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So what is a startup, anyway?

August 6th, 2004 (08:21 pm)

I've had four interviews this week. People at three of them described their companies as startups. All of these three have shipping product and revenue. Company A is a year old, B is 2.5 years old, C is five years old (with 150 customers). Only company B mentioned that people were working long hours (60-70 hours/week).

So, the question occurred to me: what makes people consider their company a startup? It's not the age, really; I left Netscape before it was 5 years old, and that was definitely no longer considered a startup. It's not being privately held; many large, mature companies are privately held. It's not the size; company B is pretty big (something over 50 software engineers, plus, I think, another 50 more in the rest of the company). All three of the companies have established themselves enough to have repeat customers. Is it a lack of profits? That one does make some sense, actually; a company that is dependent on venture capital is in a very different situation from one that's living of its own.

Comments

Posted by: C. Virtue (cvirtue)
Posted at: August 7th, 2004 03:50 am (UTC)
Foglio

I figured it was a code for "We're going to pay you with probably worthless stock instead of real money and browbeat you into working long hours."

What I'd also like to know: is the phrase you keep hearing "We hire the best" an accurate statement or is it the latest internal advertising to make candidates (or existing employees) feel they want to measure up enough to work for that company?

Posted by: Who, me? (metageek)
Posted at: August 7th, 2004 04:00 am (UTC)

Well, for the two companies where I heard it, it seems to be an accurate statement--or, at least, they put enough effort into interviewing to make it plausible. I don't think it's a broad trend, actually; I'm hearing it because the recruiter that got me these interviews specifically tried to set me up with companies that wanted the best.

Posted by: Jane Waks (msmemory)
Posted at: August 7th, 2004 06:45 am (UTC)

I dunno. The phrase "We hire the best" intimidates me. Not only do I feel pressure to measure up in the hiring process, but I feel that there would not be tolerance of errors or of a learning curve, once I were hired. I'm darn good at what I do, but hardly perfect.

Posted by: Justin du Coeur (jducoeur)
Posted at: August 9th, 2004 09:44 am (UTC)

I suspect that "startup" is being used as code for "pre-IPO". That isn't necessarily a good scale, since a company can be quite successful while being privately held. But I'd bet that all of those companies are issuing stock options, so it's very important to maintain that they *will* go IPO someday, to prevent the employees from getting cranky.

In practice, though, I have to say that any company that is five years old, with 150 customers, can't reasonably call itself a "startup".

And I'm glad to see that only a minority are demanding Stupid Hours. One of the lessons I've drawn over the past six years is that the XP principle of 40 Hours Dammit is a very good one for any sensible company to follow. (And not a hard one to follow if the company is well-managed.) The most productive company I've ever worked in was one that mostly followed that rule...

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