Go Big, Or Go…Startup

big Fish Little Fish

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A common career advice question I get all the time is what the tradeoffs are between going to a startup vs. going to a big company. There are many things to consider and lots of “it depends” when it comes to where you are in your career, where you live etc., but when it comes to the general aspects of a startup vs. mature company, most of the situations don’t vary that much. I’ve done both, several times, so here’s a perspective on the tradeoffs based on my own experiences.

Startup vs. Mature Company

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(c) 2018 Julia B Austin

Putting aside for a moment industry and how you feel about the products the company is building (both of which are very important!), most of the differences between a startup vs. a mature company are pretty obvious. In a mature company, you will likely have more role models to learn from and stronger teams to collaborate with, a clear direction and a mature board. The role you consider may have a narrow scope, but could offer deeper learning and of course great benefits, compensation, etc.. You’ll also get exposure to what good (or bad) looks like at scale and possibly a nice brand for your resume.

Startups can offer a chance to do “all the things” which can be either a blessing or a curse depending on your interests. You may miss out on having peers to collaborate with, have to look outside of your company for mentors and role models or have limited budget to get stuff done, but you may get high value equity in exchange for lower than market-level pay. If you want to dig more into deciding which startup to join, I suggest Jeff Bussgang’s book Entering Startupland which goes deep on the different roles at startups and how to get your foot in the door.

Leadership

One thing often overlooked when considering a new job is the leadership of the company. Serial entrepreneurs will have a very different approach than someone who has limited real-world experience and mature company executive teams can be world class or “legacy” leaders who can’t move with the times. There are many tradeoffs when factoring in leadership into the decision process of startup vs. a mature company.

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(c) 2018 Julia B Austin

Startup founded by serial entrepreneurs: This can often be the best case scenario if you want to learn from those who have “seen the movie before”. They likely had no issue raising money and were selective on who their investors were and who sits on their board. They will know how to get the flywheel moving incited by past mistakes OR failures.

“When I started my fifth company I knew exactly how I wanted to build the team. So, on day one I hired a head of recruiting to get things off to a strong start. I also knew market adoption would be critical to fundraising so focused on growth very early on – before we even had a product!” – David Cancel, CEO & Co-Founder Drift

Serial entrepreneurs may also try to overcorrect in areas where they failed the first time, such as over analyzing or delaying decisions, being too conservative on cash flow or focusing too much on scalability too early in the product development process. If you’re interviewing with a serial entrepreneur, it’s always good to ask what lessons they learned in their last startup and how they’re bringing those lessons into their new venture.

“I joined Drift in part because I wanted to learn from the experience of the co-founders. They’ve seen it before so they anticipate issues, they know when (and how) to hire experts to level up the team, and they know what’s “normal” for a hypergrowth company. It’s the best of both worlds: you get the rollercoaster startup experience with some of the more measured leadership and strategic characteristics of a bigger company.” – Maggie Crowley, Product Manager Drift

Industry veterans doing their first startup: Founders coming from mature companies with no startup experience can have big company confidence, be great at hiring and leading teams, but lack scrappiness to get a Minimum Viable Product (MVP) out the door and work towards product market fit.

“At our first startup after a series of roles at large enterprise software companies, we tried to force a big company perspective on how we did employee feedback and reviews. We were too structured with this initially and quickly cut back to a more loose feedback and review process with our team.” Izzy Azeri & Dan Belcher, Co-Founders Mabl

They may also be too used to having teams of people and systems in place to cover the more mundane duties of running a company and don’t want to get their hands dirty. On the flip side, they often know how to implement those processes and know the people to hire to run them so once the flywheel is moving and cash is in-hand, they can get momentum quickly.

“Earlier in my career, I hired a small team within a large corporation that was scrappy and had entrepreneurial mentality. At my startup, I quickly realized the benefit of once having a corporation behind me when things weren’t working out. The impact of a bad decision or process was much greater with no safety net.” – Karen Young, CEO & Founder Oui Shave

Startup with limited leadership experience: Working with a skilled group of founders leading teams for the first time can be tons of fun. If you bring some experience to the table, it can be very gratifying to not only work from the ground up, but also work alongside these founders as they grow. However, it can be frustrating if you find yourself figuring out things on your own because there’s no one in the company to mentor you. These situations can be very rewarding if you’re patient and you can always get outside mentors and advisors if they’re not available at this type of startup.

