you want to scale your company from point-a to point-b; do you hire someone who’s at point-c (c > b) who has already crossed a & b or someone who is between a & b but very smart?
this isn’t an easy question and likely does not have a one-size-fits-all answer; however from my experience in running hackerrank, it’s usually better to prefer the latter skill set than the former.
while the risk of choosing the latter person is the doubt if she will scale in the future, the risk of choosing the former person in a growth stage company is not getting her hands dirty to even get to point-b and/or bring in the wrong outlook.
important: the most important hire in the growth phase of your company is head of talent; this is extremely critical since there will always be a constant battle between desperate-to-hire (vs) quality. if this dispute isn’t resolved well in a clean way (more quality hires), it’ll result in frustration amongst different people and the discussion spawns into “culture problem”, “hiring problem”, “management & operations problem”, “scaling problems”, etc. hire a great head of talent when you’re beyond product-market fit and growing fast.
there are two kinds of companies you can start:
a. inventing a product in an existing large market (eg: relateIQ in CRM space)
b. betting on a growing market and having monopoly (eg: Google/Uber/Salesforce when they started)
the problem with companies in category-a is being eaten up by the giant in that market either by way of acquisition or building the same product on their own. you never worry about the size of market in this type.
the problem with companies in category-b is betting that the market is going to continue to grow rapidly – betting cloud is going to be a huge thing in 1999, internet is going to be a huge thing, the taxi market is going to expand rapidly, etc.  and creating your own path.
imo, it’s far better to start a company in category-b :- have complete belief and rationale on why the market is going to expand as you think, recruit great people to minimize your risks and build defensible aspects in your company/product that can help you be a monopoly.
 a lot of investors passed investing on Uber saying the taxi market was very small; Uber apparently makes that amount of money in just San Francisco. The bet that smartphones are going to be ubiquitous leads to things that weren’t possible to imagine before.
as the company scales, the probability of things breaking increases. it can range from a communication breakdown to pure sloppiness depending on the situation. but always remember that it’s never ever the individual’s fault.
there are only two possibilities:
a. you hired the wrong person in which case you’ve to fix your recruiting process
b. her manager didn’t do a good job in defining the framework and helping her to succeed
as you can see, this is a recursive function that comes right to you if something goes wrong and you also have the same parameters.
a big part of the reason why a founder takes a decision in a particular way is the access to different pieces of information she has. this can range from financials to impact on other orgs, people, other feature requests in queue, how doing X be perceived by users, etc.
if you’d like everyone in the company to take the same decision that you’d have taken (if you were in that situation), then it’s only logical that you should provide the same set of information to everyone.
of course, there are going to be things that are extremely sensitive which can’t be shared  but the only way you can empower everyone to make a “smart” decision is by being transparent and communicating as much as possible.
two things we’re doing and has been effective is
a. dedicate a 2 hour time slot/week with me for anyone in the company to just drop in and discuss about why we are/aren’t doing a particular thing in a particular way
b. global themed monthly meeting – product, sales, marketing, etc. with the head of that particular org talking about progress, achievements, things to improve, floating for new ideas, etc. this makes sure everyone is in sync with what’s going in the entire company.
would love to hear more thoughts.
 the things that are extremely sensitive to be shared publicly are usually not needed to take the decision
what to do when you’re in college if you’re looking to start a company eventually?
imo, college is the greatest invention to help start companies, more than it’s actual purpose of education. the amount of stuff I learnt from peers far outweighed the traditional classes. it’s the perfect environment for you to not worry about failure and most importantly finding your co-founder.
here are some things I wish I had done:
- b-plan contests: these are mostly not worth anything except for the prize money. don’t spend your time in writing that 16-page business plan. spend your time in actually building stuff
- there are always going to be a bunch of advisors, people talking about venture capitalists, b-plan, etc. who’re ready to mentor. ignore all of them. build stuff
- if you’re smart, you’re likely going to be lured by top companies for internships. don’t optimize for big brand names. don’t give in. intern (any role) at a fast growing startup. it’s an amazing experience to learn how startups function and most importantly to bond with founders
- i’m not sure of the state of CS infrastructure in India but buy a great laptop + a good internet connection and hack all night with your co-founder. it’s a great investment
- restrict your team to 2 or at the maximum 3 people. don’t treat your startup as a college project where there are 6 of your friends (one working on PR, marketing, etc.) working together. it’s not healthy and will create problems when you actually want to start the company
- launch a functional, working prototype and put it up on HN, get feedback and iterate
- do something out of the ordinary – timetable reminder, college fest calendars, etc. are all tried & tested.
