Working in a startup

Now that we have been working in startup environment from quite sometime, we thought that we would try & break some myths about joining startups that would be of help those who are planning to join a startup or are considering a job change.

Myth: Working in a startup is a risky proposition
Lets get into the root of this mentality.

In our society we have been taught to ‘play safe’ since childhood.

In SSC, every Indian parent is after the child’s life so that he/she is among the rankers.Reason: The child should get admit into the top Science college for HSC. First lesson to the child in ‘Playing Safe’ – Fields other than Science in HSC are risky

Then comes the biggest year in the history of every Indian’s career – HSC (I still see HSC students more tense than the CEO of my company:) The preparation for the big exam begins before the start of the curriculum of HSC. Loads of money is poured into expensive private tuitions. Parent’s suddenly start coming home early, child’s sport activities reduce by 90%, mothers increase the dose of healthy food (so called memory & concentration improvement edible things), non-studying friends are nowhere to be seen around the child, talks revolve around physics, chemistry,maths & biology.It looks like every entity in the child’s universe has the same epicenter – HSC exam.Everybody is concentrating on the four most important letters- P,C,M & B.Reason – getting a good hang of these subjects will get the child admit into either into Engineering or Medicine.

Second lesson to the child in ‘Playing safe’ – any profession other than Engineering or Medicine is risky

Now comes the choice for fields to be taken for let’s say – Engineering.

Here comes the third lesson to the child on ‘Playing safe’ – Any field other than Mechanical , Chemical , Electronics & (recently added )Computers are risky

Next is the choice between companies for job in their respective fields, for simplicity sake lets take Computers.

The fourth lesson to the child on ‘Playing safe – Any company other than Infosys, Wipro, Satyam & a selected few are Risky

Now I closed the loop – Its here where the myth – Startup is a risky place to work plays a role and people choose Infosys over a small startup.

The point is – we have been brought up in an environment where trying untested things seem risky which is not the case (Had that been the case, we wouldn’t have got Sachin Tendulkar, who has created an inflection in thinking about Sports as a career).

I would partly blame the parents for not letting the child pursue his interests & partly the Government & Industries for creating the asymmetry.

Lets look at Risk.Risk is always in reference to return.We see a choice to be risky when we expect lesser returns compared to the efforts from exercising it.Going with this definition, working in a startup is a Win-Win situation with very high returns & hence it isn’t risky.

Returns from a startup can be classified into tangible & intangible. The tangible component is the equity & salary while the intangible component is the Learning. I would personally rate the learning component to have more weightage.Now lets see why people see startups to be risky.They see only the tangible component coupled with pessimism - what if the company dooms?However they miss the intangible – Learning component.Startups provide a much sharper learning curve(will leave the explanation for some later post).This is fortunately well understood in the corporate world hence even if a company dooms, the other players in the industry are waiting for you with much higher packages & roles.So with every quarter, a startup employee’s value is actually growing at a much higher rate – tangible earnings and the future value of the learning!

Remember I took a pessimistic view, what if the Starup is the next Google?:) the returns are incalculable!

Any counter or supporting views?