By Harry Hurst
Running a company can be stressful at the best of times. When challenging market conditions start throwing you curveballs, those stress levels can spike for both founders and their teams.
We launched Pipe right at the start of the COVID-19 pandemic. While there’s been no shortage of hurdles and challenges along the way, four key principles have helped us keep growing, protect our mental health, and build a company where our team loves to work.
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Here’s what we’ve prioritized that can help you do the same:
Trust that your team will do their jobs well
Trusting your team can be difficult for startup founders, who often have to remind themselves that “their baby” is bigger than they are. But trusting others means you need to juggle less. It also improves morale and buy-in and opens doors for big thinking.
As a globally distributed company, Pipe offers equalized pay (rather than geo-based), which has helped us build a solid, collaborative team with a diversity of ideas and experience. This has been a major source of resilience, as it helps us find new solutions to problems as they arise.
With a great team in place, trusted and empowered to do their jobs, founders can focus on the high-impact, strategic work essential to their roles.
Keep headcount low relative to your valuation
We’ve worked hard to stay lean. That has meant ensuring our teams aren’t just efficient, collaborative executors, but well-resourced ones. When we hit a $2 billion valuation, our team was under 50 people; today we’re only around 100.
If recent changes in the economy have shown us anything, it’s that nothing is guaranteed. This week’s budget may not be next week’s. Rather than building big and having to cut back, keeping a lower headcount can give team members room to contribute meaningfully while maintaining margin in the staffing budget for unforeseen dips.
Fast growth may be enticing, but staying (strategically) lean gives you a tortoise-and-the-hare advantage.
Maintain a cash cushion in case the market slows
Running a business is a series of spikes and troughs, bull and bear markets. The ups and downs can eat away at your peace of mind, especially if the dips bring you close to the edge. Having a cash cushion is vital for building a strong, enduring company and lets you continue business as usual (more or less) with confidence.
Whether you’re looking to raise an equity round in the near future or not, keep runway in mind. How long could you operate without a cash infusion? What if your revenue dropped by x%? A cash cushion lengthens the runway so you can weather changes with less disruption.
Stay flexible and open to change
It may be a cliche that the only constant is change, but it’s true. The entrepreneurial journey is all about overcoming obstacles and finding resourceful solutions. Unfortunately, it’s easy to get entrenched in one way of thinking—a habit that turns changing conditions into stressful nightmares.
Companies that thrive in a challenging market are flexible and agile. While your goals may not change, be ready to change how you achieve them. As the market, the competitive landscape and the needs of your customers shift, it’s important to be able to roll with the punches.
Economic challenges can threaten your business’s survival—as well as your mental health. No amount of success is worth sacrificing the well-being of you and your team. We’ve found these four principles to be very helpful in building our company, and I’d encourage you to find what works best for your team and build those pillars into the culture of your company.
Harry Hurst is co-founder and co-CEO of Miami-based Pipe, a recurring-revenue trading platform. Hurst sold his first company Skurt, a financial technology company in the mobility space to Fair in 2018. He is an angel investor and mentor to a number of early-stage and growth-stage companies.
Illustration: Dom Guzman
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