Leveling Up

Making the conscious move from employee to entrepreneur

I had dinner with a friend last week who works at a late-stage startup. After discussing how things were going at work, we wandered onto the topic of what he hoped to be doing with his career in 5–10 years. Like many others in his cohort of late-stage startup peers, having witnessed entrepreneurial success he expressed a keen interest in starting his own company. When I asked him when he thought he would be ready to do so, he responded that he wanted be a product manager first so that he would gain experience leading a team in building and launching a product. This answer gets about half credit: being a PM is, on the surface, a good path because of the skills represented by the discipline. But not all PMs have these skills, and not all who have them are PMs. He was using the PM title as shorthand to denote a set of competencies and a mindset often found in entrepreneurs.

Not an entrepreneur, but makes a good sales pitch

Let me start off by saying that there is no definitive way to become an entrepreneur, and most entrepreneurs aren’t actually ready when they do start a company. If you wait until you feel ready, you’ll be waiting forever. Much like Keith believes that the right valuation for a company should make both investors and founders moderately uncomfortable, the right time to start something isn’t going to be when you feel 100% ready to do so.

You don’t need a specific job title or a predetermined set of skills to start a company. In fact, focusing too much on resume-building or qualifications is a great way to continuously put off taking the leap (again, because you’ll never feel ready). And if all entrepreneurs had the same qualifications and experiences, it would significantly reduce the diversity of companies that emerge. Some companies need engineering-focused founders; others need design-focused; others need operations-focused. There is no one-size-fits all: a founder should not be a jack of all trades, but rather have the skills needed for the area they’re attacking.

What my friend was trying to articulate was that he felt he had been focusing too narrowly in his work and wouldn’t be prepared to address the full breadth of challenges founders face. If you spend all your time in a very limited role, how do you expand your skillset to increase your chances of being a successful entrepreneur when you make the jump?

There are two basic axes along which any individual employee needs to think: (1) how do I perform my assigned role well; and (2) what makes the company better? The latter category is the more important one, both from a resume-building perspective and from an entrepreneurial skills perspective. The former just ensures you don’t get fired.

Not where you want to be. Photo by Bonnie Lane via bikesportnews.

The problem that arises when focusing solely on your specific role — what you are immediately and directly responsible for — is the same that motorcycle racers face on the track: if you’re spending the entire time laser-focused on the leader’s rear tire, you’re bound to make the same mistakes they do. If the rider you’re following enters a turn too fast and runs off the track, you’re highly likely to do the same. You need to think about your work not in the context of what you need to do to fulfill your immediate responsibilities, but rather how doing so makes progress towards the company’s major goals.

What are you doing, and why are you doing it?

What targets does your team have, and how do they fit into the objectives that the company has? Your team’s goals may be simple: ship a product, reduce defect rate, improve conversion, etc. But on some level they influence the top-line metrics that dictate a company’s success: new users, active users, revenue, etc.

Once you see the link between what you’re working on and what your company is trying to accomplish, it’s easier to see the other factors that influence or constrain your company’s progress. Is your team the limiting factor on your company’s growth? Or if you achieve your goals, will there be other bottlenecks that prevent the company from growing at its maximum rate? Understanding the bigger picture illuminates the logic behind resource allocation decisions. How are resources allocated in your company, and how does this align with (or not align with) the company’s priorities, growth opportunities, and limitations?

Taking time out of your day to think about how your work affects the company’s top-line goals will help you understand both the purpose of your work in context and, more generally, how startups grow. If you don’t see how your team’s goals align with the company’s, it’s worth asking about them: you may learn something you hadn’t previously considered about what your company is making, the resources available to it, and the constraints and incentives that act on it.

You don’t have to understand how every part of the business works down to the finest detail to be an entrepreneur. You do, however, need to understand how different elements work together to achieve your company’s goals and why your company has prioritized what it has. Every startup is a story of scarce resource allocation in the face of numerous existential threats. The best entrepreneurs can identify the most acute risks their company faces and focus on them above everything else. If you can apply this lens to your daily work, you’ll be better equipped on every level to help your company succeed.