Brilliant insight.
Reminds of me this, from Theodore Roosevelt's Citizenship in a Republic:
> It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.
Good luck, and go get 'em.
>> But from now on, I'm either gonna be a successful founder, or I'm not. And if I'm not, I'll have to deal with having broken with the expectations that people had of me.
Don't worry, they expected you to fail. They hoped you'd succeed, but expected failure. Statistically most businesses fail, and failure rates are faster when your customers are VCs not users.
I say this as encouragement, not criticism. Accepting that failure is (by far) the most likely outcome is both realistic and freeing. The anxiety of failure is gone.
Frankly, your lack of marketing experience would worry me. Without the ability to reach users (much less customers) how can you do anything but fail? New businesses are not bounded by technical ability (especially in the age of AI) they are bounded by Marketing.
If your target customers are "VC funded companies" then sure, getting in bed with as many VCs as possible is certainly one marketing approach (and probably a good one.)
Certainly you're are a lot of products targeted at businesses who are flush with cash and eager for kit like fancy chairs.
The important part of marketing is knowing who your potential customers are, and the best way for them to get to know you.
It’s much more impressive to say you have done something than to say you’re going to do it.
A friend of mine has all these failed hobbies he tells everyone he’s going to do, then gives up on. I wait a few months before telling people I’m doing something so I’m fairly confident it’s something I will carry on.
If those were events I was involved with, I too would be giving powerful speeches about the importance of disregarding critics. The decision makers only handled the situation well if you assume that the catastrophe of the early part of the century was a bit like weather, sort of coming form nowhere in a way no-one could foresee or really influence.
[EDIT] I checked, he set the program up but it was his successor that actually dropped the bombs. If Truman had any sense he'd also be talking about the importance of disregarding critics.
It is similar to the Bush family, but from an era where the internet wasn't around to let people compare notes. These political dynasties deserve criticism and should listen to it.
B) there's no way for the US to not get involved in WW2 other than pre emptive handover of the Philippines to Japan.
The criticism basically writes itself. These people are very easy to criticise, they were mostly horrible. Just saying, it is easy to see why there are speeches around about how the critics ought be discounted. The track record invites harsh criticism.
What is difficult is being in the position of ultimate responsibility over the lives of many people, making a decision and living with it. Everyone thinks they know what is best or what they would do, I don't think so.
Criticism (IMO) should always have a response on what should have been done instead, given the information at the time. Otherwise it's just playing Monday morning quarterback.
The anxiety over expectations can kill you. It’s self abuse - people (investors, bosses, spouses) don’t invest in you for your anxiety driven productivity, they do it because of who you are outside of that worry. It’s hard to replace it if you consider it your motor. Let the desire to do well and good stay, but let the fear of others disappointment go, and the fantasy that we can control those outcomes by squeezing every last drop out of ourselves.
One worries because it was a helpful strategy compared to not worrying, but some (like me very specifically) can get attached to that worry to the detriment of picking up other mechanisms.
What I’m mostly talking about is that transformation happens through life’s journeys! Requires much less commitment to the idea, as it’s pretty universally understood.
That episode really got to me. Every time the screen goes dark and transitions to Morty realizing he's still trapped in the hole, something inside me freaks out too. It's like the show is forcing me to realize I'm not actually confronting these truths in my own life. I'm probably still in the hole, aren't I?
Life is stressful. There is fear of failure, there is fear of disappointing others, and ultimately there is fear of death. And that final deadline doesn't even have the courtesy to let us know when it will come.
But many people get nothing much done without a deadline. Most get more done with some time pressure. I'm not sure how we would manage immortality. If we lived twice as long, would we work half as fast? One hopes that for a little while at least, we manage to be happy and content with what we have.
If you make it over the initial hump of developing the habit it just becomes an expected part of your day. The dislike evaporates. Skipping it feels weird.
Give me a break with that hustle culture.
Things that rely on experience peak at a much higher age, but the pure mental stuff peaks earlier.
