When Quitting your Startup is Sometimes the Best Option
When building my first startup, I would occasionally receive requests to speak at events centered on entrepreneurship. Maybe because I appeared somewhat weathered with my salt and pepper hair, I would be asked to speak about the trials and tribulations of building a startup. With that entry, I would proceed to highlight traits that I felt were needed in order to make it to the finish line. Being resilient was and still is always at the top of the list. To put it simply, resilience is our ability to bounce back. To keep going when the going gets tough. Sometimes what motivates us to keep going is determination. But as an entrepreneur I’ve encountered moments when I felt compelled to continue on out of an emotional inability to stop. In my current role as an investor and mentor, I often meet founders that should stop what they are doing, but can’t. I’m writing this post to set the record straight. Quitting is not always a bad thing. Sometimes the right thing to do is to STOP! The choice to continue on should be a logic-driven decision, not an emotional one.
Along the path of building my first startup, we arrived at quite a few moments that should have resulted in a decision to call it quits. At those points, it really was not a logical conclusion to continue forward. But as all too many founder stories go, I charged forward, too stubborn to let my vision die. While I wish it was “we” that charged on, these defining moments were sometimes the end of the road for one or more of my business partners. Yet somehow I would carry on, finding renewed but unfounded optimism from a positive VC meeting (hint, they all seem positive), a great piece of press, or sometimes just a good workout. No matter what, the cost of continuing was never steep enough for me to call it quits.
Let’s stop there for a minute and deep dive on my “cost of continuing”. The truth is I had very little to lose. In the year leading up to the start of my entrepreneurial journey, I had left a decade-long career in corporate tech. In my final role as a VP at Yahoo, I began to question the value I was bringing to society as a mostly impactless executive at a schizophrenic internet company. Unfortunately, the questioning didn’t stop at my corporate life. At about the same time I left Yahoo, I began to re-evaluate other big decisions I had made in life. At the ripe old age of 31, I found myself jobless and going through a divorce. After legal fees and settlement, with what little savings I had left, I rented a small apartment in Toronto’s west side. I drove a quickly deteriorating (and depreciating) sports car. And for about 1 year, I crawled into a shell and disappeared from civilization. I had hit my personal trough of despair.
When I started Jigsee, I was ready to plot my comeback. I needed success at any cost and I thought I would find this in a startup. Boy was I wrong! From a financial perspective, I thought I had not much left to lose, but I’d eventually be proven wrong. Along the journey of building an emerging markets-focused tech startup from Toronto, I would eventually end up moving in with my parents (12 years after I’d left home), and lose the operation of power windows on both sides of my car (the passenger side stuck in the down position). These last two events would conspire to secure my relationship status as a single male for quite some time. Entrepreneurship wasn’t quite the path to redemption that I had imaged it to be.
Yet the physical cost of continuing forward with the startup wasn’t as large as the emotional cost. Startups have a way of creating an inertia of loneliness for the founder. The dissonance between you and the people around you seems to grow, especially if you aren’t surrounded by other entrepreneurs. To further complicate the journey of building my startup, in lockstep with the growing feeling of loneliness, I became increasingly compelled to keep going. I experienced an equally strong and growing perception of the opportunity cost of stopping. The more you’ve suffered, the harder it becomes to stop what you’re doing and move on to something else. The further you continue, the more isolated you become. We’ve come this far, why give up now. There is a certain momentum of desperation that kicks in and makes it very hard to stop. Sometimes, stopping is the only logical thing to do.
For years after we exited our startup, I received praise for the tenacity I showed in making it to an exit. My unwillingness to ever call it quits loomed large as a personal accomplishment. Investors thanked me for making it to the finish line… it wasn’t a massive exit, but by venture-backed startup terms it turned out to have been a better outcome than most. And while I’m happy that we returned our investors’ money in multiples, and created jobs for quite a few people, I wouldn’t be completely honest if I didn’t mention the haunting question of ‘was it all worth it?’ that plagued me for years afterward.
Investors seek character traits of grit, determination, unwavering belief, and deep personal conviction amongst founders. We want to know that when the going gets tough, you will not give up. You will make the tough decisions, and put it all on the line, every day, right up to exit. We want the opportunity cost you perceive of stopping, to be so high that you will stay on the treadmill long enough to generate a liquidity event. Resilient founders are capable of this. Being supported by friends, family, and co-founders in an environment that makes it sustainable to carry on a mission to do something you believe in for the right reason can be a good thing.
When a motivation to continue doing something is fuelled by the wrong influences — an emotional and irrational inability to stop, it can, in fact, be mentally and financially destructive. This is desperation. Along my journey as an entrepreneur, I’d be dishonest if I didn’t acknowledge the moments of desperation that kept me going.
Founders are unique and special people, not always guided by logic. To build a successful company in fact, requires one to be an irrational optimist at times. Instances of depression amongst founders have been well documented. This linkage is not happenstance and to address it properly, we need to give founders the tools, permission, and encouragement to stop when it’s the right thing to do. We idolize and often speak about the few entrepreneurs that make it past the dark side to the big outcome. Unfortunately, I suspect far more entrepreneurs never quite make it back to the light. Time is your most precious and unreplenishable resource. Sometimes it’s ok to quit.
