Software Is Eating the World

Unless you’ve managed to avoid media coverage for the last decade, you’re aware that technology companies are often making the headlines. As Marc Andreessen wrote back in 2011,^[44] software really is eating the world. Internet companies like Facebook, Twitter, Netflix, and Google have become part of the fabric of everyday life.

We’ve seen habits that are centuries old change overnight with the introduction of taxi-hailing applications such as Uber and Lyft and food delivery applications such as DoorDash, and it’s becoming more likely that you’ll meet your future partner by swiping right rather than approaching strangers in public.

This ability for companies that offer their services via software and the internet to become worth more than Walmart in less than 1% of the time has attracted a lot of attention. It has highlighted the possibility that a good idea, combined with investment from wealthy venture capitalists (VCs), can potentially create magical unicorns: another word for a company that ends up being valued at over $1 billion.

For those startups that find their niche, grow rapidly, and then exit via acquisition or listing on the stock market, early-stage employees with shares in the company can make millions. In some cases, billions. Smart engineers worldwide are drawn not only to new and innovative—often society-scale—problems to solve but also to the ability to get in at the ground floor, experience career progression that grows as fast as the company, and have a lot of say in how things are done.

In addition to the potential reward, the fast pace, and the cutting-edge computer science, startups provide many other attractive benefits. Since they are young companies, they’re often run by smart, decisive, and often rebellious founders wanting to do things their way. This means a focus on fun and enticing office environments, plenty of employee perks and benefits, and company cultures that celebrate autonomy, meritocracy, and the ability to get impactful work done, rather than being the best politician.

You may have been tempted to apply for a position at a startup for one or many of the reasons mentioned above. But the question is: should you? After all, you’ve gotten this far in the book because you’re invested in honing your craft as a manager. One could argue that increasing your impact as a manager requires managing an increasing amount of people, and startups don’t have many people at all. Additionally, many startups are focused on finding their product-market fit rather than establishing their internal hierarchy, so without that, what good is management?

Let’s begin by looking at the general composition of early-stage startups and then look at various scenarios in which your managerial skills are in high demand.