Entrepreneurship is hot right now. In the way it is glorified by the TV shows, movies, and news media, who wouldn’t want to be an entrepreneur? I mean, you get to choose your own hours, be your own boss, build your idea into a multi-billion dollar enterprise…it sounds pretty sweet! However, the real world usually hits new (and unprepared) entrepreneurs with roughly the fire power of a jet-powered dump truck loaded with a hydrogen bomb. So, for my first post on Medium, I am going to do my best to mentally prepare you as an new entrepreneur embarking bravely on your new endeavour (or for those who are just curious what it’s like being an entrepreneur).
Disclaimer: I do not claim, in any circumstances whatsoever, to be an all-knowing authority on what it is to be an entrepreneur or what the “secret sauce” is to build a guaranteed success. Anyone who claims to know everything there is to know about building a company and being an entrepreneur is likely a snake oil salesperson, and I recommend avoidance of such personnel at all costs. Any and all information contained below are simply points of observation that may be conveyed with or without my interpretation of lessons to take from said points.
Point 1: Be Prepared to Have No Life
You know that part about getting to choose your own hours? Yeah, you do…all 12 of them (minimum) per day, usually 7 days a week. Be ready to have hackathons when something is behind schedule, or make your schedule revolve around when investors want to meet you. Be ready to have to manage a bit of everything — from engineering and development, to fundraising, to taxes and legal, to general operations. When you are a startup, you have to make the right decisions — hard decisions for the company, often without the training from school to manage any but a small part of what the total requirements are that will be put on you. It is a stressful but rewarding experience.
Point 2: Be Prepared to Be Poor
There are very few overnight successes, and very, very few companies become the next Google. Be prepared to dig in for the next 5 years, likely living off of savings or a pittance of a salary once you manage to be graced with an investor who believes in you. You will not be wealthy until well down the line, unless you are an overnight success — the highest form of unicorn (n. an ultra-successful company), and I wouldn’t count my bets on that. For the rest of us, we get to work with no life and no money building something with a mediocre chance of success.
Point 3: Be Prepared to Fail
Most companies fail. I know…you saw a story on CNN about how awesomely successful <insert person’s name here> was, but the reality is that your chance of success with a startup is not high. However, this point is easily mitigated when you accept the fact that failure is not a bad thing. Other than losing time, some self-confidence/ego, and maybe some money, the process of failure should be viewed as positive. It is very difficult to learn a lesson as effectively as by failing at something. So, be prepared to fail, but also wear failure as a badge of honour and learn from your failures. Failure is only bad if you don’t learn lessons from it.
Point 4: Cover your Bases (w/ Professional Help)
Speaking of lessons learned by failure, ensure that all of your bases — legally, accounting, and accountability-wise — are well covered. Ensure that your formative agreements (such as Articles of Incorporation, Corporate Bylaws, Share Purchase Agreements, Non-Disclosure and Assignment Agreements, etc.) are air-tight…I personally would highly recommend getting all of these agreements vetted by a (good) corporate lawyer in your jurisdiction of incorporation. Review the laws of your jurisdiction, and thoroughly review anything that your are signing, looking for anything that may cause long-term issues. Something will always get missed, but the better prepared you are for that case and the more of those missed cases that can be vetted out of your documents and company, the better. And (trust me), it’s much cheaper to get those issues vetted earlier than to have to deal with them later. Have clear separation clauses so that you know with absolute clarity what happens if a founder departs. Have any tax implications and accounting canvassed by an accountant in your jurisdiction — this prevents any surprises from a financial perspective. Most importantly, ensure that your directors are accountable and are upholding their fiduciary responsibilities to the best of their abilities. The earlier that you can catch problems, the easier they are to solve.
