Startup Therapy Podcast

Episode #71

Ryan Rutan: Welcome back to another episode of the startup therapy podcast. This is Ryan. Rutan joined as ever by Wil schroder startups dot com, Ceo and founder and as well established at this point, my friend, so will uh we've we've we've had a fair amount of our careers expired together now, which is, which is fairly cool. I'm in and ties in nicely today's episode because we're gonna talk a little bit about how as, as you know, small companies and startups, particularly early stage, how do we create career path for people? Right. How do we create a compelling vision for both the company and how the people who help us start and and grow this thing can exist within that,

Wil Schroter: you know? Right. I think we also talk a lot about what if we don't want to build a big company, Right? I mean, it's heretical in startup terms, but you know what if what if we're good at 12 people how do we get really good people to either come on board or stay on board even though we don't plan on being a much bigger company. Uh and you know, it's funny now that I think about this, um, when we first started of course, like everybody else, we were a small company and then we grew pretty quickly, but we actually wanted to stay like the bones of a small company, So, you know, I don't remember exactly the milestone, but if you remember Ryan, when we had to say like, I don't know, maybe 20 people, which was still big enough for us at the time, but like, you know fairly small, we had six managers in place, you know kind of like the six different parts of the company. Ah He wrote yeah and now we have 200 people and we still have exactly the same six managers actually it's almost the same Ryan because I was talking to somebody the other day and they were they were asking about the kind of the composition of the company and it just occurred to me that four of the six, I'm sorry four of the six yeah. Have been there since the start of the company. So the entire eight years. Um and so how do you talk to the rest of the organ and say, hey there's opportunity for you here but maybe we're not going to grow or we're not going to be as big as that other company you're talking about. And I think it affects a lot of people because there's a bit of a crossroads one is I don't want to have to grow and create hierarchy in order for people to be on the team to grow. You know it just that just feels like bullshit.

Ryan Rutan: It's arbitrary.

Wil Schroter: It can be, it

Ryan Rutan: can actually be highly detrimental because then you start to get into doing things that are counter for the business simply because it suits what you wanted to be able to do from a career standpoint.

Wil Schroter: And to be fair I also don't think and I'm curious your thoughts here. I also don't think that startups have the same kind of workforce that they used to. I think people like, I think the hierarchical workforce is a throwback to way, way back in the industrial era, right? Where you had labor and people, you had labor that needed to be managed, you had people, you know, on on the assembly line that needed to be managed by somebody on top of them,

Ryan Rutan: right? When you're turning a screw, autonomy is not really a

Wil Schroter: thing you can be afforded. It's always

Ryan Rutan: it's always righty tighty, lefty, loosey, there's no autonomy there. Like you're always going to do this. Yeah, that's that's a really good point will Well, I mean, even even like, you know, I mean like how much of how much of hierarchy was driven and just even think about like how we were building our businesses physically think about the offices, right? There was a physical hierarchy. In addition to just the title, right? The corner office, right? The bullpen, right? The opposite ends of the spectrum. And I mean now we're talking about offices even being an antiquated, uh, you know, like a relic of, of how you build a company. Um and and certainly I think that the management structures that lived within those are worth calling into question at this point.

Wil Schroter: I believe in today's economy, you've got far more empowered and far more capable people at almost every level in the organization. So what used to be? Uh you were the silly intern that came in, you knew nothing. And I'm not saying that doesn't exist, but within a few years anymore with the tools that you can be enabled with and kind of the way the world works now At 25, if you don't know your craft, you've got a problem. It used to be like 25, I'm still 30 years away from making it into management and now it's like man, about 25, you know what? Haven't you figured out yet? So I just think the tools have changed the world has changed um not wholesale, not across the board and I'm not pretending it it goes to every business, but in the startup world, in the world that we live in, I think it's much much different and this isn't an argument against management or hierarchy entirely. It's more about I don't think that moving up the ranks the way we used to, which simply meant you become a manager either you become manager of more people and then you keep managing until there's no more people, you know, no more places to to move up in. I remember where this killed me the most. Um a long time ago when we were running an agency and we started hiring lots and lots of developers. We hit a point where we had like maybe 50 developers and that's that was a lot, especially back then and our best developer was being moved up and up into management. But I kept thinking like he's a developer, like, like why were you putting him into management? Like he's actually not that good at that particular job, but because he was the most senior, he had to have the most seniority to kind of guide other people. And one day he comes to me and he's like, I hate this job, I didn't come here to manage people, right? And I said, I, dude, I don't know what to do, like uh theoretically you're the most capable, so you peter principle, you're you're way up there, right? That's it, man. And and now you're stuck.

