I remember a particular discussion in a business school class when the professor asked if success is driven more by what you know versus who you know.  I recall coming down strongly on the side of what you know.  Given the significant investments I had made in engineering studies, graduate school and analyst training programs, I suspect my point of view at that time was predominantly driven the magnitude of these investments combined with a predominantly theoretical view of the business world.  Now I’d like to fast forward 15 years later and re-evaluate my assessment.

As a business executive, you must have a minimal level of intellectual competence and relevant business skills.  In particular, critical are a solid understanding of general business disciplines and the core technology of your company.  That being said, I have encountered brilliant business thinkers from blue chip firms (i.e. McKinsey, Goldman, Microsoft, leading academic institutions, etc.) that have struggled to create value in operating companies/line positions.  That is not to suggest that there are not roles for pure “power thinkers” but I would argue that general management/front line leadership is probably not the best fit for them.

I’d like to relate this to our experiences at Momentum with start-up companies.  While the companies we deal with are typically initiated by smart technologists, they commonly face a type of glass ceiling where they are stuck getting their products out to market.  While good marketing messages and collateral are quite valuable, I believe personal relationships with enough potential early adopters is critical.  By definition, these products are a work-in-process, so there is a difficult risk assessment that must happen before customer acceptance regardless of how “sweet” the beta terms are.  A pre-existing relationship with a company executive or advisory board member can often mitigate these concerns and move a contract forward so the enterprise can start to build its initial customer base.

The ability to leverages critical relationships must permeate a successful start-up well beyond customer acquisition. Often the right relationships can drive access to venture capital, business development opportunities, PR channels and recruitment resources.  At Momentum we constantly evaluate our relationship portfolio, looking for ways to maintain them and augment gaps in our relationship portfolio.  Like any portfolio, these relationships get built up over time and often well before a specific need.  I encourage business leaders to think forward about what they want their relationship portfolio to look like and think about how to systematically build this asset.  While it is probably true that almost any relationship may have value, it is not realistic to identify and effectively foster an infinite number of relationships.  Think about your business drivers on a going forward basis and identify critical success factors that may be dependent on having the “right” relationships.  Then develop your relationship roadmap so you can start to access and develop these relationships.  Industry events, networking events, school reunions, etc. can all be venues for adding to your relationship portfolio.  As you start to add contacts you will realize that you have unearthed some jewels so focus more of your attention on those names than others.  Leverage key tools like LinkedIn and Plaxo to locate and keep track of high value contacts.

I agree that some people have a knack for networking.  That being said, networking is a skill like any other, that with proper focus and commitment can be developed.  We have a founder/CTO of one of our portfolio companies who is extremely shy but over time has built a reputation in his industry as the “go to guy” for certain technology problems.  The point is that you don’t have to dance on cocktail tables and perform stand-up routines to have people notice you and make connections.

So remember, you relationship portfolio is a source of corporate value just like an IP portfolio or a customer list.  Put it on your personal dashboard and develop a plan to build this asset – I assure you it will yield significant dividends.

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