First-time entrepreneurship is exciting. You dream big, you lose a lot of sleep, you learn a heck a lot, and most importantly, you make a lot of mistakes.
Entrepreneurship is pretty cursedly hard, there’s no doubt about that, but first-time entrepreneurship is often a crap show sustained by adrenaline overdose.
Why do I say that?
Don’t get me wrong, it was fun. Very fun. it’s almost like going through freshman year in college again – meeting lots of people, talking about where you want to be in four years, loading up on free booze and pizza, and of course, pulling all-nighters – sometimes to get things done, but mostly just paying up for procrastination.
That was the best time and perhaps the most creative time in my entrepreneurial career so far.
But it was also so creative for a very specific reason: it wasn’t practical.
Now on my second venture, by contrast, it’s less ballsy, certainly less nutsy, A couple months in, I’ve only pulled one all-nighter (and it was for family reasons). My team works regular 8~10 hour days most of the time, and yet everything from product to biz dev to fundraising, is already at least a year ahead of my first startup at the same stage, despite having a more challenging product roadmap (toy manufacturing + electrical engineering + software engineering) and being in a more uncertain space (Internet of Things for Education).
First-time entrepreneurs make a lot of mistakes, often unnecessary ones. And many of these mistakes originate from a distrust in structure and processes (the opposite problem that fortune 500’s have), and hence NO structure and processes. Some of these mistakes lead to difficulty in fundraising, overshot deadlines and worst of all, team meltdowns.
But these aren’t anomalies, first-time startups in the best case scenario, get acquired. Everyone wants a home-run, but chances are you won’t hit one after 2 strikes. One realization that’s just as comforting as it is disturbing is most certainly the fact that the first successful company you exit, the real capital gain is the experience you gained from years of making and overcoming mistakes.
Journeying back to the first days of my first startup, there were certainly things that I wished I had learned.
List of things to remember and do better with your second startup
- Anyone can start a company, and that is not something you should pride yourself on.
- Saying that you’re a founder sounds cool, heck, you probably use it as a pickup line, right? Well, this is not 1995 anymore, simply starting a tech company today is easier than microwaving a hot pocket. If the ROI were higher in startups, there will be infomercials on starting tech companies. Here’s the truth, there is NOTHING worth mentioning about being a tech startup founder other than the fact that you gave up on a stable salary. It doesn’t matter if you did it in a dorm room, a garage, a basement or in a mansion, you haven’t accomplished anything yet. Don’t take pride in something as mundane as paying your taxes, it clouds your judgment, and you need that to get work done – something you can actually be proud of later on.
- Don’t stop learning, don’t stop reading
- I’m not talking about keeping up with TC, Mashable, TNW and the likes. I am talking about all the conventions and pedantic rot in the industry that you think you don’t need to know. We as first-time entrepreneurs think that we’re here to disrupt, and because of that we need to start fresh and can care less about prior arts and their merits. Well, think of it as someone who is trying to develop the next commercial airliner without ever learning fluid dynamics. It is not uncommon for entrepreneurs in my field (educational technology) to think that they can educate the world and yet refuse to step into a poverty-stricken inner city school and learn about what might account for achievement gaps between socio-economic classes. Don’t presume you can revolutionize an industry without knowing what you’re revolutionizing. You may still get funded, doesn’t mean you’ll solve the problem – and without doing so, it’s hard to convince anything that you’re really creating value.
- Stop rewarding failure, don’t be proud of attempts
- First-time entrepreneurship and trophy-kid syndrome seem to go hand-in-hand. We make a lot of bad decisions. We love talking about how we tried something, but failed. We write blog posts, in fact, some failed entrepreneurs begin making careers out of talking about failures. Very few, if any, other field or industry other than our own, award people for not being able to deliver. You really don’t want to convince yourself that it is OKAY to make a rash decision and then spend months developing a prototype that’s been proven inadequate by someone else a year ago. You may be more independent for making that decision on your own, but certainly not wise. And talking about it doesn’t make it any more so.
- Rip up your backup plan
- How much time do you spend talking to friends and ex-colleagues about retaining an offer from Google or Morgan Stanley IN CASE if this THING doesn’t work out? There’s an ancient Chinese proverb: “Retreat to the riverbank, and then fight the battle.” Meaning you will only give it your all once you’ve put yourself in a position with no way out. Remember that you’re burning through cash, remember that your competition is catching up to you, remember that you customers are waiting on you, these are all that you need to occupy your mind. What if it fails? Cross that bridge when you get there.
- Simply criticizing the system isn’t progress (at least not for your company)
- You can whine about how your competitors’ products are inferior. You can talk about how the top VCs are backing insubstantial PR stunts, and you can accuse your customers for being stupid. All day long. That is not going to change the fact that you’re not getting the funding and the resources you need to make the better product you believe in. As first-time entrepreneurs, we love to talk about how things aren’t done right and how in a parallel universe we could’ve done things better. Well, that won’t help. If you can’t change the game, then play it, and do it in a fashion that realizes your vision for a better future.
