While several McKinsey alumni have become Unicorn Founders, consulting is still viewed as a scarlet letter vs a badge of honor in Silicon Valley.
Here are some surprising lessons for consultants considering the founder path:
Hire fast, fire faster
Despite the career’s reputation, I never fired a single person in my seven-year consulting career. In contrast, on day one of joining a start-up, I had to fire a team member and become a true manager for the first time. Start-ups taught me to hire and fire quickly. However, I took a page from consulting, and used the concept of “Search Time.” This helps someone to figure out their next steps.
80/20 is insufficient
At McKinsey, I was part of the Operations practice. I focused on creating, streamlining, and automating processes to cover 80% of cases with 20% of the effort. In my own start-up, I spend most of my own time handling the 20% not covered by standard processes. By now, I’ve earned my battle scars (and judgment) through making mistakes. The great product minds of Silicon Valley can also fall into the 80/20 trap, and miss the reality of the corner cases.
Talk about myself
On TV, consultants are shown engaging in epic powerpoint battles where magnetic personalities win based on swagger and bullshit. In reality, I was taught to always focus on the firm instead of myself when pitching. Silicon Valley is where I first saw swagger being expected from founders. Early stage investors mostly fund the founder given there is no product yet. This is a tough adjustment for me, but I’m slowly embracing talking about myself more (hence this blog post).
Growth over profitability
The first lesson of my finance training as a consultant was that Cash is King. I served ~30 clients at McKinsey and all of them made money. In Silicon Valley, it’s extremely rare for a company to be cash flow positive even at the time of IPO. Start-ups take a leap of faith when they expect technological innovation to change cost structure over time. Investor economics are also aligned for faster growth vs profitability. While counter-cultural, I still want to build a profitable company.
Vulnerability is necessary
As a consultant, I had the good fortune of structured professional development. Even as I rose through the ranks, I always had fantastic peer support. When I took on the CEO role two years ago, it was the first time I experienced “it’s lonely at the top.” Then I learned rather painfully that being a founder is the loneliest job in the world. I was shocked at a recent group founder dinner to find that 75% of the attendees went to therapy at some point. I’m really happy to see those founders being raw and open with each other on their challenges. It was incredible to see how everyone reacted to vulnerability with unconditional support. I am happy to have found another community that really believes in paying it forward.
I’m a strong believer in what does not kill you makes you stronger. I look forward to the next set of surprising lessons.
Jenny is a CS PhD serial entrepreneur with a passion for the Future of Work. She was an Associate Partner at McKinsey & Company and is currently the co-founder and CEO of Ergeon, a company that aims to simplify home improvement by empowering skilled local contractors.
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