On Uncertainty, Pushing The Limits And Thinking Like An Owner
Edition #020
Introduction
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Startup or Established Company? Which Is Best for You?
by HBR Working Knowledge
With startups emerging as a choice of place to work across the world, there is a lot of hype and enthusiasm for many to join them. Of late, there have been a lot of lay-offs and uncertainty in startup jobs, and it may be the right time to assess whether you are ready for a startup job. This article by Julia Austin is worth a read as it brings out significant differences between a start-up and an established company very well.
Key Takeaways:
In a mature company, you are likely to have more role models to learn from and stronger teams to collaborate with, a clear direction, and a mature board.
Startups can offer a chance to do all the things that can be either a blessing or a curse depending on your interests.
What tools do you want to add to your toolbox? Will the role allow you to hone skills you already have or add new ones?
What do you value? At the end of the day, love what you do and decide what role will allow you to maintain the integrity of who you are and who you aspire to be!
The Art and Pursuit of Disciplined Entrepreneurship
So, given all this volatility and uncertainty, why is Disciplined Entrepreneurship important? Also, what are the challenges that even the best entrepreneurs go through? What does it take for them to do what they want to do?
Hear all this and more from Ashwin Damera, the Co-Founder and CEO of Eruditus, a worldwide leader in the $280 billion global Professional Education Market. Some key topics he talks about:
The Importance of Ownership and Long-Term Focus
Balancing Product Market Fit with Vision
Steps to Disciplined Entrepreneurship
Listen to this entire episode on:
Startups vs Big Companies
Here’s a great definition by Steve Blank on startups - A startup is a temporary organisation designed to search for a repeatable and scalable business model.
Steve Blank gives you a great perspective on how things are looked at differently in startups vs big companies and what should you be ready for.
On Uncertainty, Pushing the Limits and Thinking Like an Owner
In companies that are young startups or small or growing companies, there is not a day when uncertainty, pushing the limits and thinking like an owner is seen or felt by everybody working there. This vastly differentiates large, big or established companies from startups or smaller, mid-sized firms.
Let’s take uncertainty, for example. Every decision needs to be taken under uncertainty. The business model is uncertain. Business plans are tentative. It could even be a hiring decision as there are downstream cost implications of renting office space based on the number of people to be hired etc. – when plans and business models are uncertain, how do you estimate the number of people needed 3-5 years from now as it may be a long-term office lease that needs to be signed? But, decisions have to be taken! The question is not are such decisions are taken in uncertainty. The answer is an emphatic YES! In an established company with robust past data and information available, one can make decisions based on what will happen in the next couple of years.
Similarly, pushing the limits is another common thing. Job roles and descriptions are fussy. It evolves and may take a lot of time to get more precise. So, you will often be found pushing yourself to your limit as some of the challenges to getting things done or executed may have resource constraints or a sheer lack of people without experience. But, ambitions, deadlines and launch dates don’t change as that is the nature of the beast called startups or young companies. So, you are bound to end-up juggling too many things and can’t afford to drop one. You will feel overwhelmed without a doubt.
Thinking like an owner often does not come naturally if you have worked in established large companies or keep comparing what happens in large companies and try to replicate it here. What does thinking like an owner mean? Can investments be stretched to the last pie or even delayed until things come to breaking point? Other things like looking at every cost item and evaluating what seems like a luxury and can be avoided, avoiding some critical or must-do expenses to save for any crisis that may come unplanned or the ability to have an intuitive understanding of revenue to cash being generated by the company to think of prioritising spends so on and so forth is something you are not taught in a large company as you are given a budget or a budget is approved. All this may look to others as not having a long-term vision, being penny wise and pound foolish, being overly pessimistic etc. But, in reality, how you plan your own finances is the same way you need to think for such young start-ups as they may have great aspirations or dreams but have cash constraints or may need cash for unplanned pivots that may happen as things are not in a steady-state.
This has implications for the kind of people who can work in startups. What’s your ability to handle all these contradictions?
Thinking long-term but acting short-term
Being ready for the job to be done rather than looking for perfect job roles or job descriptions
Being aware of doing it yourself as resources may not be there or an absence of people who are experienced enough.
Having the ability to handle and drive on the ground speed of thinking and speed of execution gap
Leadership here is about not painting a picture but drawing the picture yourself if needed.
Balancing the optimism of business future with the pessimism due to daily grind or bottlenecks
Being open to unplans rather than plans
Recognising and delivering in an environment where operations will be cash guzzling but business will be cash-starved
Doing more things with a lot less.
Some of the lessons we learnt from this week’s mission:
It is a different kettle of fish working in a startup or small or medium-sized company versus large, big, established companies. Thinking well before joining them is essential.
You may be convinced to join a startup, but can you stomach the volatility and contradictions that come with it?
Don’t join for the lure of money, equity, ESOPs or a fad, as these things don’t work if you aren’t ready for the challenges you have to contend with.
Finally, make peace with the constraints on your career growth, decision-making, and wealth-building opportunities that may not come so quickly in an established company but the comfort or fit there may be best suited for you. But don’t make it a hobby to think or discuss joining startups all the time sitting there because it is a cool thing to do.