7 and a Half Reasons To NOT Start a Company

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            “Obviously, you don’t know much about adventure.” – Cervantes, Don Quixote
I had a really good job at a fabulous e-commerce company. Everyday was an exercise in managing runaway growth and creating process. I had a wonderful boss (really, a total peach of a guy – Hi Mike!), got a good paycheck, had great benefits, wonderful co-workers, free snacks, and a great downtown office. Life was good.
Then, one day, my wife asked me a simple question, “Hey, how was your day?”And before I knew it, it all tumbled out of my mouth. I was far enough from the C-level where I felt vaguely emasculated. I commuted on a train, I walked into a sterile high-rise office building, As soon as I hit the elevator button, I stopped thinking about my job. In short, I had become somebody that I never expected to be – I was an employee. But I have 5 kids, two mortgages, car payments, horseback riding lessons, college to pay for and more! I couldn’t give up the employee life. I am a responsible adult. I was doing what adults do. They trade their time for money to support those that they love. That is the smart thing to do.
It was that day, that I gave myself 7 Reasons To Not Start a Company.

  1. Money: Forget about WhatsApp being acquired for $19B, or Oculus Rift going from Kickstarter to $2B acquisition, startups aren’t about money. In fact, according to the Washington Post, about 50% of businesses have closed their doors after 5 years, and over 70% after 10. My father worked for the local power utility for 42 years. Betting your financial health on something that has a 70% chance of ceasing to exist in a decade is a sucker’s bet.
  2. OPM: During the first dot com boom, the goal was to always play with OPM (Other People’s Money). And that is easy, right? Throw together a pitch deck, pop up at a few angel groups, and pretty soon you’ve got a 7-figure bankroll to play with. Easy peasy, no? I was at an IEEE event this week, and I learned that Harvard accepted 5.8% of of its applicants in 2013. Two investor groups (an angel investment group and an early stage VC) shared their 2013 acceptance rates:

   Firm 1: Saw 238 company pitches. Funded 3. (1.26% chance of success.)

   Firm 2: Saw 1300 company pitches. Funded 30. (2.3% chance of success.)

  1. I Want To Work For Myself: That is the dream, isn’t it? To work for oneself, to be the captain of one’s own ship? It is very American, very “Manifest Destiny”, very Emerson’s “Self-Reliance”. But when you run a company, you work for your customers, you work for your employees, you work for your investors, you work for your family. You work for everyone except you. You may be the captain of your own ship, but you are subject to the wind and waves of everyone who is not you.
  2. Life/Work Balance: I have said for years that 2 weeks of vacation isn’t enough. Millions of people in America break their backs for those 14 days of freedom. When you work for yourself, when it is your company, you can spend August at the beach, and take off from Christmas to MLK Day, right? After all it is your company. Guess what happens when you take off for a month? The whole thing grinds to a halt. Decisions don’t get made, business isn’t landed, and your dream floats out with the August tides.
  3. I Really Want To Focus On What I Love: That is admirable. But being an entrepreneur isn’t an exercise in focus, it is in an exercise is keeping everything moving in the right direction until it all magically works. When you run your own business, you end up focusing on things like payroll and tax nexus, HR policies and cap tables, local labor laws and the machinations of regulatory bodies, none of which drive the thing you love. Starting a company often means that you work for the business, not in the business.
  4. I Don’t Want To Deal With: Maybe it is office politics, or selling, or corporate bureaucracy, or whatever. When I start my business, we aren’t going to have THAT. Well, guess what, you are going to have it, or something like it. Those kinds of things that you rail against, you will invent different versions of them. You might not see them immediately, but the folks that work with you will. Organizations are full of compromise and conflict, and, inevitably, your company will have that too.
  5. Finally, I Will Be Able To: Work at home, see my kids, choose my own hours, and so on. Yeah you can do all that but the tradeoffs in stress and sleepless nights isn’t worthwhile. Starting a company isn’t fun, it is work. Really hard, stressful work that obeys no timetable.

So that was it. Those 7 rules saved me. They helped clarify my thinking. Those 7 rules lead me down the right path – towards the next rule.
RULE 7.5: Screw it. Starting a business is awesome

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