Valuable Lessons Learned In The First Year As A Startup CEO
About a year ago I was approached by a stranger and was asked to join a Seattle startup. This stranger, my soon-to-be-cofounder, asked me to take the CEO role in the startup, which unfortunately was named Order SM but eventually became Seconds.
I remember it clear as day. We met at a coffee shop in the Greenlake neighborhood in Seattle and chatted about our similar ideas on local and mobile commerce. We both believed all the current options on the market were missing the boat, releasing bloated products and not making the mobile ordering/payment experience any easier than it was online or over voice on the phone.
I was much obliged and we immediately got to work, paving the way to release our first product. It has now been more than a year since this fateful day and I feel it’s as good of time as any to review some lessons I have gathered through my first year as CEO of a fledging startup.
You will be underestimated
First thing to understand as a rookie – your peers, the media, investors and the rest of the industry will underestimate you. This is a fact of life and was nothing new to me. “He’s just a guy who was a personal trainer for god sakes. What does he know about technology?” Better get used to these types of reactions if you are trying to do anything out of the ordinary. I don’t fit the traditional mold of a tech startup’r. I look different than the rest. I my degree doesn’t align with what we are doing. To them, I a lost bet. Although it’s frustrating at times to hear this, I have no problem being the underdog. I would rather be doubted and exceed expectations than be heralded and ultimately disappoint.
It’s tougher than they say
Starting a company is definitely one of the most challenging things you will ever do in your life. It’s especially difficult if you did not study at an IVY league or Stanford university, graduate with a CS degree, come from a family of great wealth, get hired early on by Google, Facebook or Microsoft, have a sizable exit from a previous company or any other notable event investors look for when evaluating startups. No, my team and I have none of the above. Yet here we are a year later, still creating great products and building an exciting company.
Be prepared to be challenged more than you ever have in your life. You will be challenged physically. You will be challenged mentally. You will also be challenged psychologically more than you ever thought possible. You will ask yourself why you are doing this and to what cost is it worth. Challenges technically, socially, professionally and financially will string you out way past what you ever thought you can deal with.
You will also give up more than you ever thought. Going without pay for pretty much the entire year has been humbling, to say the least. You might even come face to face with the very things you take for granted each day – the roof over your head, the car you own, public transportation just to get to the office, enough food in your stomach so you don’t starve. imagine what I think when I walk past beggars and the homeless nowadays. Not only do I not have $1 in my pocket to give them but also, why would I give them a dollar when they are just sitting there asking for a handout? Maybe if they were offering a service or working towards something positive for society I might think differently. I understand the harshness of my thoughts but it’s the same standard I hold for myself. Add value to get value back.
This is the road less traveled and indeed it’s much tougher than they say.
VC’s and Investors will lie to you
Unfortunately, investors will lie to you. They will tell you straight to your face they are interested, want to learn more and actually want to invest. This, most likely, is a lie. Why? Investors want access to the most information possible for the least expense, and will lead you on for months before they let you down with a “you’re just a little early for us but stay in touch.” This is bullshit and you don’t have to take it. Just cut to the chase as early as possible, tell them what you are looking for and that you are not going to put up with any BS. Let them know you call the shots in these conversations, and it’s a privilege they are talking with you. Ask them to get on the train or risk being left behind. In fact, not cutting to the chase as early as possible shows investors you are naïve, at which point they will exploit the fact for all its worth. Trust me, I did this too much and now regret wasting my time and energy on something that was not going to happen at the time.
Remember – if you are the one approaching your odds are slim to none.
Leadership is required from day one
The day I agreed to cofound this company and become CEO of Seconds I told my then cofounder:
“If I am CEO than the buck stops at me. There will be no power struggles, disagreements and other crap that breaks up promising startups. The CEO is the ultimate decision maker and will have final say, no matter if I hold the position or anybody else. Agreed?”
I believe this initial conversation set the tone for the company, a tone that has remained solid to this day. Clear leadership, from the CEO onto others in different roles within the company (technical, design, product lead) has been established and follows a predictable path. If an issue or disagreement forms, we talk it out as a team and determine what feels like the right decision. Ultimately, when all perspectives have been heard heads then turn to the CEO where everyone believes the right decision will be made.
Building a great team takes time
I wrote about building teams previously, focusing on filling complimentary roles within the team. The way things tend to happen in a startup could be summarized by the words “controlled chaos”. People come and go. If your vision is intoxicating enough, you will attract people that want to help out. Problems arise when people realize it will be harder work than originally thought, so some will split. At that moment, you will find out who is serious and who isn’t.
It takes time and energy to find the right talent for the right job. The initial founding team helped prototype the concept and get an initial product into the market. A full year into existence, Seconds now has a whole new team (besides myself and Brent) working on the next phase of Seconds, which requires slightly different skills and talents. I have never been more confident about our team – as well as more proud of the work we have done in the last month. It’s okay to have a fluid team if the product is moving forward. At some point stability will be found.
Building a great product takes time
Just as building a great team takes time, building a great product takes time. You must be comfortable with timely, constant iteration and waiting patiently as your tests reveal valuable results. Recently I commented on our evolution of Seconds:
“We launched the earliest version of Seconds about a year ago, under a different name and clearly aimed at a different customer segment. The product was buggy as hell and to be honest, a bit embarrassing. But that’s the point of an early release, isn’t it? It does you no good to have an idea without a product others can touch, taste and see. We knew we needed to get something into end-customers hands ASAP if we were going to receive any feedback – feedback that actually led to our next iteration. I consider it lucky we were able to have a team willing to quickly put out a buggy product and gain much needed feedback. In fact, we created that luck by committing to releasing immediately and listen to the feedback.
… We refused to be boxed too narrow in the beginning, and it has paid off tremendously. A year ago, we were a text ordering system for local restaurants, struggling to fit our solution to their non-obvious problems. This winter, possibly millions of people will be using Seconds to make donations to an important cause with a few quick swipes of their finger.
It’s more fun than they say
I am sure you are thinking to yourself about how crazy and interesting of picture the above paints. All in all, I am having the time of my life and I believe any startup founder needs to be doing the same. Why on earth would put yourself through such madness if you didn’t enjoy the process?
I though I was just working hard on starting a cool payments company, yet I have learned more about myself in the last year than in the past 30 years of my life. Deep down in the founding core of any company you will find a root motivation within every founder called personal discovery. Of course they want to make worldwide impact and maybe even create great wealth for themselves and their shareholders. But what they don’t talk about is the journey of personal discovery the are currently on, the one that takes them deeper into their psyche and will only make sense decades later. I find my current journey fascinating simply because most people don’t have the courage to dive this deep. I consider myself one of the lucky ones.
Are we a little crazy? Yes. But as a classic Apple commercial so adamantly starts:
Here’s to the crazy ones. The misfits. The rebels. The troublemakers. The round pegs in the square holes…