What it Takes
Determine whether joining a startup is right for you
by Henry J. Lindborg
According to Prudential Financial Inc., by 2030, “half of America will be self-employed” and working without benefits. This, the organization’s television commercials say, is foreshadowed in Stonington, ME, a community of about 1,000 that depends on a lobster industry rooted in a long tradition of independence and myriad risks. Prudential invites the self-employed of Stonington and the United States of 2030 to “bring your challenges.”1, 2
Though U.S. Bureau of Labor Statistics data indicate that the projection of 50% self-employment is highly unlikely,3 Prudential’s emphasis on financial risk strikes a different tone from the promises of free agency during the 1990s: Freed from the constraints of corporate tradition, bureaucratic structures and threats of downsizing, work could be satisfying, enhance human potential and even be fun.
In a 1997 Fast Company article, Daniel Pink asserted, “As you take to the highways found on the new map of work, you’ll soon learn the foremost rule of the road: freedom is the pathway to security, not a detour from it.”4, 5
Over the past 30 years, Charles Handy’s shamrock model—the idea that an organization is made up of three parts, or leaves: a permanent core of employees, and contract and part-time workers—has continued to reframe career expectations. Free agency and “gig” work have become, for many, a risky economic necessity rather than a path to liberation and security.6
On the other hand, amid fears of economic dislocation and specters of disruptive technology, the allure of startups has remained. The spirit and tribulations of the entrepreneurs entering the TV show “Shark Tank” offer another vision of success, built more on innovation and strategic acumen than an escape from the oppressive corporate mechanism depicted in Charlie Chaplin’s movie “Modern Times.”
But as “Shark Tank” reminds us, starting a business requires more than a few good ideas and a desire for independence. Founders face an array of challenges. Those seeking independence must cope with interdependence when acquiring customers and managing stakeholders—not just employees, but also lenders, investors, regulators, suppliers, partners and communities.
Competition for customers, marketing space and financial resources can be fierce, and founders often must self-fund, waiting for a return on their investment as they face a high probability of extinction after just four years.
Billion-dollar startups are rightly called unicorns—they are rare. According to entrepreneurs reflecting on failure, the top reasons startups fail are because there is no market need for the product or service, and they run out of cash, indicating enthusiasm is outrunning strategy.7 But enthusiasm persists, and opportunities to join existing startups come along. If they do, should you bite?
You’ll need ambition and an appetite for career risk, an understanding of business strategy and how businesses behave in their infancy, knowledge of what skills you bring to the table and a willingness to learn under high stress.
For an experienced perspective, I looked close to home—my daughter-in-law, Beth Lindborg. Beth’s background is in biotechnology. Before joining startups, she prepared herself with a graduate degree in that field and an MBA.
Hank: What is most important for a startup?
Beth: Having the right team members with the right knowledge, experience and network to accomplish the strategic goals of the organization. Network refers to other people with the right knowledge and expertise who you know well and who are willing to help you—most likely because you have helped them in the past, or you have another personal connection or something in common.
Loyalty is at play here. The team must be cohesive, and the people should enjoy working together and celebrate one another and the little successes along the way to the larger goal.
Poor team performance has been identified as the third most significant factor in startup failure. What do you look for in a team?
Everyone on the team must have a strong conviction and belief in one another and the organization’s mission and goals. Raising money is impossible if you don’t believe 100% in what you are doing and why you are doing it.
What’s required for leadership in a startup?
Good leadership: honesty—especially if you don’t have an answer to something—transparency, incentives for employees that are motivating and make sense for the organization (alignment), and compassion and caring for the team. Most important is doing right by everyone and fairness—don’t be taken advantage of.
Following these general principles makes it easier to make day-to-day decisions, and to be confident that you are making the correct decisions.
What differentiates a startup from an older, established organization?
A sense of urgency. The reason why startups can, in theory, go faster than larger organizations is because they are leaner, get faster approval from management, and leverage relationships faster and easier compared to a large organization. A sense of urgency is extremely important to keep things moving, and that comes from the top down.
As vice president of operations in a project-focused startup, my goal is to remove all barriers for all project work (including fundraising) as quickly as possible so that things are always moving forward. This, combined with the right people in the right roles who are motivated and have a sense of urgency, enables things to be accomplished much faster than what you would typically see in a larger organization.
What’s your advice on joining a startup?
Joining a startup probably isn’t for everyone. There is a lot of hustle and it’s a lot of work. You won’t have all the knowledge and skills you need, but you must be willing and unafraid to figure it out and ask for help from your team and network when you need it.
People will tell you that your idea is terrible, that you are wrong, you will never see a return on your investment and you can’t do it—and you must be OK with that. But if you and your team (assuming it’s the right team) have the conviction that what you are doing is important and will be successful, you can be—and must be—confident moving forward.
You should listen to the naysayers and take what they say into consideration, but at the end of the day, you must do what you think is best for the success of the organization.
- “The State of U.S.: Stonington, ME,” Prudential Financial Inc., https://tinyurl.com/y9r77wjm.
- “Stonington, ME,” Prudential Financial Inc., https://tinyurl.com/y8937y3s.
- Jay Shambaugh, Ryan Nunn and Lauren Bauer. “Independent Workers and the Modern Labor Market,” Brookings Institution, June 7, 2018, https://tinyurl.com/ybl2hxscr.
- Daniel H. Pink, “Free Agent Nation.” Fast Company, Dec. 31, 1997, www.fastcompany.com/33851/free-agent-nation.
- Daniel H. Pink, Free Agent Nation: How America’s New Independent Workers Are Transforming the Way We Live, Warner Books, 2001.
- Charles Handy, The Age of Unreason, Business Books, 1989.
- “The Top 20 Reasons Startups Fail,” CBInsights, Feb. 2, 2018, https://tinyurl.com/yag4go6f.
Henry J. Lindborg is executive director and CEO of the National Institute for Quality Improvement in Fond du Lac, WI. He holds a doctorate from the University of Wisconsin-Madison and teaches in a leadership and quality graduate program. Lindborg is past chair of ASQ’s Education Division and of the Education and Training Board. He is a past chair and current member of the Institute of Electrical and Electronics Engineers Career Workforce Policy committee.