Every software engineer faces a profound dilemma at some point. What to choose for the next career move: a tech startup or a large corporation? Disclaimer: there is no right answer. If someone fiercely advises you to choose one of these options and talk you out of another one, just do not listen. Many factors could influence a decision and the first thing you should do is to identify your expectations and compare them with what every option could give to you.
To connect all the dots, let’s look at what to expect from the work in a small startup and a large tech corporation. We hope this comparative analysis will help you to evaluate all perks and shortcomings of both variants and determine the most suitable type of company for your professional path.
Corporation. The structure is the main characteristic of a big company. Generally, all tasks are carefully divided among the company’s departments and, if we are talking about a team, between its members. Once you are joining a team within a corporation, you will likely have to dig through some work items, guides, and charts, where all work processes and rules are described in detail.
In a corporate world, special attention is paid to coordination between teams. Your schedule will be full of meetings with your team and other departments to compare notes and present your current achievements.
All processes are carefully set up and polished, so your main task here is to fit into the already determined system and strategy.
Moreover, there is a possibility that in a large company, you will be responsible for maintaining and adding to already existing products – the most common task will be fixing bugs in existing code instead of making new features to the product. In this case, you will get valuable knowledge of how large and successful product is being built from the inside.
At the same time, established corporations making well-known products are increasingly launching brand new services, and teams working on them start functioning like small startups within a large company. And this is a truly win-win scenario for a software engineer, as you get a chance to be engaged in work on a new product while being part of a big enterprise. So, before making a final choice, make research on the type of company’s existing and planned products and try to get some information on services that are being developed within a corporation.
A startup is a whole different story. The process of setting targets and planning here is often more accelerated and sometimes informal. This is a normal business mode for startups, as all processes here are much faster due to smaller business volumes.
Moreover, your tasks risk changing midway, as startups are usually not stable enough to perform steadily all the time. You, together with a company, will experience highs and lows and have to act upon a situation.
At the same time, all this instability gives you a unique experience of multitasking and, very often, new skills. As a result, you will feel more comfortable in a rapidly-changing environment and not be confused when there is the need to do many important things at the same time and make several strategic decisions in parallel:)
Corporation. The first thing about career growth in a corporation you should remember is that you will unlikely get ahead very quickly, but you will have a lot more room to grow than in a small startup. Moreover, your advancement directly depends on your achievements and success in the current position and could not occur by chance. If you prove yourself as a perspective professional, it will not go unnoticed by your team lead.
And in a startup, you can engage in more high-level work earlier. If a startup consists of less than 10 people at the beginning but quickly grows, you have a good chance to become a top manager. In fact, you grow together with a company, and if your startup does not show signs of progress, your career will likely stagnate either.
Notably, according to Startup Genome, 9 in 10 startups worldwide eventually fail, and this happens due to various reasons from the lack of investment to disagreements in a team. In Germany, which is traditionally considered as the country with a well-established startup ecosystem and the European leader in terms of innovations, the startup failure rate is about 70%, according to various estimations. By the way, this is a very good performance on a global scale despite the figure seems to be really high at a first glance.
Anyway, joining a successful startup in an early stage is the best way to become a Chief-something or a VP-something. If your startup succeeds, you have a good chance to manage everyone who joined after you. Then, after a couple of years, you could apply for CTO or VP for Development roles in bigger companies.
Responsibility and impact
In a corporation, your responsibility within a team will be accurately defined and there will be almost no cases when you will need to do something beyond. On the one hand, it is useful for a professional, as you can focus on your main area of specialization and further deepen it. Moreover, any mistakes in your work will unlikely be crucial, as the company is usually running like clockwork, and has enough mechanisms to mitigate some imperfections in employees’ work.
On the other hand, there is often less room for creativity and experiments. In a large company, your personal impact on its performance is also lower than in a startup, as big products often result from well-coordinated teamwork.
In a startup, your single decision or idea sometimes can change the company’s position and even the direction it follows. Be prepared that all your work becomes highly visible and has a significant impact on the company’s performance. This can be particularly advantageous as if you make some achievements, they will be seen and noted much faster that can potentially ensure a higher position.
It is out of the question that in a large company, your income is guaranteed by a contract and will unlikely change unless things are really very bad. A relatively high salary often goes together with numerous bonuses and benefits, like different types of insurances, paid leave, access to a gym, free food, and corporate events.
Another good news: employees of large companies have smartly structured working hours and are often paid for overtime.
Startups usually cannot afford all these benefits and might not have a fancy office or opportunity to ensure free language courses but can offer you interesting projects, high speed of business, and the opportunity for experiments.
Also, startups can offer you options, which imply that you are buying a company’s stocks at a fixed price after an IPO or a startup’s acquisition by another company. It allows you to raise a significant sum of money once a startup is successfully sold. For instance, when WhatsApp was acquired by Facebook, the 55 employees got $3 billion divided between them, and early employees got $190 million each. Another example from the German market: over 40 employees of one of the country’s fastest-growing fintech startups, Taxfix, which already helped about 2.2 million users to file their taxes online, has recently sold over 3.8 million euros in shares during its spring fundraising round.
Here, it is important to understand that the WhatsApp and Taxfix cases are not common ones. To get benefits from options or shares sale, a company should be successful enough to be acquired or go public and raise good investments. Unfortunately, thousands of startups do not reach this stage even despite being structured around a brilliant idea.
If you get used to a particular hierarchy, established and clear reporting, and formal relations with senior colleagues – the work in a corporation is definitely your option. The corporate world also sometimes implies a dress code. Actually, this is not bad, as a study from California State University that looked into effects the clothes you wear changes thought processes revealed that wearing a suit makes you think more “out-of-the-box”?
At the same time, as the Z-generation, which opposes any hierarchies and strict rules, is entering the job market, the so-called startup culture became very popular. Many corporations start adopting the startup mentality, making the work environment more collaborative and open and the communications style more informal.
Otherwise, while working in a small company, you can go drinking with a founder and wear flip flops whenever you feel they are a perfect fit for your look. Communications style is generally much more relaxed than in a corporation. A hierarchy here is something conditional and is not obeyed. Although a startup almost always has a strategy and a particular mission formulated by its founders, it often lacks established corporate culture and traditions.
As you can see, the work in a corporation and startup is different and a choice here rather depends on your mindset and expectations from a dream job. In our opinion, an experienced software engineer has experience in both startup and a large company, as it significantly broader an outlook and makes you understand the main drivers of different types of companies from the inside. Once having such an experience, you will be able to promote yourself better in whatever career path you choose and clearly identify, which variant is best for you.