In this post, Ardo Illaste, the Data Scientist of Teleport shares findings about our research into why startup people move around. Who gets around the world more, founders of employees? Which of these groups behave more egotistically? What's the real balance between those heading to busy hubs vs those seeking their freedom from remote work?
To avoid just guessing about the reasons while building Teleport we recently went out and asked a few hundred startup founders and employees what exactly motivates them to move around. Survey takers were asked to choose multiple options from twenty or so reasons for moving. Additionally, the participants could also specify their current roles (founder, employee, advisor, etc.) and how many cities they had lived in. Click here if you'd like to take the original survey yourself.
Different roles, different reasons
Overall results show a clear separation of goals between startup founders and employees. Founders were mostly external-facing, concerned with nurturing their startups and focusing on their clients. Employees, on the other hand, move for personal drivers: to take up a cool startup job and improve their quality of life. (As a side remark, we did not get conclusive results on other roles listed in the survey, such as investors or advisors).
Several goals were shared equally between founders and employees: working closer with their teams and living a happy life were important across the board.
To find out more about the goals and characteristics for different roles we dug a bit deeper than simply looking at how popular a choice was for a given role. We wanted to see whether a role makes you more likely to choose an option compared to everyone else. The graph below illustrates this approach using employees.
Each dot represents one survey option and the dot’s position on the vertical axis shows the probability of it being chosen by an employee. The horizontal axis shows the probability of the option being chosen by survey participants in other roles. Predictably, only employees chose the "Employee" option and it sits at the top left corner - probability of it being chosen by an employee is 1 (or 100%) and by anyone else 0. The green line on the graph shows options which were equally likely to be chosen by employees and everyone else ("Work closely with my team"). Any option above the green line is more likely to be popular amongst employees ("Work for a cool startup") and dots below the diagonal line are options more popular with others ("Hire people into my startup").
Using this approach we can calculate how many times more or less firmly an option can be tied to a role. We wanted to find options that are at least two times more/less likely to be relevant to a particular role. On the figure below, choices in the green shaded area are at least two times more likely to be associated with being an employee. The ones in the orange area are two times less likely.
The next graph summarises these options for employees. Options at least twice as likely to be chosen by employees are shown as bars in green colours and those at least two times less likely with negative values in red/orange. The most popular choice for employees, "Work for a cool startup", is ~11 times more likely to be chosen by an employee than anyone else. Also, it appears, having lived in 3 cities is the sweet spot for employees. Goals like getting funded, doing hiring and being close to clients are not high on employees' priorities lists.
The same analysis can be repeated for founders. In addition to the main goals we already saw for them, our analysis indicates that founders are more than twice as likely as everyone else to have lived in at least 5 cities. Working for cool startups, making more money and paying off debt do not register high amongst founders' priorities. Having lived in a bunch of cities already, seeing the world is also something that they care about two times less than others.
If this then… what?
We also took a look at how an option being chosen can predict whether or not another option was picked by the same participant. To illustrate - if the option "Extend startup's runway" is chosen, what is the chance of that person being a founder?
To figure this out, we analyzed the frequency with which one option appeared together with another. The top combinations are shown on the figure below. Looking at this we can find an answer to our question above: the "Extend startup's runway" option being chosen means there is a 90% chance of the responder being a founder. As another example, those who want to "Escape something unpleasant" are also very keen to "Live a happy life" (more than 80% chance of such a combination).
Groups within groups
An interesting observation about the probabilities of seeing combinations of options together is that they are not symmetric. The probability of a founder choosing the "Extend startup's runway" option is just 20% (compared to 90% of the opposite)! Those who move in order to extend a startup's runway are founders 9 out of 10 times, but this does not mean most founders want to move to extend their startup's runway. All airport have runways but everything with a runway is not an airport, if you will.
This non-symmetry suggests that there could be subpopulations within the groups of founders and employees. Performing hierarchical clustering on the data provides an answer to this. There are two main types of founders: ~60% move for securing funding, finding employees and being close to clients, the other 40% are into working remotely, lowering living costs and living a happy life. For employees the split is 70/30, with 70% moving to find a cool startup to work for and the rest to lower living costs.
Our little survey provided a couple of key takeaways regarding the motivation behind startup founders and employees executing moves:
- Founders and employees have distinct motivators when it comes to moving
- In both groups maximizing their upside by moving to better places is more prominent motivation than simply reducing costs
- Life quality improvement is a goal shared between employees and founders alike
- Founder and employee groups are each further separated by priorities along the career ↔ personal life axis.