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There’s no such thing as “a startup within a big company”

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Re: There’s no such thing as “a startup within a big company”

#31

Post by DoofusOfDeath »

corty wrote: post #9

I'm not sure why everyone seems so focused on the cafeteria thing. I'm not sure people and their attitudes towards amenities are really the problem here. From my understanding, the differerence is the companywide attitude to risk. A startup has a "grow at any cost, or maybe perish" attitude. If things go south, bankruptcy will take care of the leftover excess risk (barring criminal charges). A bigco cannot easily go…

> So the only means to have a situation where you don't risk bigco for a single department is not making it a department. Make it a Ltd. in a holding or something.

I was thinking that as well. Can anyone explain why this isn't common practice?

Re: There’s no such thing as “a startup within a big company”

#32

Post by cdavid »

ChuckNorris89 wrote: post #15
cdavid wrote: post #8

Earlier quoted context omitted.

What's interesting about skunkworks is much it gets invoked by people vs how much it actually happens in practice. We engineers love skunkworks: working on cool stuff, without accountability and a lot of freedom ? Who would not want that ! But there are very few situations where this is sustainable, for reasons well explained by OP.

>We engineers love skunkworks: working on cool stuff, without accountability and a lot of freedom I'm pretty sure people who keep saying this have no idea what working at Skunkwork was actually like. If you read Ben Rich's book, which I recommend you do, you'll find out that they had tons of accountability, the more classified their projects were, the more they were drowning in paperwork. No employee was to be left a…

I should have explained a bit better what I meant by accountability in that context: reduced direct oversight from general management, almost kinda "chinese wall" style.

Besides the reasons given by OP, an issue w/ skunkworks is that it requires two things that happen much less often in practice than people like: you need very strong, skilled team, and the need for high impact that management believe cannot be achieved any other way.

Similarly, at the heyday of xerox park, it sounds like Taylor was key to enable true, long term autonomy for his teams.

Re: There’s no such thing as “a startup within a big company”

#33

Post by chrisco255 »

captainmuon wrote: post #22
corty wrote: post #9

I'm not sure why everyone seems so focused on the cafeteria thing. I'm not sure people and their attitudes towards amenities are really the problem here. From my understanding, the differerence is the companywide attitude to risk. A startup has a "grow at any cost, or maybe perish" attitude. If things go south, bankruptcy will take care of the leftover excess risk (barring criminal charges). A bigco cannot easily go…

If people really think of founding enterprises as a gamble with potential infinite reward, but limited downside (as bankrupcy will take care of it), I would say our economy has a problem...

It's this that makes entrepreneurship more abundant in the first place. If you have an economy with no risk taking you have no growth and no dynamism. Sure, 80-90% of businesses will fail, it's essential that people can fail without too much personal risk after all, but the 1 in 100 businesses that go onto grow to employ hundreds or thousands thanks to an effective business model are more than enough to make up for the failures. When someone fails in a startup it's not like they drop out of the economy altogether. Its not like they learned nothing. They go on to become effective employees at other companies, producing value there.

Re: There’s no such thing as “a startup within a big company”

#34

Post by pembrook »

sixhobbits wrote: post #5

I mean, sure, but it also misses the point a bit. "Startup in a big company" doesn't mean "yo take some cashdollar and try build and release something to the public", but it does mean "hey, take a small team and do your own thing with less oversight and process overhead from higher-ups". The team I worked in at AWS was like this and it felt a lot like startup teams I've worked with. That didn't mean we could take 'br…

Sounds like in your case it worked out, but I would consider AWS to be an insane outlier...also from a company still founder-led (Bezos is an exec with proven startup success--hence why Amazon exists in the first place!).

I think the point of the author is that, inside a big company, the fundamental risk/reward incentives that drive startup innovation are removed. Autonomy alone doesn't drive people to make crazy decisions. Risk/reward incentives do.

Google is never going to say to one of their internal employees:

"We're cutting your salary to $50k/yr, but you get 80% ownership of the business you create if you succeed. But there's a 95% chance you won't. And if you don't succeed you're fired. Good luck!"

That's the equivalent environment needed if you want to mimic the human decisions and behavior that drive innovation inside startups.

