I was talking to a leader in a tech startup recently, and they mentioned the levels of uncertainty and insecurity that have recently started popping up in their colleagues. After years of developing and pivoting its product, the startup recently launched its MVP, or minimum viable product.
They are now receiving a lot of interest, seeing sales growth, and a lot of promise in expanding the product beyond the MVP. All are very positive. The predicament they are facing is that after years of developing the product, too many within the company have become somewhat complacent and have lost their fire. They became comfortable with the tinkering and needed to remember the intensity of a do-or-die startup where things are advancing quickly, and the customer is fickle. The product launched, the real work kicked up, and the team is still determining if they can deliver according to the hype and turn things into an enduring company.
Welcome to the startup world!
To solve this uncertainty, I mentioned that the CEO and the other leaders needed to step up their motivational game. The startup was at a possible "go big or go home" moment, so people needed to provide their best energy and execution. There was no time for anything else. But what motivates an average individual employee to do that?
One way is to offer increased compensation. At established companies with large budgets, it can be base salary and bonus increases. At public companies, it can be some form of stock compensation, which has the extended effect of retaining employees until their stocks vest. At newer private companies, especially startups, equity provides upside on a potential exit.
Unfortunately, although everyone might have equity, not everyone will have top-tier equity—maybe not even the top 20% of the company. And if they don't, increasing their equity requires board approval, which would be challenging and potentially unlikely to happen. Any significant or off-cycle base or bonus increase would go through the board if the burn rate and budget even allowed it.
So, I suggested that the CEO and the company's leaders start making empty promises. I do this at work, too, although it is better than it sounds.
Career growth and compensation are naturally frequent topics of discussion within my department. The foundation of my response is similar for everyone. For example, I tell them it's a partnership. I have to make sure they have the right opportunities. They have to execute those opportunities in a way I can sell, and then I have to sell it. I can only do so much if my employees don't reciprocate my efforts.
I also tell them that once we've done the work, I'll do what I can to get them more compensation, a higher rating, or a promotion. But there are a lot of hurdles between them getting their rewards. My peers may back it or contend against it. My boss may accept or reject it. Then, countless other people from HR to finance to others in the direct chain of command might stop it. Perhaps the hurdle is not a person, but the company's performance is lackluster, and that particular performance cycle mirrors it. The company has done well, but the macro-level economics are trending downward. All these things are out of my control and my employee's control.
So what do we do? Give up before we even start?
And this is where the empty promise, or a highly focused promise, comes in. I tell my employees I can't guarantee things I don't control. However, I guarantee that I will work towards giving people the opportunities to grow as an individual and professionally. If they follow my lead and work the process with me, I'll ensure they have exposure to challenging problems, higher-level responsibilities, and growth-expanding experiences. No matter what happens outside our control, I can provide that as long as I still have a job and any form of authority.
From there, I also tell them that if the company or I cannot give them the career growth to match their personal or professional development on the timeline they want, I hold no hard feelings if they find another department or company that will. They must do what they must and shouldn't let anything stop them from their goals. During their growth, they have already paid back the company and myself for whatever value they provided and owe nothing more. Although I hope the company can retain people, sometimes it doesn't happen. I've had plenty of people who have moved on because of this, some of which I still connect and collaborate with.
The situation is the same for personal projects. Instead of setting goals and aspirations that revolve around outcomes out of your control, focus on only things in your control.
The startup's leadership can also address the uncertainty using the same logic. No one can predict whether a startup will succeed or fail. And even if the startup is a success, there are different types of success. Continuously growing so that the individuals can develop their careers is a success for the startup. Everyone being laid off immediately after selling to another company is also a success for the startup. Since career or compensation growth is out of everyone's control, the CEO and leaders of the startup can start giving some empty but focused promises that although career and compensation growth is not guaranteed, if their employees dig in during this crucial moment, they can guarantee to have tremendous growth from a personal and professional perspective.
The experience they gain will help them in their professions and lives, regardless of the outcome.
