Is it just me or has the word “start-up” become a somewhat liberally applied term for any business that’s successfully stayed trendy? What does it really mean these days?
In most people’s eyes the likes of Google, Facebook and Spotify are still start-ups but all of them have multi-billion dollar valuations and have been incorporated for 17, 11, and 9 years respectively.
In fact, in 2011 – 5 years after Spotify was founded and employing 311 people, it won the Start-up 100 Awards and, just months afterwards, announced a valuation of over $1bn following a successful funding round.
So we can safely say that being perceived as a start-up is not linked to length of existence, number of employees, market capitalisation or valuation.
One thing that these companies do have in common is a contemporary work ethic and environment. And I don’t mean having a water slide, a ball pool and sleep pods that play the sound of the seashore to you as you take your 37 minute power nap. I rather mean “agility, ability and humility” as core components of a start-up culture.
That is to say that organisationally you react and adapt quickly, you hire the best of the best and you aren’t afraid to try things out and admit you were wrong, cultivating a loyalty from customers/users who reward your openness and honesty.
And maybe that’s the key? This openness and honesty brings your users into the inner circle and allows them to participate in the growth process. For as long as you can keep them that close, they’re going to consider you a start-up, because they’re imbued with a sense of joining you on your journey.
This is certainly true of Google – a company that’s always showing us that they are still learning, trying, failing, trying again, set against a backdrop of undeniable ambition and accomplishment. Their famous “20% Time” allowed their engineers to spend one working day a week on a side project of their choosing. The good ideas stuck and have become part of Google’s product portfolio and our everyday lives – Gmail, Google Talk and Adsense are three such examples.
Larry Page’s “Toothbrush Test” for investing in companies tells the same story of commitment to innovation, improvement and open-mindedness – “will I use it at least twice a day and will it make my life better?” If yes, then invest.
Facebook also have it by the bucket load. You can harp on forever about how their privacy policies are atrocious and barely look up from your shaking teacup whilst you utter the time-honoured phrase “World gone mad” but, like it or not, they’ve changed the way the next generation communicate.
It’s here to stay, precisely because they steered their ship through some of the most poorly-executed reversals, both on policy and UI design choices. And, you know what, their users are as loyal as ever. Why? Because they’re all aboard that same ship. The users are learning just as much as Facebook itself and they’re stronger by going through the experience together.
Now, I’m not saying that these long-toothed start-ups deserve accolades in prestigious start-up awards. Given the organisational culture I describe, they know best of all that they must make way for the next generation; the generation they have inspired. But I don’t yet want to rob them of the title “start-up”. I worry that, if we do, they’ll become simply a household name that we take for granted, and not the shining beacon of hope we need them to be.
Those of us who want to change the world by fixing the mistakes as we go along need an existence proof – people who have done it and are continuing to do it the same way. People who haven’t given in to stoic, corporate culture despite their size and success, buoyed by the millions, nay billions, of supporters who accompany them on their exciting journey.
So, I’m proud to say that I’m at a 13-year old start-up. My advice to other start-ups?
Take your customers or users on the journey with you – make them feel involved in your growth.
Be honest with them about your successes and your failures – they’ll respect you all the more.
Keep challenging convention or perceived wisdom – don’t lose faith because you can’t tick the boxes, it’s great to be different.
Above all, love what you lead – if you do, then your staff will and if your staff do then your customers will.
So here’s to another 13 years of being a start-up!
Adam Byrne (@greenwoodbyrne) is VP of Strategic Alliances at technology startup RealVNC