What Is The Technical Founder Paradox?

Full Transcript Below

[ANNOUNCER]: Breaking down everyday workplace issues and diagnosing the hidden sickness, not just the obvious symptom. Our hosts, James and Coby.



[COBY]: Did we lose a patient?



[JAMES]: No, that’s just my lunch.



[COBY]: Hey, thanks for joining us. I’m Coby, he’s James. And let’s get started with a question. What is the technical founder Paradox?



[JAMES]: Yeah, so this is an interesting phenomenon that I’ve seen play out in a lot of small and medium businesses. not only with our work at Roman 3, but even going back to, like, my economic development days, essentially, the technical founder paradox. It’s a name that we’ve given to the idea that there comes a time in the natural lifecycle for many small and medium businesses where the depth of knowledge and skills that were required to really launch the business and to gain that initial, market penetration and market, share, actually ends up becoming a bit of a roadblock, that keeps the company from being able to push through that next hurdle and continue to grow in scale. There’s four questions or elements that I think would be interesting for us to explore in our conversation. so what is it and how does it happen? where do we see it and kind of what does it look like? what are some warning signs that we can try to identify whether or not we are falling into this technical founder paradox trap? and then ultimately, what can we do about this?



[COBY]: Yeah, and it’s something that. It’s funny because, not that long ago, a few weeks ago, I gave a keynote, and I mentioned this when I was talking about kind of trends in different sectors around retention and, labor attraction. And it was something that I kind of just, you know, kind of brought up when I was talking about the common things that happen in, like, you know, in that. In that keynote, I was talking about like, a high tech, you know, like, ICT, those types of things, saying, this is very common when, you know, very technical positions. The, you know, this, leadership team that is. That creates it can end up becoming, you know, having a difficult time with scalability when the skills that got them to where they are not the skills that they need to get to it, to the next stage. And had a few people actually come. I’ve had a few conversations since then. People have referenced that. And, so it’s funny because, we mentioned it in our last episode, and we’ve had some comments from listeners about that, too. So it’s something that I think, I’m really glad that we’re taking a whole episode talk about it, because it is something that is that people seem to really kind of be connecting with.



[JAMES]: And I want to provide a little bit of clarity because we call it the technical founder paradox. But we’re not talking, it’s not the tech founder paradox. It’s not the, it’s not one specific type of skill set. It is what happens. So we start businesses because we have, from our own expertise right now, I’m talking broad strokes majority of the time. You know, we, we have an expertise in education, in training in human resource management. And so we built a business around that. We identified a market gap. We have m solutions to fill to fix the problems that we see in them in this marketplace, and we’ve kind of constructed our business around that. That is a very natural progression. And how many, many businesses start? A founder or group of founders have a deeper, deep technical knowledge around a particular niche or industry, and they build a business, from the ground up to solve the problems that they’ve identified within that industry. And by doing that, you can, when you’re small and nimble, you’re able to respond and react very quickly. you’re able to use your deep technical knowledge to kind of guide the growth of the company. The paradox that we’re talking about, where that kind of comes into play is once you’re beyond that initial startup phase and the company is growing, you’re adding employees. you’re adding layers or levels of authority within the company. and the founders are no longer required to do a lot of the work. Now, they still have to do a lot of work, but they’re not doing a lot of the day to day, hands on development of product service work.



[COBY]: But not in the weeds.



[JAMES]: They’re not in the weeds. Their responsibilities have grown from having to do everything and deliver their product, create or deliver their product or service to more of a business development leadership growth strategy angle. And the skills that were required that made them so successful in the early stages and got them to where they are are outdated. It’s a m mismatch of skill sets. And now they have. Now they’re in a position where the depth of knowledge that they have is not equal to the breadth of responsibilities that they need to perform.



