People, people, people.

It is often said that the three most important factors in real estate are "location, location, and location." Likewise, the three most important factors in the formation of start-up companies are "people, people, and people," because it is the people who lead the firm and have ultimate responsibility for its success. The key personnel are the chief executive officer (CEO) and those immediately adjacent to him or her in the reporting structure-i.e., the board of directors above the CEO and the team of direct reports below him or her. Although the board of directors has the ultimate fiduciary responsibility for the company, it is the CEO who is responsible for leading the firm, since the CEO leads the team members, who, in turn, lead the vital functions of engineering, manufacturing, marketing, and sales.

The requirements for the board, the CEO, and the team change somewhat as a company matures, and a person or group of people who may have been right for one stage of a firm's development may not be right for another stage. Each of the following sections starts by presenting the time-independent general requirements for a given position-beginning with the most important of these positions, that of CEO-and then discusses possible flaws and more specific requirements, including how these requirements may change between the concept stage and the seed stage.