“When we started, we got a lot of advice like: stay focused, don’t expand too quickly, be careful that experienced hires match your culture.  All good advice, but we discovered there’s no real substitute for learning the hard way. The lesson just doesn’t sink in until you feel the pain of doing it wrong.” Wombi Rose, CEO & Co-Founder LovePop

Mature company with inexperienced leadership: If they made it this far, they are either wicked smart, lucky or both! More likely they also have surrounded themselves with strong, experienced leaders, investors and/or board members. You can learn a lot from joining a company like this, but they are very, very rare! When companies scale too fast, they can also suffer from having people in roles that have outgrown their experience. Read more about the impact of Hypergrowth situations written by my friend at Reboot, Khalid Halim, for First Round.

Mature companies with experienced leadership: These organizations have all the standard things you’d expect. Probably more politics and process than you’d ever find at a startup, but the benefit of exposure to great role models and best practices can be invaluable. Sometimes, these bigger companies can also expose you to the “dark side” of leadership and processes which are also great learnings on what not to do in your next job or company you may start yourself.

Which comes first in your journey?

For those doing early career path planning and knowing they want to do both a startup and a mature company at some point, there’s always the question of which should come first. Hiring managers at early stage companies can get “spooked” when they see someone with too much time (5+ years) at mature companies; questioning whether the candidate will be able to transition to startup life. Not that it’s impossible, but it’s something to consider. For these candidates, I suggest highlighting any scrappy “ground zero” work they may have done at their companies to demonstrate they can handle ambiguity and take risks. I am also a huge (and very biased) fan of people who’ve joined companies early and scaled with them. They have learned a TON from those experiences and can often start scrappy, but know how to operate at scale. Win-win.

Conversely, someone with a lot of startup experience may have a hard time adjusting to mature company. A hiring manager at a mature company may question whether a candidate with only startup experience can handle a slower pace or won’t know how to navigate a complex organizational structure that requires political and communication savvy. You may have to sacrifice title and maybe some salary to get a foot into larger institutions who may view your past role, which may have been very senior at a startup, to being pretty junior if those around you have decades more experience. However, I always find those with startup experience can be invaluable to a team that needs to be shaken up, take more risks or explore new ground. Often, those who sacrifice title and pay when they joined, make it up fast as they move up the chain in a larger organization.

There’s no right or wrong place to start. A lot depends on how you define your skills and how willing and patient you are in either case to adjust. Much can depend on who hires you and their management philosophy. I’ve seen some people bounce between both types of situations over and over, some that just can’t handle startup life, and others who have startups in their DNA and should just stick with that world 🙂

“At a startup, every job matters and you can see almost daily that you are creating something that wasn’t there before. You have the ability to learn quickly and have a fast feedback loop to let you know how you’re doing. It’s very different working at an established company vs a startup, but you can learn a lot at both – you’ll just learn very different things.” – Rebecca Liebman, CEO & Co-Founder LearnLux

Questions To Ask

Regardless of whether you are a seasoned veteran or fresh out of school, as you ponder whether you want to join a startup or a mature company here are some final things to consider:

  • 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?
  • Who do you want to learn from, and how do you want to learn? You can learn from experienced colleagues and mentors, but having bad role models can also teach you a lot about what not to do. Similarly, if you are an experienced hire coming into a company started by inexperienced founders, you may want to learn by mentoring or teaching these young leaders. Taking the skills you’ve developed over your career and applying them to a new situation in itself can be a very enlightening experience.
  • Who do you want to work with? How important is the size and culture of the team you’ll work with? Remember, you’ll probably spend more waking hours of the day with these people than anyone else in your life – regardless of the size and nature of the company you join.
  • 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!

Do you have other tips on how to decide whether to join a startup vs. a mature company? Please share in the comments!

The CTO to VP Engineering Fork

bfa_code-fork_simple-black_512x512There comes a time in every scaling tech start-up’s life when an engineering team begins to show signs of needing help. The symptoms can include lost velocity in releasing new products/features, attrition or morale issues, fragile code or lack of innovation. I frequently hear CEOs and founders say “we need a new CTO” or “should we hire a VP of Engineering?”. But what does that really mean? A title is one thing, but the skills necessary to cure the symptoms is a whole other challenge.

Most tech startups have someone serving as CTO — whether it is one of the co-founders or a first senior hire. The role of the CTO is not straightforward and as a company scales, it’s unreasonable for that role to be the end-all-be-all. In the early days of a startup, the CTO is often the chief cook and bottle washer for all things technical. She is coding, serving as the de facto IT person and project manager as well as meeting customers alongside the CEO and helping with hiring decisions. She is expected to be deeply technical and often a domain expert. Firing on all of these cylinders may meet your company’s needs in the short-term, but quite often, there reaches a point where your CTO is no longer being excellent at what they came to your company to do.

