Gregory Shepard breaks down startup org structure into four functional areas: service delivery, sales and marketing, operations, and product/engineering. Align roles to your KPIs and valuation drivers, and hire only what your stage requires, starting with a founder, product person, and engineers.
Chapters
I wanted to give you guys some input on functional areas. So oddly enough, as silly as it sounds, a lot of entrepreneurs have issues deciding what org structure they should have. The logic with an org structure isn't looking at somebody else's org structure or thinking about what is the common ways things are done. That's incorrect for a startup. What you have to make sure is that the people by functional area have alignment To the KPIs, and also, and more importantly, to the valuation drivers. So, if the valuation drivers are growth, margin, and retention, you have service delivery. These are the people that are working on service and support, and that's retention. And you have sales and marketing, and that's growth. And then you have shared services, which is like operations, and that's margin. And product engineering goes through all of them. So, those are the 4 functional areas that you need to work with. Now, you don't want to launch them all at once. You only need what you need at the stage in the lifecycle that you're at. So if you're an early-stage startup at vision or pre-seed or seed, you only need the founder, a product person, and your engineers. If you're working on a services company, technology-enabled services company, or a SaaS company, you want to focus on getting your product down first. And I would highly, highly recommend that the product person is the voice of the customer. It's easy. Easier to train somebody to be a product person than it is to teach somebody an industry. I hope this helps.
