Talking to a founder this week that feels like she is doing something wrong when she tells people she doesn’t want to make her business huge. She is well connected in the startup ecosystem and she keeps hearing the same things. Everyone tells her how great the opportunity is. Everyone pushes her to raise money and do competitions. Everyone pushes her to grow fast so she can hire a bunch of people. She felt like the only two options were to grow it big, or don’t do it at all.
All of the external advice conflicts with her internal motivations. She wants lifestyle freedom and she wants to create something that her customers really engaged with. She wants to build something she can be proud of, but one that does not complete consume her.
I told her there was nothing wrong with the direction she wanted. Ultimately, you are the one committing your time and identity to the business, so you better build a business that works for you. When I started my first software company at 23, I thought the only option was to grow fast and exit fast. I saw the stories of Facebook, Instagram, and other companies just like them exiting for big money every day. I fell in love with glamour of venture-backed startups without really knowing it meant. The online resources for startups were all about raising big money and scaling for an exit. The easily accessible local resources (VCs and Angels) were the same. I quit my fantastic job to go all in and give my company the best chance at succeeding so I could make a lifetime’s worth of money before I was 30.
It took me a few (stressful) years to realize there are other options. Most importantly, I learned that you need to match your business to your life goals. Before starting at personal or business endeavor, you need to “know your why”. Your “why” is unique to you and your circumstances. You cannot take the average of all the advice you receive from others and follow it. You have to filter through the advice with the lens of your life so far and where you want to go. Some people want to make enough money to retire while others want to achieve a lifestyle.
Write down why you are starting this business (or why you started it). In times of stress or doubt, you should look at it to help stay on track and regain comfort. Once you have identified your why, you can build your business around it. If you are trying to make enough money to retire, then you probably need to go the venture-backed route (significant capital investment -> scale big -> exit). If you are trying to achieve a lifestyle that includes time or location independence, then you probably should not take on investment and seek rapid growth. Instead, build a business that meets your financial needs and is optimized for your time and location independence.
The founder and I are now working through the alternatives to the venture route that better fit her life goals.
- Given that she may be relocating in the next couple years, we are looking at directions that give her location freedom within 1–2 years. That rules out leasing a brick-and-mortar location and filling it with a bunch of employees and physical assets. Instead, we are looking at partnerships with established companies that could provide access to the resources she needs, when she needs them.
- She finds building Powerpoint presentations and spreadsheets emotionally draining, but finds engaging with her customers energizing. For that reason, we are exploring options that shift administrative work to someone else so she can increase her time spent with customers and potential customers.
- She would like the option to work part time hours within the next 5 years. For that reason, we are exploring how to build a stable company that does not need to continuously scale and is not 100% dependent on her day-to-day involvement in the long term.
Don’t fall in love with the glamour of venture-backed startups if it is not the right path for you. It is okay, you don’t have to be a unicorn.