Startup Adversity, Part 2

Life is telling you to improve your business plan

As I mentioned in my last article, starting a company is asking the world to change. And the world does its best to resist. You are signing up for adversity.

Since I wrote this article I’ve spoken on a panel about startup adversity at the Sup-X conference, so I’ve been thinking a lot about this topic. I may even write a third article since it’s such a broad topic.

I started running my own company at 25. I’m not saying I knew what I was doing, but I made it work. And I landed the Discovery Channel as a client. It was huge for my company, and then we messed it up. My business partner decided to send a nasty email which the recipient printed and forgot to pick up. So it was sitting there in Discovery’s office and someone else read it and…we lost the account. We deserved it, but it was awful!

My business partner and I couldn’t work together anymore.

So there I was alone and without my biggest client. And it forced me to do two things:

  1. First I went and found a new partner who was great, and complemented my skill set.
  2. Then we went out and landed CNN as a customer, followed by CNBC, USA, and a bunch of other networks.

So what seemed like a terrible thing at the time made our company stronger and led to a broader and more stable customer base than if we had just focused on that one key client. Amazing!

My experience is that adversity is an opportunity to end up in a stronger position. It’s frustrating and scary, but it forces us to grow.

Things go wrong because companies are built on shifting sands. Have you ever read “The Goal” by Eliyahu Goldratt? He talks about how seemingly small errors in each part of an assembly line can dramatically affect output. A few butterflies flap their wings in China and suddenly you’re producing 25% below quota and your defect rate is through the roof.

Why is that important?

Because your company is essentially an assembly line. So is your app. When we were building software we used operating systems from Microsoft and Apple, a development environment from Adobe, browsers from Microsoft, Google, and Apple, and a ton of third-party plugins. This is called an eco-system, which is a fancy term for assembly line.

Each item in the eco-system produces errors (sorry, Apple, but it’s true) which are magnified by all the other small errors produced by all the other moving pieces. It’s a wonder that your app works at all!

You finally get everything to play together nicely…and then something changes! Apple releases a new version of the operating system and suddenly you have to re-work your software.

The same thing is true of your business. Uber is running a car service based on existing rules and suddenly the city of San Francisco decides to change them. Or the drivers sue to change their status from independent contractors to employees. Or Europe decides to tell the world that they can’t store European data on US servers.

These are serious challenges!

And it’s just part of the deal. It’s what you’re signing up for when you start a company.

And every time this happens it’s life telling you to improve your business model. Great companies are constantly adjusting to their surroundings. Astro Teller of Google’s moonshot team says, “Shifting your perspective is so much more powerful than being smart.”

Stay calm. Do more of what’s working and less of what’s not. Roll with the punches.

Iterate your product and your business model constantly. The adversity never ends, and pain is what gives you the opportunity to grow.

Written by Mike Lingle, if you like this then follow my journey as I help startups start up.