The right kind of crazy
This week I was listening to the podcast Acquired by Ben Gilbert and David Rosenthal. The episode was on the story of Sequoia.
Don Valentine is a legend and the episode is worth a listen.
Here's one of my favorite quotes from the man himself:
"The art of storytelling is incredibly important. Learning to tell a story is critically important because that's how the money works. The money flows as a function of the story."
The money flows as a function of the story.
DEEP DIVE: Inspirational Nonsense
January is a natural time to reflect on what we accomplished in the last year. It’s also a time to look forward and get serious about the things that are most important to us.
While I do think the new year is as good of a time as any to step back and assess your life, there’s one thing I really hate about this time of year more than anything: inspirational social media posts.
For the last week, my timelines were choked with fortune cookie aphorisms about hope and stilted memes reminding me I can be anything I want to be. That 2023 is the year to strike out on my own, to start that business, to become a founder.
You will never see me add my voice to that chorus because I know it’s not true. We all want to believe that we can be anything if we put our minds to it. But we can’t.
It takes raw talent, a great idea, relentlessness, insane execution, and a whole bunch of other stuff to make it happen. Not some clickbait for hope-preneurs.
Growing up, I wanted nothing more than to become a professional baseball player. I did the work, and I put in the time. I woke up early and went to bed late to dedicate myself to the goal of earning a spot on a major league roster.
I had a hitting coach from the time I was 11. I hit tens of thousands of balls off a tee, short toss, and batting practice. I sprinted and did long toss even when I was on vacation. My glove traveled with me in my carry-on. I did everything in my power to make it happen.
As you can probably guess, I didn’t make it. No matter how bad I wanted to be in the MLB, I simply wasn’t good enough to play at that level. In other words, just because I WANTED to be a professional baseball player didn’t mean I got to be one.
And yet, if I believed all the social media gurus out there, all I had to do to achieve my dream was to try hard and believe in myself.
But I had other talents and gifts which is why I'm grateful that my baseball dream ended when it did. That "failure" helped shape me for this founder life I live.
This bad advice about chasing unrealistic dreams especially bugs me when it comes to entrepreneurship. I don’t know exactly when it happened, but some time in the last couple of decades, becoming an entrepreneur and starting your own company became hip and sexy. No longer were entrepreneurs—as Steve Jobs once put it—the crazy ones, the misfits, and the troublemakers. According to ThinkImpact.com, 31 million people in the US are entrepreneurs—about 16% of the population. And a whopping 55% of adults have started their own business at some time.
The pandemic certainly added fuel to the entrepreneurial fire. According to the Census Bureau, 5.4 million people applied to start their own businesses in 2021, breaking the all-time record of 4.4 set the year before.
The problem with this is that starting a business statistically is a TERRIBLE idea. Just like only a small percentage of athletes make it to the pros, the Bureau of Labor Statistics reports that 20% of new businesses fail within the first two years. As time goes on, the margin of success shrinks, and within a decade, 65% of those startups are dead in the water.
None of that gets conveyed in the messaging of those social media cheerleaders, many of whom are pandering for likes.
Here are two reasons why I hate that feel-good, unrealistic messaging so much:
You Have to be a Little Crazy
If you believed the online advice-givers, starting a business is a great idea for everyone to pursue. They sell this image of entrepreneurship as this overly glamorous venture. Who wouldn’t want to be their own boss?!
But I think that sugar coating sets unrealistic expectations about what being an entrepreneur is really all about.
I already talked about the statistical probability of failure, but what I didn’t mention is that worry of failure is a weight on your shoulders. Every. Single. Day.
I love being an entrepreneur, but it’s filled with stress and sacrifice. If you aren’t questioning your sanity, there’s probably something wrong. There’s so much disappointment and struggle.
If you're reading this, you know what I mean. You worry about payroll. You worry about raising your next round. You worry about churn and burn.
The truth is that nothing is as easy as it looks. The “overnight” success is never overnight. Take the story of the SaaS work app, Slack. While the company and its founder, Stewart Butterfield, is famous for reaching a $1 billion valuation in eight months, what’s often forgotten is that Butterfield’s Tiny Speck company spent nearly four years fumbling around with an online role-playing game called Glitch. What we now know as Slack was simply internal software to help the company’s developers communicate with each other.
Entrepreneurship is not a space designed for everyone. It’s for the crazy ones, the hyper ambitious ones, the ultra competitive ones.
The World Needs Ditch Diggers
Selling the idea that EVERYONE can become an entrepreneur also sets an unrealistic expectation that in order for you to draw any sort of satisfaction from your work, you need to become an entrepreneur and create something. It puts pressure on people to try and become someone they’re not.
Why is this narrative continually pumped into the world? It’s no different than looking at an underwear model and being mad at yourself for not having a flawless body.
Life doesn’t work that way, and frankly, it shouldn’t! If EVERYONE was an entrepreneur, who would do everything else? We need great executives to run Fortune 500 companies. We need teachers who mold the minds of our next generation. We need firefighters and police officers and nurses and construction workers.
There’s this saying out there that if you don’t build your own dream, someone else will hire you to build theirs. It’s a terrible saying that does so much damage. There’s is NOTHING wrong with working for someone else!
Just look at what Tim Cook has been able to do by first working for Steve Jobs and now running Apple.
Is Tim Cook a failure because he decided to work for someone else?
You should only pursue entrepreneurship for one reason: You can’t imagine doing anything else. There’s a sense of destiny in it. Do you feel like you’re going to DIE if you don’t build your product? If you don’t, then it’s probably not for you.
This new year, let’s be real with ourselves. Let’s be real about what it really takes to build a company. Most of all, let’s be real that it’s not for most people.
RESOURCES for Founders and Storytellers
I mentioned earlier that even though Slack seemed like an overnight success, the road to get there took years. This TechCrunch article shares the company’s journey.
There’s no denying that 2022 has been a challenging year for startups. But it has not been equally difficult for every sector of the VC-backed ecosystem. This PitchBook report
If you're playing in the tech and venture world it's important to know the history and study the titans of the industry.
Along those lines here's a great talk that Don Valentine did at GSB back in 2010.
See you all next week where I'm breaking down the best investment pitch I've ever seen.
I coach a small handful of founders on their storytelling and fundraising. Venture backed founders looking to raise series A or beyond and bootstrapped founders doing at least 5m in revenue. To learn more, you can reply to this email.
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