- a good and an unexplored area would be to build something for enterprises – it’s a MASSIVE opportunity. there are inefficiencies in every system. a good way to get feedback/brainstorm on this is to ask your senior (2+ years) on ideas. I can at least say that the talent market is huge and ripe for disruption
- don’t do anything artificial to “boost” your resume – projects at top-tier institutions, etc. hardly matter during placement interviews. if clear the interviews, you’ll most likely get a job. spend all your time on your startup. your resume will be far more impressive if it says “I built X which has 10k monthly active users” than some random project which just involved putting together a bunch of libraries
- you don’t need an MBA degree to run a successful company. often people mislead saying MBA is important to run a great company. if you’re interested in running a tech company, just scroll through the list of founders in the most valuable tech companies and you’ll know the answer
- you can always do your “M.S” anytime but you can do your startup only now. usually, the advice is the other way. you can never really draw a path for your startup, (i.e) you’ll work in a company for x years, get an MBA/MS and then start a company. never happens. an experience of 2-3 years in a company hardly matters in running a company. build stuff and start now
- spend time in reading quality articles from PG, Ben & Sam; they mostly cover almost all problems and use-cases you’re likely to encounter. don’t read too much of startup stuff. it’s confusing
- lastly, it’s always “cool” to run a startup during college. resist doing stuff that will make you cool (eg: updating your facebook profile to say CEO or printing business cards, etc.); find a great co-founder and keep building stuff.
whenever we’re low, listening to an inspiring speech or a motivating blog post can make us feel good. humans are trained to continue to do things that make them feel good. does this mean, humans might forcefully think that their current situation is bad (even though it isn’t) so that they can listen to an inspiring speech to feel good? are motivating books, etc. fake?
i’m realizing that the toughest and most important quality to be an effective founder is the ability to bounce back to a ‘normal’ state even after a low moment. the quicker you figure out what your painkiller is, the more effective you become.
highs & lows are a part of the startup journey and the ability for the ‘lows’ or annoying issues (which adds very little value) to not affect your productivity is important.
a painkiller can vary from a 30-min nap or watching an elon musk interview or anything else that’ll get you back to the normal state.
Restore all the tabs that were present before crashing.
I was trying to see if you can find a pattern for building a successful company? I don’t think it’s possible. If you could find a pattern that will guarantee success, you can write an algorithm to generate that pattern to ensure success.
Since, creating a successful company makes the founders wealthy, everyone will choose to take this path, build successful companies, become wealthy but… no one to consume all the wealth – that’s an invalid state. Hence, proved.
Every company is unique and has it’s own DNA. As much as you can get feedback from others or listen to founder’s talks, it’s your company and you’ve to create your pattern to make it successful.
stress in a startup is generally caused because of a “failure” – something you expected to happen but didn’t, a deal not going through, not able to hire your smart friend, etc.
as the company grows, the number of parameters that could cause failure also increases. there’ll almost always something wrong at any given point in time.
one way to reduce stress in a startup is to think of a failure as a temporary loss, not a permanent one. this will not alleviate the pain but can certainly prevent after effects, a.k.a brooding over the failure instead of spending that time to fix another issue.
however, there’s a catch. to make sure that the failure is only temporary, the basic framework of running the company should be built around long term thinking. it can’t be building something now and flipping it a few years from now or thinking of ways of how you can get rich personally.
imagine the company you are building to be like GE, Goldman Sachs, etc. it has to be long term, really long term.
there’s a common notion/fear that if a product doesn’t have network effects, it’s hard to defend. the reason being anyone can copy the product and sell. i don’t agree.
when i was in high school, yahoo messenger had serious network effects and every one of my friends was on it, only to completely migrate to gmail a year later. an exact scenario repeated when i finished college – orkut to facebook.
even if your product has network effects, it can still become irrelevant. thinking deeply, the only way to make a company defensible is by building a strong team.
– a strong engg. team means a solid & a stable product where new features can be pushed fast w/o breaking
– a strong product team means a great first time user experience and beautifully designed for repeated use
– a strong sales team means the ability to understand customer’s needs and sell to the entire organization (world wide) instead of just one team
all of the above means, you attract smarter people in each of the functions in the company.
this results in unimaginable growth of the company and eventually becoming a leader like how salesforce is in the CRM space. do you think marc even cares about a new CRM that launches in the market?
it doesn’t matter whether you’re b2b or b2c. everything boils down to the team you build.