Re: There’s no such thing as “a startup within a big company”

#36

Post by Aeolun »

sgt101 wrote: post #24
ChuckNorris89 wrote: post #15

Earlier quoted context omitted.

>We engineers love skunkworks: working on cool stuff, without accountability and a lot of freedom I'm pretty sure people who keep saying this have no idea what working at Skunkwork was actually like. If you read Ben Rich's book, which I recommend you do, you'll find out that they had tons of accountability, the more classified their projects were, the more they were drowning in paperwork. No employee was to be left a…

>I'm also pretty sure most engineers don't want this, and what hey actually want is cowboy coding, playing like kindergarten kids in the sandbox with the latest shiny toys, while leaving work at 5 PM. Nope. They want autonomy, mastery and purpose. They want to be able to apply what they know appropriately - not to be micromanaged or frustrated by instructions that make no sense. They want to be able to develop skills…

Except for that last point, I agree.

Maybe if it’s a tiny bonfire.

Re: There’s no such thing as “a startup within a big company”

#37

Post by simonebrunozzi »

virgilp wrote: post #29
sixhobbits wrote: post #5

I mean, sure, but it also misses the point a bit. "Startup in a big company" doesn't mean "yo take some cashdollar and try build and release something to the public", but it does mean "hey, take a small team and do your own thing with less oversight and process overhead from higher-ups". The team I worked in at AWS was like this and it felt a lot like startup teams I've worked with. That didn't mean we could take 'br…

While I worked for Adobe, one of the executives there (Mark Randall, serial entrepreneur that was "acquired" by the company, awesome guy) launched the "Red box" initiative that eventually become https://www.kickbox.org/ . The red box was essentially a "toolbox" that he created on how to build a startup (set of training materials + $1000USD credit card that you could use however you wish), and the purpose was to get e…

Super interesting. Would you mind sharing more about it?

Re: There’s no such thing as “a startup within a big company”

#38

Post by zirkonit »

s_dev wrote: post #28

Because a startup within a company will always be making more money for other people than you. Only when you own a startup and that means outside a 'company' can you ensure your efforts profit you primarily.

Most successful startups have less than 50% founder economic equity, some - FAR less.

It's the capital holders who primarily profit from your work, whether you're an entrepreneur founder, or a salaried employee.

Re: There’s no such thing as “a startup within a big company”

#39

Post by notahacker »

sgt101 wrote: post #30
kludgekraft wrote: post #2

What is the main reason though? The BigCo being too risk averse? Or employees having too much of a safety net? Or BigCo processes weighing the team down? A combination of these?

If you work for someone with $80bn of shareholder capital at risk you can take 1/10000th of the risk at work than if you have $8M of shareholder capital at risk. It's that simple.

That depends on what the risk is. If the risk is to the credibility or business model or relationships of the $80bn core business, then sure, the big company absolutely must be more conservative. On the other hand, if only a tiny fraction of that $80bn is needed to underwrite losses from your skunkworks' niche product taking too long to launch, lack of rapid uptake isn't an existential threat (even if the project gets canned, most of the team will still have jobs and they might even keep the profitable part of the project alive) and resources can be shared with other areas of the business, there are other risks that are easier to take.

Re: There’s no such thing as “a startup within a big company”

#40

Post by aloer »

virgilp wrote: post #29
sixhobbits wrote: post #5

I mean, sure, but it also misses the point a bit. "Startup in a big company" doesn't mean "yo take some cashdollar and try build and release something to the public", but it does mean "hey, take a small team and do your own thing with less oversight and process overhead from higher-ups". The team I worked in at AWS was like this and it felt a lot like startup teams I've worked with. That didn't mean we could take 'br…

While I worked for Adobe, one of the executives there (Mark Randall, serial entrepreneur that was "acquired" by the company, awesome guy) launched the "Red box" initiative that eventually become https://www.kickbox.org/ . The red box was essentially a "toolbox" that he created on how to build a startup (set of training materials + $1000USD credit card that you could use however you wish), and the purpose was to get e…

Is the expectation with the kickbox that you work on your idea in your own time or was there a process to work on it during work hours as well?
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