Every project is a startup | Hacker News Reader

Every project is a startup

threeriversinstitute.org

7 pointsKentBeck5 comments

I'm working on a startup-like project within a very large company. A couple of trends I've seen:

- Unless you can show that your project will make the company more money in the first couple years than putting it into the bank it's a no go. We're told that it's cheaper to wait for another small company to succeed and then just go and buy that.

- We have IP, great labs, technicians and vendor relations for the technologies we're in already but it's hard to expand into totally new areas because we wouldn't be utilizing the existing resources. The usual answer is outsourcing but it's very hard to find good help when you don't quite know what you're doing yet.

- We had an official innovation funnel for a few years where employee ideas could gain some traction but that approach was abandoned in favor of the few-big-bets approach. I can't honestly say why the funnel failed but after a short while we called it the "funnel of death" since the financial types would never accept the business plans. At some point we tried to keep our side projects out of the funnel hoping we'd get far enough on our own.

We make mostly hardware so we're a lot less nimble than pure SW shops but some of the same trends surely apply.

Capital efficiency is certainly important whether you are a HW or SW startup. I'm curious about your comment that "the financial types would never accept the business plans". One of the important features of running a project like a startup is staged financing. First you get $10,000 to explore the needs. If everyone says, "Yes, I'd like something like that," you get $50,000 to build a minimum viable product (something just good enough for an enthusiastic customer to get value from). Then you scale from there. There is never a "business plan" per se, not until you have some data. I'd have the finance types write the business plan once you'd sold a few copies of whatever it is you were planning on making. At least, that's what I think I'd do given that I know almost nothing about your situation :-)

It kind of worked like you're describing except that there was very little actual money. In some cases we'd get $10K but most of the time the support was in the form of a tacit agreement to let us work maybe 4-8 hrs/week on a side project and use resources we already had from our day jobs. Once the project was accepted into the funnel, based on a prototype of some sort, you had to come up with a business plan and present the whole thing to a board. The problem was that at our site there were very few actual business people with spare bandwidth so the plans written up by engineers were met with scepticism.

This is probably not unlike what actual startups run into, even after the lessons from the dot-com bust: there's a lot of enthusiasm around the technical ideas but it's hard to convince investors.

Great post. Having worked in large companies, it's difficult to imagine organizations used to massive death march projects adopting this mentality, even if there's a better chance of coming away with viable shipping products.

And in a similar vein, organizations used to large-scale upfront requirements probably aren't even well-positioned to adapt to a new idea that comes out of a failed project. (Think Twitter being born while working on Odeo).

I'd be really interested to hear about examples of large companies that take this approach.

I think quite a bit has been written about 3M's innovation approach, which as I mentioned is quite similar to what I'm proposing.

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