How to avoid the slow climb up the corporate ladder
There used to be a clear path to personal success in the corporate world - if you defined that as becoming a CEO.
If you were smart, capable, strategic and you worked longer and harder than everybody else, the career you dreamed of would eventually come your way, if you were one of a select few that outlasted everyone else.
That long, slow climb to the top is even less certain now. Working your way up the ladder now means staying even later and working even harder, and also participating in a range of external activities, like networking, leadership groups, becoming members of not-for-profit boards, a side hustle, further study (remember when an MBA was optional in Australia?), and more.
Making it to the top will consume your entire life. Almost every waking moment has to be about building your career, and that is not a well-rounded life.
For most people, that’s simply not sustainable, and it’s often not ideal for your mental health either.
As a result, many people turn to the world of startups, thinking that it’s a way to be in control of their destiny. Here’s the real deal: statistically the chance of success is low, and it's often even harder than the climb. We definitely aren’t trying to talk people out of doing a startup – in fact, if you have that itch, scratch it but be smart about it. Start with solving a real problem that needs solving and make sure your solution can do it effectively at scale and that you can protect your idea so that eventually you get value from it.
What if there was a third way to become the leader of a great organisation? There is - Entrepreneurship through Acquisition (EtA) or more specifically Search Funds. EtA is precisely what it sounds like: applying entrepreneurial skill and drive to scale or grow an established business that you have acquired.
Search Funds enable EtA by supporting a talented entrepreneur with the time, money, and experience of supportive mentors, advisors, and investors. Search Funds are a fledgling concept in Australia, but well established internationally.
Why are Search Funds so popular elsewhere?
- Opportunity for Entrepreneurs: Search funds allow entrepreneurs who have all the skills but perhaps not the capital to buy a business to apply those skills.
- Risk versus Reward for Investors: Search funds carry less risk, broadly generating more consistent returns than startups or venture capital for the investor.
- Time and Space: Searchers receive the time, space, and investment to find the right business, not the first business, for them. During that time investors get to assess whether the searcher is the right person to be a business owner.
- Building from a strong base versus starting with nothing: Most startups flame out within the first three years or before achieving $1 million in annual profit. Why? Because it is hard to build everything from scratch, and the entrepreneurial drive that creates an idea is rarely the one that can execute it. On the other hand, search funds work by buying an existing already profitable and sustainable businesses, growing it and making it better.
Search Funds are so established internationally that many prestigious universities offer Entrepreneurship through Acquisition programs: Harvard Business School, Stanford Graduate Schools of Business, Yale School of Management, Wharton University, IESE Business School at the University of Navarra, and INSEAD Business School to name a few!
It can be the next big thing in Australia as well – but it needs the best Australian talent to be a part of it.
Lui Pangiarella is an experienced facilitator and executive coach particularly in the areas of organisational performance, strategy, culture and leadership development.
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