There’s an old joke about how to make a small fortune in angel investing: start with a large fortune and invest it in angel rounds.
I guess you could say the same thing about how to fail at an entrepreneurial venture: start a new company and then do everything that could be reasonably expected of you. And that’s how you fail.
The world is not set up to make your venture successful, and in fact almost everything conspires against you and your new company.
Because there is no natural constituency for the entrepreneurial venture, there is no way, reasonably, you can expect yours to survive. Customers aren’t clamoring for new vendors, employees aren’t looking to make half as much for their hard-earned skills at a firm that has a 50% chance of dying every day, and investors aren’t interested in taking risks or putting money into pipe dreams.
The conceit that a new venture has a shot of winning at all, under any circumstances, was unknown throughout history, is still laughable across the globe, and remains rare even here in the United States.
And that’s why it takes a special person to succeed. Notice I said “special”. Not charming, philanthropic, beloved, clever, popular, persuasive, capable or handsome.
You know, I’ve attended several dozen “entrepreneur breakfasts” here in New York City hosted by various internet luminaries or fellow entrepreneurs over the past eight years since I started TheLadders. Entrepreneurs can make good use of the dose of inspiration that comes from sharing, in the camaraderie of the breakfast table, the stories of challenges overcome, obstacles conquered, and victories won.
And while it’s never easy to tell which businesses and which people will win big this time around, it’s pretty easy to tell who is going to fail.
It’s the polite, patient, purposeful people.
Being an internet entrepreneur requires a certain antic disposition, a degree of self-immolation, and a dorkish obsessiveness with seeing the digital bits line up in a row. Not just an enjoyment, not just a desire, but a gut-level craving, an existential need, to see the machine come to life. That burn that flares so intensely in the dark of the night that it awakes you: to stare at the ceiling, to wonder expansively, to turn every part of the creation over and over and over in your head as the clock flicks the minutes into the small hours.
Many, perhaps all, who come to entrepreneurship want the fame or the fortune or the fellowship, but it is only the ones who need it badly enough that will suffer through.
I remember sitting next to one very, very nice woman at one of these entrepreneurial breakfasts in 2007. She had a great idea and a clever execution for an advice site — something like Daily Lit for the self-improvement set.
I asked what the URL was; she said the site wasn’t live yet.
I asked when it was going live; she said, with some pride in the accomplishment, that they’d already spent 18 months on the design, copy, coding and business model, and were lining up famous names to endorse the site when it went live, which they were preparing for next year at about this time.
She asked me if I had any advice for success.
I said yes.
“Put down your fork.
Get up from your chair.
Walk out this door.
Go to your office and call all of your team together. Lock the door and let everybody know you are not opening it or leaving the office until your site is live and accepting customers.”
I suppose another characteristic of entrepreneurs is our directness : )
Well, of course, she objected: that’s not practical, it’s not considerate, we still have planning to do before we’re ready for launch, and it is essential that we be perfectly positioned because you only get one shot to go live with a consumer brand.
And you know what?
She was absolutely right.
But so was I.
You see, being an entrepreneur is unreasonable. It is arrogant. It is unusual.
You are asserting that, despite the presence of 7 billion other people on the planet, and a US economy that produces $14 trillion in goods and services each year, and over 100 mm white collar workers in our country, that you, little old you, have come up with an idea, a business, a company that none of those other wonderful human beings have thought to invent yet.
I mean, c’mon, there’s no denying that it’s arrogant to say that you are right and everybody else was wrong to not see the wonderful opportunity that your company is pursuing. That they were fools to just leave the dollar bills waiting there for you to pick them up.
And part of that unreasonableness is realizing that you are in a fight for your company’s life every day. Every day that you are not “live” is a day you’ve lost the opportunity to make an impression. Every day that you’re not bringing in cash is a day that you’ve lost the chance to expand your payroll. Every day that you’re not pleasing customers is a day that somebody, somewhere else, will. Perhaps they’re not doing it as well as you know you eventually will, but the plain truth is that they are pleasing them today and you’re not.
So here’s my 3-step checklist to figure out if you’re failing as an internet entrepreneur:
1. Is the site live yet?
Yes: you’re likely failing, but at least you’ve got a chance of getting some feedback from real, live users, which may, if you’re smart and perceptive, decrease your chance of failure a little bit.
No: you’re failing.
2. Do you have free customers yet?
Yes: well, now you have a shot to establish relationships. And if you listen carefully and not pridefully, you just may have a tiny chance of hearing them correctly and improving your customer experience from awful to plausibly bearable.
No: you’re failing.
3. Do you have paying customers yet?
Yes: congratulations! You have reduced your chances of failing from 100% to 99%. There are many more chances to fail along the way, but you have graduated to some of the more interesting ones. Good show!
No: you’re failing.
If, when you wake up in the morning, the answer to any of the above questions is “no”, then you’re failing. Not failing tomorrow, or next month, or next year, but failing right now, today. As you read this…. Now.
And what you need to do, what you must do, is to spend your entire day focused on changing the answers to yes. Desperately, immediately, fully.
The very nice polite woman who had purposefully set out to make an enormous splash with her internet company did indeed get it live the next year, and her patience paid enormous dividends… to her competitors from vertically-focused advice sites. She struggled along for a couple years and then failed.
You will too, if you’re still reading this, and not locking the door to the office…