I just read a good post in a discussion by Greg Satell about digital startups. Thought I would share some thoughts. I have enough experience with digital startups to be able to confidently state that the most important quality in a startup founder and team is determination. Determination is the quality needed to drive a startup through the growing pains.
An entrepreneur must be intelligent as well, but intelligence by itself is not enough to start a company, especially an Internet business. We may feel like we were born with the web, but Internet startups are still new, and the business model lacks the direction of older more conventional business models.
Running a startup is like walking on your hands: it’s possible, but it requires extraordinary effort. If an ordinary employee were asked to do the things a startup founder has to, they may be insulted, and at the least, discouraged. Imagine being hired by a business to write code, and in addition to being reminded that the module was due yesterday (even though you were just told about it this morning), but you also are expected you to answer support calls, administer the servers, design the web site, cold-call customers, find the company office space, pick up lunch while your out, and empty the wastebaskets tonight, even if you don’t leave the office, because we have a client/investor visiting in the morning.
You do not get to do all this hard work in a comfortable environment, like a banker, whose only concern financially may be the size of his/her annual bonus, but against a backdrop of constant disasters, and financial insecurity (I hope the checks will cash). That’s the part that really demands determination. In a startup, there’s always some disaster happening. So if you’re the least bit inclined to find an excuse to quit, there’s always one right there. This is why so many people and start ups fail, rather then fight, they take flight.
Everyone who deals with startups knows how important commitment is, so if partners, clients or investors sense you’re ambivalent, they won’t give you much attention. If you lack commitment, you’ll just find that for some mysterious reason good things happen to everyone but you. If you lack commitment, it will seem to you that you’re unlucky, and Twitter, Facebook, LinkedIn, Paypal, and every other Internet startup are lottery winners.
I have had partners that have the attitude that they’re going to give this startup thing a shot for three months, and if something great happens, they’ll stick with it– “something great” meaning either that someone wants to buy us or invest millions of dollars in our business. I have become a filter, because if this is your attitude, “something great” is very unlikely to happen to you, and this reflects on me. Clients, acquirers, and investors judge you by your level of commitment.
If an acquirer thinks you’re going to stick around no matter what, they’ll be more likely to buy you, because if they don’t and you stick around, you’ll probably grow, your price will go up, and they’ll be left wishing they’d bought you earlier. Ditto for investors. What really motivates investors, even big VCs, is not the hope of good returns, but the fear of missing out. So if you make it clear you’re going to succeed no matter what, and the only reason you need them is to make it happen a little faster, you’re much more likely to get funded.
You can’t fake this. The only way to convince everyone that you’re ready to fight to the death is to fight to the death. With a deferential nod to Seth Godin, and the Dip, by fight, we also mean adapt, and make the necessary changes to find success in your space, which may be poorly defined, and full of blue skies.
You have to be the right kind of determined, though. Determined rather than stubborn. Stubbornness is a disastrous quality in a startup (I have been both). You have to be determined, but flexible, like a running back. Adrian Peterson doesn’t just put his head down and try to run through people. He improvises: if someone appears in front of him, he runs around them; if someone tries to grab him, he spins out of their grip; he’ll even run in the wrong direction briefly if that will help. The one thing he’ll never do is stand still.