Ryan Rutan: Yeah, now the peter principle is a real thing and I think it's I think that is compressed significantly and and highlighted even more within the startup space. I mean, you can use whatever analogy you want here, but like you're not gonna make Christiano Ronaldo the coach, like you're the best player, we got top goal scorer in the league, you should probably be the manager,

Wil Schroter: right? Right? That's exactly it. And so ah what we looked at, you know, when we were creating our own organization was this, we want as flat of an organization as possible for a whole host of reasons really. But our whole thing was since we intend on being small, we got bigger than we expected to be, but since we intend on being small and we intend on being a flat organization, we had to rethink what career path is in an age where higher he just doesn't make as much sense anymore. We also wanted to create something where we didn't feel forced if you will like unnaturally to start creating directors underneath, you know, VPs underneath senior VPs underneath, you know, C level execs just because just so we could mirror how things used to be done. Just didn't make any sense.

Ryan Rutan: Yeah, I mean, we talked about this a lot that, you know, a startup company does not mirror a larger corporation. It's not just a smaller version of a big company. And, and we're, you know, we sort of have that narrative out there. Um, and yet you do see a lot of companies kind of unintentionally recreate that same structure um, even though philosophically, and like, you know, the tactically the things they're doing to grow the company may not align with that at all, which I think is dangerous for a lot of reasons.

Wil Schroter: Well, it puts the founders in a tough spot though, because everyone has kind of grown up knowing this mechanism for growth and all of a sudden we're trying to unwind that. It's interesting too because again, we're of course, still in covid we may have to be having this disclaimer for a long time at this, right? Uh, but it forced a lot of people to rethink their office space, right? And so a lot of major companies remember twitter was one of the first ones in there. Just like yeah, you're not going to have an office anymore and you know, I actually on twitter of all things said today or yesterday, I said, you know, if offices didn't exist, No one would sit down as a team And say let's sit in an office from 9-6 or whatever in this uncomfortable space and work. Every like no one would have invented that in current terms. There was a time and a place that made sense,

Ryan Rutan: right? Let's go with, let's look at our growth goals guys. Yeah, there was and it's no longer right? And nobody's sitting down and things like, you know what we need is probably a roof and some walls a water cooler that will drive the growth that we need, we should probably put most of our money into that right now. It's not gonna happen.

Wil Schroter: Yeah, basically my needs right now are I want to create a commute to a place that I don't want to be at. I want to sit in an uncomfortable desk like I'm a school kid for a very long time. I barely talked to people that I like and miss my family as much as possible if we can get all those things to work. Yeah, like I would be in a very good place, right? And so again, these things start to tumble down because of covid tore this, this mechanism out, I think startups based on kind of how we're building differently, how our efficiencies are creating different types of organizations. Like you can just do it with 10 or 12 people were used to be able to do with 100 people. So you've got to figure out what 10 or 12 people looks like. Um, you know, I've referenced this before, Ryan, but uh, you know, David and Jason at base camp are huge fans of this. You know, they basically said we could have a 200 person organization, we just don't want to and hell I don't blame. Right? And so we had to sit down a couple of years ago and we had to rethink what our organization looks like and what career path looks like for folks in an era where we don't intend on creating any hierarchy. And I think that was a tough conversation. What was your take on it?

Ryan Rutan: It was, I mean, so, you know, it's hard to have that conversation with somebody without really feel like you're trying to force feed them some kool Aid, right? And it's um, because, well, it does work within the startup context. Um, and, you know, it mileage may vary, you know, start up to start up um, in terms of how that's implemented, I think where it gets tricky for people as they go, Yes, Ryan. Yes, well, I understand what you're saying to me as your perspective employee and you're kind of laying out the future for me here and that works great within the context of your company, but what happens if someday I want to go somewhere else where they expect that based on my title, My experiences that I will have these other things like I would have been managing people and not just process. Um and and so I think that was where it was the most difficult was to be able to say like look, we're trying to give you a little bit of a view of the future here, we're we're trying to help you understand what your growth looks like for us. I think the and they got that I think by and large, that's not as hard to explain. I think it's as their then thinking yeah, but what if like what happens when I need or want to leave this company, what happens if you know this startup company that I'm about to join fails? That was the most difficult piece of this and I think it's going to get easier because I think that the notion of, you know, full time employment, you know, for forever with one company and and simply growing through these, this kind of antiquated hierarchical system that we just talked about is changing but we're not quite there yet, right? It's it's 1993 and I'm trying to buy a book online and I'm still really nervous about putting my credit card details, we're not quite

