When Are You Ready? – The risks of the Mark Zuckerberg strategy
What if Mark Zuckerberg were 40 Years Old?Throughout my past four years in the Indian startup ecosystem, first with mChek and now with my company ZipDial, I have had the honor of speaking at various entrepreneurship events at business schools and engineering colleges. Over just these few years, not only have the audiences grown in size, but also the average age of attendees gets younger by the year.
When I’ve polled various audiences of students about when they want to start up, many aim to be an entrepreneur immediately out of college, and the majority of enterprising youngsters have goals to start a company within five years. Almost none plan to wait more than 10 years before starting up. The enthusiasm for entrepreneurship among students and young professionals in India is promising and inspiring. However, this trend also gives cause to stop and reflect on when is the right time to start up.
In such scenarios, I immediately jump to quote Vivek Wadhwa, a technology entrepreneur and academic of global repute. Wadhwa’s research shows that the average age of Americantechnology entrepreneurs is 39 years old. Surprise and disbelief fills the room – What about Mark Zuckerberg?! Of course there are impressive cases that break the trend, including young successful entrepreneurs from the Indian market such as Vishal Gondal of Indiagames and Pallav Nadhani of Fusion Charts who both founded their first companies at the ages of 16 and 17, respectively. However, these unique cases are just that – unique.
Learn on Someone Else’s Budget
I personally believe in building up at least a few years of work experience before starting up, and I believe this is particularly important in India. In the American culture I come from, it is extremely common to start working early in life. For example, I had my first job at the age of 13 as a babysitter, and around the same age, my brother started a small business stringing tennis racquets for a few local clubs. By the age of 18, I had an internship in the International Marketing department of Gallo Winery, the largest winery in the world by volume produced, and this was before I even started college. By the time I graduated from Stanford I had completed a total of seven internships ranging from sales to legal to manufacturing operations to investment banking. By graduation, there was no doubt that entrepreneurship was in my future, but even after the exposure and experience I had, I knew I needed more, and it was only after working six more years in technology companies and startups that the timing was right to start up on my own.
By contrast, the typical student in India only gets their first job after finishing college, and many go straight into an MBA program without any work experience. This path focusing exclusively on academics is also a good one, but like any path, it has its limitations. Working for someone else first means you get to learn and make mistakes on someone else’s budget, not yours. I personally believe it is essential to have work experience before starting a company, and therefore caution graduates to think hard about the timing that is right for them.
What Are You Waiting For?
Once you know you want to start up, what are you waiting for? Is it the idea, the money or the people? This is another favorite question I ask among aspiring entrepreneurs. The typical majority is split between “the idea” and “the money”, with the response of “the people” being a distance third.
Again, I disagree with the majority! Running a company is never a one-person show, so whether it’s co-founders or founding team employees, I strongly believe that having the right people ready to start up with you is critical. The right people will attract the money to fund the company. Furthermore, the original idea for a business is very often takes twists and turns along the way, so it is the people who will not only innovate in the first place but who will continue to evolve the idea as the market changes over time.
Power to The People
Having experience before starting up is not only beneficial for learning but also for networking. This is important for success on a few different levels.
Most first-time entrepreneurs, especially young ones, start their companies with friends. Second-time entrepreneurs are more likely to find the right people who complement their own personal expertise and skill sets. While trust, and the kind of trust that exists between friends, is incredibly important between co-founders, it is also important that members of a founding team bring distinct and complementary skill sets to the table. Startups don’t have spare resources for redundancy. While you and your business school or engineering college classmates are relatively homogenous, the more time you have spent in a cross-functional work environment, the more likely you are to build a network and trust with people whose skills complement yours. These are even better potential co-founders.
Trust in your early employees is almost as important as trust among co-founders. When your company is brand new with no customers and no revenue and no brand name, your first employees will be convinced to join based on nothing other than trust in you. People whom you have worked with or managed before may be the only people with sufficient exposure to your working style and potential for success to you know and trust you enough to join your brand new company. If you wish to hire people with whom you have no past working relationship, then your background and professionals success must be compelling enough to merit such trust. This only comes with experience and time.
If you plan to rely on more than your own personal savings and revenue to run your company, then you will need to convince investors that you are worth funding. The number one question that any investor at a Seed round or Series A round evaluates is the founding team. All investors will do reference checks on you and your co-founders, so having industry experience and a successful track record are essential for building this confidence.
There are many arguments in favor of starting up early in your career, including the energy to endure the ups and downs, the lack of family and financial obligations, etc. However, I firmly believe that starting up too young or too inexperienced is unnecessarily risky. Building experience and a network is valuable for finding the right co-founders, early employees, investors, and ultimately for promising a more successful outcome for your and your company.
Valerie Rozycki Wagoner
Founder & CEO, ZipDial