To become a good PM, run a business first
Why entrepreneurs, freelancers and biz owners can become good PMs
Many engineers and designers build their own portfolios to prove their skills and experience, on GitHub or Behance. Why shouldn’t Product Managers do the same? In analogy, I believe that PMs should have tried to build their own business at least once; run a traditional business, work as a freelancer or launch a startup (I will all call them ex-entrepreneurs from now on).
When you run your own business, you own the idea and the resources, to realize soon you can’t do everything on your own. You learn how to be a doer, while you value and evaluate the contribution of each stakeholder. Thus, it is one of the best opportunities where you can learn your limits, your skills and weaknesses, and realize what needs to be done to build a business, with or without a product.
What ex-entrepreneurs have
When you are a PM, one of the main challenges you face is that you are leading a product team without reporting to you (typically); You need a budget, but you are not responsible for the resources. You are in the middle of multiple business functions and need to lead them into a creative and productive process. You have to look at the big picture and own the outcome.
Things you learn as an ex-entrepreneur:
You learn to pitch. As a business owner, you are naked to the ones you sell a story to. If you have mastered this skill, you can inspire your team and influence decision-makers and stakeholders more easily. If you don’t have to support a new idea and get approval and funding, you don’t know the pain. These are skills a PM who landed or switched to an existing business or product is missing and needs to develop.
You are resource-thoughtful. As an ex-entrepreneur, you learn to act with a shortage of resources and trade-offs you have to make. You learn to mock without guilt, and you can turn this into a super-power to convince people. Based on the lifecycle of your product, you can plan and communicate in advance about what you need, because you have experienced the pain. I have seen PMs having Design Researchers, UX Designers, Product Designers, Business Analysts, Data Engineers, Data Researchers, and of course Engineers, without knowing what to do with them. Of course, you can learn this skill while in a company, but you will need it if you are in a growing organization.
You know how meeting clients is. What is a cold email and how do you write one? How tough and time-consuming is it to schedule and run a meeting? How important are preparation and a good demo? Have you managed pressuring or indifferent clients? If you have experienced that, you will appreciate the power of your company’s brand and you will see how managing your clients’ relationship is an art. Above all, you will understand why, how, and when the business guys need to make promises; they either want to make the deal happen or feel weak and uncomfortable. Empathy with business is something you need to develop.
You learn that you need to be a leader. If you pay your team on your own, you realize that salary is not the only way to get what you want from them. You need to inspire them, support them, and celebrate with them the wins, but also to isolate toxic behaviors and underperformers. Soon, you realize that if you have no leadership traits, apart from management characteristics, you can’t do much progress.
You become a team player. You need to live with your weaknesses and realize when you have to delegate. You have built things on your own, you have messed up, so you can recognize good contributors and you can manage them more effectively.
And indeed, some of my best hires were people belonging to that group. In the Product world, you will hear someone calling it “ownership”. But how can you have ownership when you haven’t tried to build something on your own? Yes, you can use data to validate your decisions, you can copy competition and follow the corporate strategy while you learn the industry, and you can be a great corporate PM. But definitely, you haven’t launched the business you operate in and you don’t know what it takes to potentially launch a new business.
There has been a discussion among the Product Community about the difference between zero-to-one or early-stage startup PMs, compared with Growth PMs or big-tech PMs. I can understand that people within a big corporation with its own processes and systems, an established structure with strong politics, cannot easily act as end-to-end owners. I really believe that the skills described before are useful, but the ex-entrepreneurs have also some weaknesses:
Growth PMs have specialization. Ex-entrepreneurs are generalists, and they may not pay attention to the details. When they switch to a more established environment they may struggle initially. With the proper guidance and management they can adapt, but they may feel a misfit for a while. Their managers need to pay more attention.
Big ego or free spirit. Ex-entrepreneurs may be frustrated while working in a corporate environment. Some of them may have been entrepreneurs because they had the need to create or they had a nice idea, but there are cases where they cannot fit into a team, and they go alone. This case is irreversible and you need to filter them out of the process as they will create a toxic environment.
They tend to micromanage. When someone has done “everything” to deliver, they may be judgemental on how something should be done. This micromanagement tendency will create problems within the team. This can be solved by working on the ex-enterpreneur’s management skills, to realize that they have to add quality and outcome validations and not managing the steps, and they need support from their managers.
So, is it a prerequisite?
No. In the end, it is also what the organization wants and needs. There are organizations giving full control to PMs. There are other cases where a business owner runs the business unit, and the PMs run the product. Based on the size, goal, and structure of the company, the impact of an ex-entrepeneur as a Product Manager may vary. Still, a PM who can show entrepreneurial characteristics can excel in her career, and you definitely have two rare traits:
You have someone that has launched a project end-to-end and has learned why building fast is important and how it may break.
You have someone that knows with whom you have to talk to get something done, and manage the dependencies more effectively.
For these reasons stated before, despite the initial difficulties that ex-entrepreneurs face while switching to Product Management, I consider them some of the best Product Managers I have met and some of the best hires I have made. It is a hiring tactic, and it is worth trying at least once in your product leader career.