Should You Risk it All on a Startup?

Should I quit my job to build my startup? Do I need experience in a large corporate to build my startup? Should I have previous experience in the industry to convince the investors?

Every day more talented people are thinking about moving to the booming startup industry either to change the world or make something more meaningful, corporates are struggling to keep the talent attracted by the next big thing in the tech scene, but every single person who takes this step has these questions in the back of their mind.

Deadly word: Processes

Process is related to large companies, something you might have been used to in your every day job. In startups, process is somewhat a dirty word.

When joining a startup you need to be ready for a more chaotic environment and able to handle the uncertainty. Whether you start your business or join a small team, there is less structure in the beginning. You need to be able to deal with multiple things at the same time, solve either simple or more complex problems. Saying, ’It’s not my responsibility’ is definitely not welcomed in a startup culture.

In startups - especially in the beginning - it’s more about testing, failing and trying again to make sure the product fits the market. There’s always a lack of resources – money, time and people. In a corporate job you tend to have a more structured environment, specific processes and hierarchy in place, therefore taking responsibility and making important decisions on your own might be something new to learn in a startup.

When trying to implement too many processes in a small team just starting up, it could kill the vibe and stifle the creativity. On the other hand, when your company is evolving and growing, you need to learn how to run large systems, manage more people and keep everyone focused on the same vision and strategy. At this point having a background in a large corporation could become useful, as some kind of processes need to be implemented to handle the growth.

Experience vs Passion and Drive

Recently I stumbled upon a question in Quora, “I'm 19 and I want to be a multi-millionaire. I have no work experience, no job, no money. I want to start my own business. What's a good field to get into?”

When talking about the reasons startups fail on the last General Assembly panel discussion in London, most common concerns from young people were, “Do I need to have job experience in the same industry?” and, “What if I have a job offer from Bloomberg but ideally want to create my own startup in a couple of years, and should I start working on it now or is the experience worth to wait?”

The experience is important, but passion, talent and drive are vital and can replace lack of experience in some occasions. As the CEO of Supercell Ilkka Paananen said to Hybe in his interview, “Big company experience is usually a very small factor when talking of startups. People can have it, but it should not be counted as a benefit every time.”

Working
Photo: From file

Sometimes it just depends on the product and the knowledge of the market without prior job experience. Would Mark Zuckerberg have got enough experience to start Facebook after working for Microsoft? Facebook as a product needed the understanding of a young audience, so college experience was enough to know the market.
At the same time Reid Hoffman had worked for years before founding LinkedIn which targets professionals and a more senior audience. It needed this proper network to have the initial sign-ups.

History has shown that you might need to have more prior work experience when dealing with businesses and need a large network of contacts to boost your start. When your product targets younger audience (games, mobile apps, social networking tools) you could get by just understanding your market and spotting the right need. Having a great vision, drive and belief that your product will make a difference and also enough consistency to convince others to believe the same, is the key.

For investors, the most important factor is your team and how the founders complement each other in skill-set. Aligning yourself with people who have the right combination of knowledge, ability, motivation and different experience is more of an advantage. At a minimum, a startup needs at least one person to make the product (Steve Wozniak) and one person to sell it (Steve Jobs). Founders need to complement each other to build a great organisation.

Quitting your job too early or too late

Should you keep your full-time job and work at night on your startup? This really depends on your financial situation. If you can afford to only concentrate on your startup, then yes, you should quit your job and work on your business. Startups require capital and if you have it without keeping your full time job, it’s a great advantage.

At the same time startups are risky and having your day job as a ‘safety net’ is a clever decision if you can’t afford to quit until you have gained enough traction.
While working on your business part-time, you must consider that you cannot do it forever, as no one would like to work for a part-time CEO and no one would invest in part-time teams either. Furthermore you need a lot of time to focus and keep up with the competition.

With that said, if you have decided to become an entrepreneur, it does involve risks. Quitting your full-time job is most likely the first tough decision to make, try to prove the concept of your business first before quitting your full-time job.