[COBY]: Yeah, and you’re right. So the term technical, we definitely don’t want people to confuse it with tech, because I think the best way to kind of really kind of flesh out what it is when we say technical founder is, a few podcasts ago, we did an episode about what’s called, like, what skills required to be successful and in there, we talked about the difference between technical skills and employability skills. And when we say the technical founder, we mean that person that is an expert on the technical components of their jobs. But again, that, you know, but like, we’ve seen this in, you know, the hospitality industry, we’ve seen this in the education industry, we’ve seen it in tech, we’ve even seen it in nonprofits. It’s not that it’s about the person that has this, you know, this doctorate of engineering, and it’s only about that. It’s about if someone has a great depth of knowledge in the technical aspects, like the work, the product, the service aspects of an industry. And like I said, create a business to fill that need. And that need is doing well, then they’re, they at some point hit a wall, and it’s in the wall is usually around when they’re trying to scale the business. That the skills that got them to the success they have today are the exact likely skills are going to hold them back as, they try and move up to this. They try and level up the business.



[JAMES]: Yeah. And you, I think it would be really helpful for us to talk about, like, you identified a couple different, places where we’ve seen it. the nonprofit example is always one that I found interesting. There are some really cool ones that we’ve, well, I say cool from a. It sucked for the club, for the in, for the business, because they were struggling. But I think it makes for a, good illustrative point. so this particular example was a community, focused nonprofit delivering, services in the community. That was their intent. If you’ve ever worked in a nonprofit or anything that’s reliant on government funding, then you understand the sheer volume of paperwork that’s involved in the formation and the, accessing grants and reporting requirements and all of the, what I would find mind numbing aspects of that, the administrative requirements. It is foundational and fundamental and so important in the formation of a not for profit that that skill set is absolutely essential. And what we saw was a, founder. The person who kind of kicked this organization off, had a very strong skillset in that they were an excellent administrator. They were able to chase, funding, they were working with partners, they were reporting on it, they were able to keep very busy in making sure that everything in terms of the reporting requirements were handled very, very well. Where they ran into problems was on the people side. Once it required people to deliver services, they unfortunately were out of their element.



[COBY]: Yeah, yeah, I remember, I remember this was executive director, and the executive director was. They knew the services of the sector so well. Like, again, a lot of eds that go into nonprofits, like, you know, if you’re, you know, for example, if you’re, into mental, health services, usually the person has a strong mental health background. They know mental health. Right. And you’re right, you know, and having that, that ability to understand kind of the infrastructural work of a nonprofit. And this person kind of had both the infrastructure role, like, you know, startup administrative pieces down cold, and they had a deep knowledge of the, of the topic, of the services that they provided, but they did not have the leadership skills, the management skills, the, the stakeholder engagement skills that they needed to actually kind of move the organization to reach what its funders and stakeholders had in mind for it. And, and that problematic piece was, you know, they, again, they hit the wall and then they were very, very, very busy every day. But those that were relying on the outcomes that they were supposed to provide were not seeing it because they didn’t have the ability to empower, mobilize and provide it, you know, through, through employees, they, they hit the wall. They couldn’t do any more of it on their own. They needed to trust and have the people to deliver it for them. And they couldn’t maintain this. They couldn’t have employee retention to provide consistency.



[JAMES]: And honestly, one of the biggest problems was that, being used to doing everything themselves and having a very administrative focus, unfortunately led to a tremendous amount of micromanagement, which you’re hiring highly skilled professionals to deliver services and then putting them in a box. And it just, it drove people away. And unfortunately, that’s more common than we would like to admit.



[COBY]: And I mean, and unfortunately, this story has the person being, required to be.



[JAMES]: Being asked to step down.



[COBY]: Yeah, yeah, exactly. And, then, you know, part of the work that we did with them was helping kind of, provide the new, the new leadership and everything else like that, too, to kind of help build the infrastructure for, for that pieces. I mean, that didn’t, sorry. Didn’t have to have a great ending. But it does speak to, I think.



[JAMES]: Well, not every reality is. Not every story has a happy ending.



[COBY]: That’s fair. But I think, though, that what I like about that example is it’s a good way to indicate we’re not just talking about tech rods. Talking about, high science and high.



