Lately I’ve been hearing many negative comments about creating startups and being an entrepreneur. Most of them can be reduced to: “You should work for a big, well know company and after several years you can go and start you own“. In my experience this idea is pretty widespread. I’ve heard it from my father, from my friends, from friends of friends, etc. The problem with it is that, ALL the persons that express this idea have a common characteristic: they are conservative.
The idea that working in a big company you have better odds of creating a successful startup is bullshit. There are no statistics for that. Even more, people like Paul Graham from Y Combinator recently wrote an essay precisely about this same issue:
We’ve now funded so many different types of founders that we have enough data to see patterns, and there seems to be no benefit from working for a big company. The people who’ve worked for a few years do seem better than the ones straight out of college, but only because they’re that much older.
The three most common benefits I keep hearing about working in a big company are the following:
- At a big company you’ll have the chance to get high profile contacts that might aid you when you go and create your own startup.
Contacts are of great help, everyone knows that by now, nevertheless, the idea that you’ll have better and more contacts working in a big company has no ground. First of all, to contact truly influential persons is, in general, way beyond a normal worker. You’ll need several years to reach a status within a company to get access to the management team or high profile executives. I’m pretty sure Apple employees can’t phone Steve Jobs or mail him at any time with total freedom. Even if this isn’t true (there are always exceptions), the psychological perception for many top executives is that they are better and you are worse, that they belong to the executive class and you don’t. This means that even if you can reach them, you won’t be seen as an equal and the true advantage of recommendations et al. will be diminished. Of course, there are always special cases, but we probably wouldn’t be talking about a BIG company then.
Secondly, contacts within a same company are pretty much endogamic. This means that, if you work as a beta tester, most of your friends and coworkers will be related to the beta testing environment. Reaching interesting and influential persons in other fields is much more difficult.
Finally, the rate at which you contact new people is determined by external factors like the number of people in your department or how frequently you engage with other departments or clients. If we throw some numbers we get a glimpse of the big difference. I usually go to a couple of entrepreneur meetings per month. In average I meet 2 persons of interest for my startup at each meeting. That makes 4 good contacts each month. In the software industry (my field), projects usually take between 2 to 6 months on average (even more if it’s a huge project in a big company). During that period and if you are lucky you’ll meet an average of 3 persons (which might not even be good contacts) at the client. That means that for a 6 month project you’ll only meet 3 new persons and probably only 1 or even none will be of interest to you. Check that against 15-20 interesting persons in a 6 month period by yourself (and no, you can’t go to many entrepreneur meetings if you work at a big company). Although this estimates will also go down if you keep meeting with the same persons, it’s clear which rate is better. Please, as usual, takes these numbers with caution, they are very gross estimates and there are always exceptions.
- Working in a big company you’ll get the change to work or see really big projects that employ huge resources. This vision will help you when working on your startup.
Nobody disagrees that you acquire very interesting experiences while working for a big company. Specially if you work with large teams. The problem is that when building a startup you won’t be managing huge teams or resources, you won’t (normally) need real-time critical systems either. You won’t even deal with a lot of clients at first. So, even though it’s a plus if you have the experience, it’s not critical, as a startup is NOT a big company.
- Working in a big company will give you a good resume and it will be easier for you to find investors.
Good resumes are always good things. Specially if you approach investors, your team’s resumes must be great. The problem is that many persons don’t differentiate between the team and the founders. An investor isn’t looking for a top notch programmer founder, they are looking for people with experience setting up companies, growing companies, selling companies. They are looking for people with a track record of not wasting money in useless things. They are looking for a true leader that is able to get the best out of his team. If you are also a top notch programmer then be it so. Working at a big company won’t get you more money from investors. VCs that invest on people only because they are ex-googlers or ex-yahoos are wrong and they’ll pay for it. That it’s harder to find investment if it’s your first time and you haven’t been working at a known company, true. Impossible to do it, false. Actually, most of the investments I see are to founders with not experience in big companies, just take a look at Apple, Microsoft, Google, etc.
So, in conclusion, from my point of view, there isn’t any competitive advantage in working on a big company. Actually for me it’s the opposite. Two years of inferno, with a tight leash around your creativity and without the freedom you’ve got in a startup. Worst of all is that the environment affects you in a negative way and it takes a while to get used to breath again. Finally, the years after graduation are the best to play the high risk game of creating a startup as people haven’t got so many financial debts (a house, a family, etc.). Wasting those precious years in a restrictive environment instead of changing the world is wrong.
Choose what YOU want and follow your gut. If you don’t feel comfortable at a company, take the time to think about what you really want. And most of all, don’t listen to those that try to project their own insecurity on to you, as that will only block your true feelings.
As usual, everyone is invited to drop a comment. I would love to read what other entrepreneurs or big company guys think about this. It would be interesting to have a VC or an angel to comment on this issue as well.
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