- Know who to take advice from and who not to
- This one completely eludes me, I say that because I also learned the hard way, and yet the guideline is so simple: if the person has never been there done that, you ought to question what the advice is based on. I’ve met plenty of “mentors” who claim that you don’t need to talk to investors until you have a prototype, or that you should, without prior background, prototype whatever ideas you have and then rely on user feedback to guide design. These aren’t helpful, in fact these advice may kill your startup. It is odd that first-time entrepreneurs take advice from just about anywhere, and yet they tend to ignore input from those who’ve done the startup thing. I have a faint conjecture for why that is – my guess is that it’s because those with some startup experience ask hard questions and recommend practical wisdom that take serious effort to implement; those without startup experience on the other hand, will serve up fairy-tale style success stories similar to the one told in The Social Network, and make you feel great about yourself instantly. If this is the first time you’re going about it, you’ll be tempted to hear only what you want to hear, but always remind yourself that starting up a company is very very difficult and arduous. The way to success is not a straight path but rather a series of corrections along the way (called pivots). Stay away from the folks pandering textbook entrepreneurship and IPO success stories, and stick to those who have practical wisdom (from experience) to share.
- Compensate your employees, treat them very, very well
- You’re a founder and your employees are not here for the same reasons that you are. Remember that. They are here to execute the decisions, and they are not responsible for whether your decision are good ones or not. One mistake that I made (along with my then-partner) that I see a lot of startup founders repeating, is delaying compensating employees until the big pay day (or at least planned to do so). That is not fair, not at all. It is demotivating, it is demoralizing and it burns people out. Remember that the founders are the ones who’re responsible for their own decisions, whether they’re good or bad, employees who execute well need to be rewarded fairly. Do it, before your A-players get burnt out and leave for another startup that appreciate the progress that they’ve made.
- Trust your partner when it comes to his or her expertise
- Simple enough, you partner up with someone because the person does something better than you do. Stop trying to hog the steering wheel, stop trying to override decisions, stop trying to argue about something you don’t understand. Let your entrepreneurial spouse(s) do what you partnered with them to do. First-time entrepreneurs don’t want to let go of power, And more often than not this leads to pissing contests ’cause one of the parties is not in it for the progress, he or she just keeps shadowing and criticizing other co-founders in order to prove that he or she is in charge. Don’t do that.
- Time and bandwidth are not candy, stop throwing it away. Do your research. Stop building things you don’t yet understand.
- This one happens so often that it hurts to watch someone go through the motions. Before you rush to writing an essay, drawing a wireframe or even coding a prototype for an idea, do yourself a favor and spend some time just look things up and talk to people who may know the subject matter better than you (may even be your co-founder!). First-time entrepreneurs, perhaps overlooked the fact that hackathons and startup pitch competitions are for fun and not conducive to product development, are obsessed with making things. We love squandering our design and engineering capacity like we’re filling up a blow-up swimming pool. If you’re going out there and then deciding to direct the company to pivot based on some advice from the first person you meet or the first trending article you read on tech media, you need to stop doing that. Not only are you making dangerously unsound decisions, you’re multiplying the drain on the company’s manpower.
- The answer to an outdated process is not NO PROCESS
- We don’t want meetings, we don’t want paperwork, we don’t want hierarchical decision-making, we don’t want to knee-jerk to sales numbers, right? What is the alternative? Nowadays a lot of buzzword we throw around tend to convey freedom and agility, and that often gets misconstrued as unstructured and spontaneous. Being afraid of an outdated process is natural, as these processes can be destructive, and they are reasons why most places and cultures in the world aren’t conducive to entrepreneurship. The question is how you create a better process? No matter you’d like to admit or not, your company is burning capital, you may have under-performing employees or founders, your flat-organization is running meetings with half a dozen people who won’t agree on anything, you may be spending too much on things that don’t create enough value. These eternal problems in the business world don’t go away just because you threw out processes that no longer solve these problems in the 21st century. You have to build business processes at some point. Your company may be fine without one when it’s just two clowns working out of a garage, it certainly won’t be when you have a startup of 10, 20, let alone 100.
- Work-life balance
- Pulling an all-nighter once in a while for a deadline, well, it happens. But if you find yourself pulling one every other week, and consistently working 14 hour days without any time to spend with your family and friends? You may want to take that as a red flag. You should always reserve one day of the week to unwind. Go watch a movie, go grab a drink with friends, go paint, go to a museum, go dancing, go read, anything. Burn out happens, but if you are drowning 56 weeks in a year, that is not sustainable.
- Follow your competition
- There is a Chinese proverb that I profoundly disagree with, and I think it perfectly characterizes the mentality of many first-time founders, and that is “Rather lead a pack of chickens then to be lead in a herd of cattle”. Utter excrement. Many people would rather stick around in an ecosystem where they’re the next big thing in town, than to go where the best and the meanest duke it out. No competition means no improvement, when you chose to start a company, you’ve chosen to invest your time (and perhaps money) in one of the riskiest assets in the world. In doing a startup, if you want to award yourself for choosing what is comfortable, you’ve made a horrible investment decision. Go where the big fish are, find out just how small you are next to them. Get trampled, stand back up.
- Stop spending so much time talking bullshit with people
- Last but not least, the majority of entrepreneurship-related events are talking about things after-the-fact, and too many of them are hosted by people who have never successfully started companies themselves. Networking is useful and a must, but be mindful of how much of the networking you are doing is just talking smack with someone trying to rationalize other people’s successes. The only successes that you should be talking about are your own, so stop spending a bulk of your time going to places where people have no success to share outside of what you could already read off of mainstream media. The only thing you need to know about why other people are successful is that they created value, and it’s time to stop talking about what you will create for people, and start showing them what you can deliver.
That was a Polaroid from my first-ever roller-coaster ride.