
Why Entrepreneurs Hate Working at Big Companies - trevor99
http://trevorowens.tumblr.com/post/48205958898/why-entrepreneurs-hate-working-at-big-companies
======
blackhole
This article has the right idea, but is obsessed with money. Money is not the
fundamental motivator for all entrepreneurs. There are plenty of people who
would rather work for themselves and barely be able to pay rent for the rest
of their lives rather than work for a large company simply because they will
be more happy doing what they love and barely managing to feed themselves than
they will doing something they hate and having all the money they ever wanted.
They don't care about the money, they care about doing what they love to do.
So long as they can feed themselves and find a roof to sleep under, being able
to work on something they love to do will trump everything else.

~~~
trevor99
I didn't intend it to be about money. I also said that entrepreneurs want a 1%
shot at ruling the world (king vs. rich). It's really about perception of
control and perception of fairness around hard work.

~~~
michaelochurch
A 1% shot of ruling the world is pretty useless. That's a 99% shot at failure.
Also, who wants to rule the world? All taken, it's a pretty fucking ugly thing
and it has some awful people in it. I know some people have that ambition, but
not me.

A 75% shot at never having to take goddamn orders, on the other hand, is
something I'd do things I can't put in print for. That's what I'm aiming for.
I don't want to be some despot or extortionist telling others what to do, nor
do I want to be told what to do. I want to have the opportunity to lead, if
others will follow, without entitled and artificially empowered jackasses
(i.e. typical corporate management) getting in the way of that.

~~~
hpcorona
I belive the 1% example is referring to trust your heart even when people
discourages you but you know your idea should work...

Also i belive, being able to take orders is very valuable to the team, even if
you are the ultra master chief... Closed to not taking orders? Then you are
starting with your left foot in being a leader...

Just my thoughts...

~~~
michaelochurch
Actually, I think part of being a good leader is _not_ ordering people around,
but inspiring, guiding, and teaching them.

I don't mind taking _direction_ , but traditional management turns me off.

~~~
hpcorona
Yeah, you're right, that's a better approach

------
nichodges
As someone in a 'big company', I'm often frustrated (although not surprise)
that entrepreneurs seem to see this is a binary problem.

This piece did touch on the real issue startup founders have with big
companies - but only touched on it.

The issue is not compensation, the issue is an inability to understand how to
traverse the system in order to execute and achieve what you want (and that
can include 10x returns).

This ability is about understanding how to identify the problems/opportunities
within a business that need to be addressed that nobody is attending to. This
ability has nothing to do with office politics.

I've seen several people who have managed this. In fact I've seen 5x more
people achieve amazing things in big organisations than I have seen
entrepreneurs truly succeed. People within big organisations can also make it
a non-binary choice - working with and often working on companies outside
their 'big company' (I spend ~1 day a week working/advising some amazing
startups as part of my job).

The inability to execute in a big company may not simply be due to oversight
by entrepreneurs - it may be that the type of person that is successful at one
cannot be successful at the other. But I don't believe that's true all of the
time, and I find it shortsighted that so many successful entrepreneurs seem to
see it as the truth.

~~~
marssaxman
Is it really an "inability to understand", or just an "unwillingness to
tolerate"?

~~~
nichodges
"tolerate" makes it sound like it's a negative system.

My experience is that corporations contain systems which startup founders
would absolutely love to utilise given the chance.

I have built technology within organisations that within months is in use by
multiple clients who have $1B+ market caps. I've seen projects funded with
higher risk profiles than most VC's would tolerate because those funding it
truly believed it was a good idea.

The idea that corporate systems are something that should be tolerated vs.
something that can be navigated and leveraged for a positive outcome is, as I
said above, terribly shortsighted.

~~~
hatestheword
I disagree. Though I find the binary application of the "big" vs "small" label
to be a real over-simplification (there's a hell of a lot of difference
between your typical mature publicly-held Fortune 500 company, a young startup
with a few hundred employees, most mom &pop businesses, small
consulting/service organizations, etc) and will agree that some personality
types may vastly better in larger organisations and vice versa, you are much
too quick to dismiss entrepreneurially-minded folks' objections to "big
companies" as simply being one of not knowing how to work the system.

There are, simply put, structural reasons that truly big companies tend to be
deeply dysfunctional and annoying to work with that have nothing to knowing
how to play the game in an efficient manner (I mean, yes, maybe you can
sometimes bring about change with enough hustle, but often the red tape or
extra baggage imposed by the big corporation is so large that it makes it
impossible to efficiently pursue most opportunities).

