• by William Mougayar
    Venture advisor, 4x entrepreneur, marketer & strategist. I live in Toronto, curate a lot, blog a bit, and help startups.

7 Big Company Things that Startups Should Not Do

If you’ve been working at a big company for a few years, and you left it to run or co-found a startup, I hope that you’re not going to make some of the classical mistake patterns I have seen.

I’m seeing some young entrepreneurs who have left a corporate job, are well intentioned, but still thinking in old ways.

If you came from a big company, here are 7 things you probably remembered from working at a big company, but you need to totally forget about them, if you’d like to succeed as a startup.

1. Secrecy

Big companies run on secret information, especially relating to new product introductions. The engineering/production side never let out hints about the next products, because sales reps would start promising them to customers, and that hurts sales. In a startup, if you don’t trust all your early employees, you’ve hired the wrong ones. There is no room for secrecy initially.

2. Perfect information

Big companies strive for perfect information about their markets and product requirements, and they are often close to it, in part because they can spend lots of money on sophisticated research. They can’t guess or iterate fast like startups do. This means they need to nail it from the get go. But a startup doesn’t know exactly what end-product should be developed because they have to continuously iterate until they find that product/market fit. It is a mistake for a startup to launch a product like a big company does, ie by assuming that the product will be perfect when it is introduced (with some degree of exception if you’re a hardware startup).

3. Worrying about the Competition

Big companies need to worry about the competition because they operate mostly in mature or existing markets with a well defined and known competitive landscape. Most startups emerge via a flanking approach to market entry, therefore have little or no competition. If you think your competition is an existing big company, then maybe you need to rethink your approach. You’re thinking like a big company, but you’re not one.

4. Press releases

Press releases govern big companies. But big companies already have an audience, followers and analysts that track or react to every little move they make. So their press releases get read, and they make an immediate impact on the market. Obscure startups have to work harder at getting noticed. They need to inspire with their stories, be original, and they need to pitch their stories a lot harder in order to get noticed. Other bloggers are a startup’s best friend for media awareness.

5. Planning

Big companies live and die with plans and planning. They have planning departments that just do that, including financial modelling, profit models, projections, etc. A startup cannot afford to spend a lot of time planning. They have to be doing, doing, doing. Then, refining, refining, refining. What plans are to big companies, agility and speed are to startups, which is how they compensate for their zig-zagging into the future. Yes, startups need to have a direction, but the “plan” for getting there will most certainly not be what you’ve put on paper about it.

6. Delegating everything

Big companies have a few more layers of management than startups, and the execs can delegate just about everything, including the most critical objectives they own. But a new startup CEO should not hire a salesperson before they themselves make dozens of sales, and they shouldn’t hire a growth hacker before they, themselves have had their hands dirty with it. Startups should not outsource their core competencies either.

7. Riding on your vision

Your vision might be right, but how you get there is the most important thing for a startup. Big companies can ride on their vision and hold the market hostage to it, until they deliver the products, sometimes months later, e.g. Apple Watch. But a startup can’t just have a “great vision”. A startup’s vision is not bankable unless it is being delivered upon with users and customers that adopt it.

What does this mean?

  • If you came from a big company, forget about these things, until your startup is like a big company, or at least starting to become known and pushing 100+ employees.
  • If you’re a startup, be careful about hiring employees that came from a larger firm, because their mindset will be according to the above points.

Starting-up a new company is very different from scaling and growing an existing company.

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