When it comes to People, what do VCs care about?

Last week Nicola Mann led our roundtable on the topic of People- What do VCs really care about? We were joined by 18 Chief People Officers & People leaders from the ScaleUp world.

We wanted to share some of our key takeaways. Here’s what we learned:

Get aligned on the big picture: As the Chief People Officer, do you have access to and clarity on the business strategy for the next one, three, and five years? Is there a vision for what the company looks like at these various milestones? Do you know the metrics your investors are scrutinising? Who is the majority owner of your business? If you don’t have the answers to these questions, it’s time to go and find out.

Naturally VCs care about revenue, growth, and overall financial health of the company, but they also care about the connectivity and engagement of the employees. Investors want to know that everyone is clear on (and hopefully excited by) their role in achieving the mission and growth ambitions. Having the People function aligned to the strategy is therefore critical to success.

Once you’re clear on the fundamentals and your People strategy is aligned to the business strategy, this must be then translated into everyday habits and actions that enable you to turn the big picture into reality.

Retention, retention, retention: VCs really want to know about your talent. They want to know that you’re going to keep key knowledge in the business. Of course not everyone you currently have will be in the right seat for the future of the business, but VCs want to avoid unplanned exits (especially of vital roles). Chiming with a key theme from our last event in September, the theme of a grown-up, proactive #nosurprises approach when it comes to talent is the win-win for the business and the individual.

Moreover, ScaleUp life isn’t for everyone, and that’s ok. Educate your current and potential talent on the realities of life in an investor-backed business.

Leadership skills aren’t innate: A lot of investor-backed businesses have Founders and/or top leaders who have never led an organisation before. So why do so many people assume that these leaders should know how to lead? Leadership capability can be developed in a range of ways such as peer networks, mentors, coaches, and the right board members. If people within the ScaleUp are finding there are leadership challenges, the investors probably know too.

?Tackle these head on and start with the business goals. Everyone (the leadership team, employees, and investors) wants to achieve these goals. Try to detach from any emotion (or dare we say it, egos) at play and consider how you can best support your leaders to smash their goals. None of the great ScaleUps got there on their own.

Thank you again to Nicola for sharing her unique perspective, and of course to the People leaders who went on to have a lively debate amongst peers. At Elevayte we’ll be hosting smaller, virtual roundtables like this every quarter. If you’d like to join us or learn more, please contact [email protected]