Tag: philippine startups

What Happened When We Killed Timekeeping and Attendance

What Happened When We Killed Timekeeping and Attendance

Peter Cauton

timepiece

One of the great perks of being an entrepreneur is having complete control over time.

From the time we founded STORM, Pao and I have always worked with a completely flexible schedule.

Actual sms messages:

Dude, coffee shop muna ako this morning.

or

Had a late night, will work from home today

or

Won’t be in the office this afternoon

We never had to be worried that the other person is slacking off. We’ll even tell one another if we need a break to slack off. This is because we trust one another. In the end, I know Pao cares about the firm and will work his tail off for its objectives. I know that goes both ways.

This never became a rule for our employees though.

We followed a semi-flexible work schedule: people came in anytime between 8am to 10am and could leave 9 hours after. You were really only late if you came in after 1oam. Like most firms, we had punctuality and attendance rules: 3 lates merits a written reprimand, 5 lates merits a suspension…something like that.

I never considered anything more flexible. After all, we did have teams like Customer Service and Supply Chain which needed people present in very specific time slots.

How could we do anything more flexible?

As owners, Pao and I still pretty much enjoyed the freedom to go in and out at our discretion. Functional managers also had this level of freedom, but everyone else kept to the semi-flexible rules, with disciplinary actions for violations.

reception

One fateful day though, I was asked to sign a Written Reprimand for someone whom I thought was performing reasonably well.

That disturbed me. The punctuality issues had little to do with the performance.

Why couldn’t we give all our people the same freedom we enjoyed?

And at the heart of it: can we trust our employees first?

True to our form as a company which decides fast and then measures outcomes, I met with Pao and our People Operations team that afternoon.  We created the following rules:

  • From 15 SL’s and 15 VL’s, we created a policy where an individual could use unlimited leaves. Actually, there would be no more “leaves.” We just didn’t count.
  • We totally separated salary and timekeeping. There is now no need to log-in and out of the office. Salary would be given wholly every 15th and 30th. Deductions per timekeeping are now extinct.
  • The 15  SL’s, which was converted to Flexible Benefit Points when unused, are automatically given as Flexible Benefit Points at the person’s daily rate. The person cannot convert this to cash and can only use it on her Benefits Marketplace. We believe in the power of benefits given in kind.
  • For those eligible for OT, the person will now file OT herself, no questions asked. If you think you deserve to be paid OT on a particular day, you just file it, and it will be given to you.
  • Teams with definitive service hours, like customer service and supply chain, were given the directive to create their own rules, to be managed and policed within the team.
  • Leaders were then asked to step up: the company will be monitoring metrics and individual performance much more closely – the leaders have to lead.

We did an impromptu general assembly and instituted the new rules. I told everyone we’ll be doing this for a month and see what happens.

Apparently, the market already had a name for this: ROWE (Results Only Work Environment), I didn’t like the name because I felt it ignored one very powerful factor our firm valued – culture. Alas, the name “Rowe” stuck internally.

Our people loved it. They began posting on social media how great they felt being trusted and being “treated like an adult.”

But of course, the proof would be in the pudding. We locked in on our metrics and let the weeks pass.

The first thing I noticed was how Fridays would be much leaner than every other day. As a lifelong HR practitioner, I felt this was a bad sign.

A month after, our numbers were in, and it confirmed my suspicions. Our metrics were evidently down from a month ago.

I talked worriedly with my management team – did this mean we recruited poorly? After all, shouldn’t the RIGHT people fare well in this sort of environment?

We did another assembly and I told everyone about our results.  I told everyone I was tempted to just pull the program – the results more than justified that move.

But I said we’ll give it another few weeks. I reminded them that things have to change drastically for ROWE to continue. Like most worthwhile things, they would have to fight for it. I told them I WANT the program to succeed, but it would be up to everyone.

