Podcast without Claus

In this episode of Tech Frontiers, the discussion focuses on leadership and organization in deep tech startups. The co-founders of Startup District Shield, Frederic Nielsen and Elisa Bracke, share strategies for attracting top talent, keeping them motivated, and securing investors. They emphasize the importance of selling the startup's vision and offering opportunities for personal growth and involvement in cutting-edge technology. They also suggest leveraging networks, partnering with incubators, and creating a strong employer brand to attract talent. Overcoming common obstacles includes effective messaging, showcasing the startup's unique qualities, and aligning with values that resonate with potential employees. In terms of keeping the team motivated, the co-founders emphasize the importance of ownership, impact, and appreciation. They suggest regular updates, meetings, and a culture that promotes innovation and accepts failure. Recognizing achievements can be done formally or infor Welcome to today's Tech Frontiers episode where we delve into the exciting world of leadership and organization of deep tech startups specifically. The journey for those type of startups is long and tough. They usually struggle for a long time before launching and generating revenue. That makes it a very interesting subject to bring come key strategies on attracting top talent, keeping them motivated and securing the right investors for a successful startup growth. We have the pleasure to have with us two co-founders of the Startup District Shield, a company focusing on extending Heating Pipes Lifespan, Frederic Nielsen and Elisa Bracke to answer to our questions and we'll also have an exclusive interview with our guest from an experienced startup incubator sharing first-hand insights. So let's get started. Frederic, thank you very much for being with us today. Thank you for having me. Attracting top talent is crucial for any startup, right, especially in the deep tech field where people work together for a long journey before actually being able to launch and it took four years for you, right? Yeah, something like that. Could you share how startups can stand out to potential employees? Yes, for sure. So in my point of view, startups may not always be able to compete with the big tech salaries that, for example, Microsoft or other well-funded organizations can provide, but they offer other kinds of opportunities such as, for example, personal growth for the individual employee and also to get the chance of helping to build something from scratch, right? So it's really about selling this vision to possible future employees of your startup. For instance, to really make clear that they get the chance to work on new cutting-edge technology can be a really good argument for getting good talent into your startup. Also startups can offer roles that provide a broader scope of responsibilities than the typical corporate jobs, which can be very appealing to those very eager to learn and not only looking out for the money. Yeah, that's a great point. And also flexibility in work arrangements and a promise of fast career advancement can appeal to many, I imagine. And what strategies have you seen that are particularly effective? Well, I think some successful startups really have the ability to leverage through the networks and also through existing employees connections and alumni groups from the different universities, especially here at DTU. This is not often used, but it can be a really good way of finding passionate individuals who might be out there looking for new opportunities for personal growth as well. Also a way of doing this is to partner up with incubators like, for example, DTU Skylab or CBS also have the Copenhagen School of Entrepreneurship, where they have a lot of talent that you can try to tap into that is already ready for getting out there in the startup life. And this is a way that you can significantly cut down the recruitment time for you as a co-founder. It's also important to create a very strong brand that really resonates with the values of the talent that you want to attract. This could, for example, be in the ways of being visible and active where your potential employees are. This could be specific online communities, different tech meetups, and it could also be attending events that you can attend to, to really get your message of your startup out. Indeed, the employer brand is key, right? And startups need to be seen as hubs of innovation and learning. How important is it to communicate this effectively? Could you have a few words about this? Well, I think it's pretty vital, actually, to most startups. It's really important to have effective communication through social media with good engaging content and also to be out there physically and participate in different kinds of tech forums. In this way, you can really position your startup as being a thought leader in this field. This is not only a way to attract talent, but it also builds a community around your company's mission. Crafting stories can also showcase your current team achievements and how they've overcome different kinds of challenges throughout the years. You've been trying to build up your startup, and this can really inspire potential candidates to join, to hope to be able to contribute to your startup further. Speaking of challenges, could you delve a bit into how startups can overcome common obstacles that they face in attracting top talent? Yeah, sure. One of the major challenges that I see as a co-founder is to simply get the word out about opportunities in your startup in a way that really cuts through the noise, because obviously other startups also want to attract top-tier employees for their startup. Startups really need to be strategic about how they message and really ensure that it highlights what makes their company unique and a really good place to work for the potential employees. This could be in a way of using, for example, video content to give a behind-the-scenes look of your daily startup life. Let's say you have an office and you want to show how you're working together in your own small community. It could also be to share testimonials from current employees. This could make a more substantial impact in my point of view than just the traditional job postings on, for example, LinkedIn or some of the other posting sites. It's also