Comparison is the thief of joy. I fall into this trap almost weekly. Success stories are incredibly rare and we only see the splash, not the iceberg of failure just beneath the surface.
I think about my current business constantly even though on paper we are making enough to keep this thing going forever but it never feels enough.
I felt this post and appreciate the honesty.
slow growth is terrible
Rapid growth feels like you're constantly plugging holes in the dike or putting out fires.
Like you I've had brief moments of jealously seeing a company that started after mine and grew faster. But when I think rationally, I just wish them well, and realize I'm happy with any pace of growth that's not negative.
That's a great insight.
Once you've realized that, I think the best thing to do is to talk to the person whose pressure you imagine. Then you can find out what they're really thinking. Perhaps they really are thinking that (in which case the pressure is real and you can act on it) or they aren't (hearing them say that will alleviate the pressure).
Once when freelancing I asked a customer what they liked and disliked about my work. They had previously seemed happy with me, so I was pretty sure I know what they'd say. I believed I wrote good stable software. What they actually said was they were a small company, and they had had previous developers who, when there were server problems etc., just shrugged and said they didn't know how to fix it. They felt I wasn't like that, that I'd sit there and get it fixed, call up friends if necessary, etc. So yeah, they were happy, but not for the reason I'd imagined.
So my learning was: So you always have to talk to people to find out what they think. You really can't guess.
I totally agree with that statement and it mostly explains why so many people does not go down a rabbit hole.
I’d think more would do a ramen bootstrap to test waters on both product fit and potential for monetization though
A somewhat common (yet often not followed (because it's hard)) piece of parenting advice is to not praise kids too much. Especially character judgements like "you're so smart" or "you're so creative". Reason being it makes them do things that seem smart or seem creative just to get the praise. Then it comes crashing down when they're faced with a challenge that contests the idea that they're "a smart kid".
It kind of looks like this is happening to the author. He became a founder, and started doing things that seem like what a founder would do, then got hit hard when he was unable to fulfill the "founder" role (i.e. didn't grow fast enough).
I'm not totally sure what to conclude here. I guess humans are susceptible to this kind of thing regardless of age.
Even if it's a failure but a lot of effort and learning along the way, it is still a success.
This happens a lot in the startup world: It’s really common for someone to be among the top in their classes from a young age, be praised by all their family members and friends, and be called the next Bill Gated / Jeff Bezos / Elon Musk (adjust for age) for the first quarter of their life.
So they enter the startup world believing that they were destined for this. They may think success is inevitable, they just need to get that first investment round to hire a couple engineers and then start telling everyone what to do.
I don’t think this author is an extreme example of this because they’re actually talented and successful at many things. However I could see this mindset leading them down a path that seemed like the right thing to do but wasn’t actually a good fit for their personal style. The article talks about how they’re doing better now, but it’s filled with so many admissions that they think a full-time job would have been a better path in general that it’s hard to unsee it. I wish them the best and I appreciate the honesty, but I feel like I’ve seen this movie many times before in the local startup world.
My personal experiences taught me that things generally do no play out as one imagines neither for "startup" nor for "full-time job". There are advantages and disadvantages for each, best is to try (a bit) both and decide for yourself. Of course I get that for some this is not possible, just saying what I think it would be the ideal.
I think some discontent with one's current situation is healthy - to allow for progress - but I always find strange when people strongly project that "something else would be better" without having experience with it.
Or at least know that your interests as a founder and the interests of those who invest in your company will not always coincide. And they do this a lot more times every single day than you do.
This, when unchecked, can lead to self inflicted, unnecessary pressure on myself. And failure to meet the impossible deadlines, created downward spiral.
I think this is normal, everyone went through the same thing. That’s why some VCs filter for megalomaniacs, zealots, or people who have no idea what pain is, because the journey is insane arduous.
The pain magnifies if the startup is located in VHCOL. Every month a whale appears and eat a big chunk of your runway. Who wouldn’t have anxiety?
I had a startup some years ago and took angel funding from family. When we were later running out of cash and had to raise professional money to stay alive, the pressure of the expectations I thought my family had because I was on the verge of losing their money caused me debilitating panic attacks.
