Scaling Startups

He was talking about the next paradigm in cloud computing that will transform the way we look at IT infrastructure; it has received good traction with the initial set of early experiments. Another one was passionate about the new world of converged consumer and enterprise mobility; there will be a need for a different type of mobile device management. Security remains a favorite subject with all kinds of paranoia and sometimes reality demanding attention and budgets. And then there are many solutions vying for attention with no real differentiation.

Technology evolution creates opportunities for innovation limited only by imagination and passion. The number of startups is growing in leaps and bounds supported by family funds, angel investors, incubators constituted by academic institutes, and sometimes the rich and foolish. After the initial idea is germinated many of them struggle to move to the next level. While the consumer facing ideas find their moments of truth quickly, the enterprises focused tend to seek advice on how to pitch and connect with the CIO and business.

Call it coincidence or maybe the industry is changing in a definitive way, the recent past had some ex-CIOs and industry friends talking about getting involved in helping startups. There already exist many formal and informal groups who tend to the needy and also help them with funding. Most such groups want to look at the idea, business case, and background of promoters to determine if they should invest their time or bet their money. Opportunities appear to be ranging from some great ideas to harebrained downright ridiculous.

Mentoring startups seems to be the “in” thing to do and talk about in social circuits. The commitment ranges from using old contacts and industry connect to open doors or at least create an initial meeting and dialogue, to taking on formal roles with shared financial upside should any intervention result in an engagement and business. The rub-off credibility is indeed making some difference to young entrepreneurs and also giving them a dose of reality to what works and what does not. The partnership is increasing the possibility of survival and success for startups.

Some startups tend to thrive in a niche without getting distracted giving them higher propensity for survival. For the challenged ones one of the reasons has been the founders becoming a bottleneck by not building depth of management; their passion and emotional connect that brought them to a market position ends up stifling the company. They are unable to let go of micromanaging every person and activity thus rarely scale up to their true potential. This is largely true for individual owned companies; partnerships face other conflicts and challenges.

Serial entrepreneurs on the other hand have enjoyed fruits of success with their ability to detach themselves. Moving on to their next idea or wave of evolution gives them new opportunities. They know who to tap and what they need intuitively; their experience adds to their ability to find the right customer advocates and advisors. Knowing when to push and when to give up comes naturally. It is not that everyone can be a successful serial entrepreneur, the success or failure of the first one is the most difficult analogous to making the first million dollars.

CIOs can play an important role especially in the evolution of startups wanting to provide solutions to enterprises.  Their understanding of the business context coupled with their technology expertise gives them the ability to craft architectures that positively impact business outcomes. I believe that CIOs should adopt a few fledglings depending on their interest and inclination; shaping the future has merit that it is predictable and brings self-actualization. The other option is to read about success stories and wonder.