A cautionary tale for would-be entrepreneurs
Whenever we think of startups, our minds conjure up visions of success, impact and riches. The very word “startup” connotes something that is loaded with potential — the beginning of a new thing that is full of promise and excitement. It’s an irresistible allure that has been pulling me into new companies for over 20 years — despite repeating the mantra “never again” to myself at the end of each one.
Why “never again”? Well, I have learned, as most other founders and CEOs do, that there is another type of ‘promise’ that quickly takes center stage once you’ve plunged into a new business: The many promises you make to others in order to achieve your dream. And after a string of pretty successful endeavors throughout my career, I learned the hard way that it is all too easy to focus only on the possibility of success without truly understanding the potential price of failure.
In order to launch and grow a company, you have to make lots and lots of promises; big promises that we often have only the vaguest idea of how to keep — or whether we will be able to keep them at all; promises that have a way of multiplying and morphing, sometimes even in conflict with one another.
My last startup had shown enormous potential until it basically imploded in a bitter battle between investors and board members, in which I was on the losing end. It left me so shell-shocked that I didn’t even try to work again for over a year. I told myself and others that I was taking a sabbatical, but there is another truth behind why I took all that time off right in the prime of my career: I was so emotionally burned out by the prior years of extraordinarily hard, emotionally draining work had ended that I simply couldn’t face making new commitments or promises of any kind to anyone. You could call it startup PTSD — a phrase many other founders are probably quite familiar with. It took over a year on the sidelines for me to really understand what had happened and how deeply it had affected me. The pressure of trying to keep so many big promises had gradually become crushing, and the guilt and shame of suddenly realizing that I wouldn’t be able to keep them just flattened me emotionally.
The truth is that promises are all you have when you decide to start a company. It usually starts with the promises we make to our families — that the sacrifice of time, steady income and financial security will all be worth it in the long run. Then there are the promises to our co-founders: that we will stick together through thick and thin; that we will stay committed to a shared vision; and that we’ll “tough it out” together when things aren’t easy. Finally, when the idea actually starts coming to life (yay!), we begin making even bigger promises: promises to investors that we will be good stewards of their capital and make a good return; promises to prospective employees that joining our company is worth the risk of leaving their lucrative, cushy corporate jobs because “the equity value will make up for any pay cut you take”; promises to early customers that the product or service will deliver once it’s ready; and even promises to vendors that “yes, you will be paid your overdue invoices… just as soon as that next round of funding comes in.” It doesn’t happen all at once, but over time we weave ourselves into a web of commitments that can be incredibly overwhelming.
And it’s not just what you’ve promised, but also to whom you’ve made the promises: Your cofounder? Good chance she’s a lifelong friend. Early investors? Well, you’ve got good ol’ Uncle Bob, who wrote the very first check, followed by one that came from a valuable professional relationship you’d nurtured for a decade. First employee? Maybe it’s that engineer you mentored back while working at Big Company X who’s now married and has a 2-year-old. Nonetheless, he still believes in you enough to take a risk. There’s also no escaping the fact that your family is right there on the emotional and financial ride with you. The thought of letting all these people down is unbearable. So you work your ass off, chasing every opportunity, every tiny glimmer of hope, trying to make everything be “the best work you’ve ever done.“ No amount of effort will feel like it’s good enough when those big promises are at risk.
With success comes the reward of knowing that you have created something truly amazing and, if you’re very lucky, made some serious money. It’s like no other feeling in the world, and really, when was the last time some small win at your corporate job gave you goosebumps like it does at a startup? But when things aren’t going so well (and what startup doesn’t have at least one “near death” experience?), the pressure is enormous. We resort to gutting it out through force of will, hoping on a prayer for a lucky break before we, or our company, collapse under the pressure of it all. Personal objectivity goes out the window because failure is an unfathomable outcome you simply cannot allow — until it happens. And then everything comes apart.
Dreaming big is essential to startups, but my last experience taught me to pay at least as much attention to what could happen if you don’t succeed. You need to be mentally and emotionally ready to accept the risk of a lot of broken promises to people who matter a great deal to you.
Author's note: I originally wrote this post on Medium in 2018, when I first began advising other companies and considering consulting as a full-time gig instead of starting another venture-backed company. Today, the harsh realities expressed here remain at the very core of why I do what I do: I'm still irresistibly drawn to the energy, creativity and impact of startups, but I am all too aware of how hard it is, and how much it hurts when they don't work out. So I find myself compelled to help other founders and their teams in any way I can.