| HN Mirror

I disagree. Though I find the binary application of the "big" vs "small" label to be a real over-simplification (there's a hell of a lot of difference between your typical mature publicly-held Fortune 500 company, a young startup with a few hundred employees, most mom &pop businesses, small consulting/service organizations, etc) and will agree that some personality types may vastly better in larger organisations and vice versa, you are much too quick to dismiss entrepreneurially-minded folks' objections to "big companies" as simply being one of not knowing how to work the system.

There are, simply put, structural reasons that truly big companies tend to be deeply dysfunctional and annoying to work with that have nothing to knowing how to play the game in an efficient manner (I mean, yes, maybe you can sometimes bring about change with enough hustle, but often the red tape or extra baggage imposed by the big corporation is so large that it makes it impossible to efficiently pursue most opportunities).

As a simple empirical matter big companies are rarely dynamic in that sense. They rarely change and when they change it tends to be knee-jerk, late responses (e.g., acquiring some startup at a large premium late in the game after they've proven it works). No doubt big companies succeed and small companies succeed (since we're over-generalizing), but they tend to succeed for very different reasons and in very different ways....*

Big companies often "succeed" largely because of inertia, stable cash flows, and pools of capital that they can readily tap. They generally do OK at hanging onto their key product/service areas for a few decades, but very few manage to leap into new areas successfully on net. Big companies rarely take that sort of risk-- or at least not until someone or something has effectively forced the issue.

Big companies are kind of like a big cargo ships where it can take miles to stop and even turning ability is very limited due to inertia. Even the best captains only have very limited ability change the trajectory in the short run and it's very hard for outsiders to tell how effectively the captain is doing his job by simply looking at where the ship is and its current trajectory.

To generalize, this situation means that the feedback loop for senior management tends to be much delayed such that they are often not held accountable on a timely basis (and when they are it's often in an erratic fashion--to find a scape goat, to send a signal to markets, etc). Likewise, this high inertia arrangement tends to greatly amplify principal-agent problems that exist in all organizations (small companies have it to some degree to, but they can't afford much of it). A senior manager may well privately agree that some risky plan demonstrates a great IRR for the shareholders/company, but rationally avoid this knowing that the culture of their organization is such that the personal rewards for taking such a risk are much smaller than the career risk attached to the project if it fails.

There are also, quite frankly, a lot of diseased big company cultures that look down upon key employees since they lack a certain pedigree or aren't in an area that's perceived as being sufficiently valuable by people (though part of this is often lack of ability to understand what's important and why). Conversely, many of these same organizations tend to fast-track certain people that they believe are high potential -- but even if the individual really does have the potential to truly contribute they are often unknowingly denied the opportunity to get the depth of exposure necessary in any area of the company as they're moved around from area to area (many of these people are truly dangerous since they're often very naive about key issues and don't know how little they truly know)

On a related note, these entrepreneurial concerns are particularly true if you work in an area that's not really part of the big company's business line. If you work in sales and marketing or if you're working in a key product area you can do pretty well for yourself at many large companies providing you're willing and able to play the right games, but if you work in, say, IT or some other cost center in a company that's not really in the IT business... you'll typically do much better for yourself and for the world in a company that's actually effectively competing in that area where your contributions have much more of a direct and visible impact on the bottom line.

* NOTE

There are some well functioning large companies (especially certain divisions within them) and some terribly managed small companies, but as a general rule--to compare, say, the Fortune 500 to your typical high growth startup or small-to-medium sized well capitalized business-- this holds pretty well.