very important to align with values that resonate with today's workforce. This could be such as what are people looking at or looking for when they are trying to go out there in the real world and get a job. This can be in the way of they're looking for places that are very sustainable. It could be places that are diverse, inclusive, and also have a good work-life balance. They could have the opportunity to work from home if they want, and all these kind of different metrics that you could use to really lure new employees in to make your startup very attractive to them. In that way, you can say that some of the work environment has changed. It's really not just about the work that they do anymore. From, let's say, in Denmark, it's often an 8 to 16 job that you have. It's also about the work environment and what kind of soft values does your startup represent and what do we want to offer the employees. Yes, it is clear that attracting talent with limited resources is less about competing on salaries and a little bit more about leveraging unique opportunities for growth and the ability to make a significant impact. What final piece of advice would you give to startups looking to attract and hire the right talent? You've said so many things, but a key central thing that you would say? I think it really comes down to just being authentic to yourself and also to the startup's values. You don't want to hire some candidates in that's not aligning, even though they're very talented. If they're not aligning with both you and the chemistry is not good, then it's probably not a good match. The candidates you want to attract really have to resonate with your vision of the company and also with what kind of team that you want to develop. In my point of view, when a startup's leadership is really committed to its mission and its people, I think it naturally attracts like-minded individuals that want to help you with that vision. It is true that although authenticity and commitment are key in many fields, they are even more important and central for startups. Thank you very much, Frederik, for this insightful interview. I think that gives to our listeners a comprehensive overview of how to attract talent when resources are tight. Now we can go on with the second co-founder, Elisa Bracke. I have a few questions for you about how to keep a strong team, because once the talents are on board, keeping them motivated can be another challenge for such a long journey. With the very fast-paced and often high-pressure environment of startups, I wanted to know how you, as founder, ensure the team stays engaged and driven. Motivation in startups often comes from a sense of ownership and being part of something significant. It's important that everyone feels that their work is having an impact on the startup and that they feel appreciated. For example, you can keep your team updated, showing how their efforts are contributing to the company and to the company's milestone. In this way, you can reinforce their feeling of being part of the company. Another thing you can do is meeting them weekly or monthly so that they can share their progress and see how their work aligns with the company's goals. This is usually a very effective way to make them feel involved and motivated. I would say this could be a good way to do it. Transparency is a very important theme here. I was curious about the role of culture in fostering this kind of environment. Transparency is absolutely important, as well as the culture of the company. This is another key aspect for employees and collaborators. For example, a company culture that promotes innovation, accepts failure as learning, and also supports the risk-taking can keep the motivation of the employee high, but not just of the employees, but also of leaders. It's also important that leaders behave as a role model. For example, when a leader openly discusses lessons learned from a failure, this sends a powerful message that it's okay to take risks and make mistakes, because they are actually a valuable tool and they're part of the learning process of a person. Absolutely, it's very important. Recognizing achievements seems to play a very big part, right? Because as you don't receive revenue from the beginning, you have to keep them motivated and recognize their qualities and their great job. But I wonder, how can startups implement this effectively? Yeah, you can recognize the achievements, both formally or informally. There are many ways to do it, but it's important that you do it consistently. For example, you can just do some small actions, like you can shut out in a team meeting, or you can send emails praising a job that is being well done. So, anything can boost the moral and the key. So, it's doing it consistently. But it's also true that when startups are bigger, then it becomes a little bit more difficult. Yeah, and in this case, do you think equity or profit-sharing schemes are effective in this context? Yeah, I think so. The reason is that it's very motivating, because the employees feel that they are part of the company and their interests are aligned with the company. And so, this means that they aim strongly to the success of the company. And by having a stake in the company, employees feel more responsible for the outcome of their work. So, yeah, I would definitely recommend having a stock pool for employees. Thank you. Thank you very much. That's a good point. And besides these internal strategies, how should startups handle external challenges that may affect team motivation? I don't know, market downturns or competitive pressures. Do you have any examples? Yeah, I think this is a great question. I believe it's fundamental for startups to communicate openly and also in a transparent way about the external challenges. And leaders should discuss these issues and the strategies that they are implementing so that they can deal with these problems outside. And if they do it openly with their team, it can really help to maintain trust and transparency. But not only this, because it can also involve the team in the problem-solving and can be highly motivating for the employees. But at the same time, this can be very insightful and inspiring for leaders. That's my opinion. So it sounds like motivation is less about perks and more about emotional and financial investment in the company's future, right? And could you say a few words