Why not start a startup

In a series of these articles, I will walk through my knowledge and experience in creating high-tech start-ups.

My experience came from three companies that I founded on: Netscape, which was sold to AOL in 1998 for $ 4.2 billion; Opsware (once Loudcloud), an open-source software company with a capitalization of approximately $ 1 billion, and now Ning is a new, closed consumer Internet company. But in fact, I was very lucky and took part in a very large number of startups from the moment I came to Silicon Valley in 1994: as a board member, as an angel investor, as an advisor, as a friend of some of the founders and as a participant several venture funds. There may be 40 or 50 of them, enough to know what I'm talking about.

This series will be based on this entire lineup of startups in Silicon Valley, so don’t think that everything I’m talking about applies to my companies. In fact, when I talk about some actions that I saw, or about something that happened to me, all this happened to a startup that I don’t call, but which I did not take part in as a founder.
')
And finally. Most of my point of view is based on Silicon Valley and its surroundings: culture, people, venture capital base and so on. Part of it (point of view) can easily relate to other regions and countries, some may not. Be careful!

Put everything aside and start over:

Why not start a startup!

Startups, even as a result of the collapse of 2000, became impregnated with mystery - you read a lot about how great a startup is, how fun it is, the opportunity to change the future, free food, foosball and everything else.

And as it turned out, there are a lot of wonderful things in creating a startup . And on the example of my experience, this is:

• First of all, it is an opportunity to control your own destiny . You succeed or fail yourself, and there is no boss to tell you what to do. For some people, this is enough to create a startup.
• The ability to create something new - a well-known blank sheet of paper. You have the opportunity, in fact, the obligation to present a new product that does not actually exist, and create it, without any obstacles that large companies have.
• The opportunity to shake the world - to give people a new way to communicate, a new way to share information, a new way to work together or something else that you think will make the world a better place. It seems to you that people with low income need a way to borrow money more easily? Create a prosper . Think television should be open to a huge number of channels? Create a joost . Do you think computers should work on UNIX and use open standards rather than proprietary technologies? Create a sun .
• The ability to create your ideal culture and work with a dream team made up of people that you yourself put together . Do you want your culture to be based on people who have fun every day and enjoy teamwork, or seriously compete in work and games, or are strongly focused on creating innovative technologies in the field of rocket production? You can choose and create your own culture and the right team.
• And finally - the money ! Properly created startups, of course, can be very profitable. This does not apply solely to greed. When everything goes well, your team and hired employees will feel great, they will be able to support their family, send their children to college, fulfill their dreams, and this is, in fact, wonderful. And if you are really lucky, you, as the founder, can afford an exorbitant charity that will change society for the better.

However, there are many reasons for not starting a startup .

The first and most important reason:

Understand that a startup sends you on an emotional “rollercoaster”, one that you have never seen before. You will be thrown from day to day; today you are in euphoria, anticipating that you will soon take possession of the world, and tomorrow you think that the Day of Judgment is not far off and you will be completely broken, and again everything is new. And again, and again, and again ...

And I'm talking about what happens with determined creators. There will be so much uncertainty and so much risk around what you are doing. Will the product go to the masses on time? Does this happen quickly? Will there be many mistakes? Will it be easy to use? Will anyone use it at all? Will your opponent push you out of the market? Will you write about the newspapers? Does anyone invest money in your company? Will this key developer join in? Will your main interface designer leave Google for you? And so on, and so on ... One day something will go well, and something will go bad, and the level of stress you are in will change these variables up and down with great speed and significant changes.

Fun?

The second reason:

In a startup, absolutely nothing happens if you don’t make it happen.

It knocks down both the founders and employees, to whom the startup is new.

In established companies, it doesn’t matter how bad things are or how employees are demoralized - something happens anyway. It just happens: people come to work, code is written, user interfaces are developed, servers are provided, markets are analyzed, prices are studied and thought out, sales calls are made, garbage cans are emptied, etc. In startups, there is no established system, rhythm, infrastructure, which established companies have. In a startup, the code is not easily written, user interfaces are not developed, people do not come to work, and garbage from the baskets does not disappear anywhere. You, as the founder, have to organize all these systems, routines and habits and have everyone move; Even forget that it is necessary to move in the right direction just because it is rather difficult to start moving at the very beginning. And as long as you do this, nothing will happen. Of course, if you do not do it yourself.

