How Leadership Affects Startups

When starting a new company, “it’s as if you’re in a foxhole together. It’s very intense and very stressful,” observed John Rutledge, ’94 (XP-63), cofounder and president of Oxford Capital Group LLC, speaking at the first annual Chicago GSB Alumni Entrepreneur Conference.

Rutledge was among panelists who discussed factors affecting leadership in an emerging venture during the conference at Gleacher Center February 16. Moderator Damon Phillips, associate professor of organization and strategy and Neubauer Family Faculty Fellow, said his research showed that startups fare better in the short term when the founders share similar career backgrounds.

Panelist Jo Anne Schiller agreed. She launched Everyday Learning, a research–based elementary core program that was later sold to McGraw Hill, with staff who also had worked for her former employer. “I had people who intuitively knew what to do and I didn’t have to tell them,” she said. “That was very important to me,” she said.

Ted Greene, ’93, founder and CEO of Akoya Inc., also affirmed the value of shared experience. He said he’s learned to build a firm from the ground up, valuing the contributions people make. “When you’re in a small startup company, your competition is outside the firm,” he said. “You have to work as a team.”

Other research Phillips outlined found that employees of smaller firms perform better as founders of new ventures, typically making more money and, even when they’re not making money, showing a greater willingness to “stick with it.” Phillips also is examining ways in which day-to-day operation and culture at new ventures are influenced by experiences founders have had at previous employers, and the unintended consequences of this transfer of corporate policies and work routines.

— Jenn Q. Goddu