Ok so now you are in a startup. (In case you want to know how and why to join a startup, see this video). Objective achieved. You are happy. Life is good. Until startup life actually begins! Not to worry. It’s not like something bad or difficult is coming your way. It’s just that there are a few elements which are so unique to startups, that you only get to experience them once you are in the system. Here are the top 5 challenges you need to be ready for:
The certainty of “Uncertainty”
- Starting a business is always a risk, and startups are no exception. One of the biggest challenges that startups face is uncertainty. The success of a startup is dependent on several factors, such as market conditions, consumer demand, and competition, all of which can be unpredictable.
- In addition, startups often operate with limited resources, and a small shift in market conditions can have a significant impact on the revenue stream and cash flow of the business. Navigating through this uncertainty can be daunting, but it’s essential to be prepared for the unexpected.
- By creating a plan that considers various scenarios and risks, you’ll be better equipped to handle any challenges that come your way. Another way to navigate through uncertainty is to stay agile and adaptable. Startups need to be flexible and willing to pivot when necessary. This means being open to feedback, adjusting your approach, and experimenting with different strategies until you find what works
- Finally, building a strong network and support system can help you navigate through uncertainty. Having mentors, advisors, and peers who have experience in the startup world can provide valuable insights, guidance, and support when you face challenges.
Unlimited requirements, limited resources
- As a startup person, you may have to adjust to a different working environment than what you may be used to in a larger corporation. Startups often operate on limited resources, and as a result, people may have to wear multiple hats and take on tasks outside of their job description. Relax – usually no one will force you to do so. But if you are open to doing this and do a good job – you will be an invaluable asset to the company!
- Working with limited resources also means that one will need to be efficient with their time and resources. You’ll need to develop skills around prioritizing tasks, being creative and finding ways to do more with less, such as leveraging technology or collaborating with others to find innovative solutions.
- Another advantage of working with limited resources is that it will foster a sense of camaraderie and teamwork with your colleagues. Success will come when everyone is working together towards a common goal and you will get to be part of a team with very strong elements of community and purpose. If you have never worked in such an environment, let me warn you. Once you have worked like this – you will never go back!
Long work days (And nights. And weekends!)
- As mentioned above – Uncertainty is high, resources are limited and time is of utmost importance. So it’s not uncommon for startup founders and employees to work 60, 70, or even 80 hours a week to meet deadlines, manage projects, and stay ahead of the competition. Furthermore, the fast-paced and high-pressure environment of startups can make it difficult to switch off from work.
- Even when you’re not physically in the office, you may find yourself constantly checking emails, responding to messages, and thinking about work. This can further blur the line between work and personal life, leaving you feeling like you can never truly switch off or relax. Some folks even brag about the number of hours they work in a week! My strong suggestion to you all – Please stay away from anything which glorifies this line of thinking!
- This can take a toll on your personal life, relationships, and mental health and can lead to burnout, exhaustion, and a lack of work-life balance. While working long hours may be and most likely will be necessary in the early stages of a startup (and most founders have this unsaid expectation from their early colleagues), it’s important to prioritize self-care and balance as much as possible. Don’t over-commit deadlines under pressure. Have open conversations with your team and set boundaries around work hours. Schedule time for self-care and relaxation. Take breaks and vacations when needed. Work hard – but don’t work yourself to exhaustion and burnout.
The world unstructured
- Another element that you will encounter (especially in early stage companies) will be the lack of structure. Unlike established companies, startups typically operate with minimal bureaucracy and almost no established processes. This happens because speed and execution are of importance at this stage. The processes are more individual driven and hence the structure is also being made up as one goes along. This can make it difficult to know what tasks to prioritize, how to allocate time effectively, and how to stay on track to meet business goals.
- As mentioned above, people are often expected to wear multiple hats, and job responsibilities can be more fluid than in a traditional corporate environment. This lack of structure and clearly defined job roles can be disorienting and overwhelming at times. Additionally, the constant changes and adaptations required in a startup environment can make it challenging to develop a sense of stability or routine, which can be frustrating for those who thrive on structure.
- To navigate this lack of structure, it’s essential to be self-motivated and adaptable. Founders and senior managers need to get some processes and systems in place, moving things from being person dependent to process oriented (Especially processes around operations, HR and Administrative activities). Also – No one will stop you from creating some processes or structure around your work area (There might even be an expectation from you to do so!). If you are unsure, just ask. But as mentioned, the drive needs to come from you.
- Developing strong communication skills and a willingness to collaborate with colleagues will help you stay on track and ensure that everyone is working towards the same goals. Finally setting goals and timelines, and regularly checking in on progress can help folks stay focused and avoid getting overwhelmed by the lack of structure.
The literal war for Talent
- Finally, another thing you will need to be ready for is attracting & retaining talent. Recruiting and retaining top talent is a hugely significant and warlike challenge for startups. Due to their limited resources, startups often struggle to offer the same level of compensation and job security that larger, more established companies can provide. This can make it difficult to attract and retain top talent, especially in competitive industries like say e-commerce or AI. And the result – More muti-tasking, more long hours and so on, until you are able to hire the right talent.
- To address this challenge, founders and HR teams need to be creative and find ways to offer competitive compensation packages beyond just salaries. This will include ESOPs, flexible work timings, and opportunities for career growth and development. (BMW bikes anyone??! :-)) Again, as mentioned above, you can help create a strong company culture that prioritizes employee well-being and fosters a sense of community and purpose.
- Retaining talent is another big challenge. With overheated markets offering high salaries – folks can easily jump ship with the hikes on offer. An opportunity for strong financial growth in the future, a good culture, learning and development opportunities, offering regular feedback and recognition, and creating a supportive work environment will be your moats against that.
All of these challenges are not that visible from the outside – especially when you are chasing a dream of working with a startup. However, all these challenges are well worth taking up because of the payoff. You get to create value, generate wealth, learn through it all. Most importantly – you get to create an impact. In larger organizations, it can be challenging to see the direct outcome of your work. In a startup, your contribution can make a big difference, and you’ll have clear visibility of the impact that your work will create.