"So, how many employees do you have now?" Every entrepreneur gets this question, and many can relate with both empathy and frustration.
It's a total trap. It's a judgment question, meant to quietly help the asker gauge your relative "success" based on the idea that if you have more people working for you, you must be doing well.
I am very uncomfortable with this question, as are many entrepreneurs, because I know what it is getting at. Many assume that the bigger my company is, the better I must be. And I'm worried I might buy into that idea of success too much as well.
So, does size really matter? Of course, to many it does. If you're building a firm or a gigantic operation, having a large and solid base of employees is key. But some of the most successful people have worked in groups under five.
We're getting the metrics for success and what it means wrong here and focusing on something that doesn't necessarily indicate anything about the future for a company or individual. By focusing on the size of a company as the only indicator, you're missing many things at play: namely, the most important—how is the foundation of this company? If you have an open office full of employees but not a solid company manifesto, culture, idea, and direction, you're doomed.
Growth metrics are quantitative, not qualitative. What we need to do is to consider a venture, business, or concept holistically. The right hires, realms of experience, or board members and leadership are just as important as rounds of funding and butts in seats.
Sure, funding will break news in certain financial and technology outlets, but here are a few more qualitative questions that we could and should be asking:
It is crucial that every company have mentors and advisors throughout every stage. Otherwise, ideas are in a vacuum and aren't challenged by important thought processes and viewpoints. Whether it be a formal board or a "brain trust" of people whose advice you cherish, this is someone co-signing you and your idea. If those people are well-respected, that goes a long way.
This is something that many founders forget—that core principles and guidelines are just as important as press buzz or a big office. If you have your values in the right place, and make that clear to investors, friends, employees, and advisors, it's a strong indicator of stability.
It's important to see where the founder or founders are coming from holistically. While it might be great to raise tons of funding for purposes of legitimacy, end-goals might be more telling of how a company thinks. If you're talking to a founder whose end goal is very clearly or solely financially based (yes, we all want to make money, but hopefully that's not the only goal) then that is a bigger red flag than $5 million in the bank.
Don't stop asking for the hard numbers, but be sure to consider the facets that can't be assigned a numerical value.