The Mature Startup
Three lessons from a year of running lean in an abundant environment
For five years, I did a little bit of everything at a couple of early-stage startups. I had become comfortable working in small teams with nearly complete autonomy. Then, two years ago, I made a strange choice: I joined Indeed.
I went from a team of 17 to a team of thousands, and I traded the autonomy I’d become used to for the structure of a large company. It was a big shift, to put it lightly. If you knew me then — and you had heard my vocal phobia of large companies — you would not have predicted this move.
But as a historical generalist, I wanted to become T-shaped, and I saw opportunity to really learn Product at Indeed. Plus, my new team was one where I would feel right at home — I was joining the Incubator team, a lean startup lab inside the bigger company.
What is Incubator?
The Incubator team is Indeed’s internal new product accelerator. We focus on investigating new product opportunities, typically a step or two outside the realm of an existing core product. Incubator projects start in diverse ways: some are born from the team’s interest in a specific idea while others are sponsored by a senior executive. We also regularly hold open calls for any Indeedian to pitch an idea to the Incubator. No matter the source, we run our experiments with emphases on fast iterations, empirical learnings, and entrepreneurial spirit.
Lessons
Now that I have a few years of Incubator startup projects under my belt, and plenty of hindsight on the “Ramen years” in startups, I think I’ve learned a few things about what it means to be small in a big company.
Lack of a “true” burn rate gives you freedom to focus
The fleeting nature of a startup’s existence is often the key to its success. If success is the only way to survive, then you’ll pivot until you find product-market fit or you’ll perish. In my startup roles I’ve seen monthly burn rates exceed cash on hand, and I’ve helped decide what market to bet our future on. The importance of these decisions forces critical focus.
In the Incubator, we also believe that constraints drive focused discovery of customer value. But Indeed isn’t a startup: we’ve got stability and resources that startups lack. So we’ve had to create some constraints of our own. Projects in Incubator are funded with a small set of resources for a fixed period of time. At the end of a project’s “funding round,” we make the go/no go decision to continue.
In 2017, Indeed Crowd was a nascent experiment in referral recruiting with a handful of internal jobs. My team grew it into a freelance sourcing marketplace with tens of thousands of independent recruiters — all of them signed up to source great candidates for hard-to-fill roles and get paid for successful placements. But as we got deeper into monetization experiments with Crowd, we became less convinced the product would be successful. Customer data pointed to a difficult (if not impossible) relationship between unit economics and addressable market.
If we had been a startup, we might have tried a Hail Mary pivot or two, reduced our burn, and attempted to keep the operation running (and the team getting paid) just a little bit longer.
In the Incubator context, we were able to evaluate the decision differently. What we learned from the project would be valuable no matter what, and the team would be at work the next day no matter what. Separating our personal “survival” from that of the project let us consider other things. For example, what was the opportunity cost of our very talented team not working on a different idea with greater potential impact? As it turns out, that cost was sizable.
Running our project in a stable environment conferred a benefit I would not have expected: we could carefully weigh the go/no decision on the project’s merits alone. We made the choice to wind down Indeed Crowd without any trepidation. We were (dare I say) excited to free up our minds and resources for the next idea.
Think startups are full of distraction? Add a few thousand well-meaning coworkers!
Distraction is poison to startups. With limited resources and much to accomplish, every deviation from the mission is a huge cost. And I’m no saint! In my startup days I fell victim to shiny object syndrome as much as anyone. I’ve chased peripheral customers because they were “whales,” despite their interest level not remotely equaling ours. I’ve spent hours on potential partnerships that never quite panned out. I’ve dedicated days to sizing market opportunities suggested by a well-meaning advisor or industry expert. In retrospect, much of that time would probably have been better spent focusing on more impactful things.
Even having spent time at Incubator, the lure of shiny distraction never really goes away. In the course of launching and growing Incubator projects, we see all kinds of shiny (even compelling!) opportunities we must work hard to resist:
- Enterprise customers asking to license just the backend of an SMB-focused tool
- Internal stakeholders clamoring to take a barely tested v1 to market in a different hemisphere
- Teams sitting next to you asking, “What if we make a version for Australia? Or one just for nurses?”
In a startup, you can just say “I don’t have bandwidth.” But when you theoretically do have the resources to expand on demand, the only way to stay on track is to train yourself to prioritize even more. I’m far more ruthless as a result and, because ruthless prioritization is so important to product management, my PM abilities have benefited overall.
Get buy-in or go home
Silicon Valley’s favorite estimation exercise is sizing what percent of a founder’s time should be spent recruiting. Regardless of the over/under, the takeaway is that it’s hard work to get people onboard with your crazy idea. As a founder, you’ve got to deftly sell your vision to hire the talent you need to make your idea a reality.
When a founder starts a project in Incubator, we provide a staff of talented engineers, UX designers, and other specialists to get the project going. Compared with the recruiting process, a plug-and-play team is a downright luxury! Except in one respect: buy-in.
Imagine you’re starting a startup, and you’re looking for your first few hires. The choices you make about your industry focus, product type, or technology stack will attract talent who share that interest. Finding talent pools with a built-in selection bias toward the basics of your worldview helps you get like minds on the team.
In Incubator, though, there’s no head-start on the team’s buy-in. You can rely on your team to be talented, hardworking, and open-minded — but you can’t rely on them to share your vision on Day 0. You didn’t do the initial recruiting for your team, so your job is to recruit them continuously as you work together.
Need practice in persuasion? This is the perfect opportunity to train your ability to continuously inspire. Every work ticket, meeting, offsite, happy hour, and standup is an opportunity to keep the team inspired and reinforce for the project’s journey and ultimate success.
Don’t let size get in the way
A startup isn’t the only place to start something new, develop it rigorously, and drastically improve your skills along the way. It’s probably better to be agnostic to “size” as a heuristic, and instead optimize for the ways you want to be challenged. Use the challenge as the heuristic to assess opportunities instead.
Ultimately, working with Incubator has allowed me to exercise the startup mindset while simultaneously enjoying the benefits of a mature organization with the resources to help me thrive. Are you interested in the challenge — and the reward — of thinking small in a big company? If so, I hope you’ll join me.