[JAMES]: You know, I mean, anyone with that depth of knowledge who that technical understanding that technical understanding in one area. And I’m gonna. This probably is gonna sound harsher than I intend it, but it’s a failure to recognize the importance of, the other elements of the job. A leadership like leading an organization, is not about one particular skillset. It’s about a breadth of knowledge you have to. You don’t need to do everything yourself. You should not try to do everything yourself. But you need to know enough about all of the different elements of running and growing a business so that you can be, hold accountable those who you empower to take on those other responsibilities. You need to know enough about marketing and sales to understand, whether or not you’re vp of sales is actually delivering on what they need to do. Same with operations, same with human resources, same with, finances. Or procurement. You don’t need to be able to have the bread, the depth of knowledge to do that job in every, instance, but you need to have the breadth of knowledge to understand what’s happening and make sure that it is, driving the organization along towards fulfilling its goals and strategy.



[COBY]: And what we’ve been talking about till now is really kind of answering that first question, what it is and how does it happen? Because it really is. It really is just that, is that, you know, it’s the m skills that are. That are now needed are not present in those who are in the leadership role, who are the founders, or who are the people that are there, from the beginning. And it really does. And where it really kind of hits home is when we’re talking about scalability. Because one thing that I think we should just kind of clarify first is that, not every business, will hit this problem, because, again, when you’re talking about, you saw this a lot when you were working in economic development. You should tell a lot of stories of some cool small businesses. And I remember, one story always sticks to my mind that I brought up a few times, I think, was when you were working with this, kind of mid sized, bakery, and a really wonderful, woman who was the founder and everything like that, too. And she had no intention of turning her medium sized bakery into a global conglomerate. It was always going to be that lifestyle type business where it’s where she gets to spend her time baking. She still has a lot of the management stuff to do, but she doesn’t.



[JAMES]: Serve the local community. And that’s what she wanted for her business, was something that would allow her to use her technical skill set to serve her community. And it did that very, very well. She means a very profitable business, doing great living.



[COBY]: Because it’s almost like.



[JAMES]: Whats funny. Was it like, anyways, I’ll try not to rant too much, but what was funny was because of the success, she got targeted by all of these, like, every government program wanted to push her to export. Scale, grow, push. And she’s like, no, I’m happy. This is what I want from. And, yeah, totally respect that. Because she identified her skill set. She knew what she was good at, she knew what, more importantly, she knew what she wanted from her business, and she knew when she achieved it.



[COBY]: Yeah, I remember you saying she had difficulty and she. One of the harder things with her was also around the people management side of it. She liked people, but she, she didn’t love being a boss. And it was kind of the part of the job she hated the most.



[JAMES]: She liked people. She hated managing people.



[COBY]: Yes, exactly. So it’s funny because she’s, you know, I know how to. I know how to make muffins and I don’t want to have to, but, I want to have the least amount of people management responsibilities as I can. But she. But she didn’t want to grow and have someone else take it over because she didn’t want the company to get that big. She made a great living doing what she loved and had a great impact on her community. There was a ceiling on how successful she could be with her structure, and she was cool with that, and she wanted to stay on this side of it. And there is nothing wrong with that. And people in those situations, those, And there’s probably most. A lot of them are probably in, that situation, and there’s nothing wrong with that whatsoever. It’s when you’re not okay with that and you want to go past that ceiling and you want to scale.That’s one of the, I guess, reflection points that you need to consider is, am I being impacted by the technical founder paradox? Because scalability is what I want to achieve. So then if. If that’s one of your stated goals, then this is something that you really might want to be thinking about.



[JAMES]: Sometimes we refer to, businesses like that as lifestyle businesses, right? They have created a lifestyle for themselves, and that is they’ve accomplished what they set out to accomplish. And that’s fantastic. But if you, like, you’ve said, if that’s not your intent, if that’s not your, strategy to just create a lifestyle business for yourself and you’re, you really want to achieve that scalability, then you have to be aware of the problems that are going to come if you don’t properly plan and augment your skills and abilities by either. Well, we’ll get into what you can do about it, but you need to figure out a way to make sure that you’re not falling into the technical founder paradox.



