Case Study 2: Please read the article below Please complete the questions and upload them (docx. or word file) Leadership How a Start-Up Finds the Right Leader Start-ups, by their very nature, require innovation to bring new products and services to market. Along with establishing a new brand or product, the leader has to develop the relationships and processes that make a company succeed, or risk its early demise. While leading an established firm has its challenges, a start-up requires even more from a leader. How critical is leadership to a start-up? Ask the four cofounders of the now-defunct PYP (Pretty Young Chapter 12 Leadership 379 Professionals), a website founded as a source of information for young professional women. What began as four young professional women working on a new start-up ended with hurt feelings and threats of legal action. In 2010, Kathryn Minshew, Amanda Pouchot, Caroline Ghosn, and Alex Cavoulacos decided to create the website and Minshew was named CEO (Cohan 2011a). Lines blurred about Minshews authority and the ultimate look, feel, and direction of the website. Ideals about shared leadership, where the company was going, and how it was going to get there ultimately got lost in the power shuffle. By June 2011, passwords were changed and legal actions began, and in August Minshew and Cavoulacos left altogether (Cohan 2011b). When the legal haggling from PYP was over, Alex Cavoulacos and Kathryn Minshew, joined by Melissa McCreery, tried again. But this time, rather than hoping for the best, they put a leadership plan in place. Minshew was named CEO of the new start-up, The Daily Muse, with Cavoulacos as chief operating officer and McCreery as editor in chief. Rather than trusting to luck, the three cofounders based their team positions on strengths and personalities. Cavoulacos and McCreery agreed that Minshews outgoing personality and confidence made her the proper choice as CEO (Casserly 2013). No single trait will guarantee that a person can lead a start-up from idea to greatness, but a survey of successful entrepreneurs does show some common traits. According to David Barbash, a partner at Boston-based law firm Posternak Blankstein & Lund LLP, personality is paramount: You can have great technology but if youre not a great communicator it may die in the lab (Casserly 2013 n.p.). A start-up needs a leader who is confident and willing, if not eager, to face the future. According to Michelle Randall, a principal of Enriching Leadership International, start-up CEOs have to be willing to fundraise and not be too proud to beg (Casserly 2013). Peter Shankman, an entrepreneur and angel investor, says leaders have to be willing to make the hard decisions, even risking being the bad guy (Casserly 2013). Gary Vaynerchuk credits his success to six factors. Angel investor, social media marketer, and early social media adopter, Vaynerchuk leveraged YouTube in its early years to market wine from the familys liquor store, eventually increasing sales from $3 million to $60 million a year (Clifford 2017). Gary believes good leaders recognize that they dont dictate to the market, but rather respond to where it is going. They have respect for and believe in other people, and have a strong work ethic, what Vaynerchuk called a lunch pail work ethic: they are willing to put in long hours because they love the work, not the perks. He also stresses that he loves technology and doesnt fear it, is obsessed with the youth of today, and is optimistic about people and the future of humanity (Vaynerchuk 2017). Leading a startup requires more than simple management. It requires the right leader for the right company at the right time, which means matching the right management skills with the proper flexibility and drive to keep it all together and moving in the right direction. How do leaders influence and move their followers to action? Leaders hold a unique position in their groups, exercising influence and providing direction. Leonard Bernstein was part of the symphony, but his role as the New York Philharmonic conductor differed dramatically from that of the other symphony members. Besides conducting the orchestra, he created a vision for the symphony. In this capacity, leadership can be seen as a differentiated role and the nucleus of group activity. Organizations have two kinds of leaders: formal and informal. A formal leader is that individual who is recognized by those outside the group as the official leader of the group. Often, the formal leader is appointed by the organization to serve in a formal capacity as an agent of the organization. Jack Welch was the formal leader of General Electric, and Leonard Bernstein was the formal leader of the symphony. Practically all managers act as formal leaders as part of their assigned role. Organizations that use self-managed work teams allow members of the team to select the individual who will serve as their team leader. When this persons role is sanctioned by the formal organization, these team leaders become formal leaders. Increasingly, leaders in organizations will be those who best sell their ideas on how to complete a projectpersuasiveness and inspiration are important ingredients in the leadership equation, especially in high-involvement organizations. Informal leaders, by contrast, are not assigned by the organization. The informal leader is an individual whom members of the group acknowledge as their leader. Athletic teams often have informal leaders, individuals who exert considerable influence on team members even though they hold no official, formal leadership position. In fact, most work groups contain at least one informal leader. Just like formal leaders, informal leaders can benefit or harm an organization depending on whether their influence encourages group members to behave consistently with organizational goals. As we have noted, the terms leader and manager are not synonymous. Grace Hopper, retired U.S. Navy admiral, draws a distinction between leading and managing: You dont manage people, you manage things. You lead people. Informal leaders often have considerable leverage over their colleagues.

Questions:

1. Why would start-up leaders need different leadership qualities than someone managing an established firm?

2. Vaynerchuk has been quoted as saying that if you live on Friday, get a different job. How does this apply to successful entrepreneurs?

3. What are the processes associated with people coming to leadership positions?