At yesterday’s Empire Fintech conference in New York, I was asked to speak on the topic of “How to Build a Great Company,” bringing in my perspective from my past life as a big company CEO and now as a start-up CEO at Ellevest. 

Which is harder? I’ve said it any number of times: being a start-up CEO is harder than running Merrill Lynch (and I would know). And I don’t think it’s even close.

That’s because building something out of nothing is harder than “running something.” And it’s because it’s hard to get potential users and customers to change their habits and try something new; there are some estimates that a new product or service has to be 10x better (!!) than what people are currently using, in order to convince them to change. And it’s because you don’t have a lot of room to make big mistakes when you don’t have much cashflow. One or two, maybe three….but more than that and you can be out of money.

So, to build a successful start-up, it can take everything you’ve got.

But, spend much time reading about start-ups, and you might think it takes the two P’s: passion and product. Gotta have a great tech team to get the product right, gotta find product-market fit, gotta “play to win.”

Of course, those are important. They are in fact crucial. But they’re not everything.

First off, it’s hard to have a great product, beyond the first version, if you don’t have a great product manager. So add that one to the list: someone who can juggle needs vs wants...who understands the user inside and out...who advocates for the user…..who is seen by the team as a fair broker among competing interests…who balances the long-term vs the short-term…..who balances wow’ing the user with paying off tech debt…..who gets better and better at driving the product with every sprint.

But that’s only the beginning.

It's having a co-founder who's completely different from you: different experience, different approach, different perspective. I like to joke that, at Ellevest, my co-founder and I agree on nothing (which of course isn’t strictly the case); and that means that our senior team should spend zero time trying to make both of us happy and instead make the case for what will make our client most happy.

It's identifying the one or two things that the business has to have that you can't compromise on….and then not compromising. For me, at Ellevest, it was the Chief Investment Officer and the Chief Compliance Officer. Because we were embarking on a radical re-thinking of investing, I wanted to have a Chief Investment Officer with tons of experience, but who could think creatively. It took me a year – one solid year – to find her, but I did in Sylvia Kwan. And, while many “fintech” start-ups hope to fly below the radar screen on regulations, I also believe in the importance of a strong Chief Compliance Officer, with decades of experience.

It's having a great designer....and recognizing that great design is more of a research function than it is "making things look nice"….and that design should partner with product to understand your user and your user journey deeply. It’s letting your user tell you where you're wrong (as much as I believed that female investors needed to go on an "emotional journey" to understand their money challenges…I know, I know….so dumb of me). And, in some cases, it can be understanding what your user wants more than she does. For example, ask her once what she wants from a financial provider, and she’ll tell you financial education. Dig deeper, and she really doesn’t want financial education at all; she wants an experience that is devoid of financial jargon and that presents concepts in a way that a human brain (not a 20-years-of-financial-experience brain) can understand them. 

It's marketing. A good rule of thumb that, after the initial product build, half of your effort should be in product and half in marketing. Maybe, just maybe, your product is good enough to “go viral;” but most don’t, and many need education and explaining. Waiting too long to figure out a marketing strategy can be a company killer.

Part and parcel of this is being able to "tell your story"....both outside the company and inside it. It’s increasingly the case that customers aren’t looking to do business with a faceless company; in other words, "people don't buy what you do; they buy why you do it."

So why do you do it??

At Ellevest, we do it because there is a gender investing gap. Women do not invest as much as men do, and it can cost them anywhere from tens of thousands to millions of dollars over their lives. In other words, it’s a life-changing difference. And “for women” investment offerings from existing players simply haven’t worked (I believe because they have been marketing initiatives rather than marketing and product initiatives). Thus we built Ellevest, which takes into account that women live longer than men, that our salaries peak sooner than men’s….as well as a myriad of other research-based findings on how we approach investing differently.

In this day and age, marketing can also mean becoming a thought leader in your field, a concept that was barely understood even a handful of years ago. I think about it as making sure that we give and give and give to our user with the information we provide, asking ourselves before we email or publish anything: “Is this email / article / blog post useful?” and “Is this a gift I’m giving my user”? For us, this can mean articles on the cost of a career break and how to fund your business and what constitutes “good debt” vs “bad debt” (even though none of these have to do with investing). But we have got expertise to help “Elle” with her money beyond just investing, and so we do.

It's having an HR function sooner than you think you should. While I think I am incredibly approachable (I am, right??), it turns out that more junior professionals sometimes don’t agree. And while my co-founder might think he is always available, it turns out that he spends much of his time running from meeting to meeting. While hiring a more senior HR person can feel like a big cost, losing people is a bigger cost – and one that you almost never budget for. Again, this can be a killer.

It's being intentional about your culture, and it’s working to build a culture in which everyone can thrive. I’ve been thinking a lot about how to "hear" introverts, how to make sure each of our teams feels valued, how to make sure everyone is comfortable speaking up and how to have everyone feel like they "own" the business. This will provide them all with a great work experience, and will also help us build a great company, since they’ll be able to be their real selves at work.

It means having the “no a**hole rule,” even though sometimes this can be easier said than done, since – is it just me? – or do a**holes tend to over-index on brilliance? Beyond this, it also means having the right mix of “stress creators” and “stress absorbers” on your team. Too many “stress creators”…and, well, shoot me. Too many “stress absorbers,” and there may not be enough electricity.

If you can, it's getting investors in your company who "get it"…who want to build a great company, who agree with your values, who have a track record of weathering the inevitable up’s and down’s. (In other words, the no a**hole rule holds here too.) I know many businesses don’t have this luxury and may need to take whatever funding they can get; but if you can, this is worth giving up something (sometimes a lot) on valuation. We did at Ellevest, in order to have Morningstar as our first institutional investor, because we believed they wanted to build a great company. I contrast this to a friend of mine, who sold a successful business way too early, because he just couldn’t deal with fighting with his board any longer over short- vs long-term profitability.

This can be a tough one: it's managing yourself….and making that a constant work-in-progress. It’s asking to be challenged, even in groups….it’s receiving bad news well…..it’s publicly acknowledging when you're wrong, so others on your team will be comfortable doing so as well.

And, finally, of course it’s building the strongest team that you can. To do this, we have to throw away the goal we typically have in mind when we hire someone: to find the “best person” for the job. Human nature being what it is, too often that “best person” ends up being some version of ourselves. Instead we need to challenge ourselves to “build the best team.” That means that right mix of stress creators and stress of absorbers; it also means diversity of background, perspective, education, experience, approach, orientation, skin color, and gender. It means having a diverse team.

Let’s be clear: managing a diverse team is hard work. Really hard work. Much more comfortable to hire a bunch of similar individuals and manage them all the same way. But diverse teams – along with the right culture – can help you see problems, and opportunities, more completely. Oh, and the research indicates that they also drive greater employee engagement, higher user engagement, less risk, and more innovation. And, according to First Round Capital, gender-diverse leadership teams drive greater returns: 63% greater returns.

Do these things right and there still is no guarantee of success in a start-up; in fact, maybe the odds are still stacked against you. But don’t do them at your company’s peril.

What did I miss??

#EmpireFintech

Sallie Krawcheck is the CEO and Co-Founder of Ellevest, a digital investment platform for women. She is the Chair of Ellevate Network, the global professional network, and of the Pax Ellevate Global Women’s Index Fund, which invests in the top-rated companies for advancing women. She is also the best-selling author of Own It: The Power of Women at Work.

Originally published on Linkedin Pulse.