Kairos Global Fellow and multi-award winning Ghanaian entrepreneur Emmanuel Nyame is involved in shaping the startup scene in Ghana through the Startup Cup accelerator programme, while also running DPI Ghana, his management consultancy based in Accra. In this exclusive guest post for Disrupt Africa, he takes us through the ways of putting together a top team for your startup while meeting your organisational goals.
Starting a business from scratch can be very hectic, and what can be more disturbing is having to make arrangements to pay your staff or co-founders paid for their work in your company. This has accounted for the failure of most startups in recent times. It’s not a result of founders not having enough funding, it’s a problem of paying your staff to do the right work.
What if performance does not match the amount being paid? Or the reverse case, where someone is underpaid? It has its own set of problems. Some companies have in the past devised ways of dealing effectively with this issue, whereas others have just managed to bring their business to a standstill.
Whatever the case, every founder or anyone who has dream of starting a business should have it in mind that nobody will actually join the team for free. There might be temporal payment plans, however, certain side benefits such as free transportation and meals should not be denied team workers. How then should any startup owner devise means of managing staff while achieving overall organisational goals?
Each individual wanting to join a startup or SME should note that no employer or startup owner would select or choose any person to join the company without considering the amount of output, which includes the number of hours of work that would be added to the already existing stock of the company. Employers usually look at the quantity, quality and intensity of a potential startup co-founder or team member before bringing him or her on board.
Most tech startups require that you work long hours – even throughout the night – so as to be sure that efficiency is improved upon. The quality of the startup founder has to do with his or her degree of skills, not necessarily educational skills. On-the-job experience also counts. If the individual is not willing to apply a degree of effort to the work provided him or her, they do not become attractive to the company. If all this is satisfied, an individual is well on the road to becoming a potential co-founder or employee for a company or startup.
Ideally, a startup founder can reduce a bit of stress in managing employees in two different ways: equity or employee benefits. The pre-investment stage of a startup is often the period which involves a lot of planning, market analysis, and resource allocation. It also encompasses feasibility studies, subjecting projects to systematic scrutiny and quantitative reasoning. As a result, it’s very difficult to really start paying out co-founders full amounts, which may limit finances that should be available for further prospects of the projects, especially when you’re starting off with your own personal savings.
What is advised is to plan with partners or co-founders and strike a deal to be witnessed by a third party. Talking about equity, the bigger pie could be subdivided between the founders. For example the ideator could have 51 per cent of total equity, whereas other founders could have 10 per cent each depending on the number of partners. The remaining could be reserved for investors, and perhaps family members and friends who may have assisted you in one way or the other throughout the business cycle.
Equity can be subdivided based on the amount of work expected from each person. For instance, the greater the involvement, the greater the percentage. Paying your partners or co-founders by way of equity is one way of ensuring that they provide full undivided attention to grow the business with the assurance that they are actually part owners of the startup.
Another option available to the startup owner is to pre-finance the expenses of the startup team members. This includes covering their meals and transportation on a day-to-day basis as well as on-duty expenses. This is a way of motivating them to give off their best in order to achieve the goals of the company. Mind you, this should not continue for the long-term, but rather only form part of your short-term plan.
Startups provide a very laudable opportunity to create jobs for economic growth in every country. The decision to start a business should have plans for effective recruiting and efficient staff management. The earlier mechanisms are put in place to avoid employee issues the better for the growth of the company.
One way to ensure this is to have mentors assist you from the very outset of starting the business. Such mentors should be experts so that coaching you would not be a difficult thing to do. Let’s create more jobs through startups so we contribute towards the economic growth of Africa.