The Advantages of Being a Small Start-Up – Part 4

With all the challenges your small start-up faces, you still hold some impressive cards. If you play them right, you can have the winning hand! You face all the challenges of cash flow management, distribution management and personnel management, not to mention the competition, push back and resistance you get when you are new in the marketplace.

Sometimes it’s easy to lose sight of the advantages you have as a small, undercapitalized start-up. We hope these articles provide encouragement and inspiration for the real saviors and backbone of the economy, the little guys!

Here are a few more advantages that can make the difference and give you a powerful competitive edge:

14. Establishing a Positive Culture. Probably the most important aspect of enduring success in any business is Company Culture. The big company has already established its culture and it may have existed for generations. Unfortunately, most big company culture just evolves over time till its set in stone.  When you first pour cement, you can move it with a trowel, but when it hardens, you need a jackhammer. Your small start-up has the advantage of deliberately creating a positive company culture from the outset. You are free to design the DNA and bake it in from the start. To make a sea change the big company has to undo decades of entrenched protocol and unwritten laws that determine the behavior, outlook and personality of its staff. You have the freedom to start out on the right foot on day one and you can easily correct your missteps before you get too big.

15. Company preservation is Job One. Your small start-up has hired a dedicated team that knows what they are up against and has a great deal of respect for the odds stacked against them. As they begin to succeed, they make incredible sacrifices because they see the direct effect they are having personally on the start-up success. There is an air of “we can do this thing if we stick together and all pull our weight”. “Lurking” is not an option.  The big company has stratified its work force so much that personal job security often becomes job number one. Decisions can be made that are good for the employee’s protection, advancement or budget, but are actually detrimental in the long run to the company itself. What’s more, this behavior can go unnoticed by top management. You are painfully aware of this short-sighted approach to job security because it’s readily visible in your small start-up and you can’t afford to tolerate it.

16. Be an Acquisition Target.  In these days of reduced IPOs and dried up venture capital, there is yet a way for your small start-up to monetize its value.  It can get acquired. In fact, it may get acquired by the very big company who may have resisted your advance. You can benefit by the growing trend toward acquiring new ideas. Today, in the big company, a truly new idea can get easily smothered by short-sighted views of job preservation, turf wars or stifled communication. They tend to look outside their organization for truly new ideas that have traction in even a small portion of the market. They tend to look at small start-ups like yours.

In this series we have tried to identify some of the more subtle benefits your small start-up can enjoy over the big well-capitalized, but sometimes sluggish corporations. When it comes to originality, positive culture, or ingenuity, size matters. When it comes to resourcefulness, customer service or maneuverability, size matters. The little guy can still have the winning hand!