Dangerous Self-Doubts Starting a Company
Dear Startup Founder
Launching a startup has got to be one of the most endangering things you can do for your ego.
When everything’s running smoothly, you feel good about yourself.
But the typical pitfalls of running a startup are guaranteed to threaten a startup founder’s fragile ego and make you doubt whether you have it in you to push through the obstacles.
Still here? You didn’t run screaming into the night? Good.
Here are some scenarios that startup founders encounter, as well as suggestions on how to rise above them and be a more confident leader moving forward.
“90% of Startups Fail.”
It’s true that 90% of startups fail, but there’s no mysticism behind why they fail. Often, it’s due to the fact that the company didn’t do any research to see if people would actually buy their products. Again, ego gets in the way here. If you think your app is the best thing since push notifications, get some validation before you invest time and money (and get people on your payroll) to find out if there’s no need for this app in the marketplace.
App startups have an even harder time thriving simply because of the sheer number of competitors out there as well as the insanely brief moment in the spotlight that most popular apps get before being relegated from a user’s home screen to the dreaded No Man’s Land apps menu.
Sometimes, the app industry is an ego echo chamber; many of the apps out there aren’t even useful to users; they’re just what the company thought would be cool, with zero regard for what users actually found valuable.
You better know who already has apps similar to what you want to build, as well as their revenue model before you spend a dime on development. You need to decide whether you’ll have an ad-supported free app, a freemium model, or one with in-app purchases.
Bottom line is: without research and a detailed plan for how you’ll serve your customer base through your app, you will become a statistic.
“We’ll Never Find Funding.”
I’m not going to lie to you: the odds of your startup getting funded by a venture capital firm are about as good as a Kardashian staying married forever, which is, approximately, 1%. Many startups look to VCs or angel investors for funding because there’s a certain cachet that comes with saying “we just secured our second round of funding.”
Image credit: schuldnerhilfe
I encourage you to open your eyes to other sources of funding. Bootstrapping (which 80% of startups do) is ideal because it’s your money you’re spending, which makes you more diligent about spending it in the right places. Plus, you owe no one when you raise money yourself. And maybe having to wait to launch your business until you have enough for the first year of expenses will give you enough time to cool your jets and really get a plan to ensure your startup’s success.
If bootstrapping isn’t an option, you can also consider:
- A loan from friends or family
- A Small Business Association-backed bank loan
You can waste tons of energy preparing pitch decks and being turned down by VCs or you can spend that time finding more reliable sources of financing…or earning it yourself.
“My Last Business Failed. This One Will Too.”
A failed business is a huge confidence destroyer. But hey, if you’ve launched a second company, you’ve already overcome some of that self doubt.
Here’s a statistic that might make you feel better:
Startup founders who have failed at a previous business have a 20% chance of succeeding, whereas first-time founders have just an 18% chance of success. It’s not a huge difference, but the point is: you get what you make of your previous failures.
If you buried your head in the sand, ignoring the reasons your business failed, it probably won’t help you thrive this time around.
On the other hand, if you can use those lessons in failure to do better this time around, the failure will have served its purpose. Be open to what you did wrong (or didn’t do right) and make an effort to do things better this time. If you tried to do everything yourself last time, make sure you hire skilled people to help you this go round. If you didn’t budget enough to get your business off the ground, spend more time assessing costs before you launch.
“What if We Scale Too Fast to Keep Up?”
What if, what if, what if?
There are a million “what ifs” you can dredge up about your startup, but what good do they do?
Scaling too quickly to keep up is a valid concern for startups, especially in the app space. If you suddenly have a flood of new users, will your servers be able to keep up, or will all systems shut down, leaving users dissatisfied and irritated?
Still, this is a good problem to have, and one that can be completely avoided with a bit of planning. When you first develop your app, look for server storage that can adapt as you grow. You may not need a ton of space initially (nor can you afford to pay for it), but you want to know that more is available should you suddenly make it to the big leagues. As long as you have a game plan for scaling, keeping up should never be an issue, and you can maintain a consistent experience for your users.
