The worst kind of startup isn’t the one that fails, it’s the one that stagnates. In startup and small business, if you’re not growing, you’re dying. Maybe not today, maybe not tomorrow, but probably when you least expect it.
The issue isn’t that of losing money — although I’m well aware of how much that sucks. It’s losing time. Money can be replaced. If you’re a smart, aggressive, fearless entrepreneur, money can be replaced sooner rather than later. Time is never coming back, and the longer you spend stuck in neutral, the more of a loss you’re shouldering in opportunity cost.
I spent 12 years on a startup once. Not full time, not a money loser, but a rather fun and satisfying enterprise that started to flatline about five years in, and I was too far into my own ego to see it coming.
Intrepid Media was one of the first social networks. What’s more, it was a social network for writers at a time when content was king of the Interwebs. It was Medium way before Medium. It was kind of Funny or Die but with words. It was the Onion but we didn’t make shit up. Well, we didn’t make everything up, but not every word was the gospel truth either.
Intrepid started out as one thing before becoming another. I put up a website in 1999 because a lot of the technical and cultural pieces I was writing for other bylines would stay live for a few months and then get removed from the server and thus from the public eye. I got paid, I got eyeballs, and then I was yanked. That’s how things worked.
I didn’t like that, so I started putting copies of my stuff online when it went offline. I also knew a whole bunch of other people like me, people who were writing for the online versions of traditional media companies, people who were getting paid to write what those media companies saw as secondary filler. They wanted their content on Intrepid too, because people who would come to read my stuff might like their stuff, and vice versa.
This made perfect sense to me. And it worked. And “eyeballs” exploded.
But then there were a whole bunch of other people who weren’t writing for other bylines but just wanted an outlet, and some of them were pretty good writers. So I let them join and I built some algorithms to track the reads and the ratings and a pretty simple but robust critiquing system — something I called Karma Factory, which I almost patented. Those algorithms would bubble the best content up to the top of the front pages of my site. Yeah, that kind of thing might be my fault.
Money started coming in from everywhere. People were paying me to host their content, people were paying me to read our content, people were paying me to advertise their wares next to our content. The money was great and I was working on this maybe a few hours a week once I built all the tech. So I rarely, if ever, thought about expanding.
Then blogs happened.
Blogs at the time were to my enterprise what YouTube is doing to traditional broadcasting today. Everyone thinks they can be YouTube famous, so everyone has channel, and no one makes any money (except YouTube). What I should have done is turned Intrepid into the YouTube in that scenario, the broker, the money-maker. But I believed in the content, the quality, the mission, and I bet on the fact that other people would too.
Those same quality tools I had built into Intrepid started working against me. All the revenue models died except the advertising, which actually started to do better for a while.
Then Facebook happened.
800-pounders like Facebook and Twitter started to turn content into SEO. Clever went out the door like yesterday’s garbage. Quality became authoring the perfect title to trick millions of people into clicking on your ad-bait.
I still think I did the right thing, from a mission perspective, with Intrepid. I started consulting on technology, product building, data, and algorithms, and turned that into an actual startup with employees and customers and built that into a $1 million plus ARR business.
As I learned and expanded my knowledge there, I was able to recycle parts of Intrepid to build both Automated Insights and ExitEvent. Automated’s NLG algorithms are built on some of the same models I used to bubble Intrepid Media content to the top of the page. And ExitEvent, all the way up until it was absorbed into the American Underground media brand last year, still ran on some of that same code I wrote back in 1999.
My only regret is that I moved too slowly to pivot. And it might not even be my fault because Automated and ExitEvent both happened at exactly the right time for those two startups to be successful. But I could have and should have made a couple more hard pivots before then.
I could have saved Intrepid by mutating it into something completely different, or I could have built something entirely new out of the mission, and found a smaller, more addressable niche for the quality content we were producing.
Looking back, I had three options. One: Follow the money and become a sort of written-word YouTube. Two: Follow the mission and evolve into something that Medium eventually picked up on. Three: Do Nothing.
And I chose Option Three, kind of waiting for the solution to become a little clearer but also because I couldn’t be bothered because I was still making good side money without having to put much work into it.
The lesson? Option Three will kill you, just slowly.
Intrepid stopped taking on new members in 2010 and stopped publishing new content a year or two later. Google Adsense shut me off some time after that for reasons I still don’t know. But by 2015 both the technology and mission Intrepid was built on worked out very well for me, in terms of the acquisitions of Automated and ExitEvent.
I’m still building on those components and those lessons from Intrepid, but one hard lesson I learned is I won’t wait for answers. In startup, it’s pretty much grow or die.