From Founder-Driven to Product Leadership Led

Niklas Stephenson, speaking at the Product Loop Meetup in Copenhagen, shared insights on the transition from founder-driven leadership to product leadership, focusing on scaling for high-performance teams. Drawing from his experiences at companies of varying sizes, Stephenson emphasized the importance of adapting leadership styles and organizational structures to support growth and efficiency.

Leadership Across Different Company Sizes

Stephenson’s experience spans three companies: Whimsical, with 15 employees; All Uncles, with 85 employees; and Cross Pilot, with around 600 employees. This range has given him a unique perspective on leadership and product management in different contexts. He noted that the challenges and strategies for leading a product team change significantly as a company scales.

Early Stage (0-100 Employees)

In the early stages of a company, the founder’s involvement is crucial. Stephenson argued against hiring product managers too early, emphasizing that the founder and initial team should focus on achieving product-market fit. He stated, “If you don’t know how to build a product, you don’t know how to build a business.” Hiring product managers before this fit is achieved can lead to misalignment and inefficiencies.

Stephenson highlighted the importance of having team members who understand both the market and the product. He shared an anecdote about a client who was the first hire in a founding team of four, noting that they succeeded because they deeply understood the product and market.

Growing to 100 Employees

As a company grows to around 100 employees, the leadership structure begins to shift. Stephenson pointed out that founders often struggle to scale themselves and cover all necessary areas. At this point, it’s essential to hire experienced product leaders who can take over and drive the vision forward.

He stressed that product managers at this stage need to have a broad understanding of the business and processes. Hiring junior product managers can be risky, as they might not have the necessary experience to handle the role’s demands effectively. Instead, he recommended hiring senior individuals who have transitioned from roles in engineering, marketing, or other areas.

Transition to Larger Teams

When a company reaches around 300 employees, the complexity of leadership increases. Stephenson discussed the importance of integrating product, design, and engineering teams to avoid the “throwing specs over the fence” mentality. He advocated for unified leadership to ensure alignment and smooth operation across these functions.

Stephenson also touched on the evolving role of the product leader. As the company grows, the product leader must transition from managing individual contributors to leading other leaders. This shift requires a different skill set and approach, emphasizing vision and strategy over day-to-day product management tasks.

Key Challenges and Strategies

Stephenson identified several key challenges in scaling product teams and provided strategies to address them:

1. Achieving Product-Market Fit: In the early stages, the focus should be on building a product that fits the market. Hiring product managers too soon can derail this process. Founders and early team members need to be deeply involved in understanding and iterating on the product.
2. Hiring Experienced Leaders. As the company grows, it becomes crucial to hire experienced product leaders who can translate the founder’s vision into actionable strategies. These leaders should have a broad understanding of the business and be capable of managing complex teams.
3. Aligning Cross-Functional Teams. Ensuring alignment between product, design, and engineering teams is essential to avoid inefficiencies. Unified leadership and clear communication channels can help maintain this alignment.
4. Adapting Leadership Styles. The role of the product leader evolves as the company scales. Leaders must be able to shift from hands-on product management to strategic vision-setting and leading other leaders.

Vision and Commercial Focus

Stephenson emphasized the importance of a clear vision in driving product development. He recommended using vision types as a tool to articulate and share this vision within the company. However, he acknowledged that good examples of vision types are scarce, as companies are often reluctant to share their internal strategies publicly.

He also stressed that product teams need to be commercially focused. It’s not just about building features but creating a business that generates revenue. Stephenson shared an example from his own experience, where a significant portion of the company’s revenue came from features developed in the original MVP, highlighting the importance of focusing on what truly drives business success.

Navigating Organizational Challenges

Stephenson offered advice for individuals feeling stuck in organizations with rigid structures. He suggested that if the organizational design above their level is unchangeable, it might be best to accept it and focus on growing within those constraints. However, if the frustration becomes too great, it may be time to seek opportunities elsewhere.

He concluded with a reflection on the different stages of leadership and the need for continuous adaptation. Each stage of a company’s growth requires different leadership skills and approaches, and leaders must be willing to evolve alongside their organizations.

In summary, Niklas Stephenson’s talk at the Product Loop Meetup provided valuable insights into the challenges and strategies for scaling product teams from early-stage startups to larger organizations. His experiences underscore the importance of adapting leadership styles, hiring the right people at the right time, and maintaining a clear vision and commercial focus to drive long-term success.