Wil Schroter: there yet. Um Well, so you know what I remember us doing, I think we should kind of go through exercise because I think it's served us well and I think a lot of other folks listening would like to hear it and I think where we landed to begin with was we said that growth essentially needs to be unpacked, right? Like when we talk about, you know, career growth and career progression, if we look at it at all the ends, which is, hey, I want to be a CMO or you know, you know, I wanna be able to have people reporting to me, we're missing what people are actually asking for. It's not necessarily that I want to be director of. It's that I want the things that come with director of and so we went backward. We spent a lot of time on this actually and we started to unpack all of the key tenants of what career growth actually meant to people. And what was interesting if you remember that, you know, a lot of discussions once we did that, the conversation got a lot easier because we're saying, don't you really mean this? And, and and it came down to essentially three things and I guess we can dig into each one was cash, I wanna, you know, I want to get promoted because that means more money, right? So, okay, yeah, we have to figure out how you can make more cash. Um Another one um was about recognition title was, you know, a huge recognition. You know, if I go from Director to VP I want that recognition. If you just say yes, I'm making more money, but I've never changed my title in 20 years. It feels like something's missing, right? Even if the title doesn't necessarily mean I'm getting direct reports, by the way. Direct reports are paid in the past. Uh at least I want to understand that I'm being recognized for progression. Um And and then then really the the last one was as I move up the ranks as those titles imply, I'm in charge of more. I get to do more. I get to get more empowered. And we had to explain with each of those how you could do that within within this organization with caveats to everything by the way. Um without having to jump. And I'll make one giant caveat if what you want to be is a manager like, because that's its own thing, right? Like if you're if you're creative and you're coming in, let's say as an illustrator and you really illustration is great. But you really want to manage 15 Illustrators, Right? You want to get to the art director level.

Ryan Rutan: I want to meet that. I wanna meet that unicorn. Where does that person exist? Literally? Never met an illustrator whose like what I really want to do is put down my pen and I want to just manage the output of other humans all day. I've never met them

Wil Schroter: it to be fair. Um That is that is indeed the the goal of some folks. And I'm not trying to to shortcut that say it's a bad goal, it's a different goal, but that's also where we say, yeah, that's actually not going to happen. You know, we're not trying to, you know, put um any any icing on the cake. We're just saying, I'm just saying there's no cake, Right?

Ryan Rutan: Yeah. But but but I think that was part of the reason why the conversations got so much easier. If you recall like when, when we could now say to somebody, hey, you can now there's a path to creative director that doesn't involve putting your pen down, you can still be creative and be the director, right? As opposed to just being a manager of humans now. Um And and so again, like there there is a difference still between how that's perceived internally and what they could do from a kind of a job, career capital standpoint external to the organization. Um But internally, it made that conversation not just easier, but rather than just, you know, removing the barrier of that conversation actually acted as a pole, they were like, wow, I can do that, I can I can actually be something that I want to be without having to give up the things that I like doing.

Wil Schroter: Yes. Yes, you can, I agree. Um Well let's let's unpack the first one. Let's talk a little bit about cash. Um so so you know, I'm gonna I'm gonna play the kind of employee here and I say, Hey Ryan, I'm working in customer service, I'm making $40,000 a year now. Um how do I get to making $400,000 a year doing this job? Let's start there.

Ryan Rutan: Yeah, you don't um Yeah, so there there is this one of the caveats you were talking about, right? Yeah. I mean there's there's always gonna be a top limit for for specific job functions, right? And I mean really what we're talking about is cash needs to align with contribution, right? And so there is a point at which the contribution within a given role can't exceed a certain amount, right? There's just there's only there's only so much room uh for for the contribution to continue align with the comp at that point. Um And so I think that can be one of the more challenging things to figure out is, you know, how do we continuously align the compensation from a cash standpoint with the contribution of that individual? And where that changes over time, Right? But I think we've done a good job of helping people to understand. Um and again, like it helps when you're flat, but it helps when you're a small organization and helps when you've got a lot of transparency so that people understand their contribution when your employee number 67 in a given department. How do you gauge your contribution? Not very accurately. Right. Because you probably don't have the level of visibility into the overall P. And L. That would allow you to say like, here's what I do, here's how this drives bottom line and here's how this, you know, increases top line or moves bottom line, whatever, right? But I think that that's um that's increasingly harder and in large organizations. So again, it's a luxury we have at the startup level to be able to do that.