Soon, a lot of people in the our Yammer group began sporting this profile picture.

prowe

Weeks went by, and I didn’t really see anything different. Fridays were still extra-lean, attendance-wise. People came in much later than 10am.

I was going to chalk this up to a “Well, we tried” and wreak personal havoc on our recruitment process.

As another month crept in, I asked for the metrics. I was shocked to see the results.

They were up.

At first I couldn’t believe it. But there they were.

Assembly again. I told everyone about the metrics. ROWE was on the resuscitator, but it was alive!

I told everyone I was extending the program to see if the figures were just a fluke.

A month after, the numbers held.

This brings us to today. We’re still very much studying the program. There weren’t a lot of things changed with the original rules we drafted. But before declaring the program as a permanent part of the company, I  still want to generate more data.

Some notable observations and key realizations:

  • With absolute freedom comes…absolute transparency. If there’s one thing about this program, it’s that a person’s true colors will shine. A performer who really makes the firm her own will excel even more because of the flexibility, while people who have discipline and/or commitment issues will have their problems exacerbated.  We had to release a couple of employees whose lack of discipline really negatively impacted the teams they were in.
  • So…Fridays are STILL lean days. But with our metrics being met, I think this is more MY problem. As a lifelong HR practitioner, I think I still very much equated SEEING people with ACTUAL productivity. This is a paradigm shift I have had to swallow.
  • The employee satisfaction that comes from being able to take leaves whenever you want and being trusted for your work IS the biggie. We will trust you first. Will you be worthy of this trust? Most people we see will respond very well to this.
  • For this to work, a company’s metrics and numbers obviously have to be managed well. This is something we continuously work on.
  • Leaders HAVE to step up in this sort of framework. With less structure, more leadership and influence have to be exerted so people will consistently use the flexibility effectively and not abuse it.
  • I don’t believe in purely working from home though. I’m still old-fashioned when it comes to this. I think part of the fun being in a startup is that feeling of being in the trenches with a close group of people. Tough to do that if you aren’t in the same work area. I think our culture and our sense of fun as a company encourage everyone in the firm go to the office even if its strictly not a requirement – a welcome development for me.

The program for us has taken very interesting twists and turns. Promising though.

Let’s see what happens from hereon.

 

What Is Your Fearlessness Quotient?

What Is Your Fearlessness Quotient?

Peter Cauton


jump

At work, when we talk about hiring (which we talk about A LOT nowadays), I usually tell my co-managers that I am very interested in hiring “entrepreneurial-minded” people.

Then I’d get often asked:

What does that mean?

That’s a question I’ve been mulling about for ages. What exactly is it? How do you evaluate if someone has it? How do you know if someone has the potential to have it?

There are so many theories on what entrepreneurship is.

Here’s one of mine.

I think, when you distill it, when you boil entrepreneurship down to its basest levels, entrepreneurship is all about fearlessness.

Entrepreneurs just conquer fear.

Innovation, a word long synonymous with entrepreneurship, is all about not being happy with the status quo and doing something better.

How many times have we let the status quo remain because no one had the guts to call it out? Just to even identify that you want to  merely explore changing the status quo can be scary, much more actually trying to change it. Imagine the threats and pressure Elon Musk is facing now from the gigantic industries (petroleum, automobile) Tesla is trying to disrupt. Guts.

Persistence, another word we associate with entrepreneurship, also involves fearlessness. When we fail, it takes a lot of guts to DO THE SAME THING again, knowing the results will likely end in yet another failure. Entrepreneurship involves repeated failure. Legendary Amazon entrepreneur Jeff Bezos recently declared that his failures are worth billions already.  Ballsy.

Entrepreneurs also are known as builders. In STORM, we find this important enough to include in one of our value statements, which says that “we like to build versus maintaining.” To build something also takes guts – because you are putting something out into the world and opening yourself up to criticism.