As a simple empirical matter big companies are rarely dynamic in that sense.
They rarely change and when they change it tends to be knee-jerk, late
responses (e.g., acquiring some startup at a large premium late in the game
after they've proven it works). No doubt big companies succeed and small
companies succeed (since we're over-generalizing), but they tend to succeed
for very different reasons and in very different ways....*

Big companies often "succeed" largely because of inertia, stable cash flows,
and pools of capital that they can readily tap. They generally do OK at
hanging onto their key product/service areas for a few decades, but very few
manage to leap into new areas successfully on net. Big companies rarely take
that sort of risk-- or at least not until someone or something has effectively
forced the issue.

Big companies are kind of like a big cargo ships where it can take miles to
stop and even turning ability is very limited due to inertia. Even the best
captains only have very limited ability change the trajectory in the short run
and it's very hard for outsiders to tell how effectively the captain is doing
his job by simply looking at where the ship is and its current trajectory.

To generalize, this situation means that the feedback loop for senior
management tends to be much delayed such that they are often not held
accountable on a timely basis (and when they are it's often in an erratic
fashion--to find a scape goat, to send a signal to markets, etc). Likewise,
this high inertia arrangement tends to greatly amplify principal-agent
problems that exist in all organizations (small companies have it to some
degree to, but they can't afford much of it). A senior manager may well
privately agree that some risky plan demonstrates a great IRR for the
shareholders/company, but rationally avoid this knowing that the culture of
their organization is such that the personal rewards for taking such a risk
are much smaller than the career risk attached to the project if it fails.

There are also, quite frankly, a lot of diseased big company cultures that
look down upon key employees since they lack a certain pedigree or aren't in
an area that's perceived as being sufficiently valuable by people (though part
of this is often lack of ability to understand what's important and why).
Conversely, many of these same organizations tend to fast-track certain people
that they believe are high potential -- but even if the individual really does
have the potential to truly contribute they are often unknowingly denied the
opportunity to get the depth of exposure necessary in any area of the company
as they're moved around from area to area (many of these people are truly
dangerous since they're often very naive about key issues and don't know how
little they truly know)

On a related note, these entrepreneurial concerns are particularly true if you
work in an area that's not really part of the big company's business line. If
you work in sales and marketing or if you're working in a key product area you
can do pretty well for yourself at many large companies providing you're
willing and able to play the right games, but if you work in, say, IT or some
other cost center in a company that's not really in the IT business... you'll
typically do _much_ better for yourself and for the world in a company that's
actually effectively competing in that area where your contributions have much
more of a direct and visible impact on the bottom line.

 __* NOTE __ __

There are some well functioning large companies (especially certain divisions
within them) and some terribly managed small companies, but as a general rule
--to compare, say, the Fortune 500 to your typical high growth startup or
small-to-medium sized well capitalized business-- this holds pretty well.

------
guylhem
It is that simple : if I really trust my idea to be so good, why waste my time
with a system that will at best not fight against my idea, and will not let me
reap the full benefits of it? If I success, I'd rather keep everything (or
most of it!) for myself!

There is a very small subset of problems, where, needing some very specific
resources for my project, it is more logical to seek them from within an
existing corporation, ie joining it, than from myself or the market.

I could live with the idea of japanese-style corporation, where loyalty goes
both ways. It would be logical then to accept the idea of sharing in a system
where others will share with you. Unless you have some serious deadweight,
sharing would reduce the variance of your profits, but not the mean.

But if employees are resources to be used and discarded, companies are
likewise resources to be used and discarded.

Basically, if the social contract is uphold, it is logical to share with
others, knowing they will too share with you.

For a game theory analogy, when one breaks one's word, cooperation is no
longer the best strategy, but defection.

The rise of entrepreneurship may have some link with the end of the
traditional corporation, where one had a job until retirement, put a real
effort in it, and was appropriately compensated.

~~~
hkmurakami
_> I could live with the idea of japanese-style corporation, where loyalty
goes both ways. It would be logical then to accept the idea of sharing in a
system where others will share with you._

IMO there are very few companies even in Japan who are truly like this
anymore.

~~~
guylhem
A social contract is a good thing, but I don't _need_ a corporation. I can
make a free choice.

Yet even if I like the concept of workers being compensated at their marginal
productivity, it's a sad thing this choice will no longer exist for most of
the people who are now graduating, and that entrepreneurship becomes a choice
by default.

Diversity (as in having many choices - to work for a big company or for
yourself) usually is a good thing.

Of course, you may still work for a big company, but if you know you are to be
poorly treated anyway, while bother doing more than the bare minimum? If you
have a good idea, why bother sharing its profits?

------
AndrewKemendo
I disagree with most of this because I don't think it is about money, but this
part in particular underplays what in my mind is the largest reason
entrepreneurs cannot stand large organizations:

>Corporate politics and bureaucracy are just another obstacle that can be
learned and overcome

You can learn to navigate politics and bureaucracy, but you can't overcome
them without becoming management - in which case your hands are generally
bound to the same metrics that your previous bosses were as well.

