I’m not sure when it became cool to embrace failure, but it’s time to stop. Whether it’s a small misstep that is soon forgotten or a huge mistake that kills your company, you will not inherently learn anything simply by virtue of having failed. Great entrepreneurs are by no means strangers to failure. But there’s one thing they do differently—they anticipate how they’ll overcome it.
Jack Dorsey reportedly presented a list called “140 Reasons Why Square Will Fail” when pitching investors. I’ve found that other great founders are similarly conscious of why they might fail, but are rarely willing to make those failure points public. Since I’m not actively raising and need to continue to earn the trust of both my team and my customers, I’d like to share mine. Here are the five biggest challenges facing me and my company in the near future, in order of importance:
(1) Not Surrounding Myself With the Right People
I’ve wasted far too much time feverishly trading contact information at networking events when I should have been building and meeting people who were focused on doing the same. I treaded water during most of my time at Columbia and made it my goal for this summer to make up for lost time. I went to just one Meetup gathering. I reinvested the time I saved in having real discussions with the best founders, developers, designers, and marketers I could find. But I need to do better. I didn’t have a group of close friends at Columbia who coded, designed, and sold in their spare time. And so when my company began to grow, I didn’t know where to turn. That’s the biggest reason I left.
Surround yourself with those that have answers (Hint: it’s not other early-stage startups).*
Patrick Ip sums up what it takes to launch a successful company better than I ever could. The only way I will succeed is by finding mentors that can teach me and team members who excel where I struggle. If I don’t get better at that, I’ll fail early, and I’ll fail hard.
(2) Thinking Too Big
It’s easy to talk to about disrupting an industry and changing the world. But software is built one line of code, one pixel, and one customer at a time. I think what we’re building will change the way thousands of nonprofits, politicians, and schools think about raising money online. But as an early stage company we need to focus on changing the attitude of one customer—one person—at a time. That sometimes means scrapping a big idea to focus on the little details. Pivoting early and often has taught me that “strong opinions, weakly held” are words to live by.
(3) Thinking Too Small
Excessive focus is just as deadly. Product development involves more than a checklist of features and a spreadsheet of metrics. You can do all the little things right, but if you aren’t so excited about your vision that you can’t help but tell anyone who will listen, you will fail. A little big picture thinking is a powerful weapon—just be willing to amend your vision.
(4) Undervaluing Partners
Our product relies on a number of technologies that I can’t build in-house. Most people would call these companies “vendors” or “service providers.” I call them partners. I like working with companies where I can pick up the phone and talk through an implementation strategy with the person who built the product, sometimes even the CEO. These partners help us fill in the gaps in our knowledge and capacity—they know what’s possible and can help us push that boundary.
That happens surprisingly often. As recently as a week ago it looked like we’d have to fight an expensive legal battle with New York City in order to allow candidates to accept money through our applications. That meant a big customer segment wouldn’t be reachable for almost a year. But thanks to a new partner, we’re fully compliant, and probably the first company to be able to say that. One phone call was all it took to completely turn things around. I need to continue to see our partners as people who can help solve big problems, not just the nuts and bolts that keep the engines running.
(5) Valuing Investors over Customers
Raising money is a distraction. But we live in a world that glorifies raising venture capital and largely ignores the months if not years of hard work you have to put in before you’re ready to raise. I don’t plan to think about raising a round until at least December. It’s always tempting to think that more cash will help you break out of a rut. It won’t. Good investors won’t take that meeting. Bad ones will. Unless the problem is being overwhelmed with demand, the solution is almost never to spend two months meeting with investors instead of customers.
This list is hardly exhaustive. You’ll notice, for example, that there is no mention of competitors or the possibility of running out of cash. Those are failures that I believe are both recoverable and instructive. In contrast, the five failure points I’ve listed are fatal. They represent a potential breakdown in my learning, not an opportunity to grow as a founder.
Success is a product of a lot of hard work and a little luck. When the latter is missing, I think it is entirely possible to learn from the failure that might result. Failing to work with the right people on the right problem, however, will teach you nothing.
Are you a founder willing to share your five? Email me.