Wil Schroter: So, I think it says a few things I say from a contribution standpoint, if you're growing and you're actually contributing more to the organization, right? In other words, your contribution isn't flat. If you're gonna say, let's say in customer service, which is super important function. And um in year over year, you're really just doing the same jobs slightly differently. Hopefully a little bit better. Year over year, but generally the same job. Ah there there isn't an exponential value to that contribution, right? Um You would have to, you have to take a look at the work you're doing in saying, I'm going to bring another dynamic to this work um where it will allow us to maybe make more money or save more money, right? You know, uh either helps drive the piano and here's the tricky thing. Ah you get essentially three classes of folks that work with you, you get folks that directly impact the P. And L. So that would be like um sales, right? I mean sales people can always write their own ticket because if they they bringing more money, they can always take a slice of it. Uh You didn't have people that are kind of in the middle. They they sometimes help generate more money. They sometimes don't, developers would be a good example of that and sometimes it's very hard to quantify, right? So developers can say, well I'll get it to get the mobile app out faster than I ever did before or anybody else would and that's super valuable. We'll make more money because we're selling it. So that makes sense. Maybe tricky to quantify. But even still they can make a case for contribution equals cash. It's the third category that's a little bit harder. Let's say that I'm doing HR or I'm doing the books right? There's just sort of just kind of a value of that and you run into a ceiling that a lot of people don't think about, which is called replacement costs. So the idea is if I'm a cashier at walmart and I get paid $12 an hour which would actually be a fair amount. Um and I worked there for 40 years. I won't make a quarter million dollars because there's a threshold at which point the replacement cost for that same role no matter how good you are at it um hits a certain number and unfortunately for that role it wouldn't be that high, you know, So if you're the best cashier there is, but anyone else can do some version of that job, not as well For $18 an hour, $20 an hour. That's probably been on the high end. You'll never be able to state a case for why what you're doing in that role should get paid more than that. Now sometimes some startups depending if they have the cash and if they have this purview, they'll say, you know, we're actually willing to pay more for that job. We'll pay $24 an hour for that job, assuming business economics work out because we want you to know that this is the best paying job in the most recognition that you can get. Which you know, it's fantasy I think Ryan for for an employer. And and I would like to believe that's where we'd like to be. You know, we like to be at a point where you can't go to another company and make more because we pay the most for that. And I don't look at that as like golden handcuffs. I look at that as just reward like you know, thank you for your contribution.

Ryan Rutan: Yeah. Well I think it depends on the individual, right? So in this scenario that you just laid out, you know around the cashier, even customer service, this is why some of these hierarchical jumps have to exist and occur, right? But however, if that person wants to stay in that job, if they feel like being a cashier is what they're meant to do. And that's where they want to be, being able to pay a little over market is a nice way of rewarding them for doing a great job and wanted to stay there. Um, it also helps to avoid some of the challenges that we wanted to talk about today, which is then what do you do with that person? Once they hit the top limit of that, now you're paying them as much as you possibly can for that. But that person still wants to make more, grow more and more responsibility. Well at that point you're talking about some kind of a role change or escalation or elevation.

Wil Schroter: Uh, the other thing that, that I'll throw out there and you know, we, uh, I don't want to go to on too much foreign attention on this, but there's more than cash to reward people. Um, time off. For example, flexibility in your job. You know, I would say every company right now, given covid is starting to understand where flexibility and the job and work from home etcetera is as much of a value to some folks as, you know, the next tier of caches. And I'm not saying cash isn't important, but often the flexibility to be with your family or you know, do things that you want throughout the day and kind of like make your day the way you want. It is incredibly valued people. And this is for the first time, kind of everybody's had that insight to that whether they wanted it or not. And so I know for us being able to give people a ton of flexibility and how they work has been an enormous cash reward. And a lot of folks have said, if I go somewhere else and I lose that, then the step up and cash doesn't matter. And I believe that to be very true. So again, I think we're also talking about being creative and what the full bucket of compensation looks like.

