If you are in the technology industry and haven’t read the recent blog post RECONSIDER, you should. As I’m most interested in hiring-related issues in the industry, I’ll get to my point once we get through a bit of background.
In RECONSIDER, Basecamp founder and Rails creator DHH describes how the term startup is becoming synonymous with the unicorn phenomenon and the potential dangers of this intersection for entrepreneurs and the industry as a whole. He writes “nobody these days is content to merely put their dent in the universe. No, they have to f*&%ing own the universe.” Much of what is written about startups reflects the attitude DHH describes, and he asks readers to reconsider that there may be motivations beyond billion dollar valuations for starting a company.
DHH reports that he co-founded his company over ten years ago and they’ve grown to a modest 50 mostly remote employees without a presence in the Bay Area. Clearly Basecamp never fit the unicorn profile and their maturity may preclude them from being defined as a startup today, but it’s hard to say they haven’t been successful. Few get to commission a special edition race car. The path of Basecamp might not be what the stereotypical startup founder sets out to replicate, and DHH seems to wonder “Why not?“.
What’s a Startup?
One part of the problem is which definition of “startup” is used. Startup is popular shorthand for new and (usually) tech, but some definitions require ambition of fast growth. DHH writes that the term startup has been “narrowed to describe the pursuit of total business domination“. He leads off by identifying Basecamp as a startup upon its founding and later describes it as “a company that doesn’t even have a pretense of an ambition for Eating The World™”. If their intent was never for quick growth or (dare I say) “disruption”, Basecamp may meet DHH’s (and others) definition of startup but doesn’t really meet the definition used most famously by Paul Graham.
Being that there are companies self-identifying as startups of varied age/size/ambition, and some nuance as to how those within the industry define the term, there is opportunity for misinterpretation.
One issue that DHH doesn’t really touch upon is how the somewhat hijacked redefinition of the term startup impacts careers and hiring, or more accurately, how some job seekers may be averse to any company that describes itself as a startup.
Hiring and Stigma
The term startup alone may conjure images of programmers (probably young and male) logging 70 hour weeks for pay well below market salary, poor benefits, and insignificant amounts of equity. These images may be a holdover from the first dotcom boom if you’re over 35.
Startups in many markets across the US today may bear almost no resemblance to that image, and unfortunately thousands of firms need to overcome a stigma with job seekers due to the ubiquity of the meme. It is assumed by some that a startup in Philadelphia or Boulder, solely because of their self-identification as a startup, is likely to expect employees to accept significant cuts in compensation and benefits as well as increased hours. It’s this often false expectation that leads some to stop listening about potential new job opportunities once the word startup is introduced into conversation.
What if I told you there were many fairly new and relatively small software firms solving complex problems that pay engineers at or above market rates, offer work/life balance, provide comprehensive benefits, grant options, promote diverse work environments, and never describe themselves as “we’re like $UNICORN for $PROBLEM“? Because of the popular startup stereotypes, I often feel obligated to lead off conversations by defensively telling candidates about a company’s highly-realistic hours expectations and competitive salaries before describing the interesting technical challenges that should be the focus of the conversation.
RECONSIDER hopefully has shined a light on the fact that there may be thousands of startups like Basecamp that never get huge (perhaps never sought to get huge), yet still created great products that impacted users’ lives while providing opportunities and financial stability for both employees and founders alike. Maybe these are the real unicorns.