These startups are disruptors. Yeah yeah, I know. I'm sick of hearing about "disruption" just as much as you are. But then I learned this: Founders who describe themselves as disruptive are more successful at raising more money for their startups.
This tidbit of information comes from Dana Kanze and Sheena S. Iyengar at Harvard Business Review. The pair examined the LinkedIn profiles of 2,000 entrepreneurs with U.S.-based companies. They scoured the profiles looking for iterations of the word "disrupt." Then they looked at how much money the entrepreneurs had raised for their companies. Kanze and Iyengar also looked into how long employees had been working there.
And what they found was super interesting.
First, not all entrepreneurs described themselves as disruptive. Some used some form of the word "build" instead. And these builder founders tended to have something the disruptive founders did not: Employees who stuck around much longer.
This is why this is important, whether you're a founder yourself or you're considering a job offer or investment opportunity with a startup.
Which word defines your company?
Are you a disruptor or a builder? Which archetype tends to be more successful?
Ah, that's where it gets tricky. It depends on how you define success.
The disruptors -- who also tended to use words like break, threaten and risk in their LinkedIn profiles -- received an average of 1.7 times more funding than "builder" startups, according to the HBR report. If you're a "move fast break things" kinda person, you may perhaps be more likely to describe yourself as disruptive. Raising large sums of money may be your measure for success.
The builders -- whose LinkedIn profiles tended to include words like collaborate, commit and adapt -- were able to keep employees around for an average of eight months longer. If you're someone who's invested in creating a long-term sustainable business, you may be more likely to call yourself a builder. Low turnover and productive, happy employees may be your measure of success.
The Harvard Business Review authors hypothesized about these results. "Taken together, our results uncovered two distinct types of people who are attracted to startups--those who value breaking vs. building--and different consequences for their respective startups," the authors write.
Just because a startup has raised heaps of investor cash doesn't mean it's been successful on all fronts. Uber, which has been riddled with PR nightmares, a data breach and the ousting of their CEO, is a perfect example there.
Disruptors have a distinct advantage, sure. At the start, it's easy to be inspired by the big flashy ideas of the disruptive entrepreneur on stage at TechCrunch. But once you get to the nitty gritty aspects of growing a sustainable, profitable or scandal-free business, it could become more difficult for investors and employees to maintain that level of enthusiasm.
In fact, the disruptors themselves may even get bored. The HBR authors noted that self-described disruptors were more likely to be serial entrepreneurs than the builder group. They're ready to move onto the next disruptive thing.
Builders may lack that high-energy charisma that tends to attract investors, which may explain why they don't raise as many funding dollars. But builders have something disruptors don't. They value growing a company or product towards sustainable success, which ultimately will be more beneficial to their employees and investors. Builder entrepreneurs are less likely to get bored and move to the next shiny object. They're in it for the long-term.
Above all, the Kanze and Iyengar advise understanding the strengths and pitfalls of disruptive and building personalities. Before sealing the deal, be it writing an investment check or accepting a job at that so-hot-right-now startup, take a gander at the founder's LinkedIn profile. Would you rather work with a disruptor or a builder?