Entrepreneur insights: be open, take risks, encourage questions

My colleagues and I have just finished over a dozen interviews of Bay Area CEOs who were regional semifinalists in Ernst & Young’s Entrepreneur of the Year Award program. It was an amazing opportunity, and I want to share some of their insights on managing businesses, leading teams, what motivates them and how they overcome obstacles.

But first, congratulations to the 58 semifinalists—and 30 finalists, who were announced yesterday. There was a record of 166 Northern California nominees this year. The regional winners will be announced at an awards gala June 25 at the Fairmont in San Jose. RoseRyan is proud to be a sponsor of the program, which is in its 25th year.

  • Many candidates are serial entrepreneurs and have made fortunes; however, even though many of them don’t have to work, they wouldn’t want to be doing anything else. The most dominant theme: a strong work ethic and family are most meaningful to these CEOs.
  • One CEO shared three lessons on building successful companies: Figure out how to address the business problem, keep a synergy with your core business when you expand the tool set, and recognize that strategy that works in one area doesn’t necessarily work in another.
  • All these people share a sense of action. As one said, “You can’t just talk your way out of situations, you need to take actions. That is what employees and customers are expecting.”
  • I asked one candidate how he’s gone from being a technologist to running a company that is looking at an IPO. He said, “You need to be coachable by the top talent you bring in to run the functional departments.” True insight from a leader.
  • Several CEOs believed that honest communication and total transparency kept their employees with them during “dark hours.” “If your employees know who you are, where you are going, and who you are not or where you won’t go, it helps them make the best decision,” noted one. “If you have a 25-year-old programmer working at  2 a.m. [and] he/she doesn’t know what the company is all about or know exactly where we are going, they may make the wrong judgment.”
  • Some CEOs said that they like it when an employee questions a direction, because they know it means others are wondering the same thing. This was a good demonstration of leadership: A CEO doesn’t always have to be right, but they do want open discussion with their employees.
  • They all have vision—they are looking three or more years down the road.
  • They all take risks. Part of being a risk taker is a strong belief in yourself, your ideas and the people close to you in the effort. This was evident with every individual. It’s easy to look back and say you took a risk and it worked, but I think what separates these folks from most is that they did take the risk.
  • Here’s one for us finance pros. We asked the CEO of a company that recently went public what it’s like being public. He said (and I quote), “Being a public company is easier than being a private company because of corporate governance.” He said he wasn’t talking about SOX (leave that to the CFO) but about goals. Multiple investors with restricted stock have varying priorities; once public, their shares are converted to common stock and they are all on the same page about what the company needs to do.

Finally, what makes an entrepreneur or visionary? Lots of things. But one said it was because he has a “gift of talking with financiers and can translate the tech stuff into commercial talk.”