Launching a startup is not easy. It starts with a dream, followed by a lot of work, doubt, euphoria and more work. Most of the time it doesn’t work out. A lot of the content on this blog is about startups because that’s the world I come from, so I hope it can help you learn my my mistakes and successes.
I’ve been involved in over 15 startups after starting my career on Wall Street and Silicon Valley. More about my story here. I know how fun and exciting a startup can be, but also how devastating and exhausting it can be.
The old saying about startups and small business is true:The great thing about running your own business is the freedom. You can work any 18 hours of the day you want! Click To Tweet
The Hype Cycle
The consulting firm, Gartner, illustrates it well with their “Hype Cycle.”1 The illustration was originally used to show the cycle that new technologies go through, but it also applies to new startups.
When we start a new venture, it’s exciting. We have a new idea that’s going to take the world by storm. We see this a lot on the TV show “Shark Tank” where entrepreneurs pitch their ideas with excitement, even though many don’t yet have any sales. At the beginning the founders have outsized expectations.
Inflated startup Expectations
I once met a founder who expected his company to become the first trillion dollar company, despite the fact that his company had yet to make a dollar. Later, I was a judge at a business plan competition and one of the pitches was about how the company was going to take on Google. Another startup was going to take on Uber, Postmates and several other companies – at the same time!
No matter what your idea, it’s okay to be excited. More than being okay, it’s necessary. A startup founder needs to be excited and believe in their dream. Those are the people that innovate and make things happen.
The trough of disillusionment
Inevitably, however, comes the trough of disillusionment as the reality of all the work that founding a company takes. Not everything works out in the beginning and the rule of 3 kicks in:
Everything takes 3 times as long, costs 3 times as much and earns 1/3 as much as expected.
Gradually, we learn and grow. We keep at it and our website traffic builds, our sales pipeline starts to fill up and we begin to earn revenue. Over time we build our company one product and one client at a time. We add one new relationship at a time. We build our audience one person at a time.
The Slope of Enlightenment
As that happens we travel up the Slope of Enlightenment toward the Plateau of Productivity. That hard work begins to pay off and we become profitable and the demands on us ease up a bit at a time and we start to see the light of day.
That’s what it’s like to build a startup. It’s not easy, but it can worth it if you do it right.
The startup reward
After the initial enthusiasm and excitement wears off, those that remain committed to working diligently through all the ups and downs are the ones that will reap the rewards.
I hope that person is you.
Some of our best articles and videos on starting a company: