11 Necessary Foundations to Succeed as a First-Time Founder
In 2019, around 90% of startups failed due to ineffective marketing, running out of money, lack of expertise, or just quitting. As a startup founder myself, I’ve networked with countless startups, and most of them have one thing in common: they slowly but surely fade away.
I started my own company around 3 years ago, and I was as clueless as any first-time startup founder, even more so as I was only 19 years old. Our company is still young, but I’m very optimistic that we will continue growing and experiencing success.
I learned some key lessons as an entrepreneur that made us stand out from the 9 out of 10 startups that fade away. I won’t explain how to build a product or company, but rather, I’ll touch on the foundations that I noticed are foundational for entrepreneurial success.
1. Prioritize customers over other success metrics
Through networking with other startup founders, I have come to a daunting realization. All founders, including myself, spend way too much time on vanity metrics such as:
- Which media outlets are talking about our company
- The headcount of the team
- Winning startup competitions or joining accelerators
All of the above won’t matter one bit if your company doesn’t have customers. One thing is certain: you must prioritize customers over all other success metrics.
Regardless of what you’re building, your company cannot have a real impact without actual customers who use your product. The first priority to become a successful startup is to get customers and make sure they succeed with your solution.
How do you do that? Embrace sales.
And after you bring your first sales, make sure you deliver the best experience that you can. This strategy is a central piece of Amazon’s success, which of course, is no longer a startup, but the advice applies to early-stage companies as well.
“The core of the company is customer-obsession as opposed to competitor-obsession.” — Jeff Bezos
Instead of obsessing over the technology, product, design, public relations, or anything in between, focus relentlessly on the customer.
2. Say no to things
Startup founders who get things done know when to say no to things when they’re not important or urgent. Entrepreneurs always have unlimited things to do, and it’s impossible to do everything perfectly.
At first, it felt odd to me to say no to opportunities. I was working hard to find success; how could I decline opportunities that would bring in money?
But as a startup, I realized, our resources are limited, and our goal should be to achieve the most we can with what we have. I had to say no to small opportunities to allow bigger ones to happen. I’ve had to invest in our product and in things that could scale so that we could bring the results we want in the long term.
Whenever chasing a new opportunity means that you hurt a core part of your business or it takes time away from important goals, it’s important to say no.
Don’t compromise the vision for small opportunities unless they serve the vision.
3. Rely on testing AND your gut feeling
Many entrepreneurs attribute their success to rigorous testing, analytics, and customer feedback. Even though I agree, I believe that great entrepreneurs follow their gut feeling, even when implementing a feedback loop.
Some of the reasons why I believe trusting your gut feeling are:
- To know what to test, you need to make educated guesses and trust your gut
- Sometimes your customers don’t know what’s best for them
- Creativity and innovation cannot be confined to any framework
To learn about testing, iterations, and incorporating customer feedback in your roadmap, I suggest you read The Lean Startup and Lean Analytics. But in any case, these frameworks are meant to guide you and not restrict you.
Some of our best moves originated from a combination of customer input, data, and our gut feeling as founders. You can’t expect your customers to provide you with all the answers. You need to come up with answers yourself and then trust customers to validate your ideas.
4. Seek mentorship
It doesn’t matter if it’s your 1st, 5th, or 15th company; there’s always going to be someone with more knowledge than yourself in specific matters. I’ve always tried to connect with other entrepreneurs who have more experience or know something we don’t.
Through these connections, I’ve been able to grow as an entrepreneur and build lasting partnerships. I’ve learned that to find friends and mentors in the startup industry, you need to:
- Be honest & transparent about the challenges you’re facing
- Be open to feedback and suggestions
- Make the situation win-win by offering things in return
5. Keep on learning
Startup founders who attain success do so by maintaining a learning mindset throughout their journey as entrepreneurs. Many famous entrepreneurs like Warren Buffet and Mark Cuban agree that reading is a habit that contributed to their success.
Reading is not the only way to learn. Outside of books, I like attending conferences, reading how-to’s, watching Youtube videos and courses. Luckily in the past few years, there has been a growth in startup and SaaS material throughout the internet. Two Youtube channels that I believe are highly helpful for entrepreneurs are Dan Martell’s and Noah Kagan’s.
Since there are endless ways to learn, find the ones that are right for you, and focus on constantly improving. As a startup founder, your job changes every 6 months, and you need as much knowledge as possible to help you transition from one phase to the next.
6. Prepare for adversity
If I had to describe 2020 in one word, I would say adversity. But if you’re an entrepreneur, you know that a pandemic is not needed to bring adversity.
Entrepreneurship is always a rollercoaster. Failure is followed by success, and success is followed by failure.
Whenever you start feeling like you’re getting the hang of things, new and bigger problems start appearing. That is because each challenge breeds new and larger challenges, which is the natural way things go in business.
If things are going badly, that might not last forever. But if things are going well, they won’t always go that way. One thing is constant in your journey as an entrepreneur, and that is adversity.
Successful entrepreneurs are prepared to face adversity and deal with the highs and lows the right way. Whenever things are going well, you need to plan and prepare for the future. On the other hand, when your company is in trouble, you need to make difficult decisions and make sure you push through.
You must avoid being complacent when things are working or giving up when things are not. It’s all part of the journey.
7. Do any job without ego
If I had to define my job as a startup founder, I’d say it is to do everything in my power to help my company succeed. In other words, I’ve been our janitor, gardener, sales representative, chief programmer, and more.
If you’re wondering why I put these responsibilities in the startup founder’s job description, the answer is simple.
To build a startup from the ground up, you will have to do every little thing yourself at first. Even nasty things that you would like to avoid. You have to deal with the paperwork, registering your company, calling clients, running errands, cleaning, and anything else that is required to keep the company running smoothly.
Even ultra-successful startup Airbnb had much more humble beginnings. Joe Gebbia and Brian Chesky, 2 of the founders, flew from San Francisco to New York every week to take “professional” photographs of their first hosts’ apartments, as explained in Paul Graham’s famous “Do things that don’t scale” essay.
This example showcases that as an entrepreneur, you must leave your ego at the door and do anything that is required to make your company successful and your team and customers happy.
8. Focus on executing
There are times as an entrepreneur when you need to plan and create a vision. There are other times though when it’s important to focus relentlessly on execution.
I see many startups that are stuck in a planning phase for way too long. Inertia is the worst state for startups.
Founders that get things done spend a short while on planning, followed by longer periods of execution.
Working hard to build things has been a crucial part of our success. But mindless execution is not the solution either. Dedicate time once every few weeks to rethink your plan and make adjustments.
9. Know when to pivot
When you spend time working on something that you know deep down will not work, you’re putting yourself in deeper trouble. When the feedback you’re getting from your customers is negative, or you’re failing to deliver on your value proposition time and time again, then you must admit that something is wrong.
As an entrepreneur, you must know when to pivot. You must also realize that the more time you spend following the wrong path, it will be even harder to leave it in the future. That is the reason why when you see that something is not working, you must change your path as soon as possible.
One company that famously pivoted is Slack. They started by developing a video game that flopped. But what did work was their chat app for communication between co-workers. They gave up the game, which didn’t turn out to be profitable, and made way for the Slack we all know today.
10. Inspire your team
One of the most important things you will do as an entrepreneur is to empower your team to overcome difficult challenges. As a startup founder, it is your job to recruit great employees and trust them to deliver results by giving them real responsibilities in your company.
In my experience, I’ve found it best to be transparent with my team, talk about the direction we’re going in, and speak openly, even about problems that we’re facing.
It makes a huge difference if you trust your team to tackle the problems your company faces with you. It’s your job as a founder to inspire your team to work together and find solutions.
There are tons of situations where you can inspire your team, but some of the most important ones are the “We’re fucked” situations. It might feel difficult to confront the situation, admit all of your mistakes, and rely on your team to do the impossible.
But that’s exactly when you have to inspire your team to face impossible odds and make sure your company comes out a winner.
11. Be hard to kill (like a cockroach)
Regardless of how good your product or company is, you will go through difficult times. Silicon Valley VC Ben Horowitz outlines many of the difficult times he went through as an entrepreneur in his book “The Hard Thing About Hard Things”.
The thing that makes successful founders stand out is that they don’t quit in the face of adversity. When the founders of Airbnb joined Y Combinator, co-founder of Y Combinator Paul Graham called them cockroaches because they refused to die.
As disgusting as it sounds, it pays off to be a cockroach.
The journey of an entrepreneur is filled with challenges. I wouldn’t measure the success of an entrepreneur as the cumulative success of their endeavors. Successful entrepreneurs are the ones who find ways to improve and serve their customers despite all of the adversity.
One thing to always keep in mind is to prioritize customers. The goal of a startup is to serve someone’s needs. Without that part of the equation, you cannot be successful.
You will need to create a plan and then focus on executing. Trust your gut feeling, inspire your team to deliver results, and stick to your vision, despite the smaller opportunities that come by. Even if you fail, you will learn something, but the one thing you should never do is accept death.
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