In his recent, wondrous book which every entrepreneur needs to read, Peter Thiel says that a great entrepreneur is essentially a contrarian at heart. The entrepreneur believes and works on something the rest of the world doesn’t think is true. (For example, Larry and Sergey thought web linkages produce much better search results) It takes A LOT OF GUTS to run counter to what the rest of the world thinks.

Fearlessness.

So I’ve now included a set of questions on fearlessness which I ask would-be employees.

What’s the ballsiest thing you’ve done?

Tell me about a time when you stuck your neck out for an idea.

Tell me about a time you were criticized for something you created or suggested.

When was the last time you tried something out for the first time? 

As you read this, try to answer them. It’s a good exercise that can give us clues as to what our fearlessness quotient is.

It’s a good indicator on your readiness to make that entrepreneurial leap.

The good news?

Even if you found yourself frustratingly giving crappy answers to these questions, I think fearlessness CAN BE LEARNED.

You need to exercise your fearlessness muscles. How do you build muscle? Reps.

Start with low weights.

When your boss asks your group for questions or suggestions, be sure you do a Hermione and give an answer, even if ESPECIALLY when you think your answer feels a bit stupid.

Suggest ideas. In STORM, one of our best employees, Ethel, suggests things to me very very often (she just emailed another one as I write this). Big ideas or small ones, in her scope of work or beyond it, she would just go for it and suggest. She knows that sometimes, her idea won’t go well with me. Sometimes, it does. But she just puts it out there and learns either way. That’s awesome.

Practice makes perfect.

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15 Slots Available For STORM’S Private Recruitment Cocktails Tomorrow

15 Slots Available For STORM’S Private Recruitment Cocktails Tomorrow

Peter Cauton

coverphoto 1-1

STORM is scaling fast.

Founded in January 2013 (a spinoff from my original HR startup, STORM Consulting), STORM is bent on transforming the way companies manage benefits.

I’m fairly confident STORM has been among the fastest growing local startups across these last 2 years, revenue-wise. We’ve been blessed.

In 2013, we proved our new business model could work – an entirely new way for companies to manage their benefits.

In 2014, we started growing fast. Very fast. We’ve quadrupled both 2013 revenue AND 2013 manpower. We’re set to AT LEAST quadruple revenue again in 2015.

There are no signs of slowing down. In fact, it’s looking like things will go even faster.

The most crucial thing in this scaling thing?

Hiring the RIGHT people.

I’m pretty clear with who I want to work with. I’ve seen the VAST difference between an entrepreneurial employee and a regular employee.

Are you fearless? Do you like to challenge the status quo? Are you a BUILDER instead of someone who maintains? Can you sell your ideas well?

We need people like you all over our company.

(I’ve updated our Careers page HERE)

I know this is late, but STORM has organized a privately-held career event on Tuesday, 630pm at the Astoria Plaza. (yep, this post is pretty late – apologies)

I’ve 15 slots still free.

If you think you’re a match to any of the posts on our Careers page, then please send me your resume (peter@juangreatleap.com) TO RESERVE A SLOT.

See ya!

storm

Big Picture? No, Look at the BIGGER Picture

Big Picture? No, Look at the BIGGER Picture

Peter Cauton


big pictureThese past few months have been crazy in STORM. We started the 2014 with about 16 employees. We’re ending the year with around 50 employees and 60 more job openings.

After 5-6 years hovering at around 10-15 employees, we’re now scaling at an unprecedented level.

It’s been all sorts of crazy, but its been fun. It’s a riveting challenge to see just how far we can push this.

This sudden shift in scale started when we realized two years ago that, “Hey, we can be more than a niche player in the industry – we could help EVERYONE out with flexible benefits.”

We widened the aperture.

Stepping Back for a Wider View

Every once in awhile I would talk to an entrepreneur about ideas or actual products they would share with me to get advice.

In a lot of these ideas, I could imagine a LARGER opportunity NOT being pursued.