In my experience, there tends to be two types of CTOs that evolve as a company grows:

The Evangelist — The shameless promoter of your product, this CTO is out on the road meeting prospects, existing customers and partners and marketing your product. At the same time, they are gathering valuable insight into your product, its pain-points and understanding how it compares to the competition. They are mindful of industry trends and the ecosystem of which your product belongs. They are the ultimate voice of the customer and are keenly aware of the product priorities. They set the vision for the “.next” of your product and the long-term roadmap. They may have once been a coder and understand the basics of your technology architecture. They can go head-to-head with other technology leaders in your space and represent your company at technology conferences. They also tend to be a recruiting magnet for engineering talent.

This CTO works hand-in-hand with the CEO and sales and marketing leads to set the strategy for the company — from market direction to the operations and scale of the business. They are financially savvy and comfortable presenting to and working with your Board of Directors.

The Expert — Often a domain expert or technical guru, this CTO is heads down with your engineering team ensuring your products are built to perform at scale. They may code, sit in code reviews, and mentor junior engineers. They are either designing your underlying architecture or at the very least leading that conversation and signing off on proposed plans. Also talent magnets, they attract senior engineers who wish to learn from this CTO’s experience. They may be key contributors to the open source community, prolific in filing patents, publishing technical papers and speaking at technical and academic conferences. While they enjoy meeting customers and value the insight from those meetings, they prefer more intimate meetings with technical members of customer teams and whiteboard sessions to brainstorm solutions vs. “selling” your products.

This CTO works closely with the sales and support team and often leaves the company strategy and growth discussions to the CEO and other leaders of the organization. They have an opinion on where the company should go, and they’re not afraid to share that, but they leave the details up to “management”.

The VP of Engineering

In both cases above, it’s rare when one of these types of CTOs is also a master at execution. This is when it is important to have a VP of Engineering (VPE). While a VPE can often be someone who can serve as a voice of the customer, be a technical expert and/or represent the company in technical forums, the VPE’s focus is on GSD. Key characteristics of a VP of Engineering are:

  • Process oriented — highly organized around priorities, velocity, quality and meeting deadlines. They have strong project management and communication skills.
  • Great at hiring — pattern matching skills for not just technical expertise, but for people who are collaborative and mission-driven. Knows how to ID the prima donna engineer from the eager-to-learn engineer and when to say “no” even with a great looking resume. Team fit is paramount to success.
  • Great at growing their team — this isn’t about going from 10 to 40 engineers. This is about career development. They’ve got a track record for bringing junior engineers into an organization and developing them into technology leaders and domain experts. Their former engineers have followed them from company to company because they are great to work with. They know how to have fun, but also how to appropriately push a team towards meeting a deadline with urgency and not burn them out.
  • Challenges the status-quo — they won’t just keep building what the co-founders started, but will question both the what and the how. They understand the impact that technical debt can have on the long term scalability of your products. They also know how to tune processes without overkilling the company with process. They are motivated to deliver products and features that customers not only need, but love.
  • Not afraid to get their hands dirty — they lead/attend code reviews, can code if there is an emergency, enjoy tinkering with competitors’ products to understand advantages/challenges of your own products, and appreciate the fine art of squashing bugs. They come in early and stay late when there’s a deadline — even if it’s to make sure engineers are getting food and coffee.
  • Strategic thinker — while a VP of Engineering may not be at the the table deciding the fate of the company, they are part of the discussion. They understand tradeoffs of time-to-market vs. quality and value the need to get a MVP out the door to garner customer feedback early on. They may push for a product or feature, but also respect the larger vision of the roadmap and know when to let go of something that isn’t a priority — in fact, the really good VPE’s kill things sooner than a CTO or CEO may like for the sake of velocity and GSD.

When you’ve decided it’s time to fork that technology leadership role and have both a CTO and a VPE, look for someone eager to create a partnership. Someone who prefers to lean into GSD and growing teams and who values the technology leadership, vision and evangelism of your CTO. Be leery of career CTOs who seek a role as VPE at your company — they may say they’re willing to be in charge of GSD, but could easily step on your CTOs toes. Look for examples of past engineering leadership roles as managers or tech leads. Also look for measurable achievements like improved velocity rates, quality improvements or hiring/team development metrics. Those are telltale signs that you’ve got a solid VPE candidate.

Sometimes it takes a lot of soul searching for a founding CTO to realize they’re not serving the company well around VPE-types of activities. I’ve seen plenty of CTOs worried that with a VPE on board, they’re not sure what’s next for them at the company. I’ve also seen CTOs excel when partnered with a great VPE where they can set the vision and execution strategy in tandem. Fortunately, I am lucky to have such a VPE on board here @DigitalOcean — as well as two awesome Engineering Directors with whom we partner to drive our technology roadmap.

Have you struggled with the CTO to VPE fork? Share your experience in the comments!