At September’s Startup Lean Coffee, we delved into the emotional challenges of starting a company, getting perspective, fundraising, and recovering from failure. We had some incredible epiphanies covering many aspects of being a founder. Here are some of the highlights and afterthoughts.
Let’s face it: it takes a lot of confidence to start a company, but startup success often depends on challenging your own assumptions (even your own convictions), which takes a lot of humility.
“An unexamined life is not worth living”
To maintain perspective, it’s often helpful to have both formal and informal networks of advisors.
I formally advise many founders and teams; and perhaps the most valuable aspect of my advice comes from the fact that I have been in similar situations before but am not currently in their situation. This allows me to see the proverbial forest through the trees.
As for informal advisors, there are literally endless Meetup groups and other online/in-person communities that you can turn to. Among them, please consider this shameless plug for Startup Lean Coffee!
As part of working with advisors, establish a weekly discipline to detach from day-to-day, which will otherwise consume all of you.
Is launching an MVP without a technical co-founder a bad idea? In short, not always.
It’s always a good idea for founders to have deep, first-hand experience in the business that they are pursuing. If your business involves developing proprietary technical or scientific intellectual property in areas like AI, blockchain, biotech, pharmaceuticals, fluid dynamics, propulsion, energy, or materials science, you should have someone with this skillset on your founding team.
That said, I have worked with many non-technical founders that have proven to be incredibly effective in building successful ad tech, fin tech, and manufacturing tech companies that rely on advanced technologies, but who did not have technical co-founders.
In these cases, I served as a fractional CTO and helped the non-technical founder hire and manage developers to build their product, some of whom were full-time employees and some of whom were contractors or development firms. Marc Adler, one of our regular participants, offers his expertise under “CTO as a Service” terms for this very purpose.
But before you dive into building an MVP, consider using a no-code MVP to validate your leap-of-faith assumptions. Imagine designing and running a series of week-long experiments to test your most critical assumptions before you’ve written a single line of code. After each experiment, assess what you’ve learned, decide what you want to learn next, and design/run another experiment. As you validate your assumptions and gain confidence, up the ante by running longer experiments. In a lot of cases, you can even start charging your customers before committing your MVP to custom code!
It’s worth noting that some accelerators and investors will categorically not invest in teams that don’t include internal team members with the technical expertise that they consider necessary.
If you find yourself being rejected by investors because you don’t have a technical co-founder, find other investors. All of the non-technical co-founders with whom I have worked have been able to raise money when they needed it. Some ended up raising from venture capital; others went with impact investors.
Before you start fundraising, you should definitely read Venture Deals, by Brad Feld. Understand how venture capitalists make money. Consider alternatives to venture capital, that might be a better fit for your business.
To streamline your fundraising process, make sure you’re speaking with investors who will not categorically reject you. In some cases, it’s because you’re looking for seed capital and they only invest in growth stage companies. In other cases, you might be a cannabis company and they don’t invest in cannabis. Or they might require a technical co-founder and you don’t have one… or they might already have a direct competitor in their portfolio… or they might need to raise another fund before they can invest in new companies.
Fundraising is a sales process. Be sure to segment the market of investors and target those who can say yes. Figure out how to efficiently qualify them - you’ll both appreciate saving time on conversations that won’t go anywhere.
And even if you’re talking with someone who knows you well and trusts you, when she says that she likes what you’re doing and you think she will invest, you should move to close the sale.
While no one wants to think about it while they are starting a company, the reality is that lots of startups fail. Some shut down completely; while many just continue to exist without gaining enough traction to achieve liquidity, which eventually gets very old and tiring.
Whether your startup outright shuts down or you just run out of steam and need to stop, you will go through a grieving process.
Some won’t do another startup. Others want to jump right back in! If you decide to pursue another startup, work on your energy and your personal runway. Have “flings” with your next startup ideas to see if any of them grab your interests.
Startup Lean Coffee is a monthly gathering of founders, early employees, advisors, investors, and anyone involved or interested in joining the startup world in any capacity. Our sole purpose is to help each other improve by sharing questions and experiences. All you need to bring is your attention, curiosity, and willingness to share.
We follow a Lean Coffee meeting format, a lightly facilitated meeting where participants democratically build an agenda and discuss each topic for a fixed time, voting to continue discussion or move on to the next topic after the time runs out.
Feel free to continue conversations that were started at our meetings and start new ones on our Startup Lean Coffee Slack workspace. Please treat our Slack space like our in-person meetings: ask questions, share interesting information, create channels.
Startup Lean Coffee is graciously hosted by Betaworks Studios. Participation is free; but space is limited. We usually meet on the 4th Friday of each month. Sign up for the next Startup Lean Coffee, which will be on Friday, October 25th at 9am.