[COBY]: So let’s jump into. So where do we see it and what does it look like? Well, I mean, we talked a little bit about where we see it, but it really is about when, when small businesses are trying to grow and me and medium businesses have hit that wall that they, you know, they hit the ceiling and they don’t. And they do want to surpass it. And it’s the idea of often is when, it’s when the founder or founders need you or need to be pulled out of the everyday and need to stop almost like doing the job that they’re technical experts in and start doing more of that strategic, higher level leadership, and often the skills that they may not have built along the way, or they might be very counter to their natural skillset. And that’s where we really do see this.



[JAMES]: It’s not really an employee count problem. We’ve, seen this happen with. I can think of a specific example with a group of founders that were, three engineers, highly, skilled friends through college, decided to start a business together. They, hit this wall pretty hard, around 50 employees, because they built a fantastic product. but it was also like the first job any of them had ever had, college. So none of them had any experience managing people, which caused some problems. Yeah, politely.



[COBY]: Exactly. So, and, I think that probably, yes. So this is the whole thing is that, you know, when the work that we do, the success that we’ve created, we want more of it. And so, you know, so again, this is when we realize, okay, so that first reflection point is, yes, I do want to scale the business. I do want to see how far we can take this thing. But I think the other reflection point that people might want to be aware of, do I need to be asking myself these hard questions? Is, if that’s your mindset and your goal, that’s great. But if you’re in a situation where you’re still small enough, you haven’t built a stability around your work, that you’re still kind of making decisions, not necessarily strategic decisions, about long term success, you’re really just trying to keep the lights on day to day. You’re, making decisions out of desperation or out of necessity if you’re in that situation, and then this is something that you may find yourself in the found the technical founder paradox, but you can’t do anything about it. You don’t have the ability, the infrastructure, the cash flow or anything to kind of take any other approach. Then you, as, then you, the founder or the founders that you’re working with, have to kind of do it all because there’s no other option. The real, so where we kind of say, when we talk to businesses and we kind of identify that we think we’re hitting, we’re hitting. The technical founder Paradox is when they do want to scale and they do have the stability and the infrastructure, the profitability, that they can actually do something and actually start to make those really smart, strategic decisions, to avoid falling into the paradox and avoid their current situation, holding back that big success they’re aiming for.



[JAMES]: And it reminds me of kind of another story that or situation that we’ve seen with a, the, founder of a private school. Who had done, like, I have so much respect for and empathy for these people because they have built successful businesses, like they had. So this particular one, they had started two campuses, acquired two, and were looking at acquiring or building a third, I can’t remember, but they, like, they had hundred or so, teacher staff with them, you know, serving a great, like a good population of. A lot of things. In a lot of ways, you would consider this to be, quite a successful small business, and they were on along a lot, a number of dimensions. But the problem was the founder, while very skilled in the delivery of educational resources, had major tunnel vision, and was unable to really remove those blinders and realize that not only do I now need, like, we’re now managing four and now looking at a fifth and 6th, like they had plans to continue growing. Managing that many sites require somebody who, who’s not just skilled in, as a teacher or as an educator, but as an administrator, as a leader, as a facilitator, like facilitating these opportunities and, resources for the people that they lead. Yeah, sorry, it’s just, it’s a, we’ve seen this so many times in so many cool businesses that, really require just a bit of a. Either self awareness or, some identification of where the problems lie.



[COBY]: Well, this business in particular, again, kind of met those m two kind of reflection point criteria that I mentioned before. They had big scalability, big scaling goals, big growth goals, and they actually had positive revenue and resources, the cash flow, the reputation they had with all the tools they needed to, you know, to do it. But it was, what they weren’t doing was they weren’t taking the time to kind of say, you know, is the skills that got us to where we are, what we need going forward, or do we need other pieces? And I remember this one in particular was really apprehensive that they needed help because the idea of, oh, I got this far. So, why can’t, Of course I could take it further, the way the status quo is working, so why would we ever change? And, you know, and it’s funny if to you listening, this might sound like where you work, and I apologize if it does. but these are the kind of things where we need to realize this is. This is not an uncommon problem. I mean, we’ve seen this. I mean, I say we again, general, most people have seen this kind of, with, like, restaurants, you ever have, like, a really great restaurant that’s like, just killing it and everyone loves it, so they’re like, wow, let’s try and. Let’s try and, you know, open, more locations. And then they do, and then the business completely collapses. Not to say that’s only because of the technical founder paradox, but often the. That scalability goal is they’re like, well, what’s working for us while we’re small? Well, it’ll definitely work for us if we get bigger. And that idea of falling into that paradox where the people that, you know, got you to where you are, are, you know, may not have all the skills needed or all the abilities to get you to the next stage. So sometimes it is something where, you know, you really do need to realize that a lot of businesses that we do see kind of try and hit that next, hit that next level end up collapsing and losing their stability because they didn’t go at it with the right strategic. Strategic intent. So let’s try into some warning signs because, to make sure that. To help people identify, you know, how do I avoid this as we go forward?



