How not getting into 500 Startups helped our company
When we received our invitation to a final round interview at 500 Startups, it was exciting news for the entire team. We felt like we were perfectly positioned to benefit from the program: we have a cross-functional team of first-time founders, a product nearly ready to ship, and a huge addressable customer base. It felt the accelerator may well be what we need to succeed.
Fast forward: we didn’t get in. It’s a bummer, but definitely not a tragedy. In fact, the process of not getting in helped us immensely.
We spent a good portion of the week preceding the interview preparing. We’d reached out to several folks in the 500 network, and so we had a decent idea of what questions we’d be confronted with. Value proposition, go-to-market strategy, monetization. Not unlike the questions I answer daily in meetings with potential partners and investors.
However, it’s not the whole team that gets asked them daily — it’s me. Everyone else is busy being heads down to get the product out of the door. At an early startup, everyone is very busy working on their piece: the designer designs, the engineer writes software, the CEO connects the company with the outside world. Everything else is a luxury. “We’ll cross that bridge when we get there” has to be the name of the game. The reality distortion principle has to apply to a certain extent. In reality, I have no idea what the monetization will actually look like. But I do have to have a confident answer for when the investor asks me. And the rest of the team doesn’t have to worry about that for now — we’ll cross that bridge when we get there. We are all in agreement on the fundamentals, and it would seem like a luxury to take days off from developing the product in order to precisely articulate a long-term business development vision.
But as it turns out, unanswered questions produce latent doubt. As the team started practicing our answers to the 12-month plan and go-to-market strategy, I realized that leaving those questions only implicitly or vaguely answered was not a healthy strategy. The fact that my teammates didn’t have a strongly formulated answer to them for 500 Startups meant that they didn’t have one for themselves either. And that in turn meant that they had no way of being unwaveringly confident in our ability to successfully execute on these points. Sure, we are a great team of friends. Yes, we absolutely love the product we’re building. But only glossing over the big questions and focusing on the immediate term was a mistake.
As we worked together to formulate our answers to all the big questions, we came to an amazing realization. We were not doing this for Dave McClure, we were doing it for ourselves. We were having the conversations that we’d owed ourselves for months. And most importantly — we believed our answers.
When the day came, I didn’t feel any performance anxiety. That’s because we weren’t putting on a show for anyone. We were three guys incredibly excited about the product and company we’re building, and we were thrilled to share that with anyone who would listen. After months of being heads down and working on the product, it was an exhilarating feeling. We got grilled, but it was fun. We enjoyed meeting the other companies and our interviewers.
And after we were done, we went out and celebrated. We celebrated because we presented ourselves well, and we were hoping to get in. But more importantly, we celebrated because we all felt that we didn’t actually need to get in. We’re a strong team with great conviction, and we have a product we all use and love. We’ll do just fine on our own.
When the news came that we didn’t get in, it wasn’t bad news. It was just news. Ok, we’re not moving to Mountain View. Back to work. We’ve built something great and we need to share it with the world.