about how startups can maintain this balance as they grow? Yeah, I mean, in my opinion, maintaining these motivational strategies can, as I said before, become more challenging when a startup scales. But anyway, it's crucial to stick to the core values of the company and keep the team values intact. So an option in this case can be to regularly revisit and maybe update the company's mission and values. And when doing so, taking some input from the team and employees can help everyone to stay aligned and motivated. So also when the company grows, it's important to keep the communication open and to continue promoting a culture where everyone's voice can be heard and everybody feels appreciated and in a safe environment. Yeah. That's a good look at how to keep a team motivated. Thank you, Elisa, for sharing this interesting advice. It seems clear that building and maintaining an engaged team requires thoughtful, ongoing effort and a deep understanding of what drives people finally. Thank you. No, thank you for having me today. It was a pleasure to be here. Frederic, we come back to you. I have a few questions about attracting the right investor. How should startups approach this? Well, I think in my point of view, startups really need to look beyond, what can you say, like the monetary capital and also try to find investors who can add value in other ways. This could be whether that's in the industry experience kind of way or also looking into networking opportunities or different kinds of operational experience to help really the startup get moving. Essentially, what you're doing when you get an investor aboard your startup is that you are trading money with some of the equity in your company, which ultimately means that you are giving out some of the control over your startup. So it really starts with understanding what specific investors look for in a startup to find the right investor for you. For example, some institutions might prioritize innovative technology, while others might be more interested in a proven business model or a strong management team. So I really think aligning your startup strength with an investor's priorities is the first crucial step to find the right mix. So it's about alignment, right? How do startups demonstrate their potential to these investors? Because when you're an early stage startup, you don't have many means or many proofs of concepts, right? So do you have any advice about this? I think it's really about having clear and concise communication of your business model, also of your growth potential, and ultimately of the technology that you are providing. The startup needs to not only show why their product is unique, but they also need to show how their product fits into the market at a scalable level. So a compelling pitch deck that not only highlights the product, but also provides data and metrics on, for example, market size, custom acquisition costs, and what kind of project growth that you have is also very important to really perfect. Okay, and still in this, a little bit of a similar question, but given the competitive nature of seeking investment, how can startups stand out in the crowd? I would say one effective way is through having some sort of proof of concept, and also to show traction. Investors are more likely to put their money into a startup that has already demonstrated some level of market validation. So this could be in the form of having early sales figures, having some kind of revenue. It could also be having a lot of positive customer feedback, maybe even having a pilot customer that is actually using your product and spreading the word out about how good your product is in some kind of strategic partnerships that really shows that your business has begun gaining some good commercial ground and traction as well. And what about due diligence? Is that very important from the startup's perspective? I would say it's almost crucial. Startups really need to do the due diligence on having potential investor support, because as I mentioned earlier, you really give out some of the control of your startup if you are handing out some equity to a potential investor. So you really need to understand what kind of track record does the investor have, how much do they want to involve in your startup, and also in what kind of way do they contribute to other startups. That's really essential to me. This can not only help avoid misunderstandings later on, but it can also help you in picking out the right investor, because it is like a marriage that you get into with a specific investor. So for instance, knowing whether an investor prefers a hands-on approach or whether they provide different kinds of strategic introductions can really influence not only who you should approach, but also how you manage those relationships. Okay, and what would you say about the timing of seeking investment? How critical is this, and how should startups invest their time on this for their investment rounds, I mean? I think the timing can really be everything. Let's say, for example, that you had a startup back in 2021 where the valuations for the normal startups were very high, and investors were really pooling cash into a lot of different startups at very high valuations because of the macroeconomical kind of conditions that you have in the overall society. You had very low interest rates, so the whole investing environment now is much more harder to get an investment in compared to, for example, three years ago. With that said, you should only seek an investment when you have enough runway to choose from, to choose the right investors, and not just the first ones who show up on your radar and want to give you money for some of the equity in your company. This can really be done by planning and starting different kinds of conversations before the money in your company runs out. It's also about using your different kinds of key milestones. Seeking investment after achieving a significant milestone can really result in getting a better valuation and hereby also getting better terms. Thank you, Frederik, for this view on how to strategically attract the right investors. This guidance not only helps startups to know how to secure funding and get organized chronologically, for maximizing their success, but it also gives some insights about how important it is to keep a very strong relationship with investors and mentors.