[JAMES]: Well, what’s really funny is in every example we’ve talked about so far, one of the biggest negative effects that was or out comes as a result of this, was just absolutely terrible. Retention of employees.



[COBY]: That, is one of the biggest warning signs. You’re right.



[JAMES]: Obviously, we see this very, very frequently because this is the knee, one of the niches that we, work in. Yeah, right. Like with the private school example, They had m huge aspirational goals, but couldn’t hang on to staff and had trouble recruiting people. When they acquired new locations, they would bleed employees. These types of retention problems can be indicative of many very, damaging issues, including this technical founder paradox. it was the same with, the engineering, ah, founders. you know, they had grown the business. they paid well, especially for, like, they were very competitive, within their industry and region. but they had a lot of trouble hanging on to their. Actually, their. Their field staff were okay because they were out of the office. But anybody who was kind of required to have a lot of regular interactions with the founders, did not stay because they didn’t have those skills to be able to manage people effectively. And that was the blind. The tunnel vision. They had the tunnel vision on product rather than people.



[COBY]: yeah, absolutely. So, again, retention, something that, obviously, because the work that we do is one that we see the most, but it’s also. It’s also a significant red flag that, And again, this was part of the talk. The keynote that I gave was. Was why I brought up there, too. But it’s also beyond. But beyond the retention issues is. It’s also. We also see this a lot with stagnating business development. Is that, you know, when you’re not able to, you know, when you’re seeing the difficult times actually, you know, getting, you know, fulfilling your, your growth commitments or, you know, or people are. You’re missing deadlines and timelines often, to be honest, going back to retention because you don’t have the employee base to fill that, but you kind of feel like you cross a threshold, you’re like, well, why can’t. We were able to fill it before? Why can’t we fill this now? Even though it’s more so that stagnating business development can be that the growth side of it is stagnating because you’re just not able to meet your responsibilities, because you just don’t have what’s needed to hit that next level.



[JAMES]: Yeah, that’s a good point. I think the. What’s related to that as well is if there is one division or department that seems to be just carrying the whole company, that could be another warning sign. So if you are, Well, I’ll use the engineering example again, very focused on the technical specs. And, I mean, product should lead. product needs to be important. But if every other part of the business seems to be lagging behind in productivity, in performance, and outcomes. And it just, it’s very, still very focused on just that technical, skill that the founders have. There’s a good chance you are going to hit that wall pretty soon.



[COBY]: Actually that lopsided growth aspect of it.



[JAMES]: Lopsided, yeah.



[COBY]: It is a really, is actually a really great sign too, because like, so for example, if even the product side, if you’re, if you’re like, if your sales are excellent, but your expenses are super high because your support, because your procurement and your supply is, you know, you really haven’t done reactive because.



[JAMES]: You don’t have somebody in that role to be able to dedicate that skill set.



[COBY]: Or if you’re, you provide a great product and you provide a great service, but no one knows about you, you’re like the best kept secret in town, then the idea, maybe your sales and marketing, you know, your marketing and advertising is something that, you know, might be, you know, is a skill set that, that’s lacking. And what’s great about, you know, about being able to have kind of some clear warning signs is, again, they’re just that, they’re roughly, if you’re, you know, you have this one problem, you definitely have this technical founder paradox, but these are the kind of those reflection point questions, you know, are we seeing issues with retention? Do we have lopsided growth? Is our stagnation of our business development happening? Are we trying to scale? And do we have, this ability to actually start to make the effective decisions? Because we have the stability and we have that cash flow and infrastructure to allow us to do it. If all this sounds familiar and comes to mind, this is a really important point for a business. Whether you’re in the business as an employee or whether you are one of the, one of the founders to really kind of say, you know, are we standing in our own way? So I think, it would be wise for us to move on to what can we do about it.



[JAMES]: Yeah. So obviously the crux of the problem is a mismatch in skills, right? So it’s a technical founder with blinders who, isn’t aware of the gaps, or it’s, yeah, it’s that skill mismatch. So there’s a few ways that you can address that. If you want to continue being involved in everything, then you are going to need to upskill your own knowledge. Ah, if you are a solo, ah, founder or even as a team, then your team is going to, you need to, identify and build some skills that are complementary to the technical expertise that you already have developed. I think I used the language earlier of, it’s the difference between a depth of knowledge versus a breadth of knowledge. And I like that because with the technical founder paradox, that depth of knowledge was so important early on, but now you need to take a step back and look at the breadth of skills that are required in order to be successful. Upskilling is absolutely an option there and there are lots of ways that you can accomplish that.



[COBY]: Well, I mean, and think about it too. It’s like, you know, the, what, what the founders have to realize is you’re not, you’re not like, you’re not a teacher anymore, you’re not an engineer anymore. Right. You know, you’re, yes, you still have the license and you identify as that, but your everyday is not that you’re.



[JAMES]: A CEO or a COO or a CMO or a CHRO.



[COBY]: You guess you have a new job and, you know, so what is the skills that you would want, that you would need to hire in that job? That’s what you need to be now. And it’s something that, you know, sometimes it just takes that point of going, okay, I haven’t upskilled myself. I haven’t had time for one. But now, again, if we’re in a situation where we want to grow, we want to grow strategically. We have the structure to allow me, or me and the leadership team or whatever to develop these new essential skills to level up and hit that and hit that, our next goals, then we have to do that. Because, you know, if we just, if we’re too busy to do it, then we’re just like, okay, we’re just hitting the snooze button on achieving our goals. And if that’s, that’s best reality of it, either you take, carve out the time and the resources to do it, or you’re just going to hit the snooze button on your sustainable growth. And I can’t always say it’s that the success will wait for you. If you wait too long, you might miss your window.



[JAMES]: So much about timing is critically important in business. You had a comment in a previous episode when we talked about, where we talked about technical founder paradox that I thought was really good. and I’m going to try to, it was essentially that, along the lines of what you just said, you are no longer qualified for the job that you have. As an engineer, creating, doing the engineering and product development. Yes. As the CEO who is now responsible for all aspects of the business, you may no longer be qualified for the role that you are actually performing, which is, again, it happens very organically and I don’t want this to be a criticism because it really isn’t. There’s, I have a tremendous amount of respect for founders, who are able to grow and build sustainable, ah. And scalable business. It is not flippin easy.



[COBY]: Absolutely. And it’s just more of that, it’s real talk. You are maybe unqualified for the realities of the role. So what do you do about that? Well then if you, if you want to maintain that job, then become qualified. I mean it’s, you know, real talk. That’s, that’s truth of it.



[JAMES]: Now, the good news is that your boss will probably cut you a little bit of leeway while you’re learning the new skills.



[COBY]: So, yeah, so what we do about it, step one, if you want to stay in the job, it’s up skill. Another option. So option two is to build the team you need to achieve those goals. If you don’t have the capacity, the interest or, you know, the time in order to do that, then you’re going to need to get the, get those skill sets to you. So this might look like you know, revising or adding on to your leadership team. Maybe your leadership team needs to be beyond the people that have been around the longest time, you know, and maybe it needs to be about bringing the people in that are going to provide the right, the right insights, the right skill sets. Right. So we talked, we talked about this with like strength based teams. We did an episode, we talked about fit and we outlined kind of different ideas about how the general specialists and everything else like that too. But I mean, you know, if, if you’re people dependent on your growth and scalability, then hiring people, experts to help you do that, if you’re about, you know, if you’re trying to maintain the most effective, you know, cost, for your supply in order to build your products and bringing in experts in procurement and, you know what I mean?