For example, there was one app idea which targeted Churches. As it was being explained to me, I thought: hey, this might work for ANY type of community. 

I could see why he would think this way – he was an avid Church-goer who wanted to solve a specific problem.

That is awesome. Focus is good.

In doing this though, we might be missing a larger, still unserved market which would benefit from the same solution.

It is to our best interests then, to see what happens if we take a step back and try to see a larger opportunity we can capture.

This might be easier said than done. A number of us see the world with some filters which prevent us from seeing the possibilities.

Overcoming Our Narrow Filters

I realize that growing up in school and working in corporate taught me to have a very narrow paradigm.

Good grades will make great companies want you.

You have to go up the corporate ladder.

There is no shortcut. You have to pay your dues.

There is a salary scale.

Your expertise is limited to the Department you are in. (Finance guys know only Finance, HR guys know only HR, etc…)

It takes a special type of experience or exposure (an Ivy-leaguer, maybe someone who came from Apple or Google, someone extremely well-connected, etc…) to build a big firm.

I can never learn anything quickly enough to be an expert in it and compete. So might as well stick to what I’ve been exposed to.

These are all illusions.

Feel free to dream bigger. Once you get blinders like these off, you will begin to see how MUCH opportunity there is – to make a difference, to build something special, to help a larger number of people.

Nix

If there’s one person I know who exemplifies big-ger thinking, it’s Nix Nolledo.

I realize I’ve never talked about Nix in JGL (except when he was in Startups Unplugged). This is because I respected his approach to be low-key. But hey, I don’t think this is pretty low-key anymore:

Screen Shot 2014-11-27 at 11.40.41 PM

 

Nix invested in STORM in 2013 and has been instrumental in helping us scale and grow.

What I’ve learned from Nix is looking at not only the big picture, but seeing if there’s an even bigger one hiding behind it. After every conversation with him, I’m always inspired to widen my horizons.

Of course, it helps that he lives this out. He dreams big and just goes after it. (That Inquirer story does a good job of documenting his path)

That Xurpas IPO is a huge, ballsy move. For me, it’s not only because of all the money they raised. It’s also because now, they are expected to grow much more than what they raised. They’re taking this challenge head-on, in a very public arena.

So Don’t Sell Yourself Short

This applies to everyone in the entrepreneurial path. Widen your aperture.

Yes, you can resign from your job and build something special.

Yes, you can find GREAT people to build your startup with.

Yes, you can scale and go to other countries.

Yes, you can go after a larger market.

Yes, you can build an awesome, world-class product.

Yes, you can pursue your dream and be practical at the same time.

Yes, you can.

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Release Your Inner Kraken: The Folly of Hidden Talents

Peter Cauton

kraken release

For as far as I can remember, I’ve always loved writing.

I enjoyed paragraph writing in grade school. There was always a sense of accomplishment and satisfaction when I felt a paragraph was complete, when I felt every word I used was the right one. It was simultaneously art and science for me.

This love for word construction continued throughout my high school and college stints. Writing assignments wouldn’t feel like homework. I would volunteer for writing tasks across my different subjects, projects, and the clubs I belonged to.

In my first year after graduation, I taught english for a year in my alma mater and loved every minute of it.

Then I went corporate. Suddenly, my love for writing had no outlet.

I would get chances to write – typically copy for recruitment materials or job descriptions or disciplinary memos. I would get to write a lot of academic reports, too. But this wasn’t really writing for me. It was…work. There was no soul nor creativity involved.

From 1998 to 2011, I buried my writing. It became a hidden talent.

In my mind, it wasn’t really a big deal. It wasn’t practical in a sense that it didn’t put food on the table.

But I would feel a thorn on my side when I met with writers. I would feel all existential when I would read something that would resonate with me.

After my great leap and the euphoria which followed when things started to fall into place, there was a strong feeling that I should give something back.

The first medium I automatically thought of was, you guessed it…writing.