Point 5: Underpromise, Overdeliver, and Operate with Integrity
Don’t take shortcuts. This is not a short process, and if you try to short circuit the system, it is almost inevitable that you will get yourself into trouble. Part of operating with honesty and integrity is ensuring that you can deliver on what you promise. I, personally, am a firm believer in underpromising and overdelivering — you promise slightly less than what you anticipate that you are capable of delivering, and then aim to deliver more than your speculation. Usually this leads to you just delivering what you promised (because we are great at overhyping ourselves) and when you do overdeliver, people are extra-impressed. It is a show of good faith to only promise what you know you can do. More importantly, always tell the truth. If you are past a reasonable threshold of uncertainty on your ability to deliver on a goal, be honest and transparent with your team and any potential stakeholders about this. Be honest with your adoption and your usage stats, your traction, and your stage of development — never inflate these numbers, because not only is it in bad faith to lie, but you will more than likely get caught in due diligence with this web of lies, and it can permanently black mark you. Or even worse — you might not get caught early and be on the hook liability-wise to your investors if you are a director found to have operated in bad faith and in breach of fiduciary responsibilities. So, at the end of the day, operating with honesty, transparency, and integrity is the best way to protect yourself and to just be a good person in general.
Oh yeah, this includes if you are not technical, have no intention of being technical, and have no technical co-founder, but are claiming to be a tech company. If you are in this situation, you need a strategy on how to build out your technical team, and you need to be completely transparent about your inability to build out the product until you have someone capable on the team. There is nothing wrong with admitting this pitfall, and often investors or people that you are talking to will actually be able to help you in this respect by leveraging their technical connections. Just be honest.
Point 6: Listen to your Team
If your technician is raising concerns about certain technical problems, listen to them and address them. If your team is complaining of toxic behaviour, deal with it. This is easier to address in the early stage than when it escalates to the point seen in many tech companies now. As an entrepreneur, you are the corporate leadership, and it’s your job to ensure that you build a solid team that feels valued, and a positive corporate culture strengthened by a clear set of values.
Point 7: Lead by Example
You need to be working harder than your team. This is your company, and you are the leadership. As an entrepreneur, you need to be in the trenches next to the people that are working with you (not for you). Treat your team as equals. Remember, when you are fundraising or developing business strategy, or building product, that you are working for all of your stakeholders — that includes your employees, investors, industry, and greater community. With that in mind, be a servant leader. Take time to work through a problem with the team member that is experiencing it, be part of the development process instead of intimidating your teammates into doing your will. Be deeply involved, not someone who is leaning on a title. You are all equals.
Point 8: Be Humble but Confident in What You Know
If you have experience or education with something, be willing to give advice confidently. Speak about that information with the gusto and enthusiasm to portray your knowledge in the subject. But, be humble. Don’t use every opportunity to show off your intellectual prowess, or be a know-it-all. And most importantly, only advise with knowledge that you actually have. This entire startup ecosystem thrives off of people who know what they are talking about advising others. So, be helpful where you are helpful, but do it respectfully, compassionately, humbly, and acknowledge when you do not know something. There is no shame in not knowing. There is shame in giving inaccurate advice, or being viewed as arrogant.
And this includes on personal matters. Being an entrepreneur is high stress. Support each other, build each other up, and make those around you feel valued. Because if the only way you can get to the top is by pushing others down, eventually you will be both very lonely and likely unsuccessful since no person will want to associate with you. Entrepreneurship is a deeply human endeavour that requires a lot of relationship-building (more than just building a “network”…creating real human connections to people), so keeping your reputation held paramount is critical.
Point 9: Be the Cockroach
I stole this one from the accelerator that we went through. It is an important motto — no matter how close to death you are, be un-killable. When you outlast any other company, you are (quite obviously) more likely to succeed. But this means that you have to have absolute passion about what you are building. If, in the toughest times, you are unable to be convinced to continue, then chances are you need more passion about what you are building. There will be times you will want to quit, and there will be many times that people will tell you that it would be better for you to quit…but if you feel that desire, deep down, to keep going and surviving, that’s when you know that you’re on the right track.
Is entrepreneurship for me?
Sorry, I can’t help you there. The only person who knows that is you. Entrepreneurship is rarely the glorified lifestyle of the “self-made millionaire” that you see on TV. It is an exhausting, stressful, but extremely rewarding experience. Some people enjoy this lifestyle, others prefer the security provided by a regular job. So, only you will know which is right for you, but now you can hopefully make a more informed decision about if entrepreneurship is the right path for you.
So with that, scurry, cockroach!