“Our technology is so brilliant that it will sell itself. Maybe at some point we’ll hire a sales guy who can take care of phone calls and paperwork.”
“Our business idea is amazing, and we really know how to sell it. Building the product is the least of our worries. We’ll just hire an outsourcer in Eastern Europe to do it for us.”
As an early-stage startup investor, you hear statements like these frequently. The first kind is uttered by some purely technical founder teams, the second one by some with an exclusively commercial background.
Of course both statements are dangerously naive.
Psychologists call it the Dunning-Kruger effect: The bias to think that you know more about a domain outside of your expertise than you actually do, and to underestimate how skilled actual experts in that domain are. We have all experienced it during the pandemic: Suddenly everybody was a self-taught epidemiologist.
This happens in the startup world all the time. Tech people think that sales and marketing are trivially easy. Commercial people think that engineering is just a mechanistic task for nerds. Founders think VCs have it easy, and some investors think that founders should just work harder, and success would immediately follow.
I have been lucky enough in my career to work on both the commercial and technical side, as a founder, hired executive and investor. And I can tell you from this experience: All these jobs are very, very hard if you want to achieve mastery. And all these disciplines tend to underestimate how hard other jobs are.
Of course it’s quite easy to dabble a bit in a different domain. A smart engineer can rapidly pick up a bit of finance knowledge. But that’s very different from the magic that an experienced CFO can do. A clever marketing person can learn a bit of Python and automate some stuff. But that’s a different planet from building a scalable tech product like an expert engineer.
Trying to acquire some additional knowledge from other fields is great, but it doesn’t mean that you are anywhere close to mastery. We should all learn to respect and admire our colleagues from different disciplines for the specific skills they have, most of which we will never even understand.
When experienced investors judge startup founding teams, they look for two important factors: Do the members of the team cover all necessary domains with enough skill and depth? And do the founders deeply respect each other and each other’s skills? Anything less is setting up a startup for failure.