Risk, failure, and other mystifying startup tropes

In my previous life as a graduate student in the humanities, we used to talk a lot about tropes—the modern usage being a reoccurring rhetorical motif or device (in short, a cliche born and over-used within a particular genre of literature or a set of critical works).

Tropes however, are in full display everywhere. For example, in the startup literature, we use “risk”, “fail”, “sweat equity”, “these are good problems to have”, and a host of others as accepted short-hand for the the personalities, pitfalls, mistakes, and lack of prep and planning involved in launching and building companies. From the best startup rhetoricians, one can glean useful wisdom from these tropes. From others, not so much.

Let’s take the fail trope first, because that’s a big one. Failing, even multiple times in multiple ways, has become a bit of a badge of honor. In fact, if you really want to have a career in startups than you better be out there failing now. It’s the best way to learn.

I’ve had quite a few long conversations with entrepreneurs about their failures, all of which have been spun admirably into exciting tales of daring-do. In the back of my mind however, I find myself thinking “wow. that was stupid. I pretty much would have made the exact opposite decision in that scenario…and in fact, it’s amazing you got as far as you did.” I also find myself thinking about waste before totally blanking out and thinking about other things.

Now, I don’t mean to imply that A. failing is bad, B. it does not teach you something, C. I am infallible and have not and will not make mistakes, or D. that I will not at some point fail in some future startup. In fact, I fully expect to fail at some point.

However, when I hear a tale of woe involving an entrepreneur whose core product made use of an algorithm written by an academic who clearly states in his website that any commercial usage must have written consent by him…and that entrepreneur never bothered getting permission…because they thought nobody would find out…

Well….then I have to consider the entrepreneur just a bit arrogant, and not a little short-sighted.

And this gets at the profile of an entrepreneur. What about the person who starts a company makes them ideal? Well…the “ideal entrepreneur is a little bit crazy"—"crazy-smart" anyway.

They “fly by the seat of their pants”. They “do now, apologize later”. They “hope” to be sued by big companies, universities, and past partners because “that’s a sign you’re successful” and therefore “those are good problems to have” because “nobody cares about legal shit if you aren’t successful.”

The real trick is being able to manage the risks you’re taking, and apparently there is a nifty quadrant to help you figure out just how important it is for you, as an entrepreneur, to react.

risk framework

Now, we know that old people suck at startups, and the best ones match a profile:

If you look at Bezos, or [Netscape Communications Corp. founder Marc] Andreessen, [Yahoo Inc. co-founder] David Filo, the founders of Google, they all seem to be white, male, nerds who’ve dropped out of Harvard or Stanford and they absolutely have no social life. So when I see that pattern coming in — which was true of Google — it was very easy to decide to invest.”

but one wonders…how well do most of these young white male drop outs actually succeed when it comes to risk assessment. I guess not that well considering the dominant trends in new ventures (more fail than not).

Still, it doesn’t particularly matter:

But it’s not necessarily a mistake to try something that has a 90% chance of failing, if you can afford the risk. Failing at 40, when you have a family to support, could be serious. But if you fail at 22, so what? If you try to start a startup right out of college and it tanks, you’ll end up at 23 broke and a lot smarter. Which, if you think about it, is roughly what you hope to get from a graduate program.

Presumably these young ones do eventually grow up and start new ventures having learned from their mistakes, thereby becoming repeat entrepreneurs (who tend to be more successful) and eventually old entrepreneurs (at which point I guess they start to suck).

Which sort of begs the existential question: What, in the end, does it all mean? Or, what is the significance of all these tropes?

I can’t answer that for anyone but myself and I’m not an expert on startups, so here goes the totally personal answer. For me, these accepted tropes mean never quite matching the profile of your average entrepreneur. Moreover, it means accepting that fate as good and fine because I find myself deeply at odds with the way many of my fellow entrepreneurs accept the tropes without conflict and with the way they assess risk. It means that I will not have the same relationship with failure because imho no amount of spin makes up for short-sightedness, arrogance, or plain stupidity…especially oft-repeated.

It means that when someone questions my appetite for risk as a means of subtly indicating that I don’t belong in the startup community…that I am completely comfortable saying “You’re damn right!”…at least not in so far as these tropes can ever really suit me.

What it doesn’t mean for an instant however, is that I will be staying away.

Wisdom and entrepreneurship. What does it all mean?

I watched an episode of Supernatural this morning as a kickstart to the day. I know…it’s not a great show, but my mom got me addicted early. Remember the old WB? Buffy, Supernatural, Felicity, Sabrina the Teenage Witch, Charmed, Smallville, Roswell. It was this amazing moment in high school when all these shows were on that tackled fantasy as a genre that had serious insights into the mind of a teenager. Of course, none of them were as good as Buffy, but here I am twenty-eight and a still nostalgic for the good old WB, still watching one show from that bygone era, Supernatural…which endures…occasionally in a tiresome way.

How is this related to entrepreneurship? Well…it really isn’t especially since Sam and Dean Winchester don’t get paid for their bloody efforts. But, take the most recent episode of Supernatural which sees Dean take Death’s ring for a day as a bet. If he can wear the ring and take Death’s duties for a day, he can get Sam’s soul back. (Yeah yeah yeah…I know…ridiculous stuff. I know!!)

