Bob Crimmins

I’m struck by the question of whether, and how, an entrepreneur might act differently if they were mindful that their current startup probably won’t be their last. In other words, chances are you’re likely to continue to be a “serial entrepreneur” whether you like it or not.  This actually might be a good thing to dwell on once in a while. Even if you’re only on your first startup. And even if you’re only just thinking about starting your first one.

So, why not take a moment to consider that you’ll have another startup someday… maybe someday soon?

Whoa, wait a minute, did I just suggest that you may not be working on the next Facebook or Zynga? Is it pessimistic or defeatist to dwell on the thought that your current startup may not be your last? We’re supposed to be eternally optimistic and always be reaching for the brass ring, regardless of what the naysayers tell us, right? I say no.

I’ve long had a penchant for reality-based thinking, influenced by my days as a philosophy grad student where the official department T-shirt slogan was:

“Everything is what it is and not another thing.” — Bishop Joseph Butler, 1692 – 1752

Joseph Butler (Wikipedia image)

How’s that for a hip T-shirt? In any case, you very well may be blessed with the good fortune of Bill Gates, Jeff Bezos, Michael Dell or Mark Zuckerberg. One and done. You might also win the lottery. I sincerely wish you the best of luck with both.

But if you’re like the rest of us poor slobs who didn’t start NextBigThing.com right out of the gate, then you might consider what it means to be signed up as an entrepreneur, i.e., you may be at this for a while and it may take you a few before you land on your crowning achievement.

So what if, upon reflection, it dawns on you that the startup you’re working on right now won’t be your last? Would that recognition cause you to do anything differently? Mind you, I’m not saying that your startup will be a success or a failure (however YOU measure that for yourself).

After all, lots of folks keep going after their next startup even if they do achieve some success. I’m just saying that lots of entrepreneurs end up doing more than one startup and I’m guessing that most (maybe all) of them didn’t really think much about that when they were starting their first one.

It’s a little like asking a 14-year-old holding their first cigarette whether they realize that they are going to be addicted to nicotine for the rest of their lives, that their clothes are going to constantly reek of smoke and that they are likely to eventually develop very serious health problems as a result. It’s just not part of the thought process when you start smoking. And thinking that you’re gonna have another startup after this one is just not part of the thought process for an entrepreneur.

But having a clear understanding that your current startup probably isn’t your last is actually a really positive thing.

For example, I recently met a really smart, aspiring first-time entrepreneur who (in my opinion) was stuck pursuing a problem and a market that would be very hard to create a sustainable business around.

We talked about it at length several times and I really tried to imagine a possible path that would lead to him ending up with what he wanted: Namely a business that could (eventually) make money for him, his team, his family and possibly for investors.

I’m pretty flexible and creative in how I think about problems and markets. But I just couldn’t get this one to fly — even in imaginary flight.

The idea he had was interesting. It was fun. It was even useful. And building the product was well within his team’s reach. But what then?

No matter how we ran the scenarios and crunched the numbers, it was going to require a lot of really hard things to go really, really well and then even if they did (which they just never do) the result at the end of all that just wasn’t likely to get him what he wanted.

As it turns out, I wasn’t the only one who was telling him that. I was, however, the only one suggesting that he consider himself a serial entrepreneur, even though this was his first one. What this did was create the possibility of a conversation about opportunity costs for an entrepreneur who doggedly sticks to an idea that no one is telling him has a decent chance to succeed.

Once he grasped that this was only his first startup and that there would almost certainly be the next one and the next one, then he could begin to take a more objective and critical view of his project.

The realization that his current startup didn’t have to be his last (and probably wouldn’t be anyhow) allowed him to take a more-objective perspective on what he was doing. It also opened him up to considering what might be next. Like lots of entrepreneurs, he had a handful of other ideas that he had been wanting to explore but couldn’t act on them because he was bound up in the current idea.

When we started the conversation, he was struggling figure out how to make his startup work and wasn’t sure himself whether there would ever be a sustainable business even if he did figure it out. But he just wasn’t ready to let it go.

By the end of the conversation, there was a shift of tone to genuine hope and possibility, even excitement.

Am I really saying you should sometimes give up? Admit defeat? Be a quitter? Yeah, I guess I am.

But it’s not a negative thing. Your startup “is what it is and not another thing.”

If you’ve looked out into your future and you cannot see a path that ends up somewhere you think you’d want to be, and if none of the other smart, qualified people you trust can see a path either, then it may just be the case that your working on one of those startups that teaches you some really valuable lessons and adds to your credibility as a “seasoned serial entrepreneur.”

As someone who’s stared that beast in the face a few times, I know it’s not easy. But the alternatives can be worse.

So what do you think?

Seattle entrepreneur Bob Crimmins is a serial entrepreneur whose latest startup is MoonTango. He’s also the organizer of Startup Poker 2.0 and Geeks on a Trail. You can follow him on Twitter here.

Comments

  • http://www.intrinsicstrategy.com FrankCatalano

    While the lessons you cite — notably that of creating needed perspective — are really valuable, there are also downsides to “thinking like a serial entrepreneur.” And I’ve seen them.

    Not having the patience to stick with developing a product or service long enough (yet not too long), and working through the challenges, to truly see if it can be successful. Being too focused on the “exit” and not on what is being built, because the real objective isn’t a sustainable, profitable company, but a quick financial hit in a sale or IPO. In these cases, “serial entrepreneur” is more equivalent to “serial killer.”

    But I completely agree with your core point that there are times when perspective is critical in looking at a startup, and sunk costs (time, effort, money) have to be set aside in favor of considering the opportunity cost of not pursuing something else. It’s great advice.

  • Anonymous

    While Frank makes a great point about the need for tenacity, I think the real point of Bob’s piece is that many entrepreneurs view their startup as an “all or nothing” endeavor – even when the warning signs are telling you you’re headed for “nothing.”

    Time is finite.  In any start up endeavor, I believe, the entrepreneur should define what “success” looks like before beginning, then measure progress against that definition.  For some success may be the IPO or quick exit.  For others, success may be building something really cool – even if it means only working on it nights and weekends.  Regardless, if you haven’t defined what that looks like beforehand, you’ll flail when/if you stop measuring up.

  • http://twitter.com/evanjacobs Evan Jacobs

    It seems to me that when beginning any endeavor whether it’s a new business or a new relationship that the important thing is to focus on the process (i.e. the day to day activities) and not the outcome because the process is the only thing that you can completely control. 

    It might turn out that this business (or this relationship) might be the last one that I ever start but it seems that focusing too much on the outcome would distract me from what I need to do everyday.

    • http://twitter.com/bcrimmins Bob Crimmins

      I agree, Evan, that focusing on what you can control is essential. But I do think that spending effort figuring out if you understand the probable outcomes is also essential.  I think this maps well to the way most smart people thing about joining up with a startup.  If I asked you to quit your job and come work for my startup just for equity then I bet you’d want to understand what the possible and probable outcomes were before you’d decide to expose yourself to that risk.  If you didn’t think there was at least some probable and attainable result that would make the sacrifice and risk worthwhile then I doubt you’d join me.  I don’t think that I, as the entrepreneur, should think about it any differently.  I can say, however, that there was a time earlier in my career when I didn’t pay enough attention to probable outcomes and it cost me a lot.  Once bitten… twice shy.

  • http://twitter.com/RedRussak Joshua ‘Red’ Russak

    I hope you’re not talking about me ;) Great article and if I had anything to comment on, it would be that you should do a follow up on knowing when to finally pull the plug. It’s the hardest thing to accept defeat, so a little guidance would go a long way for us serial entrepreneurs.

    I’m looking forward to the follow up.

    • http://twitter.com/bcrimmins Bob Crimmins

      Pulling the plug is an interesting topic… that I’d love to hear what others had to say about it.  After now dogging on passion, bagging on Kool aide drinking and suggesting that you sometimes have to suck it up and bail if there’s no “there” there, I run the risk of becoming the Dr. Kevorkian of stratups.

  • Anonymous

    Thinking like a “serial” entrepreneur would fundamentally shift the funding landscape. 

    Think about it: the mentality today is the need to have a company that has the potential for a 10X return.  Why, because the other investments will likely fail on their way to trying to be a 10X return.  If you knew (and your funding partners…) that this wasn’t your last then you would be encouraged to control things you can predict (i.e. product improvements and customer solutions) rather than the typical ask of predict things you can’t control (i.e. forecasts and revenue).  As such entrepreneurs would devote most energy toward true product value which will find its way to attracting other ventures lacking the defined capacity having to explore acquiring the technology in the interest of speed.  The result would be a myriad of 2X to 3X exits with significant value added innovation. 

    And should the elements you can predict happen to fall into place just like a “big hit” would then the decision to continue rather than be acquired would build much more financially sustainable companies.

