On Building A Company Nobody's Built Before
Startups are inherently risky
I've been thinking a lot this week about the word venture (or adventure). A venture is defined as an undertaking involving chance, risk, or danger. Venture capital, as you know, is supposed to back "risky startups." If it were certain, it wouldn't be venture capital, right?
Startups are always perceived to be risky from people looking in from the outside. I guess there's always some risk in anything you do, but I really like the analogy of thinking about startups as an adventure.
One way in which this is true is that while any team working to launch a startup will bring in a variety of background and experiences—maybe even a high level of startup experience, the chances are still very high that none of them have ever built a company that does exactly what their current startup is setting out to do. It’s new. That’s what makes it exciting. But that’s also what makes it risky.
Previous startup experience is great. It can help an awful lot. The ability to work in ambiguity, to problem solve, and to fight hard battles are traits to bring to the table, but in the end, it’s critical that the team not become overconfident with one or two wins in the rear-view mirror.
Each startup is uniquely risky
I like to think of starting a company like going on a journey—like venturing off to an unknown land. One might know vaguely how to get there, but he doesn't know what challenges and obstacles he'll face along the way.
Most people don't want to embark on a venture like this. It’s almost as if culture has taught people to avoid risk and adventure. In his book Zero to One Peter Theil talks about how things were different in the past:
“Bold plans were not reserved just for political leaders or government scientists. In the late 1940s, a Californian named John Reber set out to reinvent the physical geography of the whole San Francisco Bay Area.
Reber was a schoolteacher, an amateur theater producer, and a self-taught engineer. Undaunted by his lack of credentials, he publicly proposed to build two huge dams in the Bay, construct massive freshwater lakes for drinking water and irrigation, and reclaim 20,000 acres of land for development.
It was endorsed by newspaper editorial boards across California. The U.S. Congress held hearings on its feasibility. The Army Corps of Engineers even constructed a 1.5-acre scale model of the Bay in a cavernous Sausalito warehouse to simulate it. These tests revealed technical shortcomings, so the plan wasn’t executed. But would anybody today take such a vision seriously in the first place?
In the 1950s, people welcomed big plans and asked whether they would work. Even though he had no personal authority, people took the Reber Plan seriously.
Today a grand plan coming from a schoolteacher would be dismissed as crankery, and a long-range vision coming from anyone more powerful would be derided as hubris. You can still visit the Bay Model in that Sausalito warehouse, but today it’s just a tourist attraction: big plans for the future have become archaic curiosities.”
But if you’re launching a startup, that means you’ve signed up for the adventure: the ups, downs, challenges, and successes. There are few things more rewarding professionally than achieving something incredible that changes people’s lives—and knowing that you played a key role in making that happen. So, congratulations, and good luck!
Startups require personal growth
Nearly every single successful executive I worked with at Pushpay had never done their role before joining the company: a one billion dollar company was built by people who had never done their roles before in any other organisation. The reality is the adventure is what will drive what needs to be done and who you will need to become along the way. It will force personal growth (sometimes in ways you could have never anticipated), and if you refuse to rise to the challenges your venture throws your way, it’s unlikely you’ll meet success.
That said, I think Pushpay is proof that when you do lean in and do the work, when you push yourself to grow through the discomfort and fear of the unknown, great things can happen. Keep developing your skills. Don’t assume what you will and won’t need in the future. The reality is you just don’t know.
Tips for the journey ahead
Early stage startups favor generalists over specialists
In the beginning, you need to know how everything works. If the team needs someone to step in and fill a gap, that person might be you. Be ready.
Past success does not guarantee future success
While experience is helpful, it actually only helps a small amount in most cases. It can help build external confidence in your venture, and having base skills is a needed and good foundation. But what is most important is knowing how to apply those basic skills to your current location and situation. Can you think on your feet in the moment, continually assessing the best way to get from point A to point B? Make no assumptions.
Context and environment matter
It’s critical to continually orient yourselves to the environment you’re in because charging forward blindly (or based on previous experience) without taking in current surroundings can lead to catastrophe. Take the time to ask simple questions. Chances are things may have shifted since the last time you made a similar decision.
Get comfortable with ambiguity
The information we have is always going to be changing. Therefore, the best decision might always be changing, too. Many struggle with ambiguity, but if that’s the case, startups are probably not for you. People ask me all the time why I change my mind so frequently. The answer is because the right decision yesterday was based on yesterday’s information. What was the right call yesterday might not be the right call today.
Thinking long term is often a waste of time.
While you do need to make sure you’re on track for your long-term goals, 99.9% of your time should be spent on making sure you survive this month. Executing on a short-term basis is the nature of adventure. If the team focuses too much on the future, it might find itself lost in the moment (and may never recover). Give the majority of your effort every day to deliver this month.
A couple of challenges
What can you stop doing that isn’t 100% absolutely required to deliver your goals this month or week? Is there something someone else could be doing to free up more time for you? Is there a tool or product you need to make you more efficient?
Take a minute to look at the decisions you’ve made recently. Reevaluate them in light of the new information you didn’t have before. What do you see?
What generalist skills are you working to develop? Look around your org and ask yourself what generalist skills might be needed in the near future. What did you notice?
Remember, you’re working to build something nobody in the entire history of the world has ever built before. It’s going to be risky, it’s going to be uniquely risky (unlike any other startup you’ve built before), and it’s going to require you to grow.
→ Your Turn. What was your most important takeaway? What’s one thing you’re going to go work on in the following week to level up?