One of the most important decisions a startup makes is how fast they want to launch, and how big they want to be at that time. Some choose to hire employees right away, while others decide on a pilot approach, testing the market on their own.
A recent study from Andrew Burke of the Cranfield School of Management found that people that take a slower, pilot approach earn higher incomes and are significantly less likely to fail.
This table shows the rates of failure for people that start up and become employers from another or no job, versus those who take a pilot approach (a “Standard Individual”). Someone who starts hiring from a period of non-employment has a 146.7 per cent greater chance of failure.
Photo: Andrew Burke and co-authors
See the full paper here
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