A new venture team is defined as the group of founders, key employees, and advisors that move a new venture from an idea to a fully functional firm (Barringer & Ireland, 2010 p. 286). This team comes together for the company as money allows or when they are need and usually consist of a board of advisors, a board of directors, and other professionals on whom the company can rely on for direction and advice. Putting together the new venture team can keep the company from failing if the founding people do not adjust quickly in their new positions and if the founders do not have good communication with buyers and sellers (Barringer & Ireland, 2010).
A factor that is critical to a new venture team as opposed to another kind of team is the decision of whether or not a build a company with a new venture team or to build the company on their own. Team ventures do have the advantage over single entrepreneur because the team brings more talent, resources, ideas, and professional contracts to the company. I believe I could bring educational experience and ideas to a new venture team. Having more than one founder also benefits everyone involved because the team can offer psychological support to one another (Barringer & Ireland, 2010). Disadvantages of having a team versus a single entrepreneur are: the team members may not get along; and if partners start the company as equals conflict can arise when major offices are appointed by investors such as chief executive officer (CEO).
Size and quality are two factors that are critical when putting a new venture team into place. Size affects the company in several ways when there is a team. As Barringer and Ireland state, (2010) teams that have worked together before have an edge over companies with only an
entrepreneur, because the team worked together before and they understand and trust each other. These types of teams also communicate with one another about business than teams that do not
know one another. Teams that are diverse in their abilities and experiences have different points of view about aspects of the company, such as: technology, hiring decisions, and competitive tactics, which can lead to decisions not being made. Teams can also be to large which can cause communication problems and conflict. Quality of a firm depends on the founder’s knowledge, skills, and experiences. These resources are more valuable than current assets or performance to a company, because of the potential they have for the company. The quality of former experience and higher education are attributes than will give the entrepreneur the chance to succeed (Barringer & Ireland, 2010).
Since hiring for a new company can be very expensive, founders must hire not only people that are qualified for the position but also fits the position. When a business becomes a corporation a board of directors must be hired. The board of directors consists of a panel of individuals who are elected by the shareholders to oversee the management of the corporation (Barringer & Ireland, 2010, p.294). The board is composed of inside and outside directors. An inside director is one that is also an officer of the firm; and an outside director is someone not employed by the firm. The board of directors would have to be able to provide guidance and support to the manager’s. They would not only have to be able to listen and debate but also have skills and experience in the type of work they are overseeing so that questions could be answered. There are many things to look for in a board of directors: decisiveness, mutual respect and regard for each other and strong ethics are just a few. Research conducted by Ensley, Pearson, and Amason (2002), under the upper echelon perspective, reports that there is evidence
of a relationship between top management interaction with employees and the company’s performance.
An advisory board should also be hired to offer valuable business advice. An advisory board is a panel of experts who are asked by the firm’s managers to provide counsel and give nonbinding advice on an ongoing basis, but assume no legal responsibility for the firm
(Barringer & Ireland, 2010). A carefully chosen advisory board can offer experience and expertise in a variety of fields for a company. Some advisory boards consist of members that have as much if not more experience and expertise as the founders. Some founders also hire members they went to college with based on their academic performance ( Penrose, 2002). Advisory board members must have good communication and writing skills so as to be able to interact with each other, either in person, by telephone, or by e-mail.
Putting together the right new venture team can be beneficial to the entrepreneur. The board of directors and the board of advisors, if put together correctly, can give the right advice through experience and expertise to the managers and higher level personnel to make the company profitable.