{"id":1714,"date":"2015-10-23T14:29:58","date_gmt":"2015-10-23T14:29:58","guid":{"rendered":"https:\/\/leadershipshape.com\/wardroom\/?p=1714"},"modified":"2015-10-24T14:31:09","modified_gmt":"2015-10-24T14:31:09","slug":"no-pain-no-gain-in-startups-short-term-suffering-leads-to-lasting-rewards","status":"publish","type":"post","link":"https:\/\/leadershipshape.com\/wardroom\/no-pain-no-gain-in-startups-short-term-suffering-leads-to-lasting-rewards\/","title":{"rendered":"No Pain, No Gain in Startups: Short-term Suffering Leads to Lasting Rewards"},"content":{"rendered":"
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\"No<\/h1>\n<\/div>\n
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JOHN TABIS<\/div>\n
CONTRIBUTOR<\/div>\n
Founder and CEO, The Bouqs Company<\/div>\n<\/div>\n
Image credit: Melissa Baldwin | Flickr<\/a><\/div>\n<\/header>\n

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When it comes to startups, risk comes to mind for many. But not taking that leap poses a greater risk — the risk of missing a great opportunity for compensation, personal growth and networking\u00a0galore.\u00a0Choosing to accept startup risk —\u00a0as a founder or early employee —\u00a0could fundamentally alter your life and career, and quite frankly, I think you should do it.<\/p>\n

Building a startup isn\u2019t as risky as it sounds<\/a>,\u00a0it just requires a trade\u00a0off of some short-term pain for long-term gain. Here are some initial pains I went through when building my company, so you can be ready when starting yours or joining your first new venture:<\/p>\n

Related: 4 Steps to Taking Calculated Risks That Move Your Business Forward<\/a>\u00a0<\/strong><\/p>\n

Short-term pain #1: Little to no pay<\/h2>\n

When I first started The Bouqs Co.<\/a>, I took no pay for eight months. Zero dollars. And I\u2019m no spring chicken. I had a 15-year career at Bain & Co and Disney, a new mortgage in Los Angeles\u00a0and a 1-year-old boy at home.<\/p>\n

Ouch.<\/p>\n

This kind of sacrifice is common in the beginning stages of a startup. Founders often sacrifice their pay to fund what needs funded, betting they\u2019ll get it back (and more) later. And due to necessity, most startups pay below market in salary in early stages, asking employees to focus on equity upside instead.<\/p>\n

Short-term pain #2: More hours<\/h2>\n

Startup founders and early employees work more hours than almost anyone —\u00a0except maybe bankers.\u00a0For example, at the launch of XYZ Co., two to three people will be the only ones running the entire operation. That\u2019s a lot of work per employee.\u00a0As funding and demand increase for XYZ Co., the team will expand to six then 10 then 20 and so on.<\/p>\n

The trouble is, no matter the number of people on XYZ Co.\u2019s team, the work is never less<\/a>. Nothing about XYZ Co. existed in its early days, so it requires an incredible amount of time and energy to give it life and sustain it. This means many hours split among few people — and it\u2019s a grind.<\/p>\n

Short-term pain #3: The fear it might not work out<\/h2>\n

The founding team works long hours for little or no pay, barely scraping by for months. Regardless of their Herculean effort, there\u2019s no guarantee the company will succeed. There\u2019s a constant fear in the back of everyone\u2019s mind that they are sacrificing all they have for something that may ultimately fail.<\/p>\n

That kind of stress paired with early mornings, late nights and lack of funds is usually what scares away<\/a> would-be entrepreneurs. But it\u2019s just fear. It\u2019s not reality. While there\u2019s no guarantee it will work, there\u2019s also no guarantee it won\u2019t.<\/p>\n

Related:\u00a0What the High Dive Can Teach Entrepreneurs About Dealing With Fear<\/a><\/strong><\/p>\n

And ultimately, it isn\u2019t real risk. Regardless of the outcome, the gains will likely outweigh these pains. Here\u2019s how you win, regardless of whether your startup results in an initial public offering\u00a0or a closing of the business:<\/p>\n

Long-term gain #1: Compensation growth and\u00a0equity<\/h2>\n

While founders and early employees may start out making below-market salary for their skills, when the company gets big, they\u2019ll be making more than they would have in their alternative reality\u00a0non-startup company.\u00a0At a startup, founders automatically step into senior management roles, skipping over the traditional rise up the ladder. As the company grows, early employees naturally move into higher management positions. Since they helped build the company from the ground up, they\u2019ve earned the seniority needed to lead newer employees.<\/p>\n