If it takes 4 levels of review just to see if my project can be begun or to
build a team to begin even MVP development, I don't want to be near that. It's
too slow, access to resources, if available, are so tightly scrutinized that
if there is any failure you can kiss future chances goodbye, attaching new
hardware or software is a nightmare because the systems need to all be
compatible on this network etc.. etc.. all make the large corporately
integrated system terrible for the fast paced error>revise>error>revise cycle
that entrepreneurs want.

This is why the Valve model of flat organization is so appealing to many and
spoken about in terms like "future of the workplace."

------
trustfundbaby
Enterprise companies are built in a way that slows the process of getting shit
done to an absolute crawl (red tape, politics, approvals, process and god-
knows-what other nonsense that somebody in a position of authority has decided
they're going to throw at you that afternoon), and that kind of environment is
simply noxious to the kind of person that has the audacity to think they can
start from nothing and build a company that employs hundred(s) and pulls in
millions in just a few years.

It really is that simple. You can even find some small companies that
entrepreneurs wouldn't last a second in, because they have this same mindset.

The point at any company where getting things done becomes less important than
making sure people (and by induction, the company) follow orders or don't
screw up, is the point at which entrepreneurial minded folks can no longer
thrive at said company.

------
phillmv
>The answer is compensation. Not that big companies don’t compensate them
enough, but that the compensation structure is not aligned with an
entrepreneur’s world view.

As far as I can tell the dominating decision factor for everyone I know who
runs their own company seems to be "freedom from management". That's why
people work for years at an expected value of a below-market wage. That's why
people leave a year into their four year vesting schedule post-acquisition.

In the anglo corporate culture there is little to no room for co-
determination; and I would wager that's especially grating to those in the
position to do something about it.

~~~
trevor99
that's what a lot of people say, but I think it's more of an excuse/laziness
around explaining the actual problem. any entrepreneur who raises a series A
will be managed by his investors. if he is not the CEO he will be managed by
the CEO and the investors/board.

~~~
phillmv
You will always have to _compromise_ with people. That will never go away. But
the social relationship between you and your investors - and definitely not
with your fellow c-levels or co-founders - will never be quite like to that
between a regular employee and their boss.

Your mileage may vary if you're on the brink of collapse, of course.

------
DigitalSea
The problem with a lot of bigger companies is instead of nurturing and
encouraging their workers to think outside of the box, they keep them as
sterile as possible through contract clauses that prohibit their employees
from working on any idea that is even remotely close to the companies
particular niche (some even prevent you from personal projects full-stop) and
non-compete agreements when they leave preventing them from finally being able
to chase their entrepreneurial dreams.

Larger companies only innovate when their competitors do, they have
obligations to meet (stockholders, customers, management executives) and doing
anything different or trying anything new is a risk that could jeopardise
profits of a company. Entrepreneurs who start out with nothing really don't
have as much to lose as a company does, two different paths and ways of
thinking.

------
davidroberts
I think it's because they have a dream, and know that if they tried to
accomplish that dream in a big corporation, they'd have to sell it to people
at multiple levels of bureaucracy whose job description often includes killing
dreams. Even if it was accepted, it would no longer be their dream, it would
be the corporation's dream, under corporate control and ultimately susceptible
to being morphed into something totally unrecognizable or killed at the
corporate whim.

Entrepreneurs feel to their bones that their dreams are too great a part of
themselves to so totally put under other people's control. And they don't
believe anybody but themselves can truly understand their dream or pull it
off.

------
marssaxman
Working at big companies sucks for many reasons which have nothing to do with
compensation. Many people might prefer to work in a less constraining
environment regardless of the pay.

The author appears to have a strange definition of "entrepreneur" which is
some kind of personality trait and not a business role. I suppose he must be
using the word "entrepreneur" as shorthand for "person with high tolerance for
the risks involved in starting a new business", i.e. a _potential_
entrepreneur.

------
jmilinion
I disagree. Many entrepreneurs would love to work for a big company IF they
were at the controls and not the cogs.

Steve Jobs. He had full control over Apple and could tell it to build whatever
he wanted. He worked for a big company. From what I've read, he was happy
working there.

Larry Page and Sergey Brin, they seem happy working for a big company.

Larry Ellison loves working for Oracle. I have yet to hear any disappointment
from him about working for a big company.