Anyway, this does not go off without a hitch. Dean takes some lives and every time he does, the newly dead person asks ‘What does it all mean’…to which Dean optimistically replies “It’s all just dust in the wind’.

He quickly loses the pithy answer.

Tonight Jeff Revesz (@infogasm) and I spoke on a panel at Wisdom 2.0 NYC, a first-run conference (sister to the larger one on the West Coast) bringing the ‘wisdom’ community (yogis, meditation experts, activists who have actually been catalysts for social change efforts in their lifetimes) and the technology community (startup founders, hackers, social media people).

The panel was kind of amazing. Full of people with serious social change cred. I felt a bit intimidated to be honest.

A couple of the questions got me thinking. the first, ‘What is the role of audience in tech development’ and another “Is it better to focus on building your product to a point where you’re completely happy and then releasing it, or is it better to focus on building it to a point where you can release it and get feedback?”

What is the role of audience, really? Well…when we were running ASI we had a smallish audience. We were B2B, so the role of audience was ‘audience as market’…it would either squash us or reward us for our work. It was like having to please a capricious god..a media god that only bought software in Autumn and left you to starve during the summer.

I tell you…meditative it was not. But it did teach me something. Wisdom? Maybe…

It gave me insight into this thing called market…into the buying cycles of a certain segment of the market. It gave me insight into the needs and desires of a whole industry and the necessity of quick and targeted response. It forced us to pivot— to change and enhance our product offerings.

This were not things I knew when we started the company. No…not at all. Jeff and I…we were driven by ego. We wanted to be on the front page of Techcrunch. We wanted to be in Wired. The How’s and the Why’s unfolded over time.

What is the role of audience? Well, audience is market. It’s individuals acting as a crowd. In B2B the audience is a bit obscured, less immediate. Both are unforgiving.

Now, at The Huffington Post I am a Product Manager. I work with my developers on between 10-20 or so projects at any given time. It’s interesting to break these projects down into groups. One group consists of totally new products. Another consists of fixes and improvements to existing products.

The new products either come from the brains of our edit and tech teams, or from suggestions made by our community. The fixes and improvements usually come from our community. Sometimes suggestions are given to us directly. Other times we track usage data and end up tweaking the product to improve our numbers. Occasionally we have actual bugs that require fixing.

In all cases, we have to listen carefully to our community to know when to build something new, when to pivot an existing product, and when to fix something that’s broken. It’s a really interesting exercise in humility and reflection from the moment you conceive of a new app to the moment it is released and finally bug-free.

In a conference full of meditation experts and wisdom seekers, I realized that Entrepreneurship, and even the more cushioned version (Product Development) is a path to both.

To have your livelihood depend upon the reception of your idea by the market and/or the mob…is to be completely humbled. There were times when I had to choose between paying rent or paying for servers and getting us to a conference where potential clients would be. Playing it that close to the bone means feeling the needs of your customers at a very acute level.

Beyond that, starting a company is an act of faith. It’s a thought experiment. And it leads to a lot of other experiments. It erodes the ego even as it makes you aware of others in the form of the market. It makes you want to optimize yourself to the task of building the company, of devotion to the idea. For me, that meant a series of experiments with diet and exercise regimens on top of the grueling work of running the company. At one point, in the zeal to optimize myself to the task, it meant cutting out caffeine, sugar, and most salt from my diet and running 5 miles a day. The startup made me a fanatic for a time. A zealot.

Now, I am striving for balance. A thing not easily achieved when actively involved in a startup. I know few ego-less founders. Few founders who sleep or eat healthily or don’t drink and eat to excess to manage the stress. When we’re not bragging, we’re in despair. When we’re not in despair, we’re bragging.

We can be pretty insufferable as many of my non-startup founder friends found out.

So what wisdom in the end can be gained from that life? What does it all mean?

I want to say that you become ego-less for a time…after all the bragging and all the despair. That there are moments when you really ‘see’ into the scrying bowl of the market and ‘know’ what it wants like a bolt of lightning. That after a while, as with any creative act, you begin to feel like something is driving you…something outside of yourself. That a path opens up for you which offers far more freedom and self-acceptance than any other professional path other than the full-time pursuit of art/writing/music.

I also want to say that simple life-affirmative acts emerge as important and devotional. Eating dinner with a loved one. Writing a letter to a friend. Walking in Central Park. Simply because you have very little time and less energy to allot to anything unimportant.

And finally, that you begin to see people differently. The breakdancing group on the R train stops being annoying because you realize they are entrepreneurs like you. The summer crowd outside of the Broadway and Prince St. Station stops pissing you off because it’s partially caused by Latinas selling hand-cut mangos and they too are entrepreneurs…so fuck yeah! Good for them!

What does it all mean? Well, seeing the world through entrepreneur-colored glasses really changes things. I have to say that it…i.e. life…really has little meaning if you are not doing what you love and doing it to your best ability.

I think that means I belong in startups and specifically on the product development side of things because that’s when I really start thinking outside of myself. That’s when I start to have a glimmer of that thing we call ‘wisdom’.