By Mark Flickinger, Forbes Contributor
Over the course of their careers, venture capitalists assess a huge number of entrepreneurial founders, most of them in the role of CEO within their organizations. Good VCs have become somewhat adept at identifying those leaders who are most likely to build and grow a successful company, and tend to bank on them accordingly.
What makes for a winning CEO? It goes without saying that they must have the ability to innovate as well as a level of expertise in their industry. A strong work ethic is another expected trait. These are almost table stakes to be an entrepreneur.
Some winning qualities are more innate. In my experience, these are the five intrinsic traits I see repeatedly in those startup CEOs that go on to helm a successful business:
- Ability To Defy The Rational.Let’s admit that it can be a bit irrational to see some big, unsolvable problem in the market and think that youare going to be the one to overcome it. If the time and effort required to attempt this were considered, as well as the capital needed, most rational minds would decide to do something else. Successful CEOs are like dogs with the proverbial bone—tenacious in their pursuit of a solution.
- Unwavering Belief In One’s Self.Along the path to success, countless people will point out the million-plus obstacles that stand in the way. They’ll say the solution will never work, the market is too crowded, or that competing with a larger or better-known player is a losing proposition. Other people may actually bethe obstacle, such as the investor who doesn’t believe enough in the solution to fund it. Despite all that, CEOs with real potential are so convicted in their idea and in themselves that they do not lose momentum and they refuse to quit.
- Openness To Learning.Successful CEOs have a real thirst for knowledge and never stop learning. Even with unwavering belief in their solution, they’ll still listen to different perspectives, including those of their customers and advisors. In fact, they proactively seek out different perspectives to improve upon their product-market fit. This requires a humble approach where they aren’t too arrogant to change their product for the better or pivot in response to market shifts.
No. 3 seems to run against No. 1 and No. 2, and in some ways, it does. To be clear, while CEOs must have confidence, it should be balanced by the ability to recognize blind spots and a willingness to learn and improve.
- Demand For Excellence From All.Successful CEOs have high expectations not only for themselves, but for everyone inside their organization. They also understand that the person who is hired at one stage in the company’s growth may not be the person to get the business to the next level. This means they are willing to go through those difficult conversations in order to make sure the company is continually in the best position to succeed. A CEO whose mindset is “he’s been with me for a long time, so I owe him” is loyal, but that isn’t necessarily what’s needed when trying to build a superior business.
I mentioned in an earlier article that to win, you not only need a team, but you need the very best team you can find. Successful CEOs are willing to put aside sentiment for the good of their company.
- Natural Ability To Lead.The best CEOs have a natural charisma, energy, and style that causes other talented individuals to gravitate toward them. The ability to lead in a way that extracts the best from everyone and rallies them around a common goal is key to growing and sustaining a business and retaining top talent. Good CEOs are also excellent communicators. They can clearly articulate the vision of where the company is going and what is required of each person to get there. They are solid in their decision making and focused on continuously moving forward, regardless of the challenges that arise.
There are uncontrollable aspects that can thwart any business venture no matter its leader. Maybe the company has a great offering, but the market is just not ready for it. Or, the business is gaining traction until an entity with more money and greater market awareness comes along with a copycat solution. Those things are somewhat outside of the CEO’s control. In these circumstances, if a business fails, so be it. A winning CEO will pick themselves up, dust themselves off, and move on to their next venture with the same determination. Chances are still good that the next time, they’ll succeed.
Can a startup grow into a successful business with a leader who is just “okay”? Absolutely. However, a truly exceptional leader gives a company a much better chance to win.
This article was originally published in Forbes and was reprinted with permission.