If you’re already spinning your wheels wondering whether you need to retrofit your team to a new model, the study offers a word of caution. The study found that shifting models midstream was very damaging, often leading to an exodus of disgruntled employees, which badly hurt financial results. This conclusion should convince leaders that they

According to researchers from Harvard Business School and McKinsey & Co., 65 percent of startups fail because of people issues,1 not flawed technology, a misguided product, or a lack of cash. A vast majority fail because they can’t figure out how to get the right team on board and working well together.

the first key message of the day: the people stuff is hard. And getting it right can be the difference between a startup that fails and a startup that succeeds.

Yet we understand the value of simplifying complexity: it provides a starting point to address big challenges, allows you to take action, and ensures the concepts are memorable and therefore more likely to be used. In this book, we candidly narrate the trials of building a startup, not shying away from its messiness.

The Problem Synergy—the expectation that every team should be greater than the sum of its members—tends to be very hard to achieve, in large part because of the trap of the inner circle. Many teams find their cultures dominated by an inner circle that forms around the founders or other strongly opinionated, charismatic leaders within the

When his employer, the Bell Labs research center in New York, refused to promote Shockley to senior management, he quit to launch Shockley Semiconductor Laboratory. He hired several PhDs from MIT and moved to California in the earliest days of what became Silicon Valley. Right from the start, Shockley Semiconductor had a paranoid, authoritarian,

“People make products; products don’t make people.”5

A startup team can minimize this conflict potential by making sure that expectations are clear, detailed, and aligned.

Teams that pursue ambitious goals will inevitably suffer contention and internal criticism. They need to get good at managing and recovering from personality conflicts while keeping standards high. History shows that it’s easy for very smart people to get this balance wrong.