[Guest article by Alok, founder of Games2Win. Alok shares wonderful insights related to a common question-i.e. why work for a startup? ]
Are you bribed to work or is your work a bribe?
For the past 12 years of being involved with Start Ups, I’ve always been quizzed about compensation questions, dilemmas, challenges and upsets that prevail in entrepreneurial set ups. This is my attempt to put my words where my money is.
Are you Bribed to work?
Sure you are, if you in a typical ‘corporate’ Fortune 500 Job!
Characteristics:
- It has a predictable growth curve already set for you. From executive to manager to director to president (of god knows what) over a finite set of years. I vividly remember a meeting at a Fortune 500 Corp’s office a few years ago when seven gentlemen gave their cards and all of them read ‘President’. When I looked at them quizzically, one of them sheepishly smiled and said ‘Alok, even the office boy here is a President’. So, you can be the Junior Prime Minister of a Company, but your moronic boss – ‘the’ Prime Minister will still treat you like an office boy to run the errands.
- It has more politicians than all the members combined of every political party in India. You know what happens when so many politicians assemble together? You have to be mentally numb to survive in that set up.
- Colossal time dedicated to planning, budgeting, forecasting and ‘strategizing’. You have to be a Monk to survive the insane meetings that are meaningless and never-ending.
- You have to do what the system needs you to. It’s built that way. Like an axle that has to drive the wheel. You can never become the wheel and you definitely can’t chuck the job of being an axle. The driver(s) will not allow it.
To endure all this, you need a hefty bribe (pay package) to stay in the job. And that is the sweet numbing pill you swallow each month. Each year, the bribe gets sweeter as does the migraine.
Now, is your work your bribe?
This is the case in a typical start up that survives on pure innovation, energy and entrepreneurial zeal!
You enjoy:
- A massive learning curve from day one. From tech to ops to finance, you learn it all. If you stick around long in a start up, you will be stunned at how many multi disciplinary job functions you will have mastered. I remember one particular day when I opened my contests2win.com office (in a ramshackle room near metro cinema), swept the floor, made some coffee, uploaded my content via FTP, drove to the courier to deliver some prizes and then went and met the CEO of ICICI Ventures – all in the breadth of a few hours. In contests2win.com, we hired a HR professional who enthusiastically put together the processes, etc. in order. I still remember the day when he messaged me via IM at 11 am saying ‘Alok, I don’t have any work, what do I do’? One thing led to another, he got enamored by ‘Sales’ and the next thing we knew, he was in Shanghai and Beijing, selling Mobile2win offerings to clients there!! Try explaining this ‘career plan’ to a silver fox in an MNC organization.
- There is massive OWNERSHIP from day one. So you understand the difference between ‘following’ and ‘leading’. You typically make decisions, not implement them! You can steer the ship towards the ocean or onto the icebergs.
- Mentally you are trained like a ninja. Ready to take on any surprise and turn it into a victory. Fighting till the end. That training at a very formative stage is very important in long-term career success. I meet lots of ‘Corporate Suits’ who have no edge of being able to take hits and downsides.
Working up in a start up is very enriching and heady experience and some folks are happy to accept this job as ’bribe’ rather than fat cash compensation.
Also, from a financial perspective, consider this:
| Description | Fortune 500 Job In lacs | Start Up Job In lacs |
| Middle Manager Salary Year 1 | 15 | 10 |
| Year 2 | 20 | 12 |
| Year 3 | 24 | 15 |
| Year 4 | 28 | 18 |
| Year 5 | 32 | 21 |
| Total moneys earned | 119 lacs | 76 lacs |
| Tax (1/3rd) | 40 lacs | 25 lacs |
| Net take Home | 79 | 50 lacs |
| Shares in Company | 0 % | 2% |
| Exit of Company in 5 years at a minimum sale value of 10mn US$ | 50 crores | |
| Sale value of Shares | 0 | 100 lacs |
| Tax (long term capital gain) | 0 | 0 |
| NET EARNINGS | 79 lacs | 150 lacs |
Interestingly, even financially you could become richer working for a start up than a straitjacketed tight MNC job. Sure, one can argue that the exit may never happen or the equity grant may not be 2%, blah blue blee. Even so, the experience of 5 years in a start up will be so enriching, it will be worth the salary sacrificed and will be easily recoupable in the years going forward.
