Startup organizations are typically unsustainable and barely stable, because:
1. The pressures to develop and market a first product require taking some expedient shortcuts, such as hiring the most capable, but not necessarily the most team-oriented individuals; placing all priority on getting a workable product out the door, rather than building the product for maintainability and growth; putting in the most features rather than the best-tested features.
2. The top management habitually focuses on the race between funds running out and product delivery, rather than on internal communications, employee satisfaction (except with the potential value of their options), and leadership style. The command-and-control management style is workable for the first few years, but typically fails to inspire the organization to build itself into a self-renewing structure.
3. Having a focus on delivering a product using already-developed technology, the company does not need to invest in longer-term development of underlying technologies, or in the people who will bring in a steady stream of new technology.
The short-term focus of a startup must change soon after the deliver of the first few products. Companies that fail to incorporate longer-term thinking around their third year find themselves living from crisis to crisis. This makes the company unattractive to good managers and good technologists who don’t necessarily get their jolllies from living in a startup environment, where “startup” means short-term thinking.
What sort of changes does your organization need, now that the product has been delivered? A new CEO who actually allows the organization to function as if there were competence at all levels? A seasoned technology executive who knows what to do to make the organization attractive to innovative people? A shift in emphasis to listening to customer feedback and involving existing customers in product decisions? Addition of a Quality department that actually has the teeth to delay a product introduction?
Whatever the changes needed, don’t be surprised by the shift. Two reactions to the shift are typical:
(1) “What happened to my adrenaline rush?” — the people who need crises to keep up their energy should pursue another startup.
(2) “I didn’t know that a company could actually plan and execute with the future (beyond 1 month) in mind!” — the people who are stressed by the company’s failure to plan and execute for the long term grow into steady, reliable contributors.
About John Levy