Leadership Lessons from a Serial Entrepreneur (and Why Startup Founders Need to Love What They Do)

Dave Troy is a Baltimore-based serial technology entrepreneur, investor, mentor, community builder, and co-founder of 410Labs, a company that produces a suite of tools aimed at improving social and corporate communication. He also founded regional Internet Service Provider ToadNet, and developed Twittervision as well as several open source voice-over-IP systems. To help grow the Baltimore creative community, he founded Beehive Baltimore, Baltimore Angels, and the TEDxMidAtlantic conferences.

When most kids his age were playing T-ball, David Troy was writing code and dreaming up his first technology business. In fact, Troy’s programming “career” officially started at age 7, and he launched his first business at age 14. By the time he graduated from high school, that same company was worth about $1 million.

Troy credits his entrepreneurial spirit and curious mind to his parents (his dad was involved with computers in the late 1970s and early 1980s, while his mom started a magazine around the same time), who fostered a creative environment that Troy says allowed him to experiment and tinker with new ideas.

More than two decades later, Troy still loves what he does and he has no intention of slowing down any time soon. He sat down with OpenView to discuss his newest venture, 410Labs, the lessons he’s learned as a startup founder, and what leadership advice he would give to current and aspiring entrepreneurs.

You recently launched 410Labs. What motivated you to found yet another startup?

In 2004, I sold the Internet company I started in the 1990s. Then I did some consulting in the voice-over-IP space in Brazil, England, and Germany. The international travel started to wear on me and I found out how difficult it is to build something of longer-term value internationally. It’s a much different challenge than building a small, tight startup.

I wanted to start another company, but I didn’t want to do it by myself. When I met my current partner Matt Koll, who was also a serial entrepreneur, it felt like we had common goals and we both had good Rolodexes to access funding and staff. We started 410Labs in 2010 with the idea of creating a multi-product studio. We have six full-time people right now, we raised some money over the summer, and launched our first product in July. Right now, we’re listening to feedback and refining the product, so there is plenty more to be done.

What are some of the greatest lessons you’ve learned as an entrepreneur?

Trust people and try not to micromanage them too much. If you give your employees clear responsibilities and make it obvious that you expect great things within the parameters you’ve defined, you might be surprised by their will to succeed. Think hard about what motivates the people you work with — your employees, your customers, your investors. You can’t assume that they’ll automatically go along with your program. You need to make sure they’re aligned with it.

On the flip side, it’s critical to be a good listener, too. Give your customers, mentors, suppliers, and investors a voice and be sure that they feel comfortable sharing ideas and feedback with you. Paul Graham, a very well-respected tech entrepreneur and thought leader, says the number one difference between a successful entrepreneur and one who is not, is that the successful one can take advice. Now, I don’t mean you need to only take advice that initiates change. Rather, the idea is to take information and track down all of its implications. The entrepreneur who does not listen to advice — who just says, ‘oh that’s nice’ — likely lacks the resourcefulness to go after something. Throughout my career, I’ve tried to be resourceful and a good listener. If someone suggests I talk to someone else, I track that person down. It’s all about entrepreneurial will.

What leadership advice can you give fellow startup founders?

In my opinion, there are a few ways to think about how to lead. The CEO of a Fortune 500 company will lead his business in a very different way than an early stage entrepreneur would. That’s where a lot of first-time or inexperienced entrepreneurs get tripped up. Startup founders have to understand their leadership style and how it applies to their company’s culture, size, and vision. More often than not, people align with one leadership style and refuse to change. The problem with taking that approach is that while one leadership style might work well in the startup phase, it might not be as effective as the business scales.

Having said that, my biggest piece of leadership advice for early stage technology entrepreneurs is this: Surround yourself with a good team. Once you’ve developed your big picture “vision,” you need to add individuals who can bring that vision to life.

The problem, however, is that the startup community is kind of in an ‘American Idol’ phase at the moment, and some entrepreneurs are getting distracted by the bright lights.They go on stage, give these big pitches and think that qualifies as leadership. Sure, it doesn’t hurt to have a good pitch and deliver it effectively. But I would suggest not worrying so much about the pitch. Focus instead on having the right vision and a good team that can help refine that vision and bring it to market.

Once you’ve built a team that you think can take the business to the next level, it’s important to put leadership into context. Whether you tend to be more directive, participative, or hands-off, the key is to consider the most appropriate leadership style for your business’ and be ready to evolve if necessary.

You’re involved with numerous community-building initiatives in the Baltimore area. What motivates you to give back?

I believe that we need to create relationships with the places we live — relationships that are substantial and meaningful. Ultimately, I think that makes the community you live in better and motivates everyone to tackle bigger, more ambitious projects. If entrepreneurs can take that same sense of optimism that you find in Silicon Valley and spread it to their home communities, it’s going to make their business — and the environment that feeds it — much healthier. We’ve created a climate here in Baltimore that allows me to do the work I love and, hopefully, give others that same opportunity.

The investment group you helped found, Baltimore Angels, partners with entrepreneurs with “strong vision.” What do you look for in submissions?

We look for people who are fundamentally trying to do something meaningful. If you don’t have a connection with what you’re doing, you won’t be inspired to do it for very long. Prior to Baltimore Angels, there weren’t a lot of groups like ours. We wanted people to have a place to go. In a relatively short period of time, the quality of the pitches we’ve seen has improved significantly, as has the overall knowledge of the entrepreneurs meeting with us. So, while we’re still an investment group at our core, I think we’re a very different kind of investor. We’re executing an educational mission as much as we are an investment strategy.