In prior posts about my “Founders’ Dilemmas” MBA course, I provided an overview of the course, details about the Introductory case and the cases in the “When to Found” module, and details about four cases in the “Building the Team” module.
This post covers the two core new-venture hiring cases in the course, one of which is part of the “Building the Team” module and the other of which is an end-of-semester synthesis. Both of these cases also focus on serial entrepreneurs, exploring the lessons they learned in their early ventures that they then applied to later ventures. Both cases include co-founder lessons, but focus more extensively on the hiring lessons. For each case, this post provides the official case description, a list of the case’s core issues, and a link to its full HBS Publishing entry.
As mentioned before, case studies are often valuable for helping founders, employees, and investors understand the difficult issues they are facing or will be facing in the future (or even help them gain insights into their past experiences!), so if you want to see any of the full cases, you can get them from the HBS Publishing site via the HBSP links below.
NEW-VENTURE HIRING ISSUES: Whom to hire when, How venture growth changes hiring choices, How to incent and compensate hires
- Case #1: “Frank Addante, Serial Entrepreneur” (HBSP link)Case description: “Frank Addante is a 28-year-old serial entrepreneur who is in the process of building his fifth venture. Of his first four ventures, two were sold, one went public, and in the last he decided to close the venture and return unused capital to his investors. With the passing of each venture, he has learned about forming founding teams, splitting equity with his co-founders, hiring executives to work for him, and when to take outside funding. Now, he’s facing pressure from investors who aren’t happy with how he is building his current team and are questioning whether he should remain CEO.”
Core issues: Lessons learned by young serial entrepreneurs, Hiring “best athletes” vs. specialists, Hiring stars vs. team players, Hiring executives older than you, Working with older co-founders, Splitting equity with co-founders.
- Case #2: “’Lather, Rinse, Repeat’: FeedBurner’s Serial Founding Team” (HBSP link)Case description: “’Is this the right time or is it still too early?’ Dick Costolo wondered as he reflected on the latest acquisition offer. He had been building FeedBurner with his three co-founders for almost four years and was staring at the details of an acquisition offer from Google. He and his co-founders had founded three prior ventures together, each of which had had increasingly attractive outcomes, but none of which had reached their full potential. The number on the table from Google was a big one. Should the deal be completed, it would be the biggest win the founding team had ever had. However, was this the right time to exit? If Costolo didn’t think so, would he be able to convince his co-founders who all had different personal risk profiles? This was going to be the biggest decision in the life of FeedBurner and its co-founders.”
Core issues: Serial founding teams, Lessons learned by serial entrepreneurs, Pros and cons of hiring specialists vs. best athletes, Challenges scaling an organization, Crafting compensation packages, Making exit decisions.
Up next: Cases in the “Beyond the Team (Investors and Other Outsiders)” module