to go along?

Von Rump: Yes. It’s especially difficult, because it’s relatively easy to remove someone if there’s an obvious competence issue, where they’re not experienced enough in that programming language or in this particular area of design, whatever it might be. That’s one thing, but the harder thing is when there is a misalignment of values or attitude, because that’s obviously a much softer criterion but, again, you have to.

I think that’s where it really matters: to be quite clear about the objectives and requirements for the organization–whether it is about results or the manner in which we go about achieving those results.

Startups have so many immediate pressures. As a leader, how do you address the tension between the short-term imperatives and the long-term vision? How do you keep the right balance in a startup?

Von Rump: I can point to any number of examples in Giraff and other companies where there’s a conflict between a long-term vision and the expediency of getting a particular short-term thing done (for example, agreeing to take a shortcut in a particular design feature or consciously making the decision to do something that makes the product less reliable or less robust, knowing that you’re going to have to come back and fix it later).

When you’re in conflict, move back up the food chain until you find a common anchor where you can make the decision from. That’s the process, but it doesn’t always mean you’re going to vote in favor of the longer-term goal. Sometimes there are things you have to do to survive in the short term, especially where money’s involved. “It’s going to cost us a lot of money to do this fix right now, cash that we just simply don’t have.” So sometimes you do compromise. “Yes, we agree that support and product reliability are everything. If this thing doesn’t work, we’re sunk. Nevertheless, in this case it’s cash we do not have right now, so we’re going to make the decision and we’re going to put in place all the processes we possibly can to get around it and minimize the impact to customers.”

What are the things that tend to cause those breakdowns, to cause things to stop working the way you want them to?

Von Rump:

In my experience, breakdowns come because misalignment creeps into the business over time, and that is inevitable. The question is what does the leadership of the company, the CEO in particular in small organizations, do about that? The CEO’s job in that case is to realign the team and take that team up to whatever level is required to get that realignment.

In small organizations, the CEO is also an individual contributor and the CEO is also required to be in the mud at times and be focused on very specific tasks.

So, often the CEO is as much a part of the misalignment as anyone else. It’s got to be up to that person to realize it. I think that’s one of the key skills of a leader: to be able to sense that misalignment in the organization even though it may not be directly detectable. The actual problem could be something as simple as who was expected to get a certain task done in the factory or with customer support.

You have to be able to detect those things and be able to sense and recognize patterns that point back to a misalignment of the goals of the company. That’s a treasured skill of any leader to be able to recognize that, especially if you are part of the problem.

Certainly that has happened to me before. I have gotten off in my own little world and forgotten about the rest of the team.

In those instances, did you have a trusted colleague, maybe a senior manager, board member, or investor, sit you down and say, “Hey, you’re taking us off track?”

Von Rump: Absolutely, I’ve had it come from both directions. I’ve had it come from above, from the board, where they say, “Hey, Stephen, I hate to say this, but you might be part of the problem right now.” I’ve also had it come from underneath, from someone within the organization, where someone says, “Hey, Stephen, I just feel like we are kind of flapping in the breeze a little, so maybe it’s time to get the team together and review things.” I’ve also had it done not as tactfully where someone basically says, “Hey, I think you’re screwing up.”

Have you ever been able to get to the point where the board and your senior team were regularly playing this role for the organization—being a steward of the purpose, values, and vision, embracing the stewardship role for aligning?

Von Rump: Especially in a small company, perhaps the single most valuable function that a board can serve is to help pull the CEO out of the forest from time to time, understand that he is also an individual contributor, and that it’s not realistic to expect him to be able to see when things are getting off track all the time.

The single most important thing a board can do for a young company is provide that stewardship for the CEO and help him keep focused on the big picture.

In the case of Giraff, I do not think there’s a single board meeting that we have ever had that I did not walk away from with a feeling of refreshment, of rejuvenation. I’ve enjoyed being pulled out of the forest for a brief time to look at the bigger picture and then it gives me clarity. Problems that seemed so complicated and so much in conflict–should we do this with customer support or should we do that–now suddenly are quite clear. I wonder why in the world we were ever debating it in the first place.

I’ve been in a number of companies in which the board was only able to enforce process: let’s see the financial report, let’s see this report, and everyone does the dog and pony show, but then when it’s done, you don’t really feel like you got anything out of it. I think that is an extremely dangerous situation for a small company.

You’ve had leadership roles both in startups and larger companies. What is different about leading a startup versus a larger corporation?

Von Rump: I think about my own strengths and weaknesses. In a larger organization it’s much easier to plug your own gaps, things that you know you’re not good at. If you’re not a particularly good day-to-day organizer, in a larger organization you can bring aboard a COO who kind of runs the shop and is good at that. In a smaller organization, you can’t always do that.

In a small organization, you’ve to recognize your weaknesses and you’ve got to find a way to manage or deal with them–at least until you can get the right person on board. You have to be willing to go out of character or do things that do not feel comfortable for you.

People sometimes refer to CEOs as outside versus inside people. I’m definitely an outside person. I would much rather be out making deals with customers or partners or investors and so on. That’s great, but it also means that it’s easier for the company to go off the rails internally, and that’s something I have to be very attentive to.

In a startup, you can’t hide behind the organization. You’re “on” all the time, and everything about you is revealed–the good and the bad. Your weaknesses are going to be revealed, so you might as well deal with them.

Any final thoughts about leadership?

Von Rump: For me, leadership is about having a clear vision and being able to communicate that vision clearly to others, so that they become aligned with it and change the way they think and act. That’s what I try to do.



Bob Vanourek and Gregg Vanourek are leadership practitioners, teachers, trainers, and award-winning authors. They are co-authors of Triple Crown Leadership: Building Excellent, Ethical, and Enduring Organizations, a winner of the International Book Awards, and called “the best book on leadership since Good to Great.” Take their Leadership Derailers Assessment or sign up for their newsletter. If you found value in this, please forward it to a friend. Every little bit helps!


https://triplecrownleadership.com/whats-different-about-leading-startups/What’s Different About Leading Startups?

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