All in all, I think many entrepreneurs would love working at big companies -
as long as they are in the top 1% of the company who have control over the
rest.

~~~
batgaijin
Oh my god... this explains so much.

------
pesenti
I am an entrepreneur. And I now work in a big company. It has been 10 months
since they acquired my company. As far as I am concerned this article is
completely inaccurate. I don't give a damn about compensation. IBM gave me
enough money for my kids to retire - I don't need more money from them.

It's not easy though. My number one issue is inefficiency. My number two is
politics. But I wish I could make it work as within a company like IBM I have
the potential to do things that I couldn't have dreamt to do in my own
company.

------
7Figures2Commas
It's naive to make blanket statements about entrepreneurs. "Entrepreneurs" are
not a homogenous group. It appears the author believes that entrepreneurs
generally are overconfident, find insolvency to be an acceptable outcome so
long as they have a lottery ticket in hand, and fashion themselves as
arbitrageurs.

First, it's worth pointing out that arbitrageurs seek to exploit opportunities
that are, in theory, risk free. So to suggest that entrepreneurs are looking
to "arbitrage the system" while at the same time shooting for the stars when
the odds are "slim" is a curious and entirely inconsistent argument.

That notwithstanding, if you look beyond a small group of 20-something
entrepreneurs in the Bay Area, you'll find plenty of people who have started
businesses who worked at mid-sized and large companies for years. For some,
the knowledge and experience gained allowed them to spot the opportunity
they're pursuing. For many, the relationships established and good money
earned during those years of service put them in a position to pursue the
opportunity with far less risk than they would have taken on if they tried to
start a company before they had domain expertise, a professional network and
financial resources of their own.

It's sad to see folks reduce entrepreneurship to short-sighted risk-taking by
individuals who somehow can't or won't function in an organization that isn't
their own. _Smart_ entrepreneurs take calculated risks, start businesses in
industries they know and don't begin their journeys with a few thousand
dollars in the bank.

------
technotony
Best quote: It’s because they perceive the best case scenario as being a waste
of time. They see a better opportunity outside the system.

~~~
cinquemb
is it just me thinking this also could apply to what college has become?

------
xijuan
This article makes me think there are only two kinds of people: entrepreneurs
and non-entrepreneurs. And all entrepreneurs hate work at big companies... You
see the problem? The article didn't recognize that there are variations about
entrepreneurs and there are variations among big companies.

------
noonespecial
No feeling in the world is worse for an entrepreneurialy minded person than
seeing a severe problem, knowing how to fix it to the point of demonstrating
the solution, but being forbidden from doing so because of trivial politics.

You will find this by the dump-truck full at BigCo.

------
gz5
Insane determination when you are building a dream does not always map into
insane determination when [whatever you are asked to do in big company].

Consider that many entrepreneurs grow out of even their own company - their
own baby - when it moves from startup phases to an x year old mature company.

------
EugeneOZ
Word "Enterpreneurs" should be replaced to "author of this post".

------
michaelochurch
Way off the mark. It's not about compensation (if you succeed, VCs will tear
you to shreds via multiple liquidation preferences and horrible terms). It's
about autonomy and career development.

Working at a big company makes sense _if_ you can get allocated to a great
project, and it's hard to tell from outside what the good projects are.
Otherwise, you have to deal with red tape and approvals and resource requests
and headcount issues that will eat your soul and turn you just as lazy as the
middle managers who create such processes (who do so because they've become
demoralized and lazy and realize that dysfunctional bureaucracy, like
undocumented code, provides job security).

~~~
kamaal
>>It's not about compensation

Sorry, it is about the money. It has always been about the money.

As I get older, I realize nothing apart from money even matters.

~~~
dsfasfasf
Sucks to be you. Money is important. But is is not everything.

~~~
kamaal
>>Money is important. But is is not everything.

People generally say that when they have all the money in the world. Or they
have never felt a deficiency of it.

>>Sucks to be you.

It sucks to be without money.

You are right.

~~~
marssaxman
Consider Maslow's hierarchy: money solves physiological needs, helps with
safety needs, may ease but cannot really solve love/belonging needs, helps a
little with esteem needs, and does almost nothing for self-actualization
needs.

Money is important - you have to solve your basic needs - but money is not
everything, because it cannot solve your most sophisticated needs.

~~~
thewarrior
Maybe having lots of money indicates that you have achieved self actualization
by solving your most sophisticated needs ?

------
clobber
The word "entrepreneur" is getting used as a blanket term way too much to the
point that anyone with an idea, CRUD app or working at a startup is an
"entrepreneur."

~~~
Matt_Mickiewicz
Agreed.

Way too many people start a company these days because they want "Founder",
"CTO" or "CEO" title... rather than because they see a real need and want to
solve a real problem.

The fact that anybody with Google or Stanford on their resume can raise a
$500K or $750K seed round doesn't help things either.

------
paulhauggis
I've worked at small to mid-level sized companies my whole adult life (I'm
quitting in two weeks to work on my business full-time).

Working at any company always starts out well. I have so many ideas, thoughts,
and energy I want to put into my position. For me, it always fades after about
6 months.

The politics, managers, ridiculous ideas that I'm forced develop, long hours
that could have easily been prevented with better practices usually ruin it
for me.

