Wharton published research showing that Networked Founders will produce the largest profit margins, generate the most revenue growth and are more scalable than traditional start-ups. Think of Uber, AirBnB, Tripadvisor. All billion-dollar companies that have scaled fast because of being Networked.
And it’s not just about ‘networking’. Networked Founders lead with a principle of helping others, creating relationships and building collaborative partnerships, both inside and outside your company. This results in shorter sales cycles, faster product adoption and less customer churn.
For Founders, this is more than a strategy; it’s a game-changer.
So how do you become a Networked Founder?
There are 3 components you need:
- Operational Networks
- Capability Networks
- Personal Networks
Let’s break it down:
Operational Networks
It starts with creating an efficient and streamlined business machine. The networking of your operations, decision making, and teams is the backbone of your business and keeps you agile and responsive. Start by systemizing common processes such as invoice payment or onboarding new team members. Build bridges between departments and teams. Work together on a customer problem. Make sure your leadership messages encourage a holistic approach to problem solving and helps the entire business ecosystem work together.
For example, the sales team of a manufacturing business was getting complaints from customers on incomplete orders and late deliveries. They thought the delivery team at fault. But after investigation, we found that sales orders were placed without inventory in stock. By networking the finance team to the sales team with a daily inventory report, we quickly fixed the problem.
Capability Networks
Don’t go it alone. Seek out businesses that serve your target market but are not your competition. By combining talents and leveraging each other’s resources, you can multiple your capabilities and amplify your marketing. Think about services or products that would make life easier for your customers.
This is what IKEA did with Taskrabbit. They created a network connection between IKEA and Taskrabbit so customers had a flexible and affordable way to get IKEA furniture assembled.
Personal Networks
Your connection with others that sparks collaboration, learning, and personal growth. This is essential for founders to scale their business. Personal Networking isn’t about selling. It’s about exploring ways you can help others by sharing your expertise, knowledge, and creating opportunities. Remember the golden rule of networking, you have to give to receive. Start by reaching out to your team, your colleagues and past customers.
To build good personal networks, you need to listen, ask good questions, and be sure to follow through with any actions and stay in contact.
In summary, a Networked Founder is about focusing on who you serve, whether that’s your team, investors, customers or vendors. If you give excellent service at every level, you’ll create a community of enthusiastic fans and more importantly, your business will scale faster.