Why you should NOT be an entrepreneur
Watching the movie “The Social Network” left a deep impression on me, inspiring me to be an entrepreneur as a career choice back in 2011. The opportunity came during my final year in university, when a project of mine was gaining some traction and I saw the opportunity to commercialise it, and went on to pursue my first ever initiative as an entrepreneur.
As a serial entrepreneur who has started 2 companies in different locations (Kenya, UK) and currently working as a Venture Capitalist, I can attest to conventional wisdom that entrepreneurship is a path not for the faint-hearted. However, the extent of how tough it is to be an entrepreneur has not been communicated evidently to the wider audience. It certainly did not occur to me that the challenges faced by start-up founders would be (complete the sentence here) when I started my first company six years ago.
Path to Entrepreneurship
Entrepreneurship is gradually being accepted as an alternative career path for new graduates as well as mid-career professionals. The popular narrative on entrepreneurship contains ideological pull factors for many, such as allowing one to change the world, impacting others and empowering the wider community.
Along with these ideological factors, the following are some common reasons that aspiring entrepreneurs gave when quizzed on their motivation to be an entrepreneur: 1) Be my own boss; 2) A quick way to get rich; 3) Greater autonomy at work; 4) Work-life balance; 5) Passion and more fulfilment at work. While these are valid reasons, and true to a certain extent, there is more to them than meets the eye.
Working on my business plan as a first-time founder, pitching to investors for seed funding and liaising with corporate partners to tie up partnership deals, all the while preparing for my final examinations coming up in a month’s time, was really not the best way to end my final term at university. I discovered that starting a business takes way more hard work, time and effort than many would have imagined, and the only thing remaining to pull you through the toughest times is the passion that you alone possess for your idea. To see your idea being executed and bringing value to your users, impacting their lives in one way or another, is an extremely rewarding experience. This extreme belief of an entrepreneur in their idea is critical to the success of a company — as innovative business ideas challenge conventional wisdom, entrepreneurs will have to be able to turn rejection to acceptance, converting skeptics into faithful followers.
Founders of early-stage companies must perform a juggling act, wearing multiple hats at the same time: speaking to customers for feedback; implementing research insights in product development; fundraising; hiring; etc. There is no work-life balance to speak of, with myriad issues ranging from customer complaints and product development delay, to investors’ due diligence requests and partnership challenges, which all require founders’ attention and are likely to consume 24/7/365 of their time. A VC, whom I spoke to recently, commented that the companies that are around when he drops by the office on Saturday afternoons, are the ones more likely to succeed. Although this remark might come off as rather simplistic, it drives home the point that you will probably work longer hours as a founder than you would as an employee.
There is this mantra going around in Silicon Valley which encourages founders to be raising funds constantly. After closing each round of fundraising, founders should immediately be laying the groundwork, i.e. networking, for the next round. With each round of successful fundraising, more investors would join the company’s board of directors, whom founders are answerable to. Directors play a unique role where they act as advisors to the founders, providing them with the necessary experience and network to grow their company. However, each investor brings on board their own set of experiences, playbook and perspective towards your business. This is a double-edged sword, as it may add value to founders, but at the same time be distracting to them. Fundraising isn’t the core function of a startup’s business and should not be taking up the bulk of the founders’ time. Instead their time should be spent on improving the product, gathering customer feedback, hiring talents to bring the company forward.
Innovative business models are forward-looking, but investors who tap into past experiences and forcefully apply the same playbook to these business models may not always have the best advice for founders. Founders must make the right judgment on which piece of advice to heed and handling the board meetings professionally can be a challenging task — especially when you have a room full of big egos.
Prior to starting a company, aspiring entrepreneurs must be clear of their underlying motivations and be certain that there is a genuine problem that they are solving. The passion they have for their business idea is crucial, as well as the relentless drive to solve a particular problem. Starting a company may not be the easiest way to get rich; despite the success stories that are widely publicised, the majority of startups still fail. If you are in it for money and fame, it is very likely that you will give up and your company will fail, as the late nights and personal sacrifices that you will have to make, will far exceed any monetary gains during the early stages of your startup.
It is genuine passion that will shine through during challenging times and enable entrepreneurs to navigate through obstacles, however insurmountable they may seem. Monetary incentives, job fulfilment and autonomy at work can all be achieved through easier means. For instance, an early employee of Twitter would have more autonomy at work, with major responsibilities and monetary incentives than the majority of entrepreneurs.
Being an entrepreneur is not a trend, but a calling to solve a particular problem; it is not any cooler than being a software developer, a salesperson or an investment banker. The narrative that the media has played up about entrepreneurship taps into our need for feel-good stories and is not an accurate reflection of its stark reality.
If you are still thinking about starting up after all that you have read, and you still possess a burning passion to solve that ONE problem, then you SHOULD be an entrepreneur.