And so I wrote my first Juan Great Leap post.

It has been amazing ever since. I had reconnected with my lost love.

This reacquaintance has led to such amazing things.

This blog has been such a blessing for me. It has introduced and re-introduced me to people that are now significant parts of my life. It has broadened my horizons. It has blessed me by letting me into the entrepreneurial journeys of some extraordinary people. Though I have not made a centavo off of the blog, I have been introduced to investors and business partners by the blog. And I just cannot explain the joy I feel when someone emails to say that a particular piece has helped them. I don’t think there’s any greater joy for a writer  – or any type of worker, for that matter – than when their work is appreciated.

Let me tell you about my friend Mela.

Multiple people were telling me: “Have you seen her dance? Maiiyak ka!”

I found that statement peculiar. To the point of tears? Really?

Finally, I had my chance to see her in action.  In one Living Hope concert, she did a beautiful interpretative dance. Now mind you, I have no special appreciation nor eye for dancing, but there it went.

My tears.

But I guess that’s what we feel when we observe someone tap into her God-given gifts and isn’t afraid of showing it to the world.

We feel awe. We feel alive. We feel inspired. 

My theory? We feel God.

I feel all of us are blessed this way. We each have been blessed a “super power” of sorts, which, if we aren’t afraid of using and developing, can just MOVE people. Even to tears.

Alas, society, “practicality”, and fear can prevent us from exercising it.

I remember writing about Ope.

She was a Psychology graduate looking for  “HR” work. So we hired her as an HR practitioner. Soon though, we saw that she was volunteering for all the design work that was available (and doing it for no extra pay) – brochures, websites, posters…

Quoting from my previous post:

While she would do good work with her HR-related responsibilities, her design work would always elicit oohs and ahs from everyone in the workplace. It was plain to see what her passion was.

She’s now the young CEO of Rocket Concepts – a design company.

And readers – please don’t let your college course dictate what you do in life because you need to “exercise what you learned.” We selected our courses in our teens – a time when most of us were still confused as to who we are. Follow your heart. Pray and discern.

Tapping into our hidden talents always lead to great things.

Can you paint? Act? Build things with your hands? Do you speak well? Can you counsel well? Design well? Can you cook? Design cakes? Carve wood? Write plays? Play an instrument? Speak different languages well? Teach well?

More importantly, when engaged in this hidden art of yours, does the time just pass by like the wind? Do you feel an inner joy?

In each of us, God has instilled incredibly moving, tremendous, awe-inspiring gifts.

Don’t let them be hidden under the water, away from plain sight. This not only robs you of opportunities, it also robs others from being beneficiaries.

Release the Kraken.

The opportunity cost of not doing so is incalculable.

 

 

5 Reasons Why You Should Quit Your Job Now and Work for a Startup (With Traction)

5 Reasons Why You Should Quit Your Job Now and Work for a Startup (With Traction)

Peter Cauton

racecar1

So, you want to put up a startup.

You want to take the leap.

But it’s sooooo hard to let go of the cushy job you’ve spent numerous years cultivating…

You worry about the sudden disruption of that bi-monthly cashflow you’re now so accustomed to and built your life around.

So what now?

Here’s a solution – work for a startup. But don’t just work for ANY startup – work for a startup with traction.

What’s traction? I like Naval Ravikant’s (Angelist founder) efficient definition of traction: “Quantitative evidence of market demand.”

A startup has traction when it has increasing numbers – revenue, users, profitability, engagement, traffic, etc…

These are evident signs that the startup is WORKING, that the business idea has merit and potential.

I’ve been mulling about my own leap into entrepreneurship, and I think one of aspects of my own leap that I underrate the most was my stint in Chikka back in the mid-2000’s.

I underrate it because I started forming STORM before my stint in Chikka. But I think my 5-year stint in the startup (it was 3 years old when I joined) helped solidify my readiness in taking my full leap into entrepreneurship in 2008.

