Oh man what a storm.
Jason Calacanis has triggered quite a storm in the tech community with his post “How to save money running a startup (17 really good tips)“. Overall the tips are very very good, but the one that caused a lot of the stir was:
Fire people who
are not workaholics.don’t love their work… come on folks, this is startup life, it’s not a game. don’t work at a startup if you’re not into it–go work at the post office or stabucks if you’re not into it you want balance in your life. For realz.
As you can see Jason edited the statement after the storm, but the damage was done. Duncan Riley seemed to be the first big name to take offense with his post on TechCrunch. Well after that is seems to have been on for “young and old“:
- TechCrunch – Mike Arrington’s response
- Jason Calacanis again on you can have a life at a startup
- Robert Scoble agreeing with Jason
- Duncan on his personal blog
- Venture Chronicles discussing people vs stuff costs
- Centre Networks comparing Mahalo to a prison with better coffee
- TechConfidential takes an even further sarcastic look at saving dollars at startups
- 37Signals chimes in saying you should fire the workaholics
- A Mahalo guide/employee provides his own positive view on their working conditions
- Web Work Daily brings back the busy vs bursty discussion
So now where? My thoughts.
- Burn rates matter to all companies, startups need to watch them a little more closely than established ones. But is wouldn’t hurt established firms to be a little more careful with their money either.
- Good people make or break a company.
- Engaged employees make or break a company.
- Having to replace employees costs you lots of money.
- Not everyone wants to or should have to work in a startup. The reserve is also true.
Jason is right that employees who love their work tend to produce more than ones who turn up just for a pay check or are disengaged. But Duncan is right you can’t just fire someone who is not in love with the job to the point of being a workaholic. Don’t hire them to start with! Hiring the wrong people will kill any company and in a startup wrong people means that the owner/founder/CEO has screwed up.
If you do have someone who was all fired up and now isn’t, it is again most likely the owner/founder/CEO’s fault. Why? Because something has changed and they did not see it. Has the employees personal situation changed, or are they no longer in love with your idea, what has happened? Find out, try to fix it otherwise it will be far more expensive to fire them and rehire.
In summary the trick is when hiring make sure you hire correctly up front, that way you won’t need to fire anyone.
UPDATE: Another Aussie perspective from stilgherrian. Also this is a very complex and difficult issue to cover I have lots of other thoughts just not the time to write them all down.