swombat.com

daily articles for founders

A startup escape path

Today, right now, what is the best path out of the corporate world and into startups? What would I advise myself to do, 5 years ago, if 5 years ago was today?

Let's start with some assumptions:

  • I am in a corporate job (for example, Accenture);
  • I am nowhere near ready to be an entrepreneur; when it comes to startups, I have absolutely no fucking clue what I'm doing and by default, I will make every mistake in the book;
  • however, I really should be an entrepreneur; given time, I will be successful; I just don't know the best way to go about it;
  • importantly, I am not based in Silicon Valley, or, for that matter, connected to the startup scene anywhere, since I'm still a lonely corporate drone;
  • maybe I have some technical skills, maybe not; in either case, my technical skills, if any, are geared towards the corporate world (e.g. Java/J2EE, Enterprise .NET, etc.) rather than the startup world (Rails, MySQL, node.js, etc.).

It's a wild guess, but I imagine it covers 90% of the western world's potential entrepreneurs. After all, the default for smart people is to do a degree and then end up working in a bank, law firm, consulting company, etc. So most smart people end up working in large corporations. And yet most smart people would be able to run their own business if they knew how.

What's the default case for a transition from this set of assumptions to "entrepreneur"?

Failure. Dramatic, disastrous failure. The kind that hurts and leaves scars.

Running your own business is an entirely different proposition than working for someone else. There are lots of things you need to learn, hangups you need to get over, habits you need to form, in order to have a chance at being successful. Even then, there's no guarantee of success, but without those key building blocks, you might as well roll some dice and hope for a 12.

So, with that being said, what would I advise someone fitting those starting conditions, in order to smooth the transition and maximise chances of not breaking one's teeth on the first attempt?

This is the "startup escape path".

Where several choices are possible, I've chosen what I believe to be the best one. Others will disagree. For example, some might think that working for someone else's startup is a better learning experience than running your own thing right away. It's their right to do so. I've picked one path that I believe is the best.

The first step into the startup world is to get the hell out of that corporation that's sucking your soul away and grinding it into shareholder dollars. However, most people aren't ready for that transition. So step one is to get ready.

The key at this step is to make up for all those great big blind spots that will kill your fledgling company and send you back to the corporate world with your tail between your legs. This is what these tasks are geared towards. All of this stuff can be done on the side, while holding a full time job. The only parts that are time-consuming are the learning parts.

  1. Register a business: it will come in handy later. Figure out what the law requires you to do to be a business owner, and do it. Make the business active, not dormant, even if it doesn't do much.
  2. Connect to the local startup community: The number of things that can kill your startup is truly astounding. You won't know about them all, but having a good mentor can save you repeatedly. You won't be able to get a mentor right away, until you're someone worth mentoring, but you should at the very least start turning up to local entrepreneurial events so you know what's out there. Don't be a blowhard or a showoff, just be your humble self: you may have just spent 5 years at McKinsey and got a top MBA, but there'll be 19 year olds at those meetups who are a million times better at building cool startups than you'll ever be. Learn to be honest or you won't get honest advice.
  3. Read Hacker News regularly: and subscribe to a few great startup blogs. There's a lot to learn in the startup world, and HN and other key blogs will help you to get up to speed.
  4. Build something someone uses: Learn some basic coding skills in whichever "hot" technology you like (these days: node.js and iOS are the hot shit). Build something, anything, that at least one person other than you finds useful enough to use it at least 5 times. It doesn't have to look good or change someone's life. In fact, it shouldn't. Just find someone with a problem that recurs every once in a while and build something that solves that problem for them. Learn both how easy and how hard that is.
  5. Build something that you will continue to use: Find a problem in your life that recurs regularly, at least once a week (bonus points if it's every day), and build some kind of solution for it that only you will use. The important thing for this step is that you will continue to use it for a long time, so you learn how important it is not to write shitty code that can't be maintained. After you've run this thing for at least a couple of months (not before), do some serious googling and find the 10 solutions that others have come up with for this problem, and compare yours to theirs.
  6. Start a blog: being able to express yourself in writing is not optional. Your blog might suck, and that's ok. You're not trying to become the next John Gruber, you're trying to become an entrepreneur. Post something to your blog every day, no matter how short. Don't worry about people thinking you're stupid: no one will read your blog anyway. At the same time, try to get people (e.g. from the #startups channel on Freenode or from r/startups) to read some of your stuff and give you feedback.
  7. Write something that Hacker News will vote up to the top 5 of the front page: the bar is not as high as you think. Getting over that hurdle will make you more confident about engaging with other entrepreneurs and testing your opinions in public.
  8. Sell something online: create something, or buy something you can resell - whatever. Build a page that sells at least one thing profitably, even at extremely low volumes. You can start unprofitably, but eventually you should make a profit (not counting your time, of course), even if it's only 1 cent.
  9. Sell something intangible in person: even if it's not worth your time, sell something to someone who's not a friend or family member. Being able to convince someone to buy something from you is an essential startup skill. Note: selling a car or other physical item doesn't count. It has to be something that they can't touch, or that you made yourself.
  10. Come up with 10 ideas: break them down into at least one full page of hypotheses. Pick the best 3 that don't require a lot of "blind work" upfront. Blind work is the work that happens before you've validated that there is a market.
  11. Invalidate those 3 ideas: go through the hypotheses until you either realise that they will work, or realise that they won't or aren't worthwhile (or aren't exciting enough to you). There are lots of ways to validate ideas listed on swombat.com.
  12. Repeat 10 and 11 until you have something that sticks: eventually, you'll stumble into something that people actually want, and which is generating recurring revenues, however small. Once you've achieved that, celebrate, and then jump off the corporate mothership.

You may still splat yourself on the ground even after all this. There'll always be risk. The parachute is by no means guaranteed to open, and despite all these steps you will still probably make some really basic and avoidable mistakes (though if you have built a good and honest relationship with a more experienced startup founder by now, you might avoid most of them).

But you'll certainly be head and shoulders above the average "I just quit my job, what do I do?" train wreck.

There's no speed limit on this startup escape path, but I would expect it to take 6-12 months if you're going about it deliberately and with some energy.

I hope this helps someone.


More from the library:
The truth about a failing startup
Friends, Family and Fools: the worst investors
Reckless risk-taking