Kaplan talks about how roles change within a company when a transition from R&D happens. A vice president of sales when you are trying to get 3 test customers is not a good executive if you are planning to expand to different regions and have a large sales force, he says. You must keep in mind that when transitioning and scaling up, you might have to change management and get in the heavy hitters with experience, he adds.

Transcript



What do I think about the transition from what you typically call like an R&D phase. One of the most interesting aspects of that is you often meet different people. Different people become more important, the roles change when you go over that kind of a transition. Planning for that and managing for what is important. The last company that I started on, we hired a bunch of people. Now when you're starting a new company you are small and there's not enough money and it doesn't mean that you have an office when you're interviewing people at Starbucks. You know, it's hard if you come aboard. And one of the carrots you may be tempted to throw out in front them is you say, "Ok, I'll make you the vice president in sales if you join us." I can be vice president in sales. That's great! But the problem is they may be good vice presidents in sales when you're trying to get three test customers and not a good one when you are trying to hire a field force that has to be in 17 different regions. They have no experience with it, they don't know how to do it and they are probably not good at it. So what I did with the last company is I didn't give into that temptation. Everybody is hired and most senior people are director of this and director that. And the reason or two is we are going to make you rich even if we don't make you ego-happy because we're going to be so successful that we have to hire somebody else who has been doing that for 20 years at Oracle or Cisco or wherever he might be to be vice president of sales and you'll be director of sales. You can learn a lot and if it upsets you just always remember this: you have 20 times as much stock as that VP. And that's a great argument. So be careful when you hire people early on to recognize it as the company grows, you've got to change the management. You have to bring on people with different sets of skills and that's what you do with those transition points. You are about to scale it up? That is when you bring in the heavy hitters and the bigger guns.

1. Five Biggest Mistakes That Entrepreneurs Make
2. What are the Best Qualities of Successful Entrepreneurs?
3. Five Critical Skills That Entrepreneurs Need
4. Companies Have Personalities
5. Recruiting People to Sell for You
6. Timing is Important: The Same Idea Can Have Different Fates
7. Types of Risks
8. Story of Startup: The Book
9. The Best Time to Start a Company is When Nobody Thinks it's Possible
10. Who Are Your Top Leaders?
11. Personality of a Company: Establishing Culture and Values Early On
12. Envisioning the Future: Microsensor Technology
13. Transitioning from R&D

Jerry Kaplan lectures on Entrepreneurship for Stanford University students, October 1, 2003. Jerry Kaplan is widely known in the computer industry as a serial entrepreneur, executive, technical innovator, and author. Most recently, he was co-chairman of Egghead.com, Inc. Previously, Mr. Kaplan served as chairman of the board and chief executive officer of online auction company Onsale, Inc., which he co-founded in 1994. In this Stanford lecture, he talks about the five biggest mistakes that entrepreneurs make and five critical skills that entrepreneurs need.



Related Links: www.auctiondrop.com

Last Updated: Wed, Apr 19, 2006



Course Details:

- Entrepreneurial Thought Leader Speaker Series

- Stanford University's Entrepreneurship Corner (ecorner)



Original Course Name: Entrepreneurial Thought Leader Speaker Series.