Second in a two-part series on human capital management for biotechnology companies. Please see our previous post: Hiring for Biotechnology: 5 Characteristics Early-Stage Companies Should Look for in Employees.
In my previous post I shared how important it is for biotechnology startups to hire exceptional employees who embody the three characteristics that help you create a synergistic team of professionals all working toward the same goal of growth and success for your company. These characteristics include:
1) Relevant experience
2) Ability to execute
3) Shared core values
I encourage entrepreneurs to strategically hire the best “fit” individuals, as they will become your most vital resources as you develop your business and work to overcome obstacles.
I’m often reminded of a saying: “At some point in your career, your success will no longer depend solely on what you accomplish alone but by what you accomplish with and through the help of others.”
I can safely say that I have never encountered a development stage company that claimed to have all the human resources help they need.
In fact, it is almost always a lament that organizations need more help but they don’t have the capital resources to hire all the full-time employees they need. Therefore, it is important to find and leverage the right non-employee human capital resources that no biotech company can do without. These external individuals are people whom you have chosen to rely upon for certain functional aspects of your business who are not full-time employees.
Surprisingly, these individuals include more people than you may initially realize and they can either assist or detract from your progress. These individuals can include your corporate attorney, patent attorney, multiple board members, scientific and clinical advisory members, business and technical advisors, mentors, technical and regulatory consultants, your angel investors, supportive civic leaders, your legislators and many others.
This secondary human capital component includes all the external individuals who have specialized knowledge and expertise in any discipline or function you do not possess within your full-time employees. Every organization utilizes external individuals to some degree and you should evaluate and select them based upon the same criteria that you would your full-time employees. Rarely, however, do organizations think about or leverage these available resources in the synergistic and seamless way I described in my last post.
One helpful way to think of these individuals is as being similar to friends with whom you interact on a frequent basis. Your bond with them is one that has been established with a set of common goals, mutual benefit and, especially, common core values. This type of relationship can also provide valuable learning and informal mentorship opportunities, if you are willing to ask difficult questions and are not afraid of candid feedback. Although these types of interactions are less frequent than those with your full-time employees, you should still work to keep your external partners updated on the progress and milestones of your company. They can often be helpful in ways that you may not have expected.
Take, for example, angel investors, who are a very sought-after group to include among your external human capital resources. They are typically viewed as a source of monetary capital but they also have acquired success in business and can be called upon for help and advice with issues that you may not have faced before. Leveraging these advisors, who have a vested interest in your company’s success, is an example of putting your external human capital to use.
As an entrepreneur, I have had the privilege of interacting with many great angel investors. They have provided valuable advice in sales and marketing, financial matters, regulatory and business counsel, and even moral support. Include them in your business decisions and you will find a willing group of individuals who can help advise you, as well as introduce you to others in their network who can provide valuable resources.
Entrepreneurs must perform many activities in which they are not experts – especially during the start-up and early development phase. These activities include everything from building a website or putting out press releases, to managing your financing and ensuring scientific progress of your product. However, the number of activities consuming an entrepreneur’s attention increases exponentially as the company grows, making it harder for them to wear many hats successfully. Seek talented individuals outside your organization who can perform functions beyond your realm of expertise. Just as with internal employees, it is important you also recognize external individuals, even vendors and suppliers, who believe in your mission and purpose.
Board members also fall into the category of external human capital. The selection of board members is often by choice, but do not forget that this role falls to individuals who have financed your company. Therefore, always choose financial partners who share your company’s vision and those who share common core values. All cash from investors spends the same but recognize what else comes with the capital. Know that when you accept equity capital, you are entering a formal agreement with the investor’s values or the institutional philosophy from which the cash comes. Board members are a key component of your human capital resources and, when properly selected, provide a valuable resource of expertise, contacts and advice to help you reach your company goals.
Successful entrepreneurs strategically leverage external Individuals as functional components of their human capital and overall company strategy. Carefully select these individuals and they will provide valuable advice, assistance, network contacts and mentorship to ensure you can overcome the challenges you will face as a growing biotech company. More examples of board, scientific advisors, consultants and mentors are discussed in Biotechnology Entrepreneurship.
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This communication is for informational purposes only; it is not legal, tax or accounting advice; and is not an offer to sell, buy or procure insurance.
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Dr. Craig Shimasaki, through his company, Biosource Consulting Group, is a paid advisor to TriNet. Moleculera Labs, Inc., another of Dr. Craig Shimasaki’s companies, is a customer of TriNet.