Danielle Morrill
Danielle Morrill

It’s always refreshing and educational to hear startup founders come clean about a company’s struggles. Referly co-founder Danielle Morrill did just that with her latest blog post on how her startup turned into a walking zombie.

“My greatest fear as a startup founder isn’t to fail, it is to become a zombie startup,” she begins. “Kind of like in the 6th Sense when Bruce Willis doesn’t realize he is dead and tries to have a nice dinner with his wife, there are startups out there who are still “operating” but might as well not be.”

Morrill, who previously worked at Pelago and Expeditors International and was an active member of the Seattle startup community, goes on to write an authentic reflection about how her Y Combinator-backed, ten-month-old company “died.”

“It’s not the kind of dead where the website goes dark and everyone gets jobs somewhere else,” she wrote. “But the idea that we started with turned out to be the wrong one, so we killed it and yesterday I acknowledged publicly to ourselves and everyone else that we have to change our course.”

She has some good advice for figuring out if your startup is set to become a zombie. Morrill writes that first, you need to “acknowledge the reality of your situation,” and then from there it’s a “very personal and contextual decision.”

Here are her signs of a startup that’s about to die:

  • You don’t want to get out of bed in the morning
  • You don’t want to go out in public for fear you’ll have to explain what you do
  • You haven’t hit 10% week-over-week growth on any meaningful metric (revenue, active users, etc)
  • You’re working on the same idea after 12+ months and still haven’t launched
  • You’ve launched a consumer service and have less than 2% week-over-week growth in signups
  • You’ve launched an enterprise service and have less than 2% week-over-week growth in revenue pipeline
  • You are the CEO and hole yourself up in the offices so you don’t have to talk to employees and can read TechCrunch
  • You’ve hired consultants to figure out revenue, culture, or product in a company of less than 10 people
  • You’re at SXSW right now reading this post and trying not to cry

Oh, and to get the “full effect,” of the blog post, you’re supposed to listen to this classical song while reading:

Comments

  • JR serial entrepreneur

    What!?! No comments yet? Denial is oh, so very powerful. Love the accompanying music.

    Feels oh so good to let it go and go find me a job! “Welcome to Walmart – Here’s your shopping cart!”

    • Rotating Alias Dunce

      I’m sure this isn’t the first time you’ve been told this, but you have the emotional maturity of a three year old.

  • http://www.facebook.com/andrew.delorenzo Andrew DeLorenzo

    Tippr?

  • Rajeev Goel

    Hmm, by your criteria, I definitely have a zombie startup (Our School Pages), but have no plans to shut it down. 10% week over week growth? Really? I feel like I must be misreading that, because that’s equivalent to growing 6x every year!

  • Peter H

    Great article, and great reminder to organize your business to “fail fast” if your assumptions aren’t going to work out.
    I also had a beef with the 10% weekly growth metric. Everyone reasing this article will immediately think “so is my startup a zombie”? 10% weekly growth is very hard to achieve, and many great startups don’t exhibit 10% weekly growth … not sure what is meant by that one.

    • http://www.facebook.com/kmorrill Kevin Morrill

      Part of the reason we switched is because the growth rate in affiliate revenue was quite low, but the growth rate in other parts of the product was much more explosive. Go where the energy is.

      You’re right that 10% is not a one size fits all number. It depends a lot on the kind of business you want to have. Paul Graham’s essay on growth is a great read http://www.paulgraham.com/growth.html

  • Lewis Lin

    Re: zombie startup, I think Steve Blank has a great quote: “Lukewarm response to any product or the problem it solves is a serious, red-alert danger signal that calls for an iteration or a pivot rather than an automatic step forward into customer validation.” (Italics are Steve’s.)

  • http://www.facebook.com/people/Michael-Saffitz/685196053 Michael Saffitz

    This is an incredibly valuable post, and as a co-founder of a startup (www.apptentive.com), something I strongly identify with. It’s very easy to fall into the trap of having small incremental wins, and making small incremental progress without ever really breaking out.

    I think one of the most important things any founder can do is set aggressive but achievable goals for their important business metrics (# customers, revenue, etc.) WITH dates. If you’re continually missing hitting those goals, you need to ask yourself why that is and what needs to change.

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