What I learned in the past 2 years about being an entrepreneur
Late last year, I exited from Fleetbit, the company I co-founded right out of college. While the company didn’t turn out to be the kind of wild success we initially hoped for, I am still extremely proud of what my co-founders and I have accomplished over the past 2 years. The company is profitable and has a stable revenue stream from more than a dozen customers; our product is live and stable; and I think we helped push the taxi industry forward. Had Fleetbit not been around, I don’t think any of the existing dispatch software vendors would have embraced mobile as quickly as they did.
The past 2 years has been an amazing journey that was filled with both joy and disappointments. The company was featured on national press like Techcrunch, National Post, BNN, etc. I got a chance to go to China and pitch Fleetbit to prominent VCs and executives. Last but not least, the team drove all the way from Toronto to San Francisco then back, chatting with local taxi fleets in each city along the way.
Despite the modest success we achieved with Fleetbit, there are also deep scars on my back from this experience. They are my badges of honor, but those scars also serve as stern warnings for me and any other aspiring entrepreneurs looking to start a tech company. Below are the 3 key lessons I learned during the past 2 years.
Fall in love with the process, not the end result
People start companies because there is a huge financial upside. I get it. I would also like to sell my company to Google or Facebook for a billion dollars. But if getting rich is your sole reason for starting something, I urge you to seriously reconsider. If your goal is to maximize your personal cash flow over the course of your career, then starting a company is a really shitty option. First of all, 95% of the start-ups fail. Of the ones that do survive, an even smaller percentage of them actually obtain meaningful exits. A good analogy I like to make is: imagine you are playing roulette with your entire life saving, except you can only bet money on singles and you only have 3 tries to get it right. Would you want to play this game? What do you think is your chance of success is this scenario? My point is, while the upside is high, it’s really hard to convert that upside into actual cash. My advice: before you start something, make sure you have other factors motivating you besides money.
If you don’t know how to code, start learning now
You may think that it’s ok to simply “understand” how technology works and not know how to code. After all, that’s what programmers are for. I used to think like that too, and it was the biggest mistake I have ever made. Yes, there are people who have started successful technology companies without knowing how to build technology. But they are the exceptions within the exceptions. Starting a company is already hard enough, why give yourself an extra handicap? Technical talent is expensive. In the early stages when cash is tight, knowing how to build product yourself can dramatically increase your runway. If you know how to code, $10,000 can buy you 6 months of rent + instant ramen to prove out your idea. If you don’t, you will need to hire outside help. The going rate for a competent programmer is about $50/hour (~100,000/year). Assuming he works 40 hours a week, you will burn through all your cash in 5 weeks. That’s probably enough time to develop your Minimum Viable Product (MVP), but nothing more. You have no more money left for sales, marketing, or hosting. Moreover, if the product needs additional changes (which it will), you are out of luck. In theory, you can try to find a technical co-founder to develop the product with you. But finding a co-founder is hard (see point below). Finding a co-founder that is technical is even harder. So don’t kid yourself, go learn how to code.
Choose your team wisely
People say every great business start from a great idea. I disagree. I believe every great business start from a great team. Ideas can change easily, your team can’t. If you already have someone you trust who is willing to take that giant leap of faith with you on this adventure, then consider yourself extremely lucky. Otherwise, go out and meet people NOW. Finding a co-founder isn’t something you can do in a week. A simple way to extend your network is to find the smartest people you currently know and invite them out for coffee…get introduced to all their smart friends…then rinse and repeat. This process always take longer than you think. Moreover, you should never start a company with people you haven’t worked with, regardless of how impressive their credentials are. Start a cool side project and ask them to help. Go on vacations with them. Meet their friends and family. This may come across as obvious, but you want to de-risk your potential business partner as much as possible before popping the question. Remember, committing to a co-founder is like getting married. Once committed, getting divorced will be a painful process for everyone involved.
Looking back, I’m really glad I pushed myself to start a company right out of school. During the past 2 years, I met some amazing people and learned a ton about how to build a company. Quite frankly, if you told me 2 years ago that I will be the founder of a successful technology company that helped push an entire industry forward, I would have said you are crazy. But that’s exactly what happened. Hopefully, this is just the beginning. Here’s to an even brighter future.
