I still remember the day I fully committed to moving on from my first startup, MoPix.
As a third culture kid who grew up in Senegal, Nepal & Indonesia it was only fitting that I arrived at the final aurora of my startup while sitting on an airplane, returning home to Los Angeles on a flight from Portland; dejected, overwhelmed and with barely any money in our startup bank account.
Staring out the window I found myself having a panic attack. I had tried to be the duck calmly swimming above water that everyone sees while I kick like crazy underwater. The reality was that I was close to rock bottom, overwhelmed by stress, and grabbing for anything to help me rise up.
I had run out of all my startup runways
I had hidden a lot of my financial situation from my fiancé (now wife), but I didn’t have money to pay my bills, spent the money I needed for the next wedding deposit, and was close to being maxed out on credit cards.
From an outsiders perspective, what to do when you run out of runways seems like an easy decision. But for those who have gone through it, you know the emotional turmoil. It’s the paradox of startup life. The passion it takes to start a business often ends up being the thing that prevents you from letting go. You believe in the idea so much that you risk comfortable jobs, savings and more to chase down your vision.
In the words of the late Randy Pausch: “Brick walls are there to show you how bad you want something.” And many startup founders thrive on busting through those walls like the kool-aid man. I know I did.
My entrepreneurial journey was rich with experience and full of resilience.
We did a lot of right things. We managed to create a business that filmmakers loved. It started with an idea to create the criterion collection app experience for independent filmmakers and evolved into a digital video distribution system for managing content collections with 2300+ titles, one of the largest library of independent films online. We gave content creators the outlet to sell movies for less than the cost of a DVD. Earn higher margins. Allow users the opportunity to download to any device and own all the special features they would on a Blu-ray. Overall, we made the experience of building a digital library a very satisfying experience.
We had bounced back from tough situations several times. Disaster hiring decisions, lawsuits, demanding clients, and I remember with fondness the camaraderie of the team coming together to get things done.
We had a few heroic efforts. Getting people interested in what we were doing, before we had done any work by using the Transcendent Man app to sell the vision. Advancing as Finalist at the SXSW Accelerator pitch contest at a time when we needed a big win. And acquiring the Film Baby business from CD Baby.
But ultimately, with modest sales, an exhausted team and the company running out of money it was finally time to let go. Disruption was not a distribution problem, but a content problem. Content rules over distribution. Content attracts the audience and distribution gets the word out. Hollywood content is a high touch-based business, while we were trying to be a soft touch business allowing a filmmaker an automated process with limited support. We were mercenary entrepreneurs in a missionary business.
Knowing when to let go is tough.
There is no easy way to let go and move on from your startup. Chances are if you have found yourself in a similar position you were wrestling with the same type of questions — Can you extend your runway? Can you close a new investor or customer? Does your startup still bring you joy? Do your investors believe in you? Do you believe in yourself? How do you handle conversations with your staff, co-workers, and family? It can feel like a state of loneliness until you finally admit to yourself that the venture has failed, and start the process of moving on.
I believe you know when it’s time to let go when you have run out of your emotional runway, not just your financial one. A startup dies with the founders gives up, not when the money dries up. It’s not about proving others wrong or staying committed to recouping the money invested. It’s about recognizing you're burnt out, your team is burnt out and your customers are not buying in a way that will meet the goals you set up to accomplish. When you are really honest with yourself it becomes clear that its time to hit the reset button.
On that flight from PDX to LAX, I recognized my passion, drive, and desire to lead MoPix was no longer there. Two days later I sent this email to my co-founder, beginning the process of moving on.
Moving on from a failed startup is a tough process. The right approach is to focus on what you can learn from your startup failure. Embrace that there are no mistakes, only opportunities wasted. Use the experience as a tool to develop resolve and resilience.
Astro Teller, Captain of Alphabet X’s Moonshots, believes failure should be valued as much as success.
The greatest people in history have had failures. Celebrate like Michael Jordan coming back for a second three-peat. Once you’ve done that you’ll feel a weight lifted from your shoulders. And then it’s on to the next one.
I moved onward, the only direction. Can’t be scared to fail search and perfection — Jay-Z
With MoPix we had the chance to pioneer a new category and get all the glory for it, but the market took longer to develop and it was time to move on. However, the lessons of persistence, determination, boldness will live with me forever.