There are so many things that can kill your startup, from pure chance down to very specific mistakes. Through my course i have done all conceivable mistakes one could do. I have learned from this experience and after some pondering i have summarized my gravest fails down to seven major areas. These are the kind of fails that can single handedly bring down your efforts, i did them all and enjoyed them fully.
What can one add to this so much talked about topic? We’ve heard all and seen all, single founders succeeding, stellar teams failing, the magic combination… In my case, as a single founder, being the one man band was apparently not enough. The realization of that fact turned me in the lookout for a co-founder, which was pretty much a loss of time. You can’t find a co-founder on the super-market shelves.
The founding team is a position you have, not a quest. You either have a team or not, and you have a team by having past experiences with the persons you will team up with. That said, you either have to look in your past, or start building up strong relations for the future. It takes time, years, not days and it will not happen simply because you want it to, you have to create the environment and live it.
I’d start by saying technical founders tend to do this mistake, but i have seen all kinds doing it. You want your product to be complete, the experience for the user holistic and you don’t take no for an answer. Only if your users have both Facebook and Twitter signup options can the project succeed, only if you have both an iPhone and Android version for your app can you reach critical mass!
There are two things going on here:
- You have no idea how to do a startup.
- You really want to hold on that dream a little bit more before you expose your baby to the real world and get crushed.
There is a reason that poor guy, Eric Ries, has been pulling his hair out; shouting to all startupers about the MVP and the lean startup methodology. If you are thinking product, you are doing it wrong. Think market, distribution, competition. Once you got these cleared out, product will be a given.
Metrics have been the hidden underdog in the startup blogoliterature. You won’t see many talking about it, or its significance. Not having metrics is like opening a new shop and standing in your cashiers desk with a blindfold. You can only sense people coming in (visitors) and customers paying you. You have absolutely no idea what people are doing in your shop, what they like, what they don’t like, where they stumbled, what path they followed before they leave and if they understand what your shop is about.
Metrics is a very deep and wide subject, which i plan on analyzing further in future posts. One thing to point out is that proper metrics mechanisms will add a 20% overhead on your development time. The best source i have found so far is Andrew Chen’s blog, which is the most complete and comprehensive source about metrics you can find out there.
This might be the biggest sin of them all. All entrepreneurs focus on fund raising too much. The whole startup scene has been built revolving around the fund raising process. This subject has been blown so much out of proportion that mainstream media (cnbc,forbes, The Economist…) have pointed out we are in a second tech bubble. Others debate the issue. Don’t care whose bubble it is at this point. The important thing is that entrepreneurs fall into this trap.
And it’s a black hole, rather than a trap. I considered fund raising to be the ultimate indication of success, dedicating the biggest portion of my energy around this pursuit. The pitch, the deck, map investors, map VCs, read how others did it, business plans, techcrunch, angel.co, oh the cool juice i just can’t have enough.
Well, i couldn’t have made a biggest mistake. Throughout my course, money was the least of my problems, yet it occupied 80% of my energy and focus. I built and oriented the product so it looks good to investors. Lost whole months preparing for and chasing funds.
Is this what matters? Is this what will guarantee you success? Do you believe money is the problem?
Mentors / Environment
I’ve said it before and i’ll say it again. There is no other place to build your [internet] startup than the valley. There are true believers that say you can do an internet startup anywhere in the world… Sure you can, and it has happened a couple of times. You can grow algae in space too. However corn fields need fertile land, and lots of it.
Nough with the smartass sayings, the real issue is the lack of mentors. While mentors exist anywhere, and it’s usually them who lead the tech communities around the globe (Brad Feld explains why this is wrong), these are not the mentors you really need. Typically they are coaches, CEO’s of technology companies (but not Internet Industry, or with slight relation), lawyers, marketeers and good willing people in general.
What you really need are multiple mentors with a wide variety of backgrounds whose experience is from the Internet Industry. You need CEOs of real internet startups, you need product managers that created gmail, you need the ui/ux designer of youtube, you need people that have gone through what you are going through and can help you with your exact problems, issues and challenges. If you wanted advice on how to build your gadget would it hurt if you talked to the first iPhone hardware engineer who likes to lurk in Hacker Dojo?
Following up on the previous subject, mentors, a natural byproduct of having them is that you have access to their network as well. A network of highly specialized people who have dedicated their lives on solving problems you couldn’t even imagine.
And what about your network? Who are you connected with? What can these people do for you? What can you do for them? Much like the Team subject, this is a positioning and not a quest. A positioning that will unlock your way through the hardships of startup building.
If you are like me, i have no network. Or rather, had none. What chance do i stand with no network? Shouting, waving my hands, trying to attract attention? I need not say more, you are smart readers, you understand what i’m talking about.
Well, in our case ignorance is not bliss. Being enthusiastic, pumped up and strongly believing is one thing. Being ignorant of the surroundings is another.
Only now, after years of actively, vividly, energetically being in the startup grindings do i realize how many unknowns i have. Ask me two years ago, and i’d tell you i know all i need to know. This naivete can also be a positive thing, in pushing you to do something on yourself, which in any other case you wouldn’t.
However once you start dancing it helps to know the moves.