Enjoy throwing trash out of baskets.

Third reason:

You are often told no.

Of course, if you are not engaged in sales, then you probably will be new that you will often say "No."

It is not so fun.

See "The Death of a Traveling Salesman, " and then the " Americans ." That's exactly what it looks like. Potential employees, investors, customers, partners, reporters, analysts will refuse you ... No, no, no ... And as soon as you hear "Yes", in a couple of days you will call again and hear that the answer suddenly turned into "No."

Learn to work on a fake smile.

Fourth reason:

Hiring workers is a headache.

You will be pleasantly surprised with how many “lovers of gaze” you will have to face. Many people think that they want to be part of a startup, but when it comes time to leave their place in HP or Apple, they retreat and remain. To pass an interview and be conquered by a start-up is a rash act for an ordinary engineer or middle-level manager in a large company. Taking part in a startup should be selective, without taking part or doing any hard work. As the founder of a startup, when hiring a team you will often have to face such a problem.

When Jim Clark decided to start a new company in 1994, I was one of almost a dozen people from various Silicon Valley companies that he offered to join his company, which became Netscape. I was the only one who came to the end and said “Yes.” Mostly because I was 22 and I had no reason not to say so. And it was Jim Clark - the legend of the industry, who left one of the most successful companies in Silicon Valley in 1994 - Silicon Graphics Inc.

And how do you think how easy it will be for you?

Then, when you make your way through the crowd of “lovers of gaze,” and still hire someone, your level of success in hiring people will not exceed 50%, and only if you are already very good. Speaking about this, I mean that half or even more of these people will not work. They will be very lazy, or very slow, or easily withdrawn, politically-minded, bipolar or mentally ill. And you will only have to say goodbye to them or hire them.

Which one do you like?

Fifth reason:

God help you, for one day you will have to hire managers.

Do you think hiring employees is difficult and risky? Wait until you start hiring the vice-presidents of the engineering department, the marketing department, the sales department, the human resources department, the main consultant and the financial director.

The sixth reason:

Clock.

Recently, in Silicon Valley, a lot has been said about the balance of work and life, about how you can start a startup and at the same time continue to live a full life outside of it. In fact, this point of view is very close to me, and I make every effort in my companies (in the last two companies) to do everything possible and help people not to be nailed to the space near the workplace by workload and time. . But it is very difficult. The problem is that startups are a very busy place of work, and they are trying to squeeze out as much as possible from people. And only because you want your employees to have the best balance between work and personal life; it's not so easy when your money starts to run out, your product has not yet entered the market, your investor is angry with you, and your opponent in Menlo Park, who is supported by Kleiner Perkins, well, that one who has all employees over 19 years old you on the heels. Something like this will look like most of the time.

And even if you can give your employees a balance of work and personal life, as a founder you will not.

By the way, if you're interested, then “hours” reduce stress.

The seventh reason:

Startup culture can easily go to the side.

This includes the first and second points. This is an emotional “rollercoaster” that sows panic not only in you, but in the whole company. It will take time for the company’s culture to be established for a team of people who are together for the first time, in order for people to understand what they are, what they value and how they look at problems and misfortunes. At best, you will get an amazing momentum consisting of cohesive people, supporting each other, working hand in hand in pursuit of a great dream. In the worst case, it will all end in widespread bitterness, disappointment, cynicism, low fighting spirit, contempt for leadership, and depression. And you, as the founder, will have less influence over this than you think.

Guess how this happens most often?

Eighth reason:

There are a lot of hidden factors that you may encounter, and they will turn everything upside down and you can do absolutely nothing with them.

Stock market crash, terrorist attack, natural disasters. A better start-up with a more professional team that has worked longer than you do and unnoticed. A startup that unexpectedly launched a product quickly conquered your market, depriving you of any possibility, and you didn’t even know that they were working on it. At best, any of these factors may block your window for financing, cause consumers to postpone or refuse purchases, and at worst - to close the company.
Russian mafia, laundering millions of "dirty" dollars through your service, will lead to the fact that credit companies will close your project.

Think I'm kidding?

And now the most important part:

I didn’t even talk about inventing a product, creating it, bringing it to market and separating it from the crowd. All the risks in the main actions of your company that it carries out will be still ahead, and will be considered in the following parts of this series.

Metaphor for last: