The Problem with Founders

In response to Danny Crichton’s TechCrunch article, “The Problem with Founders,” and commentary from another CEO.

My response.

Minda Aguhob · CEO & Founder at Peakfoqus · 223 followers

I really appreciate hearing from the CEOs in the trenches here. Marius, Daniel, I can hear your experiences are similar to what I’m experiencing as a woman founder in Silicon Valley, leading Peakfoqus – designing smart solutions for senior health & safety.

Despite what the media portrays, money does NOT come easily – not even to the best of the best – although yes, there is a lot of money out there. The investors are intelligent, have deep experience, and easily sort real entrepreneurs and talented leaders from the wantrepreneurs.

Founders work really hard to validate our concepts, get traction, building realistic yet visionary business plans, and of course, product. I’ve found that the founders who last through the endless rejections are people with serious character who I deeply admire. I’ve sacrificed my savings while working sideline projects – I drove Lyft and did analysis work during my customer validation phase (@dailylyft). At a certain point, you must throw your hat over the wall and become 100% committed.

I believe in rewarding the team fairly, and it also takes time and experience to find co-founders, people who truly deserve equity. The sacrifices involved are not for everyone.

The article below, brief version. (Another CEO’s commentary below, too.)

“Just go start a company.” The ultimate panacea to all of life’s problems, the one solution to rule them all. I have personally received Silicon Valley’s most popular advice line more times than I can count, and my friends seem equally likely to have this help foisted upon them.

Feeling bored at work? Just go start a company. Feeling depressed about life and lack any direction? Just go start a company.

…The irony of all of this advice is that it almost invariably came from people who had never founded a business before. Our generation’s just go start a company is pretty much like our parents’ “just go join the army.” Regardless of where you stand in life, somehow the experience of going through hell will shape you up and make you a productive human being.

…Many years ago, starting a business was difficult, needing vast reserves of capital and requiring founders to give up their careers just to try a new idea. The bar was extraordinarily high, and the talent that joined in these early days was equally high.

The bar is so much lower today. Starting a company requires little capital to get started, and even then, dozens of seed funds will cover a startup’s first bills. Top students from engineering and business are gravitating toward Silicon Valley to build their company, since everyone is starting a business and everyone wants to change the world.

That single rare diamond is now mass-manufactured cubic zirconia.

Yet our myths about founders haven’t caught up with this reality. It’s the reason there is so much derision about founders today from some corners of the press. Heck, it’s the reason this article exists at all. The issues surrounding founders this year, from sexual harassment to physical assault to drunk driving are not problems of heroes, but quotidian problems of everyday life. Founders are normal people, yet are treated like deities.

…We can’t live in a world where everyone wants to be a founder. Starting a business may be hard, but scaling a business is where all the value of a company gets built. For every founder, we need dozens or more engineers, product managers, business developers, salespeople, marketers, and others to build a startup into a sustainable, economically-competitive entity. Silicon Valley’s founder premium needs to adjust accordingly.

Equity is one valve for making this a bit more democratic. Having a startup’s talent, especially those with single-digit employee numbers, receive a bit more equity would probably assist startups in recruiting, and may also allow them to focus more of their attention on getting the best people.

<snip>

Our culture won’t change, however, as long as the media continues to fawn over co-founders at the expense of every other individual. Reporters are often too willing to engage in the narrative-building of startups, since it helps in crafting a story. We need to take a wider lens, and report more than just what the CEO has to say. It’s one of the reasons why I read sites like High Scalability, where employees who often don’t get much attention have an opportunity to demonstrate their innovations and skills.

It’s been fashionable to call Silicon Valley and startups a “hits” business, but we are not Hollywood. Ultimately, the names on our “About Us” pages matter little unlike the movie actors that grace a film poster. The only narrative, the only thing in the whole universe that truly matters is the product we build for our users. Silicon Valley’s roots are in the communalism of the 1960s, and the egalitarian ethos of the Bay Area in the 1930s. We need to bring that egalitarian spirit back into our startups. Just start a company — like that.

Marius Hilarious ·  Top Commenter · Founder, CEO at Tennis Buddy App

A bit cynical view of people trying to startup a company. There are two assumptions in the article that are not right.

Seed-money is not plentiful, you can´t just walk around and money gets thrown at you. The process looks like this: Have an idea and built the MVP –> fail. Then pivot 1-2 times and you MIGHT find product market/fit. This normally takes 6 months to 2 years. Once this is done, then you can start thinking about fundraising, except you´re among the 1% that have worked at facebook or Google of course.

This is so much harder than scaling a company with a product that already works.

You don´t get equity as an employee, because you get paid a salary, you don´t have to worry about things like where to pay your next rent from, if you are willing to sacrifice your friendship with your best friend from college, because of cofounder disputes or that your girlfriend might break up with you because you don´t have time for her.

These are just three worries that you can experience when starting a company, there are dozens more just like that.

My response.

Minda Aguhob · CEO & Founder at Peakfoqus · 223 followers

I really appreciate hearing from the CEOs in the trenches here. Marius, Daniel, I can hear your experiences are similar to what I’m experiencing as a woman founder in Silicon Valley, leading Peakfoqus – designing smart solutions for senior health & safety.

Despite what the media portrays, money does NOT come easily – not even to the best of the best – although yes, there is a lot of money out there. The investors are intelligent, have deep experience, and easily sort real entrepreneurs and talented leaders from the wantrepreneurs.

Founders work really hard to validate our concepts, get traction, building realistic yet visionary business plans, and of course, product. I’ve found that the founders who last through the endless rejections are people with serious character who I deeply admire. I’ve sacrificed my savings while working sideline projects – I drove Lyft and did analysis work during my customer validation phase (@dailylyft). At a certain point, you must throw your hat over the wall and become 100% committed.

I believe in rewarding the team fairly, and it also takes time and experience to find co-founders, people who truly deserve equity. The sacrifices involved are not for everyone.

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About Minda Aguhob, M.Ed.

Minda Aguhob has always been passionate about the effective use of technology, advocacy, and rigorous research to develop innovative processes that improve performance. Based in San Francisco, California, Minda is leading Peakfoqus (http://peakfoqus.com) a company that's designing digital health solutions rooted in research and advocacy.
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1 Response to The Problem with Founders

  1. Pingback: Why We Need to Stop Saying, "Just Go Start a Company" - The Startup Couch

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