Recalling my stint in Chikka, and my own experiences in running startups, here are 7 reasons why you should quit your job now and pursue a job in a startup with traction.

Screen Shot 2014-08-12 at 1.11.54 PM

1. It’s Inspiring

After 5 years in a very “corporate” environment (IT consulting), I had a very different experience on my first day, when our CEO sent me an email welcoming me to the team, and on the last line saying: “Let’s kick ass and rule the world!” I don’t think I’ve ever seen the word “ass” in formal company channels.

But after that, I was sucked in. I loved the informality and culture they were trying to create. I loved that everyone was in t-shirts. (my previous firm made me wear a tie)

More than this, however, I loved experiencing the growth.

In seasoned corporations, you’d expect conservative growth figures of perhaps 12% or 15%. In startups with traction, we’ve experience numbers like 700%, or even 3000% growth. This is undeniably exciting for everyone in the firm. When a startup CEO makes announcements about growth figures – everyone feels giddy (because everyone feels he/she contributed).

I remember reading that in Amazon’s early years, they made a bell ring whenever a customer would purchase from Amazon. This made the culture electric, they created a real buzz (pun intended) in the air. (obviously they stopped this after there came a point when the bell just rang incessantly.

Traction makes things ultra-exciting for a startup.

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2. You Can Get Paid (!)

Here is where the big difference I think lies. At STORM, I tell people who come in: “You probably won’t get the same salary as you would command in a multinational – but present salary isn’t why you would join a company like us.”

But you know what? We would come close.

And combined with everything else we offer (culture, learning, excitement, contribution, input, upward mobility, etc…), this makes it a sweet deal.

You get to work in a startup without sacrificing that big a monetary sacrifice.

“But I won’t get equity.”

No, probably not the big 20%-30% ownership that you would get when you join a pure from-scratch startup with no traction, but….

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3. You Have A Shot at Significant Shares

Noah Kagan was one of Facebook’s first 40 employees. He was there when Facebook was still in that rented house we saw in The Social Network. He was fired in his first year (so he didn’t get his shares, because it was vested). He basically lost $100,000,000. Of course, not every startup will be Facebook, but what I want you to look at here is the shares given to Noah. No, as the 40th employee, he won’t have the same % as Zuckerberg or Sean Parker, but got a much, much larger percentage than current employees get. (and he doesn’t need to buy them at $100,000,000 if he bought the same shares now).

Let me break it gently to you: you have NO chance of gaining significant shares in a seasoned corporation, especially if its public.

On the other hand, a number of startups offer equity shares to strategic/loyal employees.  I know some young startups who give all their starting set of employees shares in the firm. In some startups, you need to prove yourself (if you do, most entrepreneurs I know would be happy to give you shares). Dino Alcoseba now owns a portion of the startup he leads, Strata.

If your goal in becoming an entrepreneur is equity (which makes a ton of sense, as this is how most billionaires acquire their wealth), then you might actually find it by working for a startup with traction.

You’re going to have to prove yourself, though. Bottom-line, you have a shot.

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4. Learning From Success

You now have so many stories on entrepreneurs learning from their mistakes. We hear a lot of quotes like:

That company I started failed, but the learning I garnered from it was why I now succeed…yada, yada..

This is true, of course (in fact I write about it here).

But you know what? You can also learn from successes! Yes!

By joining a startup with traction, you can see what it takes.

You can work for a dozen failed startups, amass a TON of experience, and STILL have no clue about how a startup can succeed.

In working for a startup with traction, you can see and observe best practices. Want to be a successful startup CEO? Then learn from a successful one.

5. Upward AND Horizontal Mobility

Dino is my poster boy for upward mobility in a startup. 5 years from “Junior HR Consultant” to CEO. (We have numerous examples of less dramatic upward movements as well 🙂 I think this is a clear advantage of working for startups – you get to grow with the firm.

