How to survive in uncertain times?

Today's post is not about technology, but about a topic on my own account, which I would like to use to give some courage and hope to others in the same situation.

At TigerGraph, there was the 2nd wave of a mass layoff last week, which also affected me and many of my colleagues in EMEA and the US.

This is nothing unusual and TigerGraph joins a number of other tech startups that have also had to make the bitter decision to release employees across all departments. At the beginning of the pandemic, the tech industry was booming, now it is deep in crisis and the layoffs have nothing to do with a bad product or unmotivated employees. The good guys have been hit, too.

TigerGraph is a world-class provider of an analytical graph data platform for connected data. The graph database developed by Yu Xu is second to none. Speed and performance in querying, a powerful GSQL query language, as well as support for query language openCypher and an ML Workbench that provides Deep Learning and Graph Neural Network framework functionalities for fast and accurate ML and AI modeling are just some of the unique selling points.

The OECD already warned of a weakening global economy in 2019. Crises such as Corona, energy shortages and the war in Ukraine have fueled this development. Inflation rates above 10% are no longer a rarity.

Is it now better to work for an ancestral tech company instead of a startup?

Not necessarily. Large companies are driven by shareholder value. If things don't go well in the economy, staff have to be cut. Often, this is done in a socially responsible manner and through severance programs, so that the general public notices very little.

Start-ups are young, dynamic companies with revolutionary business models, bubbling over with innovation, always hoping to become the next unicorn, but always facing the risk of not surviving the "valley of death". This is the phase that is characterized by negative cash flow, hyper growth in sales and number of employees and the lack of or untimely expansion financing from late stage venture capitalists.

And then there is the in-between, the small companies, which have up to 249 employees and generate sales of up to 50 million euros up to the upper middle class companies (“Mittelstand”) where the sales can exceed the billion euro limit and are usually active worldwide.

Small businesses are self-sufficient organizations that need to make money from day one, with relatively low sales, operate in local markets and usually have a small number of employees. Here too, technical innovation can emerge, but not with the aspiration of having to operate in a global mass market.

SMEs (small and medium-sized enterprises) as well as the upper middle class are characterized by the fact that owners and decision-makers are usually themselves financially invested to a considerable extent (high equity ratio) and thus bear a considerable entrepreneurial risk. Entrepreneurship as a mindset influences the corporate culture in a positive sense, which is reflected in a high responsibility towards the employees but also towards the region in which one is active.

Is there a golden rule?

Not really. The decision as to which employer you would like to work for next must always fit in with your own and your current stage of life.

When you're young, you accept more risk. When you have a family and children, you focus more on security, until your willingness to take risks increases again as you get older, because you don't want to miss the chance to be part of the next unicorn.

At the age of 55, I set myself a certain treshhold. Never again work for a company with less than 200 employees and less than $200 million in venture capital.

Have I always stuck to this treshhold?

No, the lure of start-ups is just too great.

Is the treshhold a guarantee?

No, even start-ups that have almost reached or already exceeded this treshhold are often painfully set back. As an investor and as an employee, you take a risk. 80% of all start-ups are doomed to fail. According to CB Insights, the 3 most important reasons for this are:

1. lack of demand
2. problems in the team
3. little cash

What can I take away from this?

Age group 16-35: Start-ups are interesting. You are young, try it. If one closes, 10 others will open.

Age group 35-55: Stability, sustainability and appreciation can be found most in SMEs, the upper middle class and large companies.

Age group over 55: Also think about becoming self-employed, not in the sense of freelancing, but as an entrepreneur, by yourself and constantly.

For me personally, at the age of 55 I have a stable and large network, a lot of experience and still power to tackle new things. Another start-up, tech unicorn or even the path to self-employment, for me everything is possible.

• I am ambitious and determined
• I am willing to take risk and responsibility
• I am convincing and a real team player
• I approach things practically and never stop learning

Everything I do requires a portion of joy, energy, courage, the necessary bit of luck and God's help.

Sales is my passion. Always with a 360° view of the customer, because "people buy from people".

As my former boss Michael Eggloff once said. Fall down, get up, straighten your crown, keep going.

Yours,

Mathias Reidel