May 6, 2021

Bursts of Color - From Solid to Liquid

By Geoff Donaker • Issue #50 • View online

I love metaphors. This one below, describing how money can “change state” from solid to liquid, has stuck with me since I read it twenty years ago in David Brooks’s Bobos in Paradise:

Members of the educated elite find they must change their entire attitude toward money. When they were poor students, money was a solid. It came in a chunk in every paycheck, and they would gradually chip little bits off to pay the bills. They could sort of feel how much money they had in their bank account, the way you feel a pile of change in your pocket. But as they became more affluent, money turned into a liquid. It flows into the bank account in a prodigious stream. And it flows out just as quickly. The earner is reduced to spectator status and is vaguely horrified by how quickly the money is flowing through. He or she may try to stem the outward flow in order to do more saving. But it’s hard to know where to erect the dam. The money just flows through on its own.

This passage stuck with me because it’s funny and well written. It also resonated because it caught me at exactly that point in my young adult life when it felt most relevant.

Solid to Liquid: Start-Up Edition

I think this metaphor also applies well to start-up teams as they grow from a solid state of 10 or 20 people hand-picked by the founders to a dynamic liquid state of 100+. The solid state is characterized by a tight-knit team for which every potential new hire is painstakingly scrutinized, and from which any departure feels like a death in the family. By contrast, by the time a company has fully transitioned to liquid state, it has the recruiting, HR systems and resiliency to handle two people joining and one person leaving on any given week.

A Liquid State Mindset

Just as in chemistry, the phase-change period between the solid and liquid states can be chaotic for a company: when it’s too big to behave like a tiny start-up, but still too small to have the support teams and systems that will eventually help things move smoothly. What to do in the meantime? My best answer is to adopt a liquid state mindset sooner than you might expect. This means accepting that everything about the organization is temporal and that few teammates will stay more than a few years. This shows up in places like:

Let’s hire the best candidate we find this month, not wait for “perfect” six months from now.
It’s a bummer that Suzy is leaving… but she gave us three years, so that’s a win.
Remember that pep talk you gave last year? Well the team doesn’t, since two-thirds of them joined after that.

Did you enjoy this issue?

By Geoff Donaker

Bursts of Color is a newsletter for start-up leaders who work with Burst Capital. It's meant to include products, people and ideas that I think are interesting and maybe relevant for you.

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