I still feel the effects 6 years later, but have learned to cope whenever I feel the pressure begin to build. But man did it scar.
OP if there is any advice I can give, it's that you should have a chat with your investor friends about and make sure you feel like you can always walk away.
The author nails it: "I started to actually operate in a way that is counterproductive for my startup, while thinking I was actually doing what was best." That's the dangerous part. The pressure doesn't announce itself as pressure. It masquerades as ambition, urgency, drive.
Bootstrapping has its own version of this though. Instead of investor expectations, you've got the slow burn of "am I wasting years of my life on something that needs capital to work?" The grass is always greener. At least with VC money, you can move fast and find out if you're wrong. With bootstrapping, you can spend 3 years proving out something that would have taken 6 months with proper funding.
Neither path is inherently better. But knowing which one will fuck with your head less is worth figuring out before you're in the middle of it.
You might be able to move faster with VC money, depends on your product. But getting that VC money can break you. And now you're on the hook and you've lost full control.
If they hadn't taken the money, what would the counterfactual article have said?
Everybody creates narritives and belief-systems, where causes and effects seem so clear.
Perhaps I'm far too skeptical about their self-analysis. I've met very few people where their own analysis about themselves has matched what I have read in them. So many people misread their own minds and emotional drives. So I have learnt to cynically look for excuses and rationalisations and justifications.
The article is brilliant because we too rarely hear about people's doubts and negatives.
Some people (whether successful or not) do know themselves, but it is uncommon in my experience.
I helped bootstrap a business and we were in an incubator. There I saw some of the side-effects on businesses and founders from taking investment. We were just lucky that we couldn't be bothered with doing the distracting pony-show to get an investor onboard: we would have taken investment if it weren't so costly to do so.
Money and ownership causes weird pressures.
- It was easier to find a link to where you worked at than your repo (https://github.com/skaldlabs/skald?tab=readme-ov-file), you should have linked it visibly
- I had no idea what / why I should use it so I looked at the demo video and it didn't seem to solve any particular use case for any particular problem, it was more a ,,config'' video instead of a demo video
- From reading the (quite interesting) article it seemed like you are focusing on pivoting instead of iteration speed. Have you tried for example to just query an LLM to build the whole project that you have done? How much time would be to vibe code it?
I know that HN is mostly against vibe coding, but if the project could have been created in 1-3 days and you took 3 month, that's a bigger issue than growth itself. In that case the metric that should be looked at is iteration speed instead of just growth (both are super important though!)
Genuinely curious, can I ask why this is relevant to point out? This seems like just a general blog post, about raising money for a startup and personal reflections on it. Why would a link to a github repo be an important part of that?
For engineers it feels too pushy / not genuine, but after spending time / effort on a great non-generated interesting article, inserting a link for people who want to check it out isn't pushy.
Investments are bets. Most sane investors aren't putting it all on one thing
Startups are bets
Applying for jobs. Sales. Dating. Health. Basically everything
You risk $X money and time for a payoff of $Y that comes Z%
You can make the best decision and have a bad outcome because there are so many unknowns. This isn't chess
You can play everything wrong and still hit it out of the park
I mean this is one of the range of outcomes that could've happened. You can't declare yourself a success or failure from one project
Just keep making good decisions and don't risk it all, and you'll more than likely end up fine
Probabilistic thinking about the EV of your decisions is a good framework, but "Just keep making good decisions" is the hard part. Same as in poker, though, the hard part about making a decision in life isn't the middle-school level probability math, but about making the right estimates about payoff potential and success rate based on incomplete information.
Analyzing things as they are rather than how you wish they were, being able to separate useful information from noise, and taking a step back to look at second-order effects are all useful skills that will help you make better decisions the more you develop them.
I am not being sarcastic or flippant in this, it limits me to not be willing to take advantage of the risk/reward system, but it's somehow deeply tied into my ethics in ways I didn't even really notice until my second startup. And I'm okay with that limitation, but I'll work through it sooner or later and regain my appetite for risk.
