How can we in Europe motivate more technical people to take risks as founders?
A pattern I’m hearing worryingly often from seed-stage startups is this: “We don’t have a technical co-founder yet, but we have identified a CTO who will probably join after we close the round.”
Look, I get it: Strong technical people are rare, and they have their pick of different career paths. Joining a startup opportunistically could be a nice option, but why take unnecessary risks in being part of an unfunded team?
Unfortunately, that’s not a great setup. The most effective founder teams are very balanced across all key skills. Taking the same amount of risk at the same time for the same potential future upside is what works best. Anything else could come back to haunt you in the future. Spoiler alert: Things always get tough in a startup sooner or later, and very often you have these old imbalances pop back up at the worst time, poisoning team culture.
It’s also crucial for future employees, investors and customers to see that a technical co-founder is fully committed as early as possible. And obviously the earlier you can start building a technical product, the better.
So why do fewer technical people take risks in Europe? Partially it’s a lack of education and culture at universities. I know from my time at MIT that it’s quite different at the top universities in the US: The young talents there debate startup ideas constantly and take entrepreneurship classes. It sometimes feels like that at ETH or TUM the most important question is whether to join Google, Siemens or a big finance company, while the engineering graduates at Stanford or MIT worry about which of their many startup ideas to implement. Of course that’s a bit of an unfair oversimplification, but not by much.
Entrepreneurship education in Europe has made a lot of progress, but it’s by far not sufficient. Innovation (not just technical invention) is crucial for the success of our economy, so it should be an essential part of any curriculum.
Similarly, business education has to step up its game in making graduates more technically competent. It’s a mystery to me how in 2022 a business graduate can still leave a university without at least solid basic knowledge of programming and data science. Our world is getting digitalized faster than ever. These are not nice side topics anymore, they are at the heart of innovation and therefore business.
An important effect for startups: business-oriented founders who can at least do some technical work are much more effective in the early days of a startup, probably impressing potential technical co-founders in the process.
And technical founders who have some decent business knowledge will be much more comfortable taking risks and effective at building a company.
Originally posted on LinkedIn