Question 1. Consider the entrepreneurial team that Jim brings together. Can you identify some guiding principles in team member selection? Assess how well Jim has done in assembling a suitable team.

From the case of Ockham, it can be discovered that there are several guiding principles in selecting members of the entrepreneurial team.

First of all, the team members should respectively be expertise in different aspects of the business. For example, in the case of Ockham, Jim Triandiflou has degrees in marketing and MBA, and he was to be the CEO, handle sales and marketing – all the “outside” stuff. Ken Burows with a background mixed both technology and finance, was to be the COO, handle the “inside” stuff like engineering, finance, and human resources. Mike Meisenheimer, who Triandiflou and Burows thought “had domain expertise in sales management and could thus be in charge of defining product specifications”, was going to run product management. Moreover, they had worked together at The Alexander Group, so they knew each other’s working abilities well. That is important to ensure the composition of the team, also mentioned in the “Three Rs” principle as Roles. The roles that each team member plays had better not be overlapped.

Second, make sure that each member of the team can be highly devoted to the business that is going to be started. If some of them are just interested but cannot be fully in, they are not the right ones to choose, like in the case Ron Hardin. Ron was asked to fill the software development hole in the team and did express an interest in participating. However, when the team was asked to quit their current jobs, devote full-time attention to start the company, and put in their money, Ron could not be fully in. Probably Ron was just to help, and the team was just a client of his. Ken, the one who first came up with the idea of the business, also decided not to quit his job, but he was willing to put in his money and became a part-time shareholder.

Third, relationships of the entrepreneurial team members are also significant. Either a team too relational, such as friends and/or family, or entirely strangers has many drawbacks. For instance, a relational team consisting of friends and/or family can be too homogeneous as the members tend to have similar backgrounds or skills and also similar professional networks. The members are likely to delay contentious discussions including critical ones about roles they will play and equity split. On the contrary, a team of entirely strangers or acquaintances is possible to have the difficulty of conducting due diligence on a stranger. It has to build trust and get to know how to work together at the same time as it is building a company. However, a team composed of past coworkers is the best one. It can avoid some of the disadvantages mentioned above while maintaining many advantages of a relational team or a strange one. It has a high initial level of trust and knowledge of working together. If the team members worked in different departments, their skills and professional networks will not be overlapped, so that it is less likely to suffer from human and social capital gaps. It is also more likely to have discussions about how to allocate roles of startup team members and how to divide equity. In the case of Ockham, Burows, Triandiflou and Meisenheimer were coworkers in The Alexander Group. They are likely to comprise the most stable type of startup teams.

Taken all above principles into consideration, Jim’s startup team is good but still has some problems to address. Consisting of all coworkers, it can be a highly stable entrepreneurial team. The team members have distinct backgrounds and skills from each other, so they can play different roles in the team. They are all expertise and experienced in their professional areas. The team also has a very useful contact, John Yates, who offers an amount of information about social networks and thus brings the team significant social capital. However, as Hardin quitted the team, the team is now suffering from a gap in human capital. It lacks a technology guy, who can be critical in a technology company. In addition, with the growth of the business, the relationship within the startup team begins to worsen. The members start to have conflicts about their roles, about who should be involved in making different types of decisions. In order to have good future development, these problems are urgent for the team to solve.