Startup Milestones and Broken Bones
Let me take you back to a time in my startup, Zinch, to an afternoon that was almost typical. Change was in the air as the Utah autumn shifted leaves from green to bright reds and yellows — and so, too, our startup was a-changin’… We had outgrown our office and had hired more sales people. They brought with them new competitive fire, and, on this day, aggressive ambitions took an unexpected turn for the worse, as the office expansion had unintentionally created a struggle over who got what in the new space. In the early days of startupdom, you learn to give just enough guidance to your salespeople and then let them have at it. What this meant for the team vying for the best desk space that day was a head to head match at arm wrestling.
I was in a neighboring office when, after a few whoops and hollers, I heard a distinct “pop!” I thought someone had punched a wall. As I entered the room, I saw one of the arm wrestlers on the ground, his right arm hanging limply at an odd angle. His opponent (let’s call him the ‘arm breaker’) stood dumbfounded, trying to process what just happened. A broken arm bone was what just happened! A few hours and an ER trip later, Lance’s arm was declared to have a spiral break at the bicep. Unbelievable! To this day, it’s still unbelievable!
Just like moving into the office and expanding the sales team created a momentous (and memorable) milestone, startups experience notable transitions. One of those is summiting the $1 million mark of annual revenue. Over the last year, several of our Peak Ventures portfolio companies achieved this important milestone, an inflection point that is often (I’ve realized) marked with other evidences of growth, like adding sales reps. With the addition of new sales people comes increased internal competition, the carve-up of sales territory, and new benchmarks that guide the company’s sales quota and expectation for growth.
There is a hidden problem in growth, however: change can be painful. Hopefully not as painful as a broken arm! If you know that your company will transition and are flexible enough to adapt, the pain of change can be used to propel you forward. Here are some lessons I learned first-hand and through the founders we back, so whether you are sales hire #1, the newest account exec, sales manager or founder, appreciate the following:
1 Your company made it over the hump and you will always bear the title of founding team member. Not many startups get to this point and, by virtue of that fact, few sales people get to experience this early stage in all of its arm-wrestling glory. It is the heaviest lift. The path from zero to one is the Mayflower, the maiden voyage, and it sets the stage for what will certainly come next. Our arm-wrestling fanatics, Lance and Josh, will always have claim as part of that founding team.
2 The next stage will not be the same, so dump expectations and adapt. Save yourself the heartburn that comes with living too long in the past. Sales records will now continually be broken (which is what you wanted all along); the caliber of new hires will (on average) increase (bravo!); and at some point you will either feel like you are being overrun or you will pitch in, continue to be a contributor, and enjoy the next phase of your company. And make no mistake; this is your company. Whether you remain a contributing part of your startup is the real question.
3 Learn to ride the train of investment in your company, and in you! One of three things will likely happen after a major milestone: 1) the company will invest in new people with experience to meet the demands of a growing business, 2) the company will invest in current people with the same desired outcome of scaling and/or 3) the company and/or individuals will wait on investment (whether deliberately or due to lack of growth capital) and play a reactive game to markets/customers/competition. Let’s assume you work for a company that is actively investing, then you can look to either #1 or #2 above — your company is going to invest in its future.
Understand the indirect investment in you. This is not always how you will see it. When someone else is hired, your tendency may be one of skeptic. Buck the trend of the jilted employee! For goodness sake, you made it this far, embrace the fact that the exact same strategy is being employed now as it was when you started. Somebody believed in some people enough to invest. Somebody is doing that now. We hired 5 Harvard MBAs consecutively as we scaled. Each was a remarkable contributor and from 4 of the 5 (due to the nature of intersections in our work), I learned and grew a lot. It would have been crazy not to learn and lean on and grow alongside those individuals. These were indirect investments in everyone surrounding those relatively senior hires.
Meet the direct investments with investments of your own. If the company is investing in you, presumably through added responsibility, new responsibility, or simply giving you the reigns to continue to plow where you’ve plowed, listen up… They’ve given you some rope. And that feels good. I am a believer that hard work can go a long way in life/career, however, navigating the evolving stages of a company requires a different set of skills and habits at each stage.
Here are some takeaways on how I’ve seen others invest in their future when the company they work for has directly invested in them:
Develop hard skills — I’ve seen a pair of founders put themselves through coding school at an early stage of their business. This technical foundation led to them building their MVP, created the ability to more effectively interview/hire their eventual CTO and now gives them an added edge of credibility with their technical team members.
Enlist a mentor — Few things stroke the pride and satisfaction of successful people as much as them seeing their “professional posterity” go on and do great things. Look at great college coaches who’ve created a tree of those who learned under their eye. Look at the flood of admiration someone like Bill Campbell receives when he departed this life. It’s how they live on. So here’s your turn — thoughtfully select a mentor. I speak to one of mine at least twice a year. He is extremely busy (if they’re not, you may have the wrong mentor), but he amazingly cares about my career and my life for that matter.
Hire your boss — Some of us have it in us to go back to back. Back to back in successful startups. Back to back in successful navigation through the stages of growth in our company. Most of us don’t. We are great, for a time and a season. And then we need a reset. Think of your last career change- remember that feeling of complete exhale? Nothing wrong here, it’s just a function of cognitive horsepower over time. We all need a defrag now and again. Few things can get you comfortably back on the learning curve in your career than hiring people more talented than you. Stop looking for employees and start looking to hire your boss.
Each phase of startup has its memories. Today, Lance and I raise kids in the same city and his gnarly bicep scar is a reminder of the times we shared. Since then, Lance has grinded through nearly every milestone of the business, and is still a massive contributing force to the acquiring company’s bottom line. We’d both tell you that we benefited from seeing the direct and indirect investments in our company as an opportunity to regroup, self-assess, and up our game. Milestones and the consequential changes can be tough. Broken bones hurt. But if you lean forward through the change and maintain flexibility, you’ll get through it and help your business grow.
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