38 ms·

Startups have the risk meter pegged so it doesn't enter into their management decisions, instead they are focussed on execution and they flame out or succeed as

by j_baker 15y ago

Startups have the risk meter pegged so it doesn't enter into their management decisions, instead they are focussed on execution and they flame out or succeed as they will and when they succeed they clarify the risk around their idea (if it flops the managers can pat themselves on the back for avoiding that land mine, if it takes off the managers wring their hands and wonder if they should have been able to forecast that success. Your profile says you work for Blekko, and in a senior enough position that I'm going to assume you're not naive enough to actually believe this. Startups are every bit as capable as risk aversion as BigCos, albeit for different reasons. At BigCos, it's sheer organizational inertia you have to deal with. At startups, you have the exact opposite problem: "We're so new and unestablished that we just can't afford to take that kind of risk". Humans are, as a general rule, afraid of risk.

ChuckMcM 15y ago
This is a fair point. The risks around committing to market a product for which there has not (yet) been established that such a product can work, is the risk that start-ups take. They believe in their better mouse trap and generally see it through to production if they can. Then there are other risks which everyone is afraid of, like the risk of running out of capital before you're done (perhaps exemplified as the risk of pivoting) and one that is more damning in start-ups the risk of not having enough capital after you release, and your idea fails, to do another idea. While failure is always a possibility, it always hurts. I accept your premise that humans, in general, are afraid of risk. Perhaps I should narrow my claim to specifically say that large companies are more afraid of 'new product' risk than companies that aren't currently shipping any products. I've always felt (but have no direct knowledge of) that Microsoft's initial failure to capture any sort of tablet market was their fear of creating a "new product" that would compete with Windows. I used one of the early Toshiba tablet PCs and was always saddened by what looked like a lack of commitment on Microsoft's part to the notion of a tablet in its software stack. When I used an iPad for the first time I didn't feel like it was a less capable version of MacOS.

by j_baker 15y ago

ChuckMcM 15y ago

This is a fair point. The risks around committing to market a product for which there has not (yet) been established that such a product can work, is the risk that start-ups take. They believe in their better mouse trap and generally see it through to production if they can. Then there are other risks which everyone is afraid of, like the risk of running out of capital before you're done (perhaps exemplified as the risk of pivoting) and one that is more damning in start-ups the risk of not having enough capital after you release, and your idea fails, to do another idea. While failure is always a possibility, it always hurts. I accept your premise that humans, in general, are afraid of risk. Perhaps I should narrow my claim to specifically say that large companies are more afraid of 'new product' risk than companies that aren't currently shipping any products. I've always felt (but have no direct knowledge of) that Microsoft's initial failure to capture any sort of tablet market was their fear of creating a "new product" that would compete with Windows. I used one of the early Toshiba tablet PCs and was always saddened by what looked like a lack of commitment on Microsoft's part to the notion of a tablet in its software stack. When I used an iPad for the first time I didn't feel like it was a less capable version of MacOS.