Incumbents plan big but startups try small:

A big difference by looking at small details.

Daniel Gusev
Jun 27 · 2 min read

In my previous life I worked in a venerable old-time financial institution where processes to launch a product sometimes run for 2 years — and where people went on and off, losing sight of end-user benefits, often delivering product no longer making sense to the world that moved on, where insular behemoth did not grasp this change.

I switched to startups to chase my understanding of the world and what I wanted to bring into it: progressing with iterative testing of small ideas, progressing from both laudable feats as well as failures. Failure is praised for it educative qualities: putting one down to earth and having a stimulating effect to improve.

Success on the other hand is a vindication of everything put right but often carries a toxic component too. It is a silent killer, if success is framed and not formed: where a big institution through its near monopolistic position believes it is succeeding as it can paint a picture — but in reality it is not. Failure is shunned as with 2 managers — 1 can paint a success and would push the 2nd out of resources — and out of job.

Silos, painted windows, politics kill innovation: it skews the picture. Hence where startups play with small things learning from mistakes and only then scale, incumbents shun small things (one would not be promoted from trying small things that high-ranking executives don’t understand and consider below their pay-grade) and paint success left and right.

Institutional capital has started noticing these things after the Great Recession and deployed capital circumventing banks and going to smart intermediaries. This is one of the positive outtakes from redistribution of capital to the tech-enabled world, that brought not just the modern tech stack but the discipline and tech culture of building it.

Daniel Gusev

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10+ years, 2 labs, 1 bank, 2 startups, 1 exit. Digital banker, wishful tinkerer, amateur father. Fintech VC @gauss_vc and co-founder of @finfitapp.