There is an interesting post doing the rounds on the blogsphere which talks about 17 tips for startups.
Most of these tips apply to the US, but some are universal, and the one I like the most: fire employees who are not workaholics. I totally agree with this one and strongly recommend that every startup apply it. You don’t need a big team, you need 2 to 3 people working 18 hours a day, 7 days a week with no vacations. Find them and keep them.
Anyway, that post was followed by a Techcrunch post, which was a startup not too long ago and the founder had his own advice.
If you have any additional advise then do share here in the comments section.
Here are some of my tips:
1. Try and outsource as much as possible. You may not be able to recruit great people because you are a startup, but you will find fantastic entrepreneurs who are available to work on your project in an outsourced capacity.
2. Cash is a very scarce in a startup. Try and do equity deals with outsourced companies, this will bring down your costs. You will be surprised how many are willing to take equity if they like your idea
3. Don’t recruit employees. Recruit co-founders. The best people no longer want to work for companies, they want to own them, so recruit co-founders. You will be amazed at the quality of people you get, far better than if you advertsied for employees. You will need to give them some stock, but that can come from the ESOP pool. Goto www.salary.com to see how much you should set aside for ESPOS
4. Drive the costs down of everything. Don’t be shy of bargaining.
5. Work like crazy, don’t relax, get everything done at 5 times speed. You will run out of money faster than you think. You customers will come later than expected. The only chance you have of beating the system is keeping costs low and working faster than money runs out.
- Fire employees who aren’t workaholics… - March 9, 2008
- How did you fund your startup? - February 7, 2008
- IAMAI Entertainment 2.0 - October 20, 2007
Bipin, I think the definition of workaholic is not just someone who is warming the seat 18 hrs, but someone who is active round the clock on the project: thinking, living and breathing it. He/She is the kind who will sit a few hours after dinner and wrap up some important stuff; and makes sure he buys books to educate himself on the subject; and takes time on weekends to do some kind of work benefiting the project.
I think smart and hard go together. You want smart and hard.
Deepak, I think you said it: without stock you can’t get crazy on your project. Stock is an important component of getting a good startup team together.
Microsoft used to have this implicitly for a while (you wouldn’t get promoted if you didn’t appear like you were working long hours). People would make programs to send status reports at 3 AM 🙂
Yes, co-founders will work hard – not 18 hours, 7 days, because this kinda guy will burn out in 6 months – but 80-100 hour weeks are likely to be common. Can’t do that with employees, even those with stock options, unless they get a reasonable chunk of the company.
The rest of the points you mention are excellent, thanks! Startups need all the cash they can save, especially if they’re bootstrapping.
Conventional wisdom is dicey as far as startups are concerned. I am working on something where I am less concerned about speed of execution than the quality of it.
In fact, if you ask a user of travel sites, chances are she doesn’t know which site came first. But she will know which one she likes best. Yes , it is difficult to enter a market which is already crowded. But then, was there no email before gmail ? Good products married to a great market ( fueled by an undeniable market need) will and should always find users.
Therefore, I don’t see how workaholics could be good for any startup. I am much better off hiring people who are a) passionate b) share my dream and c)take ownership. It really comes down to working smart versus working hard. In the seed stage, so many of the smallish things are ultra-critical in terms of their future impact. You don’t want to rush them. You want your guys to think over it – not just technology but in terms of future use cases- and then make the right decisions. I don’t expect someone working 18 hour days , 7 days a week to work smart for long.
Its really difficult to find even normal techie in India forget abt workaholics,
It is a chicken and egg situation…..
Fire employees who are not workaholics – difficult because you dont find employees with right skill set and who are workaholics
Fire co-founders who are not workaholics – difficult because you dont want to disrupt the team.
I empathize with the founder who is surrounded by people whom he wants to fire but cannot, so lives with it.
Vyaas