How to Make a Successful Transition From a Big Company to a Startup?

Olivia has always been an intrapreneur at work, not accepting the status quo, bringing in new ideas and taking on more challenging projects and responsibilities. She has also been frustrated with the pace of things and internal politics she needed to navigate constantly. After many years at a multinational company’s human resources department, she wanted to challenge herself in an entrepreneurial environment. Plus, the Great Resignation was happening at full speed so she decided to join the movement. She received a lucrative offer to join a successful startup as their Chief Human Resources Officer.

Olivia was excited about this opportunity but also nervous because she was taking on an executive role with no guardrails this time and was wondering what she could do to make the transition a success.

If you like Olivia, you are itching for action and wanting to join a startup after a career in a big company, there are several important factors that you need to take into consideration.

The Reality of Big Corporate Versus Small Startups

Profitable big companies have several advantages in comparison to startups:

  • Access to top talent and expertise
  • Training and career development programs for employees
  • A stable structure that allows for smooth(er) execution,
  • Strong brands that give them credibility with clients and potential hires,
  • Economies of scale and scope in production and distribution of their products and services
  • An abundance of internal resources to execute any kind of project
  • Processes to ensure product quality and minimize risks

Because of all of the above, paradoxically, many big companies struggle to innovate. It is hard for them to leave legacy approaches behind and quickly adapt internal processes and matrix structures to launch new business models and product offerings. New projects require an alignment of numerous stakeholders and often become too slow and costly. Big companies normally pay well and have great benefits so they attract employees who seek stability and comfort and may avoid taking risks that can jeopardize their position.

The late Clayton Christensen wrote about this in his famous book, The Innovator’s Dilemma. His key argument is that what makes big technology (but not only) successful companies – meeting the needs of their best customers – is what ultimately makes them decline; they neglect segments and customers that are not part of their core business until it is too late. They are then overtaken by new emerging players, like startups.

Startups are lean and nimble because they are born without structural constraints.

They:

  • Do not have to rely on legacy systems or processes
  • Make the best out of the few resources they have in order to survive
  • Have a lot of flexibility to test new ideas with any type of customer
  • Prioritize launching unfinished products, failing, learning from failure, trying again and adapting their approaches until they find a good product-market fit
  • May pivot the entire business in a week if they realize that market conditions have changed
  • Often attract people who are curious, ambitious, and who enjoy high-risk, creative environments

On the flip side, the majority of startups fail because they do not have enough financial resources or experienced people to help them grow profitably. They need to invest a lot more effort into building credibility with clients or potential employees who have never heard about them.

Founders are often visionaries with a lot of drive and resilience yet limited managerial experience. Employees have little to no guidance or training and have to learn everything on their own, which can costly cause mistakes as well as high burnout and turnover. Unless the startup is well-funded, it will face difficulty in attracting experienced employees who require high salaries and rely on junior talent instead. All this, paired with a lack of structure and processes, may lead to failure to achieve aspirational goals.

Someone who goes from a big company into a startup may add a tremendous amount of value by bringing in all the know-how and experiences of big companies as well as an outsider’s view. Yet, he or she runs the risk of failing to adapt themselves and their ideas to this very different environment.

Some things to remember:

Iterate, Do Not Try to Be Perfect

In a big company, one is often incentivized by internal processes to spend a lot of time perfecting an idea or a product before showing it to others, to avoid getting the idea criticized or even killed. In a startup, there is no time or money for perfection. If you are going to spend even a month trying to perfect something before sharing it with your startup colleagues, it will probably be irrelevant by the time you show it. Sitting on your projects for too long may also raise high suspicion about your contribution to the company. Instead, come up with a blueprint of your idea and next steps for execution and quickly share it with others. They will give you important feedback and probably tell you to go ahead. This brings me to the next point:

Get off the Throne and Get in the Weeds

Remember the whole thing about startups being strapped for cash and resources? This means that even if you are now an executive, you will not have the same big company resources (internal or external) to help make your projects a reality. You will need to be a lot more hands-on and sometimes take on tasks that you would have otherwise delegated to the intern.

Moreover, be careful about proposing ideas that you may not be willing to execute yourself (if not you, then who?).

This does not mean that you need to do everything a team of 30 people would do. You can and should negotiate for more resources but before you can delegate or outsource, you will need to learn the work, structure it and train the person.

Think in Quarters Instead of Years

Projects can last years in big companies. Startups, however, cannot afford long timelines. You should figure out how to make a useful contribution to the bottom line in the first 90 days of your arrival (and potentially, 30 days). You can run pilots but even those should take a fraction of the time they would take in a big company. The good news is that there are MANY opportunities for improvement within a startup, you should just pick one or more. “BUT BUT BUT..” you may say, “first I need to conduct an extensive diagnostic, develop a detailed plan and then build a great team of experts before I can start delivering important results.”

See the previous paragraph point, trade the detailed plan for a rough outline and then break down your vision into a lot of small projects that you could start delivering in the upcoming months to build credibility and ensure that your ideas are in fact useful for this new context.

If the above pointers are making you feel like Alice in Wonderland going down a rabbit hole, bring some friends to the tea party.

Make Friends

Startups tend to be fairly flat and informal organizations. They are often facing a lot of hardship and resource constraints, which is conducive to bonding among colleagues who are going through this journey together. On one hand, as an outsider, you will need to show that you “get it” and would fit in within the startup’s culture. On the other hand, people will be grateful that you are coming in to help out and curious about the know-how you are bringing. As a newbie, you do not need to figure out all of the above on your own. Make new friends, ask lots of questions, socialize ideas to get feedback on their relevance and get others inspired to join your projects.

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Adapting to a startup role can be challenging but keeping an open mind and being ready to make mistakes and learn along the way will make it much easier.

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