Since 2020 More Than 2,500 Fortune 500 Executives Left Their Jobs To Launch Startups. Rama Penta Is One Of Them.
It was 3am, the first week of 2022, and Rama K. Penta lay awake in a hotel room in Las Vegas, ruminating over a very big decision: should he quit his job?
At age 42, Rama had become Bayer’s Director of Technology Innovation. He was in Vegas for CES, the Consumer Electronics Show. As he walked around the booths at CES, some of the most promising startup founders in the world interrupted their conversations with investors, journalists, and customers to give Rama a big hug, and thank him. They’d say things like, “We wouldn’t be here without you,” and “we love you.”
Each hug reinforced Rama’s sense that he could do more outside of his company than inside. He had a sense that his hierarchy of needs was different from the other executives he worked with. What mattered most to him was: work with people you love, make a dent in the universe, and make money - in that order. Everyone else seemed to have the reverse set of priorities. Everytime he connected with entrepreneurs who had the courage to try and make the world a little better he felt like he was making a huge mistake. Like he was neglecting his ability to fix healthcare for something that increasingly felt trivial: a raise, a promotion, a golf outing with other senior executives.
So, in 2022, he took the courageous decision to leave leave Bayer to launch Archetype Wellness, a startup which invests in health, wellness, technology, and real estate services and solutions.
Rama is one of 2500 executives who constitute the Entrepreneur Exodus - who left executive jobs in the Fortune 500 over the past three years to launch new ventures. Increasingly, when executives leave #google , #goldmansachs , #Amazon, or #Aon, their most likely next career move is to become a founder. This founder demographic is reconfiguring the competitive landscape of healthcare, banking, management consulting and big tech.
Increasingly, the startups built by the Entrepreneur Exodus attract the most funding, generate the most revenue, and retain their value when the rest of the market contracts. The leadership team of OpenAI is built almost competely from Google and Amazon's entrepreneur exodus. Entrepreneur Exodus startups are the adult alternative for investors who were disgusted by the implosions of Sam Bankman fried, Adam Neumann, and Elizabeth Holmes.
Feed the Lie. Starve the truth.
And yet, no one talks about the Entrepreneur Exodus. A gigantic web of startup misinformation has told us that an entrepreneur is supposed to be 28.The prevailing archetype is still “30 Under 30”, “40 Under 40.” The average age of a founder on the cover of Fast Company is 38, even though the average age of the founders with the biggest funding rounds of 2023 is 52.
The main reason the dogma is so different from the data is because there is a mismatch between the most coveted media demographic and the most successful founder demographic. The most coveted media demographic is 18-35. The most successful founder demographic is over 40. There’s lots of money to be made through courses, conferences, and sponsorship deals by convincing 20-year olds that startup success is easy.
The consequences of neglecting the entrepreneur exodus are pernicious. Here are a few of them:
Your family and friends think you’ve lost your mind. Rama’s mother and father couldn’t grasp why he would leave the stability and prestige of a Fortune 500 executive job just because it was no longer fulfilling. My wife and parents felt the same way when I quit my job at Bloomberg.
Investors think you’re too old - When Gary Hoberman quit his job as CIO of MetLife to launch Unqork in 2017, one of the 300 ‘no's’ he got from VCs summed up the general mood: “You’re too old.”
Incubators don’t save you a seat - Incubators are mostly geared toward the dormroom founder rather than the boardroom founder. Y Combinator is not a good place for people with kids and a 401k.
You’re pressured to make financial decisions that are stupid. Many VCs push you to pour your savings and 401k into your startup. This makes sense when you have no mortgage, or kids, and no intention of retiring for 50 years. But it’s reckless and stupid when you’re 49.
AND STILL WE RISE
So, why is it that so many entrepreneur exodus startups do so well, in spite of all the headwinds? Here are a few reasons:
The entrepreneur exodus solves billion-dollar unsexy problems. When you spend 20 years in finance, insurance, healthcare, or big tech you see what’s broken, why it’s broken and how to fix it. Those billion-dollar problems are invisible to everyone else
Pitch an outcome not an idea - When you’re not a sexy founder as far as VCs are concerned, you’re forced to live off of your own cashflow before you raise funds. Few VCs have an investment thesis with the words “construction-tech” in it. But Willy Shlacks, age 45, founder of Equipment Share has the second largest funding round of 2023, ($290mn). That’s because he generated cashflow first, and pitched investors second.
Bottom line: Be more like Rama.
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If you're part of the Entrepreneur Exodus, please reach out.
I'm giving keynotes at big companies, and VC retreats to talk about the Entrepreneur Exodus. Reach out if you're interested.
