Common Traits I Love in Founders as Entrepreneurs [Part I]

[This blog originally appeared on Ted’s Take on February 6, 2012]

Since 2006, I have been backing entrepreneurs in building their companies. I’ve done this as an angel investor and a venture capitalist; as a mentor, advisor and board member.

I love Founders: I love what they create for our economy, and how they build value and create jobs. One thing I enjoy about working with them is that it gives me a seat at the “table of the future.”

Last year, I formalized my investing practices and efforts by joining Steve Case and Donn Davis in creating the $450 million Revolution Growth fund. Its focus is on a new category of investing that we call “speed up capital:” we look for companies that are established and growing, but need “rocket fuel” and guidance to take off for even loftier aspirations. Our first investment is in a Washington, DC-based company called FedBid. FedBid represents what we are looking for in an investment: a high-growth company that can help transform an industry—doing well by doing good. We also like FedBid because we believe it can scale to much greater value by growing into adjacent opportunities and new markets, via our investment, our participation on the board of directors, and our work advising management.

I have been gaining perspective on what makes for great leadership and the traits that founders share in developing high growth, high value enterprises. I also know why I fall in love with these companies. Here are a few points to consider and perhaps emulate if you are a founder or working in a start up company.

As you would expect, personal traits and business leadership traits are intertwined. Sometimes “betting the jockey, not the horse” is the right way to invest. It is very infrequent that you will find a great company without a great founder as its CEO or Chairman.

Here are a few common traits that I see in the best entrepreneurs that build value (with more to come in a subsequent blog post):

  • Unique vision and point of view… and the ability to sell it to all constituencies: This seems pretty basic, but the ability to articulate a big, new idea (and a new way to enter a big market) is critical to outlining the higher calling of the enterprise. Knowing how to do that, as well as how to get big fast, and how to radically change or improve on an obvious need to build value, is a rare art. Vision– communicating and creating a strategy that is much bigger than what is initially seen in the first set of products or apps — is something I look for as priority one in an investment. Being a stone cold, confident evangelist for your company is something I enjoy seeing and want to invest in! I love hearing new vocabularies and a new perspective on businesses and problem solving. Having a much bigger agenda than what is first represented by the initial in market product is what drives world class founders.Andrew Mason of Groupon, is an example of a CEO with vision and a higher calling – traits he has had since the first day I met him. He built great value, took the company public and has created a major new category of industry: “Curated real-time social commerce.” He created more than 10,000 jobs in fewer than five years. He has his own voice, his own perspective: it is original and his vision is being rewarded. I am proud to have been an angel investor in Groupon and to serve on its Board of Directors as Vice Chairman.
  • Execution: A maniacal focus on execution is critical. Execution of product based on platform and/or scalable technology is often times the big value generator for new businesses. Being technically astute– understanding architecture, underlying technology, being able to code or lead a team of coders, having an intrinsic feel for the products themselves – is critical to understanding the big picture of what is being built so it can scale if it hits. These qualities are major points of differentiation for good versus great next generation business leaders, in my view.Hooman Radfar at Clearspring Technologies is a good example of great execution. He is a data scientist and engineer at heart and by training. He designed a platform for the social web before social was “cool;” this platform has scaled to accommodate more than 1 billion unique visitors around the globe on a monthly basis. The platform was executed well by Hooman and his team; it has now spun off many products — and those products and services are now generating fast growing revenue streams. The execution of the platform and tech strategy is building great value for consumers, for publishers, for employees, and investors. It was no small technical feat to build what Clearspring has developed and delivered. The founder’s force of will and ability to execute has made all the difference. I have served as Chairman of this company and now am on the Board of Directors; I am also a proud investor.
  • Real life expertise — and the ability to connect the dots: The best founders and CEOs have deep subject matter expertise and can connect product, technology, marketing, positioning, sales, customer support, business model, and corporate development matters.A good example is Rick Allen, founding CEO of SnagFilms. Rick grew up in the entertainment and legal fields; learned a lot about technology later in his career, and has been building SnagFilms as a leader in a new market. Rick oversees and leads content acquisition; works with filmmakers; and is deep in sales, product, technology, editorial, marketing, and fund raising. Rick is as comfortable in banking meetings as he is at the Sundance Film Festival; he has intellectual curiosity; he is respected by ad sales executives and by platform architects; he connects the dots for all; his mental and emotional agility are great traits that are adding tremendous value to the company. He knows a great deal about each subject and can lead and mentor young employees as the company grows to become what one trade publication called “The Netflix of Indy films.” I am Chairman of this company and the largest shareholder.

These are just a few of the traits I believe are important to look for in a great founder.  Stay tuned for more traits in my next post.


Ted Leonsis

Ted Leonsis is a nationally renowned entrepreneur, investor, and business-builder. He sits on the board of directors of several leading companies ranging from American Express to Groupon.

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