Aside from that, many people despise thinking this way about their work. Like me, even though I'm willing to do it. I've met founders who loved negotiation. Like I swear they must have been nightmare children. I hate negotiation, I want people to treat each other fairly and will stick with a good human that does so forever. I suspect those people don't mind ripping off family and friends, much less strangers. It is harsh, and I've seen things, but anecdotes aren't statistics, and that's a huge obvious red flag to me. If the leaders like to do internal negotiation games I just want out. It's just painful to have to deal with being around when you just want to make stuff work.
It's important to talk about ahead of time, and get in writing, but that's also something easily overlooked among family and friends who do not do this kind of thing much. And the downsides need to be honest and clear to avoid mistrust.
Now, after working at two startups and starting three, my third is a consulting company that exclusively does things hourly except in very special circumstances. It's never going to grow fast because it scales as my hours of labor. But I am way more able to pick a price for my labor than decide how to price something that I haven't done yet. I could figure it out, I just kinda don't want to. For now?
Life's odds are rigged.
> you could do everything right and still fail
Sometimes even a high probability draw doesn't get there on the river.
> while someone else (like a nepo hire) can do everything wrong and still succeed
Some people always start with pairs, Axs, or suited connectors.
In poker, there are rules everyone has to follow. In real life, the rules can differ from person to person. Hence, the odds are rigged.
I recently had to deal with this, ugh, I just pick a prior or two and see what the outcome looks like. I'm not sure we can calculate probability of success, but rather use probability to find losing ideas that should never be done.
What are some good books to build this sort of perspective on Probability/Randomness/Chance?
Unlike in poker where you know those 3 numbers if you are paying attention, in real life you know only X, and sometimes not even that. The rest is a guessing game, and that estimation is the hard part.
Even if your estimates have large error bars, it can still be a good bet if you believe it’s +EV and have a large enough bankroll.
Raising money has been marketed as success by VCs and they have done a great job of it. Remember, that in reality, raising money is sign that your business is not doing well.. not the other way around.
Furthermore, a lot of people hope that raising money will help them get distribution and customers' trust. Thats NOT true. We raised a decent amount of money from YC and other VCs, and despite that, the thing that helped us most for distribution was content SEO and posting on reddit + no customer ever told us that they were using our product cause we raised $X from these VCs..
People also expect that well known VCs will help you magically solve issues in your company. That's not true either.. VCs may seem very smart, but when it comes to the details of solving issues about your company, they literally can't help, cause they don't know as much as you do about your business.
Another reason people want to raise money is cause they can't afford to quit their jobs and rely on their startups. In this case, well, do not quit your job.. work on your startup as side project until it's already generating 1.5-2x your annual salary, in a stable way. Remember this way, you dont have a deadline for your startup based on your runway, which is GREAT not only from your startup's survival point of view, but also from a mental health point of view.
I would also like to talk about hiring. A lot of people just assume that raising money is needed cause that way they can hire people and grow faster. This is again, not true.. usually, hiring people means you are actually going to slow things down unless you know EXACTLY what you want to hire for, which is rare for a startup. Even if you find a great person for the job, they will take at least a few months to be full productive, and if your startup is not growing like crazy (which is true for most startups), the person will likely leave (cause they are good and will find a better company) = wasted time.
I would like to say that money you raise for your company is NOT your personal money. You can't just spend it on buying stuff for yourself. In fact, even taking a decent salary from that money is looked down upon, unless your startup is doing really well already.
Finally, VCs play a numbers game. They invest in 100s of companies hoping one of them will give out a massive return and cover the losses for everyone else + make a huge profit. You are, statistically, in the ones that won't make it, and you will be written off.. at this point, you will have an entity, owing a large part of your company who literally doesn't care about you.
All of the being said, here are the reasons of why you SHOULD raise money: - Your business model only works at scale. - Your initial investment costs are very high: This is usually never true for software companies. - You are trying to impress your partner and / or friends in the short term and give them the illusion that you are successful already (lol).
