I always used to think that my goal of becoming a successful CEO of some billion-dollar company was identical to my goal of becoming a Disney princess back when I was two years old: it was cute, but deep down inside I knew it was never going to happen.
Growing up, the media always glorified famous entrepreneurs to the extent in which I thought they were either a) extremely talented from a young age, b) extremely lucky, or c) extremely rich to the point in which they didn’t have to worry about the costs of building stuff.
In reality, however, many of these successful CEOs who run billion dollar companies in Silicon Valley started off as ordinary people (shocking, I know). But what genuinely surprised me was how many failures these people had to go through before they could finally create their unicorn companies.
An amazing example of someone who has had a life filled with both failures and successes is Max Levchin. Even though I personally didn’t know who he was for the longest time, this man’s life is an extraordinary example of how anyone, with the right mindset, can become a successful entrepreneur. Here are some of the valuable lessons I’ve learned from his speeches and interviews:
“Risk-taking does not guarantee immediate success”
After his first startup failed, Levchin continued to start companies on campus. The problem was that they just kept. on. failing.
He made four companies, in the span of three years. All of which failed.
You see, we generally only take risks if we think that it will eventually pay off in the end. We also generally associate higher risks with higher rewards. But just like investing in stocks, the outcomes of these risks can be highly unpredictable. You could have the dream team with an amazing idea but unless you’re in the right place at the right time, your company could join the other 90% of all startups which fail.
What set Levchin apart from other serial entrepreneurs back in the day was his passion and relentlessness. Even after going through so many failures he was able to continue making more and more startups. It was this mentality which allowed for him to finally succeed in later years (don’t worry this story has a happy ending).
Four years later, after another failure, Levchin found himself attending a lecture at Stanford by a hedge fund manager named Peter Thiel. As one of the six people attending the talk, he went up to Thiel afterwards and they decided to meet again the next morning. At breakfast, Levchin pitched him on two ideas and Thiel suggested his hedge fund would be willing to invest in oneof the two. Levchin asked Thiel to become a full-time CEO at the company and the rest is history.
Serendipitously, after taking all of these risks, and after going through countless failures, Levchin began what would be an immensely successful startup: PayPal.
“You’d think that with the number of failures I’d accumulated by then my skin would be as thick as a rhino’s, but no such luck.”
Once you’ve experienced many failures, one might assume you’d get used to the awful feeling of parting with something you’ve spent so much time working on. I, for one, used to find it extremely difficult to part with my “drawings” from elementary school that can only be placed into the category of abstract art. But, after countless conversations and an abrupt realization that I could not become an artist when I was older (the princess phase was over by now), my works could always be found on display in the recycling bin.
Unfortunately, this wasn’t the case for Levchin. After PayPal was sold to eBay, Max realized he missed his work and decided to pursue other startups and ideas. However, these startups began to fail as well.
Even after success, a failure can be extremely disheartening, especially after having experienced so many in his past. My few drawings were nothing in comparison to companies that he spent months developing. At his startup, Levchin had to go through a severe round of layoffs multiple times, all of which “hurt [him] terribly” to do.
“Stories about Silicon Valley often over-glamorize failure. We shot the moon, we fell short — but hey, it was a good try, no big deal. That’s simply not true: failing sucks.”
Even though its always a part of life to go through numerous failures, it’s important to realize that it won’t always be easy to bounce back from them. I always see these famous quotes on walls about how you shouldn’t let failure affect you or how failing is just another part of the process, etc. and even though they can sometimes be great ways to hype people, they don’t really include the full picture. No one’s ever said how much failures will actually affect me as a person and that’s why it can come as a shock to many people, even after previous experiences.
It’s naive to think that you can just move on from all your failures in the blink of an eye. Being an entrepreneur is tough and its why people like Max Levchin, are hard to come by. That being said, don’t shy away from taking challenges head-on if you’re afraid of failure. Just be aware of the amount of time, effort, and emotion that goes into the creation of startups
“Don’t be lazy. Just go do it.”
Sounds familiar? Well maybe because it reminded you of this:
Similar to the Nike slogan, Levchin believes that, above all other traits, perseverance is the number 1 factor for becoming a successful entrepreneur. Inspired by his grandmother and her sayings of how the only difference between somebody with a failed life versus somebody with two PhDs is tenacity, Levchin has internalized this thought throughout his entire career.
In fact, perseverance was what allowed for Levchin to go through all the past challenges in his life, from living in the Soviet Union, to moving to America, and finally to the countless startups which either failed or succeeded under his guidance.
After his unsuccessful startups, Levchin created a billings company called Slide, had a hand in a bunch of little companies (one of which was Yelp) and was in an environment with lots of interesting people and ideas going around.
While I would kill (not literally, I love everyone) to be in a position like that, Levchin still felt like something was missing in his life.
Five years later, Slide was ultimately acquired by Google and Levchin was once again looking for something to do. The problem was he didn’t know what he was passionate about (reminds me of the majority of millennials these days). Sure, PayPal was successful, but Levchin wanted to continue persevering to see just how much of an impact he could create on this world.
And then he realized: he loves difficult, serious problems. He also realized that he had amazing friends that he could literally just call for ideas. (Remember, it’s important to have a strong network of friends + experts!!)
Those conversations with people in his old PayPal crew caused Levchin to go back to look at payments, and ultimately lending, and start his latest company: Affirm. What originally was a math exercise to see if they could do a better credit-score product became a full-fledged consumer finance firm that employs around 500 people to this day.
The best part is, Levchin can credit all of these accomplishments to his grit, risk-taking, and hard-working personality.
While it is highly likely that most of us will not experience a life similar to Max Levchin, his advice can still stick with us forever. If there’s anything you should take away from this article, it’s to take risks, acknowledge failure, and persevere.
Sure, I’ll admit that my dream of becoming a Disney princess when I was 2 years old seemed a bit unrealistic. But my other dream, the one about becoming a successful entrepreneur, isn’t as far-fetched as I originally thought. Who knows, maybe even you, the reader, will create the next PayPal someday :)
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