As industries continue to digitize and market transformations accelerate across transportation, energy, agriculture, and DTC, I attended Startup Grind in Silicon Valley to uncover what makes founders successful and startups sustainable in a world where most people fail.
Here’s some sage advice from a few of the most successful entrepreneurs:
If It’s Broken, Fix it
The motivation for launching a thriving business typically lies in the mission that there must be a better way to do something and that it’s worth changing. This is usually fueled by a personal need or a “hellish” experience one encountered. Shan-Lyn Ma of Zola was annoyed with trying to find the right wedding gift and used that to help Zola grow in four short years. Adi Tatarko, cofounder and CEO of Houzz, was remodeling her home and the arduous experience of finding the right product, designer, and architect fueled her passion to create a marketplace that now has more than 15M shoppable products with 20,000 sellers. If you see a problem, try to fix it.
Money Makes the World Go Around
On fundraising: The overwhelming majority of founders recommend boot-strapping as long as you can, but when you do go for your first round, remember you have the power to select a true partner that is aligned with your mission, vision and values.
Get Used to Hearing No
The focused founder keeps chipping away at fundraising and interprets “no” as “not yet.” Jennifer Fitzgerald of Policygenius heard “no” more than 80 times. The cofounder of Robinhood, Baiju Bhatt, heard “no” 77 times. When starting up, many entrepreneurs tested their concept while working full-time as a “side project” or the midnight shift. Nick Huzar, cofounder and CEO, of OfferUP even second mortgaged his home for an early start-up. Patience is important if you truly believe in your product.
Hire Well
The first ten employees can often determine ultimate success. Attracting and retaining the right people is vital. While it’s easier to recruit a team that you trust and worked with in the past, that often isn’t the right fit for your new venture. Max Levchin of Affirm fame, said it best: “Are we hiring the best people we don’t know?” This plays very positively to the saliency of the diversity and inclusiveness need, especially for engineers. Max personally visits universities to tap previously uncovered talent.
Focus Pays – Three Ways
- Reddit to Houzz to Headspace all grew by listening to their audience and putting a relentless focus on community.
- Zola and Booking.com all made simplicity a sustainable competitive advantage and centered on an obsession over product experience – in what Shan-Lyn of Zola called “moving people to happy tears.”
- OfferUp discovered local commerce and having the infrastructure capacity in place before scaling aggressively. They concentrating locally before scaling nationally.
Sometimes We All Need a Makeover
Walt Mossberg suggested that no matter where you are in your career life cycle, today’s economy requires you to always realize you need to keep reinventing yourself, and the personal awareness to do so.
We are Only Human
Discover humanity in the world of risk and return. Harvard Professor Mihir Desai reinforced the need for humility in life and business. He reminded us that many people confuse luck and skill. And Guy Kawasaki suggested that while competence trumps many things, you still need to become “mensch-like.”
Perfect Your VC pitch
Rule number one shared by Eurie Kim of Forerunner Ventures was to know your audience. “When VCs need to review 2,000 potential deals, distill and synthesize and see 20, and finally invest in 8 to 10, you better be prepared.” It pays to do your research.
Modest Beginnings Fuel Passion
Have you noticed that many founders came from very humble beginnings? From trailer parks in rural states like Policygenius cofounder Jennifer Fitzgerald, to Rich Pierson of Headspace, who was struggling with what he wanted to do next in his life, it is clear that often entrepreneurs who are successful are fueled by the challenges of their lives.
Be Open to Criticism and Radical Candor
Steve Huffman, the cofounder and CEO of Reddit, believes that accepting criticism led to the street cred of the site. Eurie Kim of Forerunner also stated that “radical candor” is also a little-known key to success. In other words, 10 pages of slides is enough. If we don’t get it, go back and shift to plan B. Huffman went on to add that life is long and many times in life you are at a low point, then you head for a high point, and then you get shot down. The ability to remember you were once at that low point, will give you the confidence to rebound again.
As my former boss once said, “adapt, improvise, overcome.” This is what it all comes down to.