[JAMES]: So you might chain logistics and. So many skills that can be helpful. You need to take a strategic approach to how you acquire them.



[COBY]: Yeah, I mean, it might be weird for you to be like we’re going to bring a bunch of new strangers into this company that we built, you know, 20 years ago or ten years ago, whatever it is, and you know, instead of promoting within, but if that skill that doesn’t exist, if you want to hit that next level you kind of need to go to where the skills are to bring them to you. You might, and you might probably need to pay for it, but the thing.



[JAMES]: Too, is going to have to pay for it.



[COBY]: Absolutely. But the thing too is that this is one of the benefits of kind of the rise of fractional work. You may not need to jump in and hire a bunch of new C suite directors with crazy salaries. You might have a good cash flow, maybe not that good of cash flow, but the idea of having fractional help kind of command in that more advisory role, in that more upskilling role, build capacity internally. Whether your fractional person becomes your CMO or they help you build a marketing team or whatever it is, you know, it’s about, you know, bringing in the skills that are going to allow you to have that strength based approach. You can do more of what you’re good at and you have someone else doing more of what they’re good at and that, and then you have all you need to hit that next level.



[JAMES]: And I like that comment, around using them to build capacity internally. I absolutely love it when companies have a focus on internal growth, on developing their people, that is such a great mentality to have around, skill development, people development, and can be an incredibly powerful retention tool. So if you don’t have the skills right away, a stopgap, fractional while you’re developing your internal, capabilities couldn’t be a really interesting, solution to that.



[COBY]: Absolutely. And especially if your goal is, okay, we can only afford fractional, you know, for the next four years, but if they help you hit that next level, then it’s a matter of, okay, now we can look at permanent people. Whether it’s upscaling people that have been working under these fractionals for the past four years, or whether it’s bringing them on full time or whatever it is, your options are available to you because you, you successfully hit the next level with strategic intent.



[JAMES]: The last one that I want to talk about is, is going to sound kind of weird. But honestly, there’s also the opportunity. If you are a highly skilled technical founder and that’s what you love to do, there’s nothing wrong with stepping back from the responsibility of doing everything and stepping into a niche that you really enjoy. And I remember working with what, ah, stands out for me was a company that we were working with that is kind, of a key component in the supply chain for mining, industry, providing, equipment, and safety, safety equipment, a number of different widgets that are required whole gamut of things. and the, the owner was such an amazing human, ah, being. Anyways, they were hitting this same problem of they were spending all of their time and energy having to manage the day to day operations of the business and they honestly hated that. What they loved to do was to build the relationships, to be out, networking, to find new clients, to be more in that sales leadership role. And what was so great about that project was actually being able to work with the founder, ah, the owner, to put this, the solutions in place, to identifying somebody internally that can take over guiding them, offloading those responsibilities, from the owner to the new operations manager who could run, all of the day to day responsibilities. They were ecstatic because they got a promotion and more money. And ultimately the owner was far happier because he was able to step back from having to do everything and step into what he really loved to do, which was meeting with, which was talking. I mean the guy could talk forever. but he was very, he was very charismatic, he was very personable. And you like the, the networking, the relationship management side was such a natural gifting for him. Yeah. And it was so cool to see that develop well.



[COBY]: And that’s just it is that there are a lot of owner founders that hate their job. And it’s because what got them into the work, because they help, they had to hold on to for, whether it was a self imposed or for whatever reason they’re in, they’re doing the job, not the job that got them into the work or that they, that they built for themselves. They have a job where they’re all the stuff that they like to do is they had to give it to someone else. It’s again, part of it is like, well, I’m the owner, I should be the CEO or should be the president. Like, I mean, like, you know, I’m not going to be an employee in my own company. Like I, that’s not why I did this. But for some people they’re like, well, the different approaches. Well, why, why am I, as the owner, the most miserable person in the company? Why, you know, why can’t I worked.



[JAMES]: For somebody else for 20 years and hated every minute of it, so I started my own business and hate every minute of it.



