The Only Chance You Have in Life is to be Unpopular

Around the world, startup investors and founders are trying to outcompete each other to be sad, both in public and in private.

Optimism and pessimism are contagious, creating a herd mentality and feeding the madness of the crowds. Don’t make the mistake of not thinking through all the possibilities of the world — both sad and happy.

Firstly, let me acknowledge very clearly the health and economics shocks from the spread of COVID-19 are severe. Everyone should be thinking through their survival and stress testing downside scenarios. But the problem is people have stopped there, they have forgotten to think about the possibilities of positive scenarios. Most companies may very well reach the end of that analysis with no happy possibility but to not even try is heartbreaking.

The sadness and madness of the operating plan
Every startup has now re-examined its operating plan over the past month.

Here’s how it goes:

Have you seen the Sequoia matrix?

Is your runway more than 12 months?

Let’s create a plan that gets us to 18 months, no make that 24 months

Let’s assume revenue goes to zero, can we still get 18 months of runway?

Have you considered if the government will not give you the tax refund they are legally obliged to?

Have you considered if money is worthless and the human race is extinct? What happens to your runway then?

The only way to cut costs at a startup is to cut people. Nearly 100% of the expenses relate to the salaries of employees. So the conversation inevitably moves to layoffs.

My other startups are cutting 20%

Have you seen”

“Have you considered cutting 40% of your employees?

Everyone is competing to be the saddest.

We can all be happy being sad together
The great thing about being sad is that it allows you to feel emotionally validated. You might even be factually right, in which case you can claim to have seen the future. But if you’re wrong, you’ll still be patted on the back by society for being ‘cautious’ and ‘prudent’ — our reptilian brain chemically encodes this survival instinct. Add that to our craving to be accepted by others and you have the sadness jackpot of warm and fuzzy feelings.

In reality, there is a cost to being too sad. You achieve less and take more time.

Now is the time to be unpopular
Only the courageous achieve anything in life. And being courageous means being unpopular.

In fact, the only chance you have in life is to be unpopular.

Every year on December 26th, members of the public trample over each other to purchase a sandwich grill, whose price has just been reduced by 60%.

But when the value of publicly listed companies plunges, people run away.

Fund managers who were complaining about valuations every single year for the last decade are now not sure we aren’t yet at the bottom. Life has become so comfortable in the peanut gallery, they have forgotten the way onto the field.

The marketing world is facing an exact parallel conversation to the investing world at present, with ad prices down by 50% or more.

The doors are wide open for growing your company via the greatest ad-buying bargains in recent memory. (Note: generally, even though ad pricing has halved, conversion rates are also down. Not by the same amounts though)

And the reaction? “We’re cutting back on our marketing”. The imagination has failed.

But never before has advertising been so measurable. Shouldn’t you see if you can spend more on marketing if your customer acquisition cost can now be cheaper than ever before?

A company we are investors in is considering raising a round just to spend on marketing.

Out of adversity comes opportunity.

Silver Linings in the mirror
The COVID-19 pandemic and economic shock should be a moment to look hard into the mirror.

What have you been kidding yourself about?

Now is also your greatest opportunity to change course, to confront your uncomfortable truths, and to seize a once in an economic cycle’s buffet of opportunities.

After you have stress-tested all of your sad scenarios, why not take the time to test some happy ones?

Now is your chance to be unpopular and courageous.

When the world returns, the focus will once again switch to the winners, while the losers will file to the back of the line once more. The winners will be those who achieved something with their opportunity, not those who are popular.

Don’t choose now to be like everyone else. Your pathway to achievement just got a whole lot less crowded.

Your time has come.

Co-founder @blackbirdvc. Creator of @startmate. Lover of numbers