  • Will Miceli

    Great read.  Having perspective is the key takeaway for me.  That can come from thinking of the current project as one of many or just having perspective in general.  When we’re consumed with a project or company, perspective is tough to find.  It helps to have people who don’t BS you and give you honest feedback.  The tricky part is that those people can be wrong too.

    • http://twitter.com/bcrimmins Bob Crimmins

      Thanks, Will.  Your right on about perspective.  Getting third-party perspective is something I think serial entrepreneurs get really good at.  You’ll certainly hear from people who get it wrong and it’s not always easy to know which they are.  But it’s a numbers game of a kind and it’s actually valuable to find the neigh sayers.  But if ALL of the qualified folks you talk to ONLY tell you your out of your mind then at then it’s in your interest to wonder if they just may be right.

  • Anonymous

    As a serial entrepreneur,  I always have a few key “next big thing” ideas rolling around in my head.  The ones which aren’t going to be the “next big thing” go to the bottom of the memory stack.  I think we all do this…  The other thing I think we all do is *believe deep in our heart that our current deal is the next big thing*.  We are compelled to do this…more so than the urge to mate.  Trust me.  To an outsider this seems completely irrational, but there’s a method to this madness.  This irrational thought is a required ingredient for the successful entrepreneur cookie batter.
    I imagine there was an investor at one point who told Bezos his idea wasn’t the bomb. I’m certain that same investor wakes up every day, looks in the mirror, brushes his teeth and then kicks himself in the ass…yes every day.  If Bezos took what that same investor said to heart the world would be a different place.  It’s amazing how the belief in one’s own irrational thought can build an Amazon, a Facebook, or an Apple.

    • http://twitter.com/bcrimmins Bob Crimmins

      I hear ya, Aaron.  But for every Bezos who didn’t listen and succeeded there are a hundred others who didn’t listen and failed. Also, you don’t need everyone to see your vision… but if you can’t find anyone then you just may be onto nothing.  Suggesting that Jeff succeeded despite the folks who didn’t believe in him doesn’t give him the credit he’s owed for being extremely smart.  He certainly knew that he was pointed at a big market at a transformative time.  Sure there were unlucky investors who didn’t see it but plenty of smart ones did.  Jeff wasn’t hat in hand begging on street corners for someone… anyone… to believe in him.  It’s unfortunate that these apocryphal stories of misunderstood geniuses and dogged determination against all odds winning the day have become motivational (even aspirational) and the justification for bad business decisions.  There’s a reason that investors prefer to invest in serial entrepreneurs and I suspect it’s not because of their capacity for irrational thought.

      Respectfully.

      • Anonymous

        Hi Bob, I do agree with all of your points.   They’re completely valid.  I think you misunderstood the direction I was going.  My point was more that irrational belief in one’s own vision as a requirement for success.

      • Anonymous

        Hi Bob, I do agree with all of your points.   They’re completely valid.  I think you misunderstood the direction I was going.  My point was more that irrational belief in one’s own vision as a requirement for success.

        • http://twitter.com/bcrimmins Bob Crimmins

          I think I understand your point, Aaron.  I could go along with “really strong belief”, even “over-exuberant belief”… but I have trouble getting all the way to “irrational belief”.  Perhaps it’s just semantics and you don’t really mean “irrational”, i.e., “without or deprived of normal mental clarity or sound judgment.”  I reckon the extraordinarily high failure rate of startups is at least partly due to irrational beliefs about ideas.  ;)

          • Anonymous

            Actually I do mean irrational.  
            It’s not rational to throw every waking minute into something, deprive your family of your time, invest big portions of your hard earned money into something which has an extremely high chance of failure, all the while pining for that thing from the minute you wake up to the minute you go to sleep.

            I’m going to go have a tall glass of my own Kool-Aid now :-)

          • http://twitter.com/bcrimmins Bob Crimmins

            Aaron, you sound motivated, dedicated, driven… even a little obsessive — all GREAT traits for a startup entrepreneur.  If you also think it’s a good idea to put yourself, your family, your team and investors at financial risk for several years on a startup that wants to sell ice to Eskimos or to build a social network exclusively for professional chimney sweeps then you may also be irrational.  I trust that you’re not headed down any such path and I wish you well. 

            For my part, I’ll be constantly obsessing over my startup every waking minute as well… and also looking for really smart people to kick my ass about the business every chance I get.  We all need folks to kick our asses and cap the Kool-aide bottle once in a while.

            Best of luck to you!

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