I'm writing this on a Sunday after working 16 hours a day since last Monday. I've seen my kids for brief 2-minute facetime conversations. I'm exhausted and cranky.
And I wouldn't trade this for anything else... ever.
Being an entrepreneur is the most invigorating, fulfilling thrill I've ever experienced. After spending some time in Big Finance I can also say that I'm also structurally incapable of doing anything else.
But there are some big, hairy warts. Here's what they are:
- Exits Suck: A dark, funereal cloud descended upon every startup I've ever been part of while we were nursing a beer the night before our acquisition closed. Once you go through an exit you think, "Why is this considered the holy grail of entrepreneurship?" You know those images you've been fed of some 28 year old surrounded by models on a yacht off the coast of St. Barts 1 month after his startup's been bought? Replace that with your CEO on the brink of a sleepless nervous breakdown, realizing that he just sold his own child to the highest bidder. The reality of an exit is that almost no one gets rich, and every CEO I've ever worked alongside would gladly go back and undo at least one acquisition that made him wealthy.
There's a huge caveat to this. These same CEOs are so much smarter when an opportunity for a second, or third exit emerges. They know exactly where to look for the landmines and dead bodies. They also know how to vet an acquirer to ascertain whether they will add or subtract value. The ironic thing, in my experience, is that a CEO who launched their startup in order to have a huge exit, will usually botch it. Whereas a CEO who launched their startup to build an incredible product is better able to assess risk and maximize value.
- Very few investors actually give a damn about your invention: The sad reality is that most VCs want you to replicate another product that they regret having missed out on. Or they want you to behave exactly like another startup they backed that's doing well. But everything that gets you excited about what you're building and how it will change the world is a costly distraction as far as they're concerned. VCs usually have an ulterior motive and will usually treat you like a distressed asset in need of turnaround - even when it's not true.
As above, there's a huge asterisk here. Veteran startup CEOs are better prepared to choose investors who add value as mentors and partners.
- Everyone is in their 20s: This has never bothered me personally. I'm 38 and love working with and learning from the Millennials who work with my GenX self. But I've seen a lot of people my age and older with incredible technical expertise become stifled by a cross-generational divide.
- Startups believe their own bullshit: If you play an "innovation" drinking game while talking to a startup founder, you'll be drunk very fast. Do a shot every time he or she says "unprecedented", "unique", "transformative", "innovation", or "disruption", and then the whopper: "no one else is doing this." In Wall St. there's a tacit understanding that no one's honest. On Planet Startup, they actually believe their bullshit is real.
The truly great entrepreneurs are able to actually build their bullshit. But most of the others are irreconcilably full of it.
- If you're doing it right you're pissing people off. The nature of entrepreneurship is that you are displacing an incumbent solution to an entrenched problem. Along the way you will render the powerful obsolete, and depose gatekeepers. They will subsequently hate you and come after you with fury and lots of lawyers.
Great entrepreneurs think of those inbound missiles as a validating right of passage. Most others are terrified and back down. I was very lucky to have a CEO in my first startup who never shied away from those conflicts and emerged from each of them with new users, a stronger brand, and more loyalty from people like me who saw him fight for us.
- The transition from tribe to company is painful: Scale in a startup is very hard. Two factors that were taken for granted in launching a product: team and execution now need to be actively managed and systematized. The informality that is inevitable between a small team that built something they were passionate about is not enough for the next product, and the one after that. This is usually when new blood gets brought in for their past experience in achieving scale. Avoiding a disruptive culture clash at this stage is very hard.
I left the entrepreneurial life for a while for an opportunity to make more money in finance. I quickly realized I made a huge mistake. I can't live any other way. Being an innovator in a huge, bureaucratic company is like being a gay man in the closet. There are those who want to use their career to build something that's important. And there are those that want to hold onto territory. If you're an entrepreneur, then you're building something important--but brace yourself.
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