[COBY]: Yeah, but like if the stuff that you like to do or that you’re good at or that is, or really, you know, is relying on you, then, then stepping away from the stuff that is not and stepping into your niche to allow for you to do what you’re good at, that you enjoy doing, but then having people that maybe work around you or sometimes even above you depend on the structure, but to allow you to be very successful, you know, and very, you know, very wealthy doing a job that you would love doing. Right.



[JAMES]: I mean, it’s not, I mean, your ownership doesn’t change.



[COBY]: Yeah, exactly. Yeah. like we’ve seen kind of some of this in, in hospitality and restaurants too, a bit, you know, where like the founder is, is the chef and they’re, you know, and as they grow, they never really leave the kitchen. They’re still in the kitchen. They just bring on other people to be the general manager and this, you know, they’re still the owner. They still, they still call a lot of the strategic shots, but they’re. But the general manager, they kind of still, they somewhat report to, but at the same time, like, you know, it’s, it can be a bit of a fine tuning act to try and get the right kind of relationship and the right flow going. But I mean, you know, when you have someone that is, is vital towards one component, then let them do that and let other people who have the skills, background, education, whatever it might be, to do all, everything else that you don’t have to be as the owner, be the CEO or be the president, you know, that it is an option to step back and find your niche. It’s not a common one. We don’t see it a lot, but one at least worth considering.



[JAMES]: Yeah, I mean, I think a lot of what we’ve talked about can be summed up by saying that there are a lot of responsibilities and a lot. There’s a large breadth of knowledge that’s required to scale a company. And you don’t have to do it all yourself. There are solutions to it. And if you continue to operate with tunnel vision, then you are going to hit a wall. You will be blindsided by the things that come, from out of left or right field because you’re just moving forward.



[COBY]: Yeah, absolutely. Okay, I think I’ll just do a very quick summary. But, yeah, so the question was, what is the technical founder paradox? Well, ultimately it is for, businesses that are trying to scale, that have, that are in a situation where the founders, the owners that got them to this point being a successful, viable company, their skill sets that got them to where they are might be the skill sets that are holding back their ability to hit the next level. Where we see this, we see this in any business that has kind of that, the technical expertise of often the product or service to kind of deliver, or that has been delivered, and the lack of skills in business operations, you know, people management or other aspects that are essential towards the business of scalability. So again, there’s two good reflection points that people need to realize. You know, is this where we are at? And one of them is, you know, are you moving away from being a lifestyle business where you’re just trying to, where you’re happy with that ceiling and you. And, you want to, and you’re successful as you want to be, trying to move into a scalable business where the sky’s the limit? And are you in a situation where you’re not making decisions of desperation or necessity, where you actually can make the strategic, smart, long term decisions because you have the stability, cash flow, infrastructure or whatever, some warning signs, or if you’re falling into the technical founder paradox is if retention of core operational, positions is a challenge, holding on to good people, if you’re stagnating your business development because you’re just lacking m and missing in the, what’s needed for growth, or if you have lopsided growth where the area that the founder has significant expertise in is doing much better than other departments, and you’re not able to kind of, you know, grow effectively, sustainably, you know, across the board. So what can we do about it? Well, there’s three options. We can either upskill ourselves as the founders to be able to develop the skills and have a larger, instead of having that depth of knowledge, having the breadth of knowledge, to be able to kind of, you know, be able to do all aspects of our work, we can actually bring in the people and build a strength based team to have the expertise around us that allows us to be able to have these essential required capabilities, to perform the functions of a scaling business, or we can step back and find our niche and just do the parts that we really enjoy with our job and other people who have the skills to, be able to deliver higher, the higher level growth and scalability, let them worry about that and let you, as a founder, actually have a job in your own business that you actually enjoy. All right, that about does it for us. For a full archive of the podcast and access to the video version hosted on our YouTube channel, visit www.roman3.ca/podcast thanks for joining us.



[ANNOUNCER]: For more information on topics like these, don’t forget to visit us at www.roman3.ca. Side effects of this podcast may include improved retention, high productivity, increased market share, employees breaking out in spontaneous dance, dry mouth, aversion to the sound of James’ voice, desire to find a better podcast…

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