Ryan Rutan: Yeah, Yeah. But it's, it's a really important point though. Well because you know, we're, we're talking about the fact that we looked at the hierarchy and we said, you know, becoming a director wasn't really the thing they wanted, it was the things that came with it that they wanted. But even those are really just a means to an end, right? Even if we look at cash, cash isn't necessarily what they wanted. They wanted to do something with that cash, right? The more responsibility isn't necessarily the thing they wanted. They wanted, the more you wanted more responsibility so they can achieve more within the role, right? And, and so even even as we break out these three buckets were really still talking about most of these things being a means to another end. So it's a really good point that you raise that, you know, it goes well beyond the cash compensation. Um, it's a big piece of it, right? But it's really about what does that buy me, right? And again, if leaving this company to take more cash comp means, you know, traveling and working long hours and not seeing family, then maybe that doesn't really give you what you wanted. Maybe the cash that you wanted was you could take an extra vacation which you can now afford from a monetary standpoint, you don't have the flexibility to take it. So what have you actually accomplished in that in that move? Um, and, and so you know, of course career path is an extremely complicated and multifaceted adventure. Um the calculus on, it's tough to do. Uh, but you know, you're absolutely right in saying that we've got to kind of go beyond these, the base metrics and understand what's really motivating folks, what do they actually want? Right, Let's get beyond the obvious. And let's talk about what do they actually need to want to stay with us? Because I think a big part of, we're talking about today's retention, right? How do we keep the people that we want? How do we keep them happy and and how do we help them to excel in doing what they're doing

Wil Schroter: well. And again, and, and we always have to bear in mind that because we're a smaller organization, we're always going to be a bit saddled with with the replacement cost. Right? So if we've got somebody to an accounts payable And that person is doing a kick as job and they're making $60,000 a year, but there's no version as a business. Again, we're a small business, We're going to pay $160,000 for that same role. Right? Again, back to the cashier at Walmart. There's just some point at which the organization can't afford to pay exponential for a function in the business, regardless how good that person is or how loyal they are, etcetera. And the truth is what you're really talking about isn't whether or not, hey, I want to stay with this company. It's, I have to go to any other company. This isn't even about, you know, moving up and down the ranks, etcetera, who's replacement cost is higher, Right? Um, you know, maybe a Google can pay $120,000 for an accounts payable person because their replacement cost for what they do in the level of that responsibility is dramatically different.

Ryan Rutan: Right? What what goes, goes straight back to contribution, right? You assume that google can afford to pay that because the contribution of that individual accounts payable, there is significantly higher.

Wil Schroter: And, and, and so our goal as a small company should not be, let's come up with every reason no one can ever leave, right. Our goal should be, let's have a very clear dialogue about what we can do well and where we have to say goodbye, right? And, and, and, and I I think um, we get so caught up in retention to mean if anyone leaves, I failed. And the truth is, people will outgrow different aspects of the organization said differently if they're not, you've kind of failed there where you haven't grown the staph. Uh, and so, uh, we need to look at contribution in cash as this multifaceted thing. Like what are all the ways that I can, you know, compensate you time money, etcetera. Um, and try to come up with the best, you know, pie chart of those things that we can and if, if we can't, not the end of the world, but folks need to understand that they can grow in cash, you know, that their reward without necessarily having that to become director VP, etcetera.

Ryan Rutan: Absolutely well. And so I think we can kind of put a bow on that by saying that, you know, cash equals contribution. Um, maybe maybe calm people's contribution rates. So we can talk about things we can do for the staff outside of cash, but that's the general crux of it. Um, you know, the other thing that we talked about is that, You know, your, your title needs to reflect your, your capability, uh, not necessarily your direct reports, right? Like, you know, being a creative director versus being an illustrator speaks to what you can accomplish within that role. Not simply, I now am an illustrator with 15 people working for me. Um so let's unpack that a little bit, right, because I think this is something that we've done a good job of internally Is helping people to move up, you know, in title um and in recognition um without saying, yeah, but that's going to be limited on when we can hire those 15 people to sit underneath you right now. This is a reflection of your progression through your capabilities within this role. Not simply, yeah, we were able to hire 12 more

Wil Schroter: people. You know, it goes back to the The Gentleman I mentioned when we had 50 developers and I said um we kept moving him up to put people under him to say that's a reflection of your progression. But essentially he had become a systems architect and that was a reflection of his progression. Um Everything else had nothing. He was actually, he was he was good enough manager. I'm not gonna knock him, but like that really wasn't his, you know, superpower.

Ryan Rutan: Yeah. It also wasn't what he wanted to be doing, right? He came to and said, I hate this job

Wil Schroter: Well, but but actually stick with that. I could never get around how people were inherently put into management positions as a reflection of their capability. Um without necessarily saying is that really how we should be progressing you, Right? And so, Uh this was always, you know, my beef around creatives, you know, at the agency, we had like 150 creatives and again, going back to the person, you know, with the with the pen. That was an amazing illustrator Founded, Hey, you know, so I have 20 people reporting to me. Where did you get that responsibility or said differently? Where did you get that skill? Right. I mean, you went to art school, What do you know about management?

