I have decided to write a short piece about this because I have had quite a few conversations with people who are about to finish university and have asked for advice on what to do. They are smart people with a few good offers (like I had from KPMG and others when I graduated from Kings College), but when pressed what they really wanted was to start their own company, and the question was “should I get some corporate experience and then start a company, or should I start one right now?”
I have had as many or more conversations with old people (i.e. over 40!: OLD!) who are in successful corporate careers, but who also want to “start my own company!”. One of these guys is Ned Philips who did start his own company, Bambu, two years ago and has just raised $3m from Franklin Templeton and is really taking off. Ned recently told me he has never been happier. And he should be; what he has done is amazing. He is working closely with his dad, one of the foremost thinkers on neural networks, and employing 30 people and counting, and traveling the world talking about how AI will change the way people will invest, and a nice bonus: his company is worth millions.
There is another long article I will write on why starting your own company is the best thing to do, but for now, just take my word for it — starting your own company is the most amazing thing you can do and the answer to all of your problems, and the world’s problems. Trust me, its true. Ask Ned.
So that being said the question is when to start your own company. There are pros and cons to doing it early (I started Tigerspike when I was 27), or late (Ned started Bambu when he was 49). The big advantage of doing it young is you often don’t have a partner, kids, mortgage etc.. so you can live on very little, and you don’t miss your kids growing up when you spend all hours of the day and night at the office (which you do because you love it. You don’t see it as work). The disadvantage of doing it young is your youth can work against you. Most of your contacts are the same age as you, and it can be difficult to be taken seriously by ‘old’ people. I saw this quite a bit when I walked into big companies and tried to sell to them. I am sure in their heads the older execs were thinking “who is this kid trying to tell me about how mobile will change my business!”. And to buy from someone it helps if you can relate to them, and its harder to relate to a 27-year-old if you are 47.
The disadvantage of being old is your life costs more, so when you start your company you either have to raise money, which comes with a ton of headaches you don’t want, or you better have an understanding family and no mortgage. The annoying reality is that it is easier to start a company if you are somewhat rich — it just gives you more flexibility.
At 27 I still needed money to live in Sydney and didn’t earn anything for two years so it got really tough. I never took money from my family but between the co-founders, we had supportive girlfriends and $100k of debt on our credit cards. But I knew that if the shit really hit the fan there was family support there. Not everyone has that, and I would say there are very few entrepreneurs who are truly ‘self-made’. Everyone gets help from someone. Kylie Jenner is certainly not ‘self-made’ as Forbes recently described her.
Another thing is it depends what sort of company you are starting. If you are starting a B2B (i.e. ‘Business to Business: you are selling to businesses) then I would get some corporate experience and wait until you are older. Your customers (the corporate executives who control the budget you are trying to get) will be over 40, and so if you are 22 you won’t relate to them and they won’t relate to you, and if you don’t relate to each other then they won’t easily buy from you.
If you are starting a B2C company (Business to consumer: selling to people, like Facebook) then you can get away with being younger the trying to hone your product while eating cereal for every meal. You can learn online marketing and if it works and your product is well designed, then many people will buy it. An example is a student I spoke to at the careers day at United World College in Singapore. I went to UWC when I was young and everyone who left wanted to join Goldman Sachs so I went to the careers day to try to save a few souls. One I soul I saved was an Indian student who came to the careers day with his parents and grandparents (who were there to make sure that he got into Harvard so that he could get into Goldmans). He and a friend had made and released an online game and in 3 months it had 10,000 users a month and growing. Much to the horror of his family, I advised him to quit (he settled on delay) university and focus on the game — those numbers were amazing!
And that brings me to the answer to the question “when should I start my company” and since there is no right answer the answer is when you get the opportunity to. My opportunity was being in the mobile technology space just as mobile was taking off, and looking for a new challenge after 8 years at KPMG. And it is an important point that my time at KPMG did help me with Tigerspike, I am sure we would have gone bust a few times if we didn’t have some financial discipline that must have sunk in over the 8 years of working as an IT consultant and Chartered Accountant. But its hard to say whether having corporate experience is worth the delay. Again, if you are disrupting a business, you can’t really do it if you are not in that business and therefore have intimate knowledge of it. If at 18 you start paying your car insurance and realize that you don’t like all the paperwork or the cost so you decide to start a company and disrupt the insurance industry, this is probably not as easy as being a 60-year-old Insurance veteran who knows the ins and outs of Insurance starting one.
The truth is there is never really a good time, just an opportunity spotted and acted upon. You don’t even need to have to have an idea, the opportunity could be that you have just been laid off from your job. Or you are doing a gap year and have time and don’t need money, or the game that you made suddenly grew to 10,000 users.