Startups are not a game of chess

Jun 4, 2013 · 3 min read

One of the really hard things to do as a founder is to not try and solve for too many problems at once. I’ve found it is one of the first things I end up talking to early stage entrepreneurs about. And something I struggle with myself.

There are two big reasons for this, the first is that as founders we have the entire business in our head. And so it’s easy to start thinking through all the strategic directions the company might take: “should we focus on mobile or web?” “how is this going to scale?” “how would we deal with that competitor if they did this?” We build pro and con columns for initiatives because ultimately we are doing to be directing our team down a path. We play constant games of scenario analysis, becuase naturally we are thinking about our businesses more than anyone.

The second big reason is that we talk to new investors, customers, and entrepeneurs every week about our business, layering on new questions and decisions to make. This brings up new points that hadn’t been illuminated, and the natural desire to try and come to resolve them.

A lot of times, unfortunately, this ends up feeling like a game of chess, thinking a few moves a head and trying to maintain optionality. While this might sound fine, it can be disastrous in many startup situations. At a resource constrained startup we don’t really have enough “pieces” to be playing chess. Especially when the rules of the game are constantly changing.

At an earlier startup I cofounded called Conduit Labs, we were one of the first players in the Facebook ecosystem and launched a product that achieved immediate growth. But I was very worried about the end game with Facebook, playing out scenarios of them owning my customer and revenue stream. So we moved off Facebook, built products on the web that had great retention but naturally struggled to grow.

It took us years to finally get back to Facebook and grow again, and at that time the ecosystem was quite different. We were thinking strategically, trying to stay two steps ahead, and actually much of my reservations turned out to be correct! But, at that time, we failed to make the simple choice to optimize for the #1 question,”given a great product, where will you best get users.” The answer, unequivocally, at that time was Facebook and everything else was just over thinking the problem.

A better analogy than chess is to think of it like a game of Football, it’s about moving the chains, getting one first down at a time. You can’t answer all your questions simultaneously, as satisfying as it can be to try and let your brain do it. In early stage startups there is simply too much optionality.

How can you help control this?

Start by trying to list out all the questions they your business is trying to answer right now. ie “Will people want to keep using my service?” “Do want green or blue on the homepage?” “Will they pay?” “How do we protect if google/microsoft/zynga/facebook come at us?” It’s fine to have a really long list, it could take you years to get to all of them.

Then, the key thing is to get ruthless about which of these questions you are trying to answer now, and which you are pushing off.

If done well, you’ll find your team suddenly knows what to do (“I don’t care about CPA optimization right now, just get me a small enough sample of users to prove if it works!”) and it’s a great way to focus the board of directors as well (“Very good point, we’ll solve for that after we’ve finished answering how to make curation better.”).

Try picking just one thing. Try making sure you will knock out of the park in the next 1, 2, or 3 months. It’s incredibly hard. But I think we all intuitively know it virtually never “all comes together” — it happens by simply, clearly, solving things one move at a time.

    Nabeel Hyatt

    Written by

    partner at Spark Capital, former CEO, full-time geek, investing time and $ at the fringes.

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