In startups, experience is overrated.
Granted, it's good to have experience if the role is highly specialized (e.g., machine learning or enterprise sales).
However, those are exceptions. Not the rule.
You can thrive at a startup with limited experience.
Read on to understand why potential is more valuable than experience and how you can show your potential to prospective employer
What is potential?
Throughout your career, you can view yourself as a corporation.
Like any corporation, you have strengths and weaknesses. You produce a product or service that has value. You may even have a personal board of directors that includes mentors, parents, friends, and your dog Fufu.
The corporation of you even has a stock price. Also known as your compensation package.
Experienced employees from big tech companies are highly valued stocks and command a higher compensation package.
Given these dynamics, how do startups compete for talent?
There are two strategies:
- Hiring undervalued people. People with potential.
A startup has a limited amount of equity. Before long, they need to hire undervalued people if they want to compete with the kings and queens of the tech jungle.
These undervalued people are like high-growth stocks. Similar to Zoom today, Netflix 5 years ago, and Amazon 10 years ago.
But how do you identify these high-growth / undervalued people?
The key metric startups use to identify potential is rate of learning.
Your potential is your rate of learning over time.
To determine a candidate's rate of learning, hiring managers try to gauge:
"How much has this person learned over the past two years?"
Rate of learning is the best predictor of potential.
Not your current salary. Not the companies you've worked for. And definitely not which college you went to.
Sure, those are signals. But those accomplishments mainly test your ability to follow predefined rules.
Many years of experience can be spent checking boxes like dutifully executing your manager's vision, coloring in between the lines of a performance review, and relying on your company's market dominance to get shit done.
However, too many years of this type of experience is like empty calories. It's Flaming Hot Cheetos in a diet geared for career growth.
Instead of following rules - learn them, master them, and then redefine them.
Startups create rules. They're defining an entirely new game from scratch. And this requires the ability to learn quickly and adapt.
As a result, someone with a high rate of learning is a much better fit for startups than someone with twice the experience filled with checking boxes.
So, how do you improve your rate of learning and show you have potential?
The key lies in tight feedback loops.
What is a feedback loop? A feedback loop is a three-step process:
How much you learn depends on the quality of your actions and the quality of the feedback.
Those learnings are used to improve your actions, which creates a cycle.
Your rate of learning is based on how quickly you move through this cycle over time.
Want to increase your potential? Improve your rate of learning.
So, how does this work in practice?
How to create feedback loops
In my senior year of college, I was rejected from every product management job I wanted.
I majored in Finance but I was desperate to work in tech so I decided to become a software engineer.
I had to compress four years of computer science into ten months.
I started off by identifying all the skills I needed to become a full-stack software engineer. These included:
- Web design (e.g., HTML and CSS)
- Backend development (e.g., APIs and Databases)
- Algorithms and Data Structures
Next, I prioritized learning one or two skills at a time and created tight feedback loops for them.
For example, for programming fundamentals, I used a website called CodeWars to do hundreds of small programming problems and compared my solution with the proposed answer.
In this case, my solution was the action and the proposed answer was the feedback.
My singular obsession was going through this cycle as many times as possible for all of the skills above.
I only went through tutorials if they provided a thorough answer that I could compare my solution to.
By doing so, I was able to compress four years of computer science into ten months.
As I was looking for jobs, Instacart was near the top of my list because they were one of the fastest-growing startups in the world and I used their product every week.
However, they were only hiring for Senior Software Engineers with at least three years of experience.
Luckily, I met one of the founders at an event and he referred me for an interview.
I couldn't waste this opportunity.
To prepare, I developed tight feedback loops to get better at solving algorithms problems and devoured every press release about the company.
Through this process, I received offers from Instacart, Uber, and others.
A few months later I asked the hiring manager why he hired me even though I didn't have any experience. His response:
"We care much more about potential than experience."
As someone interested in startups, use tight feedback loops to catalyze your rate of learning.
By doing so, you'll be offered positions way above what your experience level suggests.
That's how startups win.
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