Corporate to Startup Transition: What's It Really Like?

In our previous article Navigating Work Environments: Where You Work Shapes How You Work we discussed different working environments with all their pros and cons. This time, we delve deeper into the specifics of a Corporate to Startup Transition.

In recent years, the number of people transitioning from corporations to startups has been increasing. According to data from Nikkei in 2022, the number of employees moving from large companies has risen sevenfold compared to three years ago. This trend is driven by a desire among individuals to break free from the stability of large corporations and a growing emphasis on personal growth. This article explores what it is like to switch from a corporation to a startup, considering the benefits and drawbacks of such a transition.

Advantages and Disadvantages of Startups

One of the key considerations within a Corporate to Startup Transition is the shift in company culture. Where large corporations often rely on hierarchical structures, startups foster an enviroment of open communication.

The greatest appeal of startups lies in their speed and flexibility. Startup companies have the ability to rapidly implement new business models and respond quickly to market needs, which is seen as a significant strength. This sense of speed fosters growth and creates an environment conducive to realising innovative ideas. Additionally, startup leaders emphasise the importance of being adaptable to change, a quality that is also expected from employees.

In terms of salary, while large corporations traditionally offered greater stability, the flattening of salaries between startups and large companies has diminished the primary reasons for staying in a corporate job. According to the Nikkei, data from 2022 shows that over 20% of job openings at startups offer salaries exceeding 10 million yen, surpassing the 10% offered by listed companies. Compared to publicly listed companies bound by existing salary structures, startups are able to secure the necessary talent through agile investment.

Currently, the age group of individuals considering a transition to startups is primarily in their 30s to early 40s. This demographics seeks new challenges while leveraging their corporate experience, and startups are also looking for their level of expertise.

However, challenges still exist within startups. Funding and talent acquisition remain significant barriers, and the possibility of unstable salaries compared to the consistent income of corporate jobs persists. Furthermore, particularly in the initial stages of founding a startup, long working hours may be required.

Startup Corporate Culture and Career Growth

The cultural environment between large corporations and startups differs significantly. In large companies, it is common to follow directives from superiors, whereas startups are characterised by a flat organisational structure that facilitates easier communication with management and encourages employees to express their opinions. Many believe that “open communication promotes innovation,” and voices from individuals working in startups often indicate that “an environment where ideas can be easily shared fosters growth.”

Additionally, working in a startup provides opportunities for skill enhancement. Many startups require individuals to take on multiple roles, which leads to the acquisition of diverse knowledge and skills. Experience in a startup is considered a great opportunity to learn about new technologies and market trends, with many expressing that they feel a greater sense of personal growth.

Transitioning from a corporation to a startup, the Corporate to Startup Transition, offers attractions such as a fast-paced environment, a creative atmosphere, and the chance to experience personal development. However, it also comes with challenges, including financial instability and cultural differences. When considering a career change, it is important to carefully evaluate your options and find an environment that suits you.

Cogs is an executive search and recruitment agency specialising in connecting creative-minded individuals with global career opportunities.

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This article is based on articles from the following sources (in Japanese):
The Sense of Crisis Expressed by Those Transitioning to Startups Regarding Staying in Large Corporations (Japanese)

The Number of Employees Transitioning from Large Companies to Startups Has Increased Sevenfold; Shrinking Income Gap as a Tailwind. (Japanese))