But horizontal mobility is extremely important as well. Increased horizontal mobility allows you to find your own traction within a firm, and contribute where you can do your BEST work (a tremendous difference)

In a large corporation, it is often very difficult to change departments. Let’s say you start a career in Sales. You go up the ranks. If, suddenly, after some discernment, you decide, “I want to transfer to supply chain,” don’t be surprised if it takes time for your request to happen, or more likely, it doesn’t happen.

With a startup with traction, you can be flexible. With traction comes growth. With growth comes the need for new positions. Hence comes the opportunity to not only contribute in different areas – and try them out!

Longtime JGL advocates would be familiar with AR, who originally worked as a recruiter in (the now defunct) Searchlight, then she was hired by STORM. She then became STORM’s HR Officer, then HR Manager, then transferred into Consulting, then became our Content Management Head, before occupying the position she holds now in STORM, which is Customer Service Head. All in 2-3 years!

For startups, traction is king. Once a startup experiences traction, the possibilities are endless.

Make your possibilities endless as well and join one.

(Part 2 coming up soon!)

 

 

 

Thursdays Unplugged Postscript (July 31 Edition)

Peter Cauton

TUWEEK2

 

See that bottle of Pepsi in the picture?

I started this Thursdays Unplugged session by accidentally dropping the closed bottle, and then proceeding to absent-mindedly open it.

The result was an explosion of cola and pride, mostly on my shirt (which, incredibly, looks the same in the picture).

It was all uphill from there though!

With the third participant calling that he couldn’t make it the last minute, this became a 3-person session. Of course, I loved the result, as Jode, Gerome, and I not only got into the technicalities of the their startup ideas, but more importantly, we got to talk about their journey, and the softer parts of the startup life.

The thing I love about these sessions is that they’re discussions. Even if Gerome and Jode had very different concepts (one design, and one more IT-logistics) and were in very different stages of the startup journey, the exchange proved to be quite open, honest, and everyone was more than helpful to one another.

Can’t wait for the 14th. Seeya Mike, JC, and Michelle!

Slots still open for the 21st (1 more slot) and the 28th (2 slots free), so if you wan’t to secure a seat, do email me.

 

 

 

 

 

 

Risk Now or Forever Hold Your Peace

Peter Cauton

risknow

The older we get, the more permanent our decisions become.

In high school, the biggest decision we made was probably what school to take (a lot of people I know didn’t have a choice in this matter as well), or perhaps what course to take.

We could then easily shift courses. A lot of people I know even shifted schools.

We also choose who to hang out with. This can change easily as well.

Then one day, we graduate from college.

Then we have to face the next big decision in our lives – what job to take.

Not quite happy with our first job, perhaps we transfer to another firm. It isn’t as easy as changing courses, but this decision is still flexible enough that for a lot of us, we do this several times in our first few years out in the corporate jungle.

By this time, perhaps our relationships deepen as well. Soon enough, we start getting invitations for weddings. One day, we ourselves get married. We often hear of a lot of stories of people getting “cold feet.” This is natural. This decision is permanent, so we take our time. We get anxious.

Meanwhile, our jobs take some sort of pattern. The sum total of our jobs and our experiences becomes our “career.” This is an over-arching decision that is difficult to undo. If we’ve taken on a “marketing” career, then we would think long and hard before deciding to become a programmer. The longer the career, the more difficult a potential career shift becomes. The more the investment, the more difficult it is to let go.

If at one point we realize the career path we’ve taken isn’t quite what fulfills us, this can lead to many a term-crisis.

Then we start having kids.

You’ve heard how this can change everything.

This changes everything.

Suddenly, you literally aren’t living for yourself any longer. Suddenly you’re thinking – I want to send them to good schools! But where will I get the money for tuition? I want to get them HMO coverage! What will happen if I kick the bucket? O gosh, does this mean I have to talk to that pesky life insurance guy? Where will I get the money for insurance payments? Who picks them up from school?! 

