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A growing number of middle managers are stepping out of their corporate nests to join start-ups, as the new technology boom continues to gather steam.
During the economic turbulence of the last decade, most middle managers were content climbing the corporate ladder. But as more start-ups rake in venture capital and, in some cases, generate enormous wealth for employees when the companies are sold off or go public, some corporate middle managers are changing course. In the last year, executives from American Express Co. and Comcast Corp.'s NBCUniversal, as well as various Wall Street investment banks and major law firms, have all taken senior-level roles in start-ups.
"From an enterprise and consumer standpoint, [start-ups] have a need for more experienced management, folks that have built more of an operational superstructure from bigger companies," says Eric Wiesen, a general partner at New York venture firm RRE Ventures.
Emily Glazer/The Wall Street Journal Alison Lindland, left, with Kohort co-worker Benji Markoff at the company's midtown Manhattan office on Monday. Ms. Lindland left her job at American Express to work for the start-up.
While there are no official statistics tracking the movement of managers, venture capitalists and recruiters say they have seen a rise in the migration over the last year.
A growing number of middle managers are stepping out of their corporate nests to join start-ups, as the new technology boom continues to gather steam. Emily Glazer has details on digits.
The shift also reflects a profound reappraisal of risk in today's labor market, where more established industries are being disrupted by technology shifts and upstart companies. Some middle managers now see start-ups as increasingly attractive because they can exert a more direct impact on a company's operations.
"If I think about where I want to spend my time, this is my opportunity to try something big," says 30-year-old Emma Nothmann, who this summer left consulting firm Booz & Co., where she was a principal, to become senior director of partnerships and business development of San Mateo, Calif.-basedEdmodo, a social-learning network for teachers, students and parents that was founded in September 2008.
Christa Ventikos, chief executive of executive-search firm Ventikos Associates, based in Washington, D.C., says the number of start-ups she is working with that are seeking corporate middle managers to help build out business teams has doubled since the fall of 2010.
Still, some experts say managers should proceed with caution. During the last tech boom, some top executives left corporations at the height of the bubble—such as George Shaheen, who stepped down as CEO of Andersen Consulting in 1999 to join online grocer Webvan Goup Inc.—only to see the start-up they joined sink soon after coming onboard. Webvan declared bankruptcy in 2001.
Midlevel managers should stay with a bigger company where they can gain experience and move up the ranks, says Rick Devine, founder of executive recruiting firm Devine Capital Partners based in Redwood City, Calif.
"There's a disproportionate risk associated with" joining a start-up too early in its development, says Mr. Devine.
Martha Josephson, a partner in search firm Egon Zehnder International, says that if these middle managers are hired too soon in a start-up's development, their talents could be wasted—along with the start-up's money.
The fear of leaving too early didn't stop Alison Lindland from joining Kohort, a New York-based start-up, founded this year, that is developing online software that helps people plan and manage events. This May, Ms. Lindland, 32, left American Express, where she was a senior manager of strategy and business development, to become director of business development and marketing at Kohort. Although Ms. Lindland took a pay cut, she said the company's high-profile investors and the stock options that she received made it worth the risk.
"My time at American Express was a career incubator for me and like a second grad school," she says. "It was a great springboard and training ground to what I'm doing now." She has tapped her experiences at American Express —including mobile applications, display advertising and search-engine marketing—to use at Kohort.
At American Express, Ms. Lindland didn't always work directly with the product. She would communicate ideas through presentations to sell them to the higher-level executives. Now she speaks directly to customers to gauge satisfaction, and she works with software developers to "make decisions in real time that impact the product instantly," she says. "That's incredibly exciting and motivating and keeps you on your toes."
The speed at start-ups appeals to these workers.
"In a large company the process is slower, there's a lot more cooks in the kitchen, it takes more time to align everyone," says Pat Hu, who gave up his job as a business-development manager at NBCUniversal to become director of business development and finance at Bookish, a consumer website for book lovers, in July. The venture is backed by a consortium of top publishers like Simon & Schuster, Penguin Group and Hachette Book Group.
Mr. Hu, 32, who works directly with Bookish's CEO, says he is able to move forward on big deals while working with some of the start-up's partnerships.
"That was kind of appealing to me to be in a place where things would happen at a faster pace," he says.
Write to Emily Glazer at emily.glazer@wsj.com
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