When one does not raise money you get questions like "how do we know you will be here in 6 months, how are you funded?". I doubt people will tell you directly "oh, we have seen you are funded we decided to give you a chance".
> raising money is sign that your business is not doing well
You can raise money to execute (a part of) a larger plans. There are various fields that have barriers to entry in terms of regulation and/or compliance. This can still be couple of FTE + costs before you can sign any deal.
> work on your startup as side project until it's already generating 1.5-2x your annual salary, in a stable way
This highly depends on the type of business. If you are for example in B2B you can't tell your customer "sorry I can meet only after 19:00 because of my other job" not to mention how you can be perceived.
I would add to reasons why you should raise money: make sure the startup has external feedback that you listen to. All founders are quite stubborn - which is good and necessary - and is hard to convince them they need to adjust/pivot/rethink things. Investors can do that, but best is to have some previous experience with the field, otherwise they can be just noise.
The thing is, we did raise money, and we still go the same questions, and we replied saying these are the VCs that have funded us, and we still lost those kinds of deals. The deals we won, were mainly cause we solved some burning pain point of that specific user, who really didn't care about our funding status.
> You can raise money to execute (a part of) a larger plans. There are various fields that have barriers to entry in terms of regulation and/or compliance. This can still be couple of FTE + costs before you can sign any deal.
Agreed. But for most startups, people raise cause they need more money to survive.
> This highly depends on the type of business. If you are for example in B2B you can't tell your customer "sorry I can meet only after 19:00 because of my other job" not to mention how you can be perceived.
Agreed. It's not ideal, however if you are solving a big enough pain point for the user, I'm willing to bet they won't mind it.
> make sure the startup has external feedback that you listen to. All founders are quite stubborn - which is good and necessary - and is hard to convince them they need to adjust/pivot/rethink things. Investors can do that, but best is to have some previous experience with the field, otherwise they can be just noise.
Yup, I agree here as well. But, the best external feedback is not from your investors, but from your (potential) customers!!
sometimes the best decision is the one you don't take.
As someone who fantasizes about running my own thing, working for a few start-ups have made me very stringent on what my requirements are for starting something (co-founders, investment, location, market). And also that these requirements have become so very risk-averse that I probably am not the personality profile to run a business! Nevermind the endless imposter syndrome.
Having a strong product and being unable to raise feels like shit, early users may validate you're solving a problem but it may not make sense to investors.
Having an early raise is a very positive signal, I can only imagine you're perceived trajectory coming out of that. Being unable to settle on a problem also sucks in a different way.
Regardless of what camp you're in I feel the take-away is you need to focus on reflecting inwards. Be better than you were yesterday, not better than someone's projections on LinkedIn.
1. do not require secrecy
2. do not require external funding to enter a profit mode
3. do not quire some fancy specialized team labor skills
4. do not operate like they have a $10B market cap with financial and legal teams
5. produce products that are unique, have actual utility, and have perceived scarcity in the market
One often will keep more money with a smaller firm in a niche, than competing with irrational groups with practically unlimited hype investment capital. Most truly successful people I know do not hang out on social media goading competitors and cons. =3
I think this is a case where this helps considerably. Its essentially the 'consulting' thing for small businesses.
As a side note, I'm in a much better mental space now, largely due to facing these things straight on. Things are good, and I'm motivated and sharp!
Has it this always been common or if it’s a characteristic of a vc-hype cycle?
Why devote yourself so long to creating solutions for a problem of solving it isn’t more gratifying than money?
But after almost decade of working in GTM for B2B startups, I’m starting to realize I find it totally unfulfilling and having begun moving back into the arts world i came from. So maybe I’m just cut from a different mold. Not better, just different.
It's not symmetric.
Be the bet. Do your thing and you might be right. They dont need you to make a sale tomorrow.
-- Kahlil Gibran
Nothing wrong with admitting to uncertainty and insecurity. I mean, there are two types of people — those who suffer doubt sometimes, and those who don’t admit it. Give me the first kind any time.