It’s a crazy, never-ending cycle of worry and planning and spending.

It’s also extremely fulfilling and a source of profound joy 🙂

At this point however, it’s extremely difficult to carry any form of risk.

Recently, I’ve been talking to a very accomplished friend of mine who’s just above 40. He’s contemplating the jump to entrepreneurship. Our lunches have gone on for about a year now.

In one of our lunches, I asked him, how much will it take to get you to make the leap? How much are your expenses?

With potential startup founders, the salary question isn’t “how much do you want?” but “what’s the least amount you can live with?”

The answer almost made me jump out of my chair.

I know he’s reading this – yeah dude, I almost fell off my chair – but my vast composure powers prevented me from flinching.

I told him, “No startup can accommodate that.” He nodded in slow approval.

In our subsequent talks, this amount became the sum we have in our minds for him to consider a jump. Financially at least, the distance he has to leap has become a Grand Canyon. Whatever startup he cooks up has to pay this amount.

We both acknowledge, however, that this isn’t even the biggest hurdle.

One lunch I was lamenting to him about this other person who was about to take the leap, but didn’t.

He told me:

“You have to give people our age some slack. We don’t think that way.”

I realized he was right. After 15-20 years of corporate, it’s just hard for people to re-imagine a career outside corporate. Even if the desire was there. 

In one of my earlier posts, I noted how a great number of the people I interviewed over the last nearly 20 years I’ve been in HR said “I want to create my own business,” when asked what their long-term plan was.

This just doesn’t happen often. The older we get, the lesser our ability to risk becomes.

Yes, some people get to invest in startups when they get older. But this isn’t a function of getting older. It’s a function of financial success and generating enough money to consider angel investing.The rule of thumb is that as an angel, you invest only 10% of your disposable income. (translation: by-the-book angel investors don’t really risk) Interestingly, a vast majority of angel investors I’ve encountered are ALSO entrepreneurs. Truthfully, I haven’t met anyone who’s a corporate lifer who’s now into angel investing. A number of older corporate folks leverage on experience and go the consulting route. But this route often lacks the ambition and scale of what a modern startup wants to do.  (translation: long corporate careers do not lead to startups)

My advice?

If you are under 35, have no kids yet, and you possess the entrepreneurial fire in the belly. Don’t wait. That fire has a shelf life.

Leap.

Soft vs. Hard Entrepreneurship and What to Prioritize

Peter Cauton

HARD vs SOFT

You can divide all the elements of entrepreneurship into two distinct categories: hard and soft. Here’s what the HARD column can be populated with:

  • Valuation
  • Product-market fit
  • Lean Startup Methodology
  • A-B Testing
  • Seed, Series A, Series B, Series C….
  • Pivot
  • Runway
  • Dilution
  • MVP
  • Growth Hacking Strategies

Here’s what the SOFT column can be populated with:

  • Passion
  • Founder Dynamics
  • Culture
  • Maturity
  • The entrepreneurial spirit
  • Mentors
  • Perseverance
  • Following the heart
  • Following the dream
  • Motivation
  • Taking a leap of faith

Now, ask ANY successful entrepreneur what the reasons are for her success.

Do you think most responses will fall within the HARD category or the SOFT category?

Yep.

It’s interesting that despite having MOST entrepreneurial educational material out there focusing on the HARD part, it’s the SOFT part which will largely determine your entrepreneurial success.

Here’s another task: ask most ANY startup/early stage investor what factors they closely consider in investing in a startup. Watch those answers fall within the SOFT category.

In fact, I’ve a strong suspicion the first factor isn’t even in my list above – integrity. 

Does that mean the HARD factors are unimportant? Of course not. (I blog about a lot of those here)

It’s the order of priority that’s crucial.

Master the SOFT column first, and then the HARD column becomes that much easier to accomplish.

Inner before outer.

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