Why a Small Company Might Be Your Next Great Step
If you've been climbing the corporate ladder at a Fortune 500 company (one of the top 500 U.S. corporations based on annual revenue), you might wonder whether you're suited to a new position at a small company. Will there be adequate room for growth? How will it look on your resume? What are the pros and cons of working at a small company? Guess what: Transitioning to a small company may be the best next step in your career.
How is a "small business" defined?
First things first: What is your definition of "small"? You might be surprised to know the U.S. government's Small Business Administration (SBA) defines a "small business" differently by industry based on number of employees and annual revenue. The SBA standards are used to determine eligibility for various federal programs. Depending on the industry, a "small business" by the SBA's definition could have up to 1,500 employees or more than $40 million in revenue. Your personal definition of a "small business" might actually align more closely with the term "microbusiness"—defined by the SBA as firms with one to nine employees.
However, you are measuring "small business," chances are likely you're already working at one or will be soon. The Small Business & Entrepreneurial Council reports that as of 2018, 99.7 percent of U.S. employer firms (companies with paid employees) had fewer than 500 employees, and of those, 78.4 percent had fewer than 10, meeting the definition of a microbusiness.
The benefits of working at a small company
A big company has a lot of perks: brand recognition, human resources infrastructure, and networking potential, to name a few. But the small company world has its own plusses that may appeal:
- Access to leadership—This might not be as true at a 500-person company as it is at a 50-person company, but at many small businesses, you’ll know the CEO or president on a first-name basis. You may even get invited to their house for a barbecue. This level of access to leadership is an excellent learning opportunity to see how entrepreneurs deal with daily challenges and long-range planning. If you've ever pondered opening your own company, this will be invaluable.
- The chance to put your own stamp on corporate culture—The smaller the group, the more likely your individual personality is to shine, and the more opportunities you'll have to influence corporate culture. If you're interested in helping develop employee growth programs and diversity initiatives, not just receiving a packet from HR in New York, a small business may be appealing.
- Opportunities to diversify your experience—At a small company, employees tend to wear several hats by necessity. For instance, marketing may be a team of one tasked with media relations, social media, managing the website, placing advertising, and more, while at a large firm, multiple people or even divisions may specialize in these roles. If you want to try on several tasks for size rather than specializing in one area, a small company is more likely to give you that opportunity.
- Less bureaucracy and more flexibility—These small business benefits are closely related to increased access to leadership. The more employees a company has, the more policies, rules, and procedures are necessary to keep things running smoothly. That's why small businesses have the capability to be more flexible. Perhaps you and your company's owner can work out additional remote work arrangements, or maybe you can arrange to take additional PTO during your first year on the job for that already-scheduled European adventure. This type of flexibility is harder to find in a larger firm with more red tape where it's necessary to secure multiple layers of approval and more employees may start asking for the same arrangement.
- Long-term growth potential—At a small business, where roles may be less defined, you could have tremendous opportunity for career growth. Maybe your career will take you in a new direction using a skillset you've picked up to fill a need—or maybe the small business will grow enough that you have the chance to lead the opening of a new location.
Depending on what you're seeking career-wise, a position at a small business or a microbusiness can lead to big opportunities. Don't overlook their potential.