Additionally, the equity value in a successful startup can be more than enough to offset any short-term decreases in pay in the beginning. As a startup accrues value, equity value grows to exceed what early team members would make as employees at regular day\u00a0jobs.<\/p>\n

Long-term gain #2: Not much is actually lost — even in failure<\/h2>\n

Even if the business fails, not much money is lost by an employee or founder in the grand scheme of things.\u00a0Let’s say Sara tries to build a startup. She makes nothing. Zero dollars. Zilch. Six months later, it fails. Take the lost wages (half of one year\u2019s salary at the next best alternative job) and divide it by all the money she will make in her career. It’s just a tiny portion.<\/p>\n

The losses, while real, are mitigated by the short time frame in which startups make it or break it.<\/p>\n

Long-term gain #3: Learning at a\u00a0fast-forward pace<\/h2>\n

Running a startup forces founders and employees to learn more than they would at any traditional job, earlier in their career.\u00a0Everyone is forced to do more,\u00a0do it\u00a0more quickly and are asked to execute beyond their pay grade and experience. This means rapid development of experience and skills that may take years to acquire in another environment. If the company doesn\u2019t go big, at the least employees will walk away with knowledge and experience that makes them more valuable in the job market.<\/p>\n

Long-term gain #4: Building a\u00a0solid network<\/h2>\n

When building a startup, founders and employees meet and have the opportunity to develop relationships with key people who may influence the business or their career. They\u2019ll attend industry events and meet business influencers, investors, founders and others who could get their ideas in front of the right eyes to help the startup take off.\u00a0These connections may also support their individual careers down the road. Plus, it doesn\u2019t hurt to be well-connected to a pool of successful investors when another great idea for a business manifests in the future.<\/p>\n

While there can be downsides to founding or working at a startup in the beginning, there\u2019s always a light at the end of the tunnel — in the upside or downside. Ultimately, the experience gained, the connections made and lessons learned are likely to be more than enough value to cover any short-term losses.<\/p>\n

And those who\u00a0make it? They get to change the world in some way, experience a life-changing sense of accomplishment and validate that the risk was worth it all along.<\/p>\n

What short-term sacrifices did you make when you started your own business? What did you gain long-term? Please comment below.<\/p>\n

Related:\u00a07 Essentials for Overcoming Mental Barriers to Exceptional Success<\/a><\/strong><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

JOHN TABIS CONTRIBUTOR Founder and CEO, The Bouqs Company Image credit: Melissa Baldwin | Flickr October 23, 2015 When it comes to startups, risk comes to mind for many. But not taking that leap poses a greater risk — the risk of missing a great opportunity for compensation, personal growth and networking\u00a0galore.\u00a0Choosing to accept startup … Continue reading No Pain, No Gain in Startups: Short-term Suffering Leads to Lasting Rewards<\/span> →<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"pmpro_default_level":"","jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[6],"tags":[],"class_list":["post-1714","post","type-post","status-publish","format-standard","hentry","category-startups","pmpro-has-access"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p4MGMb-rE","_links":{"self":[{"href":"https:\/\/leadershipshape.com\/wardroom\/wp-json\/wp\/v2\/posts\/1714","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/leadershipshape.com\/wardroom\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/leadershipshape.com\/wardroom\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/leadershipshape.com\/wardroom\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/leadershipshape.com\/wardroom\/wp-json\/wp\/v2\/comments?post=1714"}],"version-history":[{"count":1,"href":"https:\/\/leadershipshape.com\/wardroom\/wp-json\/wp\/v2\/posts\/1714\/revisions"}],"predecessor-version":[{"id":1715,"href":"https:\/\/leadershipshape.com\/wardroom\/wp-json\/wp\/v2\/posts\/1714\/revisions\/1715"}],"wp:attachment":[{"href":"https:\/\/leadershipshape.com\/wardroom\/wp-json\/wp\/v2\/media?parent=1714"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/leadershipshape.com\/wardroom\/wp-json\/wp\/v2\/categories?post=1714"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/leadershipshape.com\/wardroom\/wp-json\/wp\/v2\/tags?post=1714"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}