“I Can’t Do This Alone!”
Maybe you had no clue how many decisions you’d have to make as a startup founder and now you’re freaking out. Understandable. It’s like being king or queen of a small domain; it’s a lot of pressure.
Fortunately, you don’t have to go it alone.
Even kings had advisors that helped them. Start by hiring talent or firms you can rely on for specific functions, like app development, accounting, or marketing. Taking each of these off of your plate will alleviate a lot of the pressure.
Realize that you have options when it comes to getting help.
You can hire full-time employees if you can afford it, but you also have the option of working with part-time or contract freelancers, which may fit your budget better. If you have one-time projects this is probably your best bet. Working with an app development firm can get you access to professionals who live and breathe app dev, giving you a competitive advantage before your app’s even launched.
Then, consider whether this business will thrive with just you at the helm. Having a co-pilot in your startup can be a major boon. Not only would you have someone to bounce ideas off of, but you’d also benefit from that person’s experience and knowledge, which should complement your own.
In fact, a company with two startup founders rather than one can raise 30% more investment and can grow customers three times as fast. Don’t you want those odds for your startup??
If you do decide to bring on a partner, spend plenty of time on the decision. This will be, essentially, your work spouse, so you want to trust this person implicitly and be able to get along day in and day out. You can divide and conquer decisions and responsibilities based on each of your areas of expertise, but you can always consult with one another to ensure you’re making those decisions in the best interest of your startup.
“My Family Doesn’t Believe I Can Do This.”
There’s little that can fracture a startup founder’s ego more than not having the support of his family. In fact, I’d say that support is one of the most critical elements for the success of said startup; if your family is frustrated because you’re gone all the time, it’s hard for you to focus on building your business.
Start out by sitting down with your spouse and kids and talking to them about the business. Tell them why you’re starting it. If they understand the passion and drive behind what you want to do, it may help them accept that, at least temporarily, you’ll be focused on something other than them.
Then, manage expectations. If launching will take you away from your family, commit to something that will balance that, such as being home for dinner two nights a week, or completely unplugging from your phone and computer on weekends. Let them know how long you’ll have limited availability for them so they can be patient until things slow down for you at work.
And do a self-check once a month. It’s easy, since you’re likely Type A, to keep working uber hard, even if you don’t need to. Remember there’s a family that needs you as much as, if not more than, your business.
“I Don’t Have a Business Degree.”
Pish posh. There are tons of examples of startup founders who never graduated college, let alone got a business degree. Being professionally trained in the art of running a business, managing your finances, and strategizing about your marketing is helpful, but it’s certainly not the only means for you to get this knowledge. Also, having a business degree does not guarantee your startup will survive. Save yourself $50K and DIY the knowledge.
It’s important that you set your ego aside here if you think you can wing it in running a startup without any business knowledge, however. You need at least a basic understanding of finances (particularly how to decipher financial reports like balance sheets and profit and loss statements), marketing, and leadership if you want to be an asset to your business. A good idea alone does not a startup make. At least not a good one.
Think about which areas you’re weakest in and look to beef up your knowledge in that category. Maybe you have no idea how to do your own accounting. Even if you hire an accountant, taking a community workshop on the basics of accounting will serve you well.
Or maybe you want to better understand social media. Look for blogs that walk you through setting up and using each social channel. Continue to read business magazines, books, and blogs to stay fresh on business-related topics. You’ll never reach the pinnacle of knowledge on the subject; there’s always more, and staying informed makes you competitive.
There’s no getting around the fact that running a startup may make you question why you wanted to launch a business and doubt your ability to do so. The key is to work through those sticking points that slow you down and bruise your fragile ego. And get a thicker skin around that ego! You’ll survive whatever is thrown your way, and remember: you’re only given what you can handle.