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This founder sold her first startup for $110 million

Via Business Insider : Mariam Naficy built her first startup fast. It was first to market, first to grab the biggest share. It raised money fast and then sold fast.

When she was 28, she and her cofounder Varsha Rao sold their online makeup company Eve for $110 million to Idealab.

But Naficy is largely ignoring the Eve playbook as she builds her new startup: Minted, a crowdsourced designer stationary and arts marketplace.

“At Eve, I hired a whole corporate management team in six months. We raised 26 million almost immediately in the first year,” Naficy said. “That was appropriate at the time, but it’s not right for Minted’s business model or the time now.”

The largest change has come from how Naficy has hired her management team at Minted. She’s changed her thinking from build fast to embracing creativity around people.

“Half the leadership team has been developed inside the company now,” Naficy said.

Part of that came from the lower funding rounds Minted took in its earlier days. Instead of taking in tens of millions, the company subsisted on a $2 million Series A in 2008 and $5.5 million Series B round in 2011. It would later go on to raise an additional $79 million in two rounds over 2013 and 2014.

But the earlier, leaner days of Minted meant that Naficy had to be creative with how she built out the core leadership — this wasn’t like Eve where she had assembled a team in six months.

“It really forced us to look at the people we have and make it work,” Naficy said. “What you need is actually within your organization most of the time, and you have to be creative about getting people into the right roles, give them chances to expand and try new things. Often, you’ll be surprised.”
Moving around the world and around a company

Naficy was in her high school AP English class in Maryland when she first realized that you could slice people down to identify the one thing they are really the best at. In her English class, that meant someone was the best at reading poetry or someone was the best at creative writing.

Naficy now looks for the nuggets of talent where each person excels, and then moves them to the department that matches that skill. Often, it’s the other employees — who may only have seen the customer service rep as a customer service rep — who have a harder time accepting the transition than the employee moving into the new role, Naficy said.

Moving her employees around so much may have something to do with her own background. During her childhood, Naficy lived in five different countries: Kuwait, Lebanon, Egypt, Iran, and Tanzania. Her father was an economist with UN Development Program, and they would spend their summers flying back across Europe for a vacation in the U.S. before returning to the different deployments throughout the Middle East.

minted

“It could be in the back of my mind there is this connection with the more you are exposed to, the stronger you get,” Naficy said.

“I do think there is possibly some relationship to my conclusion that inside a company, if they see one issue from the perspective of marketing and the next time they look at the same issue and they’re in product management, they’ve created a more unbiased viewpoint of that issue. They’ve been able now to see it from two different sides of the issue.”

Moving employees around, training them at new positions and then identifying them as leaders takes years. That relaxed timeline is one thing Naficy has with Minted, but never had with Eve.

“It takes years to realize it and I had not run a company for years before,” Naficy said. “If you nurture your promising people, you will have people to pick from in the future.”

That’s not to say hiring from outside is verboten. Naficy has hired several C-level execs from outside for her team, but they’re in departments that don’t make up Minted’s core competency, like finance and human relations.

Where you should look to hire from within are the departments that make your company unique and different, Naficy said. For Minted, that’s places like merchandising since it’s an entirely crowdsourced model. The company culture revolves around someone else’s taste, not Minted’s, and being enablers, not deciders.

“The odds that somebody from a traditional merchandising job would be very, very slim,” Naficy said. “These things that have to be grown culturally, it behooves us to grow that within the company rather than import it and say ‘We’re going to break down 30 years of merchandising that you’ve learned and say our model is better.’”

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