There’s a time-tested way to build high-performance, high-trust teams. Only hire A-players; it’s a truism that A-players hire A-players while B-players hire C-players (or worse). Hire people better than you are (especially if you’re a CEO) in each functional area to lead those areas. Communicate clearly and openly. Set a small number of clear and meaningful goals (as a mission statement gains items, there’s an exponential increase in how vacuous they are). Keep incentives simple, powerful, and aligned with the goals. Give frequent feedback, whether criticism or praise. Trust, and don’t micromanage.
I write this article from my perspective as a six-time CEO of startups / growth companies after two VP of marketing roles. Four of my startups were funded by top VCs including Sequoia Capital, USVP, NEA, Menlo Ventures, and Redpoint; two have been bootstrapped. But the ideas in this article apply to any leader of any team, in business, government, sports, the military, and more.
So, what about diversity? What role should seeking diversity play in building a great team?
Diversity really does matter in startups and growth companies. The sooner you get a diverse set of customers in your target market to buy your product or service, the better your chance of success. Depending on your pricing model, you may also need a diverse range of order sizes. Celebrate diversity!
Diversity of your team in terms of perspective and background is also to be celebrated. Different viewpoints from talented people lead to better and faster decisions, more innovation, and more fun.
Oh, but what about seeking diversity in your team in terms of demographic characteristics like race, ethnicity, gender, sexual identify, age, being disabled, and so on? There’s a powerful current of DEI (‘Diversity, Equity, and Inclusion’) pervading the culture today. Companies, government, universities, the military, non-profits, and more are pushed hard to embrace DEI. But in reality, DEI more accurately stands for ‘Discrimination, Exclusion, and Intolerance’, or ‘Didn’t Earn It’.
The words Diversity, Equity, and Inclusion sound positive, and as words, they are. But Elon Musk is right in saying that wokeness, which includes the DEI and CRT (Critical Race Theory) movements, is a civilization-destroying mind-virus. There are surely some DEI programs that are harmless or even modestly helpful. But when you look at the actual materials used in many DEI programs, and the incredible dumbing-down of organizations (e.g., major companies, the US military, many medical schools) that embrace DEI, it’s clear that DEI is usually profoundly destructive.
What’s wrong with diversity? Nothing, per se. The main job by far of a CEO is to recruit, lead, and retain a world-class team to implement the company’s mission. The world is a diverse place, and there will be A-players suitable for your team from every possible demographic. Embracing diversity and being inclusive is essential. It’s tough to find great people, so you need to foster a culture in which every team member feels welcome, safe, and valued, to help them perform to their highest potential.
But I don’t see diversity as an end in and of itself. You can make a championship basketball team diverse by recruiting a bunch of dwarves, but that won’t help the team win. You can make a gifted team of neurosurgeons diverse by recruiting clumsy people, but that won’t help their patients.
My view is that you NEVER recruit or hire just for DIVERSITY. You ALWAYS hire for EXCELLENCE. As CEO I always hired for Intelligence, Intensity, Initiative, and Integrity. A tech CEO named Alexandr Wang recently coined the acronym MEI: hiring for Merit, Excellence, and Intelligence. I like it.
I believe that every CEO has a duty to look deeply at himself or herself and the culture he or she fosters, to see if there’s any attitude, behavior, or aspect that is not welcoming to some demographic, or that does not make it easy for people from every demographic to feel included and be maximally productive. You owe your team a culture that nurtures all of its excellent members.
Hiring for excellence doesn’t always mean hiring for the best credentials. There are many people who are heavily credentialed but not really educated. Be open as to where you can recruit excellence. Sometimes the best overall talent will be, say, a software developer who spent a couple of years at a community college while working as a developer, before finishing a degree at a good but not top university. I believe it’s useful and honorable to look for excellent talent in demographics that are under-represented in your organization. If you use recruiters to find talent, you need to push them to send you a diverse set of excellent candidates. But you always only hire excellence.
Consider a simple example, very common with startups. Two or three friends, all white guys, meet in college and later start a company. They’ll tend to hire people they know, who are probably like them. Let’s say they do well with revenues, and / or getting some external funding. Say they are at eight people and need to hire another engineer. They use job fairs, web sites, and recruiters to find candidates, and come up with three. Two of them are also white men, and very clearly A-players. Another is from another demographic, which would add diversity, but is clearly decent but just a B-player.
What do they do? It’s utterly simple: hire one of the white men to add another A-player. Never hire the B-player even if that would make the team more diverse. (To be clear, this example would be equally valid for a founding team of any demographic(s); the reality is that most tech startups are founded by men).
Let’s say that the company keeps growing and needs more staff. This time they look again and find four A-players, two of whom are more white men and two of whom would add diversity (the first woman, the first Hispanic, the first whatever). Since all four are excellent A-players, this is the perfect time to hire for diversity! Maybe the team can even hire two of the diversity-enhancing candidates in anticipation of more growth. It’s much easier to recruit the next A-player woman, the next A-player black person, the next A-player lesbian, and so on, when there’s already one on the team.
Given the vast demographic diversity in talent, there’s a limit to how diverse a small team can be. But let’s say a company really takes off and becomes cash-flow positive, profitable, and successful. When you get to hundreds or even thousands of employees, sometimes it’s tempting to relent on hiring for excellence, thinking that it’s too hard to find great people. First, remember that people’s skills are not static, and working with A-players makes everyone better. Second, great managers know that it’s better to have a hole in a role than to hire a B-player. Always wait to only hire A-players.
What if the company is large and visible and some half-wit HR consultant observes that ‘I was at the all-hands meeting and saw that we don’t employ any one-legged Filipino transgender lesbian dwarves. Shouldn’t we hire some, because, diversity?’ The answer is always NO!
DEI is toxic. DEI is a dreadful gateway to mediocrity. DEI dumbs down an organization, impeding its mission. DEI is inherently racist as it’s focused on group identity instead of individual merit. DEI is an ugly repudiation of Dr Martin Luther King’s dream that people be judged by the content of their character instead of the color of their skin (or the nature of their genitals, the origin of their parents, etc.).
Avoid the lie that’s DEI, and always, always only hire for excellence.