Ryan Rutan: Yeah, they didn't mean it. Yeah, It literally just comes and this is what we talked about the fact that, you know, sometimes, you know trying to create a situation whereby we add those people so we can promote that person like this person needs the promotion, they want the promotion. So I guess we gotta go hire people to put underneath them. The the the opposite can be true as well. Which is that there's a necessity to add people. So in your case you weren't hiring developers so you could promote this guy, you were hiring developers because you needed them to execute on projects which then just by proxy elevated him to a different position that he didn't want or need to be in. Right. Both of those things are bad.

Wil Schroter: Well they are and look at it this way ah there's another side of it where the person progressing, let's say they don't have an interest in management, but, but on the other side of it, maybe the rate that they're progressing just shouldn't have anything to do with management, in other words. Um, if I show up and I'm a kick ass marketer, let's say, let's say year one, I'm not, I'm 22 years old, I'm at a school and I show up at the organization and I'm just earning my stripes. But by year two man, I'm absorbing a lot, right? I'm starting to get some campaigns rolling. I'm actually starting to get, um, some real progress By year two, year 3, etc. I'm actually on my grind right. Like I'm nailing all of these initiatives or I'm doing stuff that people normally 10 years ahead of me were doing is the notion that the only way that I can prove that I have those skills is by having reporting structure. That doesn't make any sense. But, but if I go into a big organ and again, I'm not knocking a big or if I'm just saying this is where it kind of breaks down in a big Oregon, this is where it's an asset for a smaller, I have to start to have to go at the bottom. I have to work under some dude that probably doesn't even understand half the stuff I'm learning right and kind of just sit around and wait in line and hope that he or someone else in the organization kind of figures out that I'm more valuable and kind of figures out how to move me into a reporting role so that I can do the same damn thing I was going to do anyway. That pisces me off. Because in my mind, every person in the organization should be given a path, an individual path to run as fast as they can despite anybody else that maybe above them, right? In a reporting structure. Other words, Yeah, man, if you show up and you are just amazing at your job, there should not be any hierarchical boundary to how quickly you can advance. Um, we see this with developers all the time, you know, because they tend to get a tremendous amount of experience at a very young age and become very market valuable at a young age. I hate the idea That, that a 21 year old developer can't get senior level pay By the time they're 22 or 23. Right? And in what throws people as they look at that and they say, well, that doesn't make any sense. You know, they couldn't possibly have the experience, they have the contribution

Ryan Rutan: if they do, that's it. If they're making the contributions, Yeah.

Wil Schroter: You know, we brought in our director of finance at what 22

Ryan Rutan: was he? I'm not

Wil Schroter: Sure. Yeah, barely, I mean, but 23 maybe, uh point being this, the director of finances, that's not a minimal job, right? Um, Are are now Cto same thing. Um I wasn't a director role by the time he was 22, Um And the point of that is, we don't look at how many years of experience you have per se. We look at what can you do? How capable are

Ryan Rutan: you, what level can you play

Wil Schroter: at now? Think of what a waste it would have been of talent of either of those guys had we put them in the same role at any other company or any other big hierarchal company and perhaps they would have moved up in their own way. Um but not likely. Right. They would have said, well, you don't have the experience yet, so you can't move up yet.

Ryan Rutan: And and there's, there's so much historical precedent for how long somebody needs to be there before they can do it. Well, you know, it took Jim seven years, it took Bob and Jane or whatever. So like you end up with all of these additional arbitrary drags in addition to just the hierarchical structure itself that keeps people from being able to move up as quickly as they're there capabilities would allow them to.

Wil Schroter: It's basically like saying somebody comes into the military and they wind up being this just amazing soldier with amazing strategic capabilities and they're like, you know, uh no, you're just gonna be a private, Sorry, that's what people are at this level. It doesn't really matter, no matter what capabilities you have, uh that's where you are now

Ryan Rutan: potatoes need peeling.

Wil Schroter: And I guess to be fair, there's probably tons of use cases where that works out just fine. But in the startup environment, one of the things we should be flexing is that, that doesn't work here, right? Everyone is constrained by their own growth, not anybody else's growth and more importantly, not by someone else's incidental role in the company. So in other words, if someone else just happens to be sitting in the VP director slot, it doesn't mean you're not allowed to grow anymore. Your title may not become VP Director because they're the VP director, but it doesn't mean you can't, you can't level up within your own capability, right?

