#intheblack — Building a business on your own terms

Why did you decide to become an entrepreneur?

This simple question is harder to answer than it seems. There are as many reasons as there are entrepreneurs. We asked this question and have seen some patterns emerge: “because I wanted to solve this problem”,“I wanted to build something meaningful“, “I liked the freedom of being an entrepreneur” or “I couldn’t imagine doing anything else”.

When we were thinking about building a startup conference in 2010 we wanted to organize it around that same energy. Around the people that have the urge to create something meaningful. At their own pace. Around founders. And that’s why we called it PIRATE Summit.

It took us some time to realize that the reality often looks quite different. Most teams that start out building their company on their own terms end up building it on someone else’s. Because — so the typical startup wisdom goes — you need to look for capital early on to jumpstart your business. And this capital comes with strings attached.

Once you are profitable, you can — but you don’t have to

Of course there are many business models that require external capital. For some, you need to invest into growth for years or you’ll never make it. However, many markets are not winner takes most markets. Most valid business models don’t require critical mass to become profitable. And for founders of those businesses there is one simple (not easy) way to build a business on their own terms: profit.

Once you are profitable you can — but you don’t have to — look for external funding. You can — but you don’t have to — aggressively pursue growth. You can — but you don’t have to — reinvest all the profits in the business. You can — but you don’t have to — prepare for an exit. See the pattern? You can — but you don’t have to. Profit brings great flexibility and freedom of choice. You can — but you don’t have to.

We need more founders that are proud of being #intheblack

Somehow being profitable has a bad reputation in the startup world. Profitable businesses are often referred to as “lifestyle” businesses. If you are not going for hyper growth you are not doing it right. If you are not reinvesting profits you don’t believe enough in the business and are leaving too many opportunities behind.

However, there are multiple ways to build great companies. And there are various ways to measure success. Building a company with five million EUR in revenue and one million EUR in profit is a big success. We want to advocate for diversity of thought on how to build businesses and what is considered a success. 10x or die? Sustainable growth? From 9 to 9, 6 days a week like in China? Building a business on your own terms? Ultimately it’s the founders’ choice. You can — but you don’t have to.

#intheblack as the overarching theme of PIRATE Summit 2019

Being profitable should be cool and celebrated. We need more founders that are proud of it and talk about it that way. Founders that build businesses on their own terms. That’s why we made #intheblack the overarching theme for the next PIRATE Summit.

Also, and we have said this before, there is too much focus on unicorns in startup land. Instead of focusing on the Fortune 500 startups we’d love to see more of the Fortune five million emerge. We imagine a world where a lot more people think and act entrepreneurial. Instead of a monoculture of a few giants we imagine a diverse and rich business ecosystem including many small and medium sized businesses.

At PIRATE Summit we want to discuss the advantages that building a company #intheblack has. How to get and stay #intheblack. There are scenarios when it doesn’t make sense to be #intheblack early on. Let’s debate them. This is a topic with a broad range of opinions and certainly some polarizing aspects, but this is exactly why we need to talk about it.

Show your support for #intheblack at intheblack.xyz

For us being and staying profitable is the ultimate entrepreneurial freedom. Startups get celebrated for closing new funding rounds all the time. Whereas a funding might be an indicator that you are building something valuable, profits are direct testament. The ultimate purpose of a company is to continuously deliver value and delight customers.

We created a small page to give #intheblack a voice. Check it out at intheblack.xyz. Leave your name if you think more founders should be proud of being #intheblack and build businesses at their own terms.

You can — but you don’t have to ;)

What do you think? Please leave a feedback in the comment section.

ARRR!
Manuel & Till

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PIRATE Summit started in 2011 as a true grassroots entrepreneurship conference with the focus on connecting entrepreneurs. Whilst the event has grown to capacity at 1.000+ carefully selected participants, two things remain at its heart: #MeaningfulConnections and #PurposefulDisruption

The next PIRATE Summit will happen on June 26–28th, 2019 in Cologne, Germany.

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A big thank you to Alexander Peiniger, Alexander Luik, Moritz Delbrück, Philipp Moehring, Axel von Leitner and Robbie Bouschery who gave valuable feedback for drafts of this post.