Random Walks in the Low Countries: Tuesday’s thoughts on business

Malcolm Gladwell (Outliers) notes that it takes 10,000 hours of practice to become an expert in a field, abut five years of on-the-job experience.

If the pace of economic change accelerates to where workers are forced to change jobs faster than that, wouldn’t it lead to both a progressive loss of expertise and a complete breakdown in retraining?

A friend / mentor observed last week that all startups go through a similar crisis before they get to market. Founders start out with a dream, a division of labor, and commitment to shared decision-making. This gets formalized in the founding documents.

As investors enter, they want control in exchange for money. As the product nears market, the organization expands and professional management is brought in. As lunch approaches, the stakes get much higher, stressing the decision-making,

As a result, quarrel develop over decisions, roles, and control. Passive founders try to retain shares; active ones want to retain influence. The crisis comes when the founding document has to be rewritten to give the company a professional structure.

Both of my startups hit that crisis, and it’s painful. I’m not sure how to anticipate and smooth it: it seems to be a natural adolescence.

I’m used to calling investors and leaving messages: we’re at the end of ski season and many take extended holidays to catch the late snow.

Recently, though, the same thing is happening with my vendors and contractors. I’m starting to feel like everyone skis: I may be the only one still riding the trains at 10 pm, working.

And, lest you think it’s just me, having a bad day, an analysis of 32 failed startups shows that co-founder disharmony is “one of the most fatal issues for a company.

While waiting for the bus the other day, I wondered how I should be thinking about it. On the one hand, I sacrifice and save to give the company as much money, as much time, as possible to succeed: riding the bus is an evolutionary step towards the eventual beachfront mansion.

On the other hand, success comes more slowly than one hopes for, and there will always be pressures on money and time: riding the bus could be a permanent condition for the vast majority of entrepreneurs.

And, on the positive side, the FT suggests that businesses should “Hire more multilingual employees, because these employees can communicate better, have better intercultural sensitivity, are better at co-operating, negotiating, compromising… they can also think more efficiently.”