Ryan Rutan: Yeah. Yeah. I still think that's one of the biggest challenges though, right? Um even if you've elevated them to, let's say all else is equal, right? Let's just say for somehow comp is equal. You know, their, their their their autonomy is equal. Everything else is equal. It's still hard for that person to take that, isn't it? I mean to be able to say that like, well, I'm operating the same level, We have different titles, right? Um It's it's a challenge. So

Wil Schroter: what I would say for someone, let's say particularly younger in their career, they should be able to find a company, like a startups dot com and there are many like us and say I want to go there because there's nowhere I can level up fast enough if I'm good enough to get the comp the title and the responsibility, you know the empowerment. Um this this thing is a rocket ship and on top of that if I move to the top of that stack, I get to do ship at that organization at a young age that I would never get the responsibility to do in a bigger organization, right? You know, I get to have that impact. Yeah. Um which I think kind of leads us to the next point which would be ah as I'm leveling up, I kind of want to be rewarded with the empowerment to do more stuff. If I'm killing it on marketing or design or development, I don't want to say, I don't want to hear, well you're not the VP of this so you don't get to make that decision. It's like, you know, pardon my french funk that um you know I want to know that if I'm not capable, give me the ball right? That kind of that simple uh and let me run because that's what I do, it doesn't matter how old are, you know I am, what background I'm from or anything else like that. I want to know I'm in an organization where if I'm that good, no one stands in my way and I think that's a superpower of a startup.

Ryan Rutan: Oh it is absolutely it is and I mean there's a lot of things that that feed into that I think and one of the big ones is just visibility. Um you know, we talked about this at the, at the top, but in a large organization mapping that contribution to that individual can be really, really tough um, in a, in a small company, in a startup, it's usually not very hard to understand, so and so did this and it led to that, right? And if that's a good thing then then let's give them more opportunity to do more of that. But I think that there's, there's something really cool about that too, right? Being able to say that now, I were kind of measuring me by my contributions, not by my time and saddle, not by how many people are managing and now we're going to open the door to give me more opportunities to make those contributions and maybe even to define what those contributions should and need to be. Um and at that point you're really talking about unbridled career growth right? Like at that point, at the point at which you now have a clear understanding of how your comp and and so forth is tied to your contributions. Um and the fact that your skills are, are really what are being measured here and your ability to make that contribution through those skills and now you're being given autonomy and more ability to create contribution, what else do you need at that point? Right? It sounds ideal.

Wil Schroter: Well, there's another part of it too. A lot of people have asked, can I get a contribution, You know, can I get into some empowerment to do stuff that's actually not even in my skill set. Right? So in other words are our CTO has had experience in M and A. Right? There's no version if he was a programmer at Google where Larry and Sergey are going to call him up and say, hey, you know, we're looking to acquire Fitbit. Can you, can you sit on these meetings, you know, so you can, we can, you know, have you weigh in um not questioning his ability. I'm just saying that would never happen, right?

Ryan Rutan: It just isn't gonna happen. They would have no, there'd be no exposure to it and therefore no reason to involve them correct.

Wil Schroter: And so I think uh, you know, part of the package that we're talking about is giving people the opportunity um to dig in to get their hands dirty on stuff that they've never seen before. You know, product, everybody brings up product development. I have product ideas, so I want to be in product development, right? Well, that usually just doesn't happen. Um one of the cool things about a smaller company is, you can start to get your hands and stuff that you could never touch before. Um fun, fun, caveat, some people are good at that. You know, some people actually do have, you know, a bit of a capability to kind of across, um, genre, so to speak. Most people don't, to be fair. Most people try it and they realize that there's a reason that other people are better at

Ryan Rutan: this. That's the reason I'm in this

Wil Schroter: lane. Yeah. I mean I'm just saying like every year I try to teach myself to code and every year I'm like, oh, that's why people, that's why people go to and I don't, ah, so again, um, but at least you got the opportunity,

Ryan Rutan: right? Well there's also a difference too between an ability to contribute in those spaces and to own that space, Right? And I think that's something that's really hard to do in a large, large organization because you won't have enough exposure to it to be able to make a meaningful contribution. And so even if you tried, it probably wouldn't be a very valuable contribution. But because of the transparency between departments between individuals that typically exists in a startup company, I think your ability to make meaningful contributions even at a really small scale is far far superior than in a large organization.

