With more startups sprouting from college dorm rooms every day and gaining small seed funding or taking advantage of crowdfunding resources, these one to two-man companies tend to expand on shoestring budgets. It can be hard for the founders to delegate the proper roles to the proper employees while expanding so rapidly.
This may result in executives and managers wearing an abundance of different hats as they commit themselves to doing whatever is needed to get the company up, running and in the eyes of angel investors or major venture capital firms.
But, Mark Suster of the venture capital and startup blog "Both Sides of the Table," claims that this kind of hectic organization and stressing of the company's leadership sources are more a turnoff to venture capitalist firms than most may think.
To combat this, Suster imparts the advice that the scarcest resource a company has is its management bandwidth. How well a company can use the abilities of its management team is integral to not only impressing angel investor groups and venture capital networks during a pitch meeting, but also maintaining the livelihood of the startup.
"Instagram didn't rush to Android. They also didn't do video. They were truly excellent at what they did do," writes Suster on the patience and focus of high-level startup Instagram.
By having managers and executive focus solely on their high-level roles and positions rather than stretching their energy and attention – or, their "bandwidth" – the company will not only see an increase in productivity and efficiency, but also impress potential investors with its leadership abilities – a major factor – as well as their organization.
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