The Scrappy Entrepreneur
Claw Your Way to Success
Written by Steve McGarry.
Our team at FunnelFeed became familiar with the term “scrappy entrepreneur” when we went through the Betaspring accelerator last year.
I didn’t truly understand the meaning and functionality until I moved out to Palo Alto a week ago. I was always under the impression that it meant “lean” or “bootstrapped.”
Funded vs. Scrappy
Entrepreneurs in San Francisco and Silicon Valley appear to be divided into two basic categories: (1) funded or (2) scrappy. Interestingly, both funded and scrappy entrepreneurs both compliment each other in the startup ecosystem.
A funded entrepreneur is someone who has received enough angel or VC investment to get their startup off the ground. They pay the insanely high rent in Mission Bay, Castro, SOMA, Palo Alto, Mountain View, and San Jose.
Scrappy entrepreneurs are the ones sleeping on the funded entrepreneurs couches. These are the fearless founders who are not afraid to live in their car to pursue their passions.
These two make up the startup ecosystem that has been rapidly growing out here for years. It will continue to flow smoothly as long as investors continue investing in startups and people are willing to live on the street for a dream.
The biggest difference that I quickly learned was that a funded entrepreneur doesn’t necessarily mean a successful entrepreneur. Startups fail every day. The best part about startup culture — unlike almost all other cultures — is that failures do not define who you are.1
When I met with Tim Chae, a scrappy-turned-funded entrepreneur, who’s now an Entrepreneur-in-Residence at 500 Startups, told me recently that the difference between successful and non-successful entrepreneurs is based on how they react after receiving funding. The second they lose the “scrappy” mentality of “do whatever it takes to make my startup a success,” they are dead in the water.
The Startup Circle Of Life
The funded help the scrappy.
Wait, who’s helping who?
The magic is that this constantly flip-flops. When a funded startup fails, and a scrappy entrepreneur makes drives his or her startup to success (ramen positive) they help each other. It is just the way it goes.Here is a great example.
Given I am as scrappy as they come, I found a fascination with how this sustainable startup environment operates on a daily basis.
I have been meeting with fellow scrappy entrepreneurs who have told me their stories and pitched me on their concepts. Asked for introductions, which is what you need to be doing constantly. But, the bulk of my interest was meeting with the dozens of funded entrepreneurs.
All the funded (or previously funded) entrepreneurs said they started from sleeping on a couch, floor, car, or park bench. It’s basically like asking someone if they have ever grown up. Everyone has to do it, it is just a matter of how long.
I am currently living in a house with six other people, sleeping on various floor spaces. It is cheap and I am happy with meeting new people as they come and go.
This is all across the San Francisco and Silicon Valley. Actually, it is everywhere.
As a matter of fact people are now building businesses around it. When lived in Boston last year I lived inKrash. It was a great experience for an entrepreneur moving to a new city. Housing that was short-term, reliable, and safe.
In San Francisco there are twice as many “Hacker Houses” and “Startup Houses” all across the city. Most of them do not have names and cannot be found online. Word of mouth is a powerful tool when demand is high for housing.
What do all these startup “flop” houses have in common? They are owned or rented by a funded (usually Airbnb user) entrepreneur.
These people are moving the innovation needle by putting roofs over entrepreneur’s heads. Reward them.
Stay Scrappy San Francisco.
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