Wil Schroter: You know, one of the things I found is that, that when people say, hey, I want to get involved in product development or hey, I want to get involved in something else. They don't mean it the way I think I used to think they mean, I used to think that they mean like, hey, you want me to just hand me the ball and let me run. That's not what they're saying, What they're saying is I want to watch it happen, right? I want to watch how the sausage is made, I don't want to make the sausage right? Um and they're just saying, I want an inside view as to what's going on there. You know, I want to be able to sit in a management meeting and just hear how it goes. I'm not saying that I want to manage the entire company. Um and when people get those opportunities um on a consistent basis and then they look at a job somewhere else where they'll never get that opportunity, it's not the same job anymore. Right? So again, back to the holistic comp a lot of these opportunities we can create around empowerment, our opportunities. People just can't get elsewhere. With all that said, I think we go back to the big caveat is that we can offer the comp the career progression, the title progression, the empowerment, et cetera, but there is a point where you're better off elsewhere. I mean, I I don't, and I've said it to plenty of people over the years, I've just said, look, I love you, you're awesome and this is why I'm going to tell you this, you're better off somewhere else. Um Yeah, and I also say the opposite. When I say, and again, I can't predict the future, but just based on my experience, I say, look, um there is a point where I still think you're better off here and you're probably jumping the gun, but it's up to you to figure that out. But on the other hand, there are people that come to us and say, Hey, you know, I need to make 200 k doing this job, and I'm like, that's going to happen here.

Ryan Rutan: Adios. I mean, and let's see what happens. It sucks because they're like

Wil Schroter: off of my favorite people, right? Um and they're the most ambitious, right? That's why they're my favorite people. Um and I look at that and I say, ah again, there's a place where we top out, there is a place where you got to kind of run into your own thing and and I'm okay with that. You know, we've we've talked about that before.

Ryan Rutan: Yeah, we've we've we've gone over that one. Yeah, I mean, we're we're always happy to see people move on and progress. Of course, we'd love to know that they can progress within within the walls of startups dot com, but um you know, it happens in in more ways than one, right? You know, they can outgrow the company um or or simply grow faster than that aspect of the company's growing. Um Sometimes the converse is true, right? Sometimes the company grows faster than they are and and they don't have uh you know, they're they're not prepared at that point because sometimes these things can happen really fast, right? We turn on a new channel, all of a sudden things change overnight and now, you know, in a role they were thriving in now. They just feel like they're trying to hang on for dear life and in that case it's also, you know, a better move to switch. Um, and sometimes they ride it out and, and can kind of catch up. But oftentimes, you know, that creates a window of opportunity or necessity for them to go and do something else to write, like you said, we want to keep everybody forever, but it doesn't happen. And I think that as long as, as founders, we're doing everything we can to create, um, an environment where for the time that you are here, you have great opportunities, you enjoy the work and you do have some clarity in, in the path to proceed and knowing where that ends, then it's okay, right. I think one of the things that I've seen happen within startup companies that ends up being a tragedy for everybody involved is to lay out a path that sort of fundamentally doesn't or can't exist or that there are too many things that need to be true, um, that are just out of the hands of either the person telling them or the individual who then needs to follow that path. Um, and that can just lead to a lot of disappointment, right? You know, if it's like, you know, start here today, jimmy and you know, in in five years you're gonna be running this thing, right? If we told every customer service rep that worked for us, that that was the possibility and of course anything is possible. But if that's the path you lay out, you're being disingenuous and that can lead to a lot of heartache.

Wil Schroter: Yeah, I agree. Look, I think at its core our goal is to simply say this is what we do really well. We're kick ass at these things. You can make more money at this role than most other roles. You know, Again, not everybody, we cannot pay google. Um we can give you a title progression that has no bounds. In other words, it is not bounded by who's ahead of you, it's not bounded by um your, your experience and market, it's it's bounded by how, how much as you kick. Um and we can give you the empowerment. Just do what you wanna do, See other things that you'd never see before. If all of those things sound awesome and continue to sound awesome. This is the place for you. If it's not, again, you know, we'll help you find your next gig, so to speak, but I think all we can do in putting that path together is lay our cards out. So this is where we're awesome at, we hope you can grow with us,

Ryan Rutan: that's a wrap for this episode of the startup therapy podcast. This is Ryan Rutan on behalf of my partner Wil Schroder and all the startups dot com family thanking you for joining us and we hope you'll continue to join us. Be sure to subscribe rate and comment on itunes or wherever you love to listen to startup

Wil Schroter: therapy,

Ryan Rutan: you can find all of our episodes at startups dot com

Wil Schroter: slash podcast.

Ryan Rutan: If you're looking for more amazing resources to launch or grow your startup, be sure to head to startups dot com and check out startups unlimited. It's everything we have to offer from our online university to our amazing community of experts and founders and even all the tools we've built like biz plan, fungible and launch rock. It's everything a founder needs visit startups dot com slash begin that startups dot com slash B E G I N. You'll thank me later.

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