As PaperG went from seed stage to growth stage, I’ve begun to notice the nature of the decisions I’ve had to make has changed.
Seed-stage companies with $0 revenue and an incomplete product have a lot of uncertain outcomes but in many ways, only one way forward. For example, as we were burning through the initial $30,000 we put into the company as founders, a decision had to be made between raising outside money or not. We weren’t certain putting more money would lead us to discovering product/market fit and ultimately building a successful company but we were certain if we didn’t raise any money, then we wouldn’t go anywhere. So, the decision was simple — raise money.
In general at this stage, you’re doing anything and everything you can to make progress. You’ll do whatever you can to save on costs, fuel adoption, and bring in investment. What ultimately drives most decision at this stage is survival.
As another example, when we were designing our ad product at that stage, we had partners demanding certain product requirements and certain timelines. None of the requirements were individually crazy or unreasonable, and we needed customers to generate validation and get feedback; consequently, when deciding between building a reasonable feature a customer wanted built for free by a certain time and losing that potential early adopter, we chose to build it. We needed customers.
Growth-stage companies with $5MM+ revenue and running break-even or profitable still face a lot of uncertain outcomes but have many ways of getting anywhere (and no where). You start facing decisions like:
- Take on a high profile but difficult and demand customer that doesn’t want to pay the true costs of support or turn the customer away and maintain your reputation and finances
- Compete with existing partners to gain more control of end-users or support existing ecosystem of partners
- Hire a good but not great candidate for a position you needed to fill last month or wait it out while as customer demand for more support and features grow
- Promote from within as team grows and needs more management or bring in an outsider with management expertise
What drives decisions starts becoming more about values. Many more decisions revolve around principles and what sort of company people want to work for and build.
The grass is always greener on the other side so I can’t really say I envy the decision maker in either stage, but I can say there is definitely a difference in the types of decisions you have to make. It makes me wonder what the difference will be like when we get to late-stage.