My 2 paise – Work in a start up early in your life, at least for a decade gaining first hand experience, and then start up your own venture. And sure, as sweet revenge, you can hire the suited goons from the local MNC anytime you want.
Recommended Read: All of Alok’s Insights.
[Reproduced from Author’s blog. Follow Alok on Pluggd.in. ]
Perfectly Said….and illustrated
great look at the issue!
But never forget the ‘fight’ with every day and experience that we get!
Very well said!
A perfect insight into why startup or not?
Though i would like to add just one point. Its all easy for someone who does not have immense family responsibility, as there are always risks with a startup. For such people, every penny counts, and the risk is too big to take, in their early life.
However if you are okay with risks, not high responsibility, startup would be a good bet!
Excellent analogy of- Axle, Wheel & Driver
Very good article. Though the illustration has beefed up numbers (the hike per year), I relate to the whole MNC vs startup job thing. I worked in an MNC early in my career and now working in a start-up, which very different. Sometimes I like the dynamics and sometimes I hate the chaos, but it sure is very exciting and enriching experience.
Collect all such articles on pluggd.in and call it bible for Indian startups.
@Pranay: Agree with you about risks involved in startups.
So why not do moonlighting? build the product, take it to a level and then go full time?
Cheerz
I totally agree with this article. I entered this world of startups right after completion of my engineering. Recession helped to make that decision. Its been a year and 2 months since I finished up engineering and I am very happy that I chose this path.
Very interesting and well-thought article….
This is a Masterpiece Alok!
I might sound a little weird BUT are you serious with this?
Would you also post a ratio of the number of startups established to the ones that could even build a quality software IN INDIA. Our college education is screwed, graduates hardly know how to reverse a linked list and you expect them to work for a startup .. just out of the blue??
And if you expect quality computer science students to take up the initiative, I rather feel a company atmosphere at the launch of one’s career introduces one with a more broad picture of a software industry as a whole than one has when they are fresh out of college. So working in an MNC for some time and then taking the right steps is more logical/lesser risky way of proceeding than the one you propose.
PS: Opinions should differ
@Avi – completely agree.My last para says ‘work in a start up early in life’ – not as yr first job. Ideally say after 5-7 years of ‘rag-dooing’ in a stupid job.
Great post! I couldn’t agree more to all the above mentioned points…
It also means that if you keep doing awesome work – money always follows…
Mark Suster in his blog bothsidesofthetable.com, in my opinion put it best:
Join our company if you think you’ll learn from being here. I think you will.
Join if you think your career will progress because you’ll be given more responsibilities than elsewhere and if you’re good at what you do you can move up quickly. We’re a meritocracy.
Join because you know you’ll be earning less than you could elsewhere at some meaningless job cranking out non-core code, producing Powerpoint slides or shuffling paper. You can always earn more. But join here if you want to grow.
Join because you like the culture. You think you’ll have fun. You’ll consider your colleagues close friends.
Join because in three year’s time when you look at this job and this company on your CV you’ll feel proud and it will be part of how you got where you were going.
Join because as we grow our ability to reward you will grow and your income will grow with our success that you contributed to.
We give out stock options. I hope they’re worth money to you some day. But let them be “icing on the cake.” If they pay off handsomely that’s great. But don’t count on it. Don’t let it be your motivator or your driving decision.
Not because we don’t want them to be valuable, but because we don’t want to create an “options culture” around here. Option cultures are corrosive, create the wrong incentives and attract the wrong sort of people.
OMG – loved it. Reproduced on Rodinhood with link back and credits
Thanks
Agreed that this is a pro entrepreneurship blog and this article makes perfect sense here, but, I think that it is important to realize one thing – At a startup, you are developing a product and not creating technology. The kicks you get from the former are different from the later. If you really enjoy hardcore programming from scratch, you might be better off at a larger place which has the resources to develop new technologies. (I am thinking stuff like prog languages, internet scale systems etc)
Also unfortunately, the way the world seems to work, I have seen people start off in the the later camp (large places) and later in their careers migrate to the former camp (entrepreneurship) but rarely does the reverse happen. It is hard to get into a cutting edge engineering project unless you have been in that world for a while.
Of course, most of the work at large companies will be mindless maintenance, but, things are not so bad in India as they used to be say 10 years ago. Not everything is support and maintenance.
I guess a startup is more for the people who wants to “do” things rather than just to ensure that things are “getting done”. Also, the environment is more lively and responsibilities grow much beyond JD.