“Floating in the system” and other terms in the tech space I didn’t understand
Several months ago I got some advice on what a startup entrepreneur like myself should do if my startup fails. My incubator manager looked at me and said:
“Just float around in the system…”
What does that even mean? This seemed like another piece of jargon like, failing quickly, and pivoting.
Only recently did I understand what floating in the system means and for the benefit of anyone that wants to learn from my journey, here are some definitions to the terms as I understand it.
Floating in the system
When my startup ate up my personal finances, I understood what floating meant. I realised there were people who knew me through my startup experience, and they had money but were having difficulties in things I was good at. I make them know I could solve these problems in exchange for money. This happened in a number of ways:
- I interviewed for jobs at medium-term projects
- I started letting people in my network know all the skills I offer — video directing, website project management, slide decks and 3D graphics
- I use the resources I built in my startup to keep selling within my network, even if the team is no longer there full time, I sell the pieces of the product that work well — helping with bank onboarding and interfacing with the Companies Office.
So floating in the system is really about looking at your network and where you fit in today, the next week, the next month or the next year. This is only applicable if you are already qualified and could get a job either way, so school and work experience is important before trying this trick in tech entrepreneurship. Floating is more flexible than long term employment but still gives you enough room financially, to look at your market and see how you can try the next idea — or, pivot.
So business registration didn’t happen right away. The business model was to build a system that made it prettier and easier to interface with the Companies Office but dealing with institutions is difficult for a startup. No one pays you anything right away, you are burning money fast and you have very little patience for the institutional resistance of Uberizing a traditional centralized service model. So you use the same resources you have and tweak the product to sell directly to clients of the COJ instead. Then when you are not reaching enough people on a daily basis then you shift to accountants and lawyers. The lawyers and accountants see you as a threat so you shift to the bike couriers… and so on till you find a business model that meets your growth objectives or you reach the limits of the resources you have in the company to serve this market. If you can pivot fast enough then great. If you don’t have everything you need to pivot fast enough then you can float in the system. For the sake of efficiency and all stakeholder’s money involved though, fail quickly.
The failure of the founder and the failure of the business are two different things, I learned that after too long. There are things you have control over and there are things that you don’t. You do not have control over when people have money, or the time people take to pay you. You do not have control over your team and when they come into your startup and you do not have control over what things cost. You do have control over what you do about these factors when you know about them.
I could have called my startup a failure at any number of points:
- When after three months of development the Sign Up button for our MVP did not work on launch day.
- When our angel money ran out after six months
- When I lost my last engineer at 1 year
- When the Companies Office published in the newspaper that we were spreading false information at 15 months
- When my mom and I broke down in tears as she made an appeal for me to go find a job at 18 months
- When I was just down to my co-founder and myself after 24 months and she announced she was seeking additional income
- When I was down to zero dollars in my bank account, at 27 months in
I didn’t. Up to this point I had not seen the business as separate from the founder. I forgot that the business is the experiment, not me.
I built a solution despite all my challenges and the business still exists, is tax compliant and creates value for hundreds of persons and has 2 people on PAYE. I am not a failure, the numerous business model experiments were.
What are the assumptions you want to test in this experiment? For me it was that:
- The business could pay me within 12-months
- Businesses wanted to be legally compliant if they knew how to
- The market cared about missing filing dates
- Engineers were all I needed to work with me as CEO
- People wouldn’t pay unless we had a credit card option in place
I learned from how to make these experiment cheaper and collect money when people want us to solve their problems.
Failing quickly, pivoting and floating in the system once understood, are all options that make tech entrepreneurship a less scary undertaking.