Billion Dollar Unicorns: Reconsider Your Aspirations

In November last year, I read a brilliant piece titled Reconsider by David Heinemeier Hansson, creator of Ruby on Rails, and a partner at Basecamp, a small 50-people collaboration software company. David starts the piece by saying:

It [Basecamp] didn’t disrupt anything. It didn’t add any new members to the three-comma club. It was never a unicorn. Even worse: There are still, after all these years, less than fifty people working at Basecamp. We don’t even have a San Francisco satellite office!

I know what you’re thinking, right? BOOOORING.

After all, in these crazy days of Unicorn mania, what wisdom does a founder of a small, 50-people company full of remote workers serving about 6000 global customers offer you, really?

You are wrong.

Read the piece. It’s a gem.

Well, the reason I’m here is to remind you that maybe, just maybe, you too have a nagging, gagging sense that the current atmosphere of disrupt-o-mania isn’t the only air a startup can breathe. That perhaps this zeal for disruption is not only crowding out other motives for doing a startup, but also can be downright poisonous for everyone here and the rest of the world.

Part of the problem seems to be that nobody these days is content to merely put their dent in the universe. No, they have to fucking own the universe. It’s not enough to be in the market, they have to dominate it. It’s not enough to serve customers, they have to capture them.

I love working with customers, adding value, solving problems, learning. For me, this is not a means to an end. It IS why I work. It was refreshing to see David underscore a point of view that is so out of fashion these days, so mercilessly drowned out in the cacophony of Unicorn mania.

Who said that the ultimate success in life is to build a Unicorn company?

I KNOW who said it.

Do you?

VCs said it.

Yes.

Of course.

For the venture capital model, Unicorns are the way to make maximum money. And their job is to make maximum money for their limited partners and themselves.

It is an entirely self-serving point of view served up by a cottage industry of financial services professionals.

As an entrepreneur, why do you buy into it?

That’s the question I want you to reconsider.

That’s the question David is asking you to reconsider.

WHY?

So first you take a lot of money from angels desperate to not miss out on the next big unicorn. Then you take an obscene amount of money from VCs to inflate your top-line growth, to entice the investment bankers that you might be worthy of foisting upon the public markets, eventually, or a suitable tech behemoth.

And every step along this scripted way you will accumulate more bosses. More people with “guidance” for you, about how you can juice the numbers long enough to make it someone else’s problem to keep the air castle in the sky inflated and rising. But of course it isn’t just guidance, once you take the money. It’s a debt owed, with all the nagging reciprocity that comes with it.

Now, if you truly want to become the next fifty-billion dollar Uber in another five years, I guess this game somehow makes sense in its own twisted logic. But it’s more than worth a few moments of your time to reconsider whether that’s really what you want. Or, even more accurately, whether an incredibly unlikely shot at that is what you want.

I don’t like bosses. I enjoy doing exactly what I like with my life. My self-esteem is not tied to making money for a bunch of VCs. If my company makes $10 million a year serving appreciative customers and happy colleagues, it counts as success, not failure, as most VCs would deem such a business.

What is also getting drowned out in this chorus of Unicorn mania is quality of life. VCs deride entrepreneurs who run successful, highly profitable small companies as “lifestyle businesses” as if that’s something to look down on.

I know a lot of VERY rich people VERY well. Excess is not necessarily a source of happiness or fulfillment. Striving for excess at great costs is often a road that leads to unhappy, lonely, dysfunctional lives. Being an asshole in that process leads to even emptier outcomes. 

So entrepreneurs, you are being idiots if you are letting a small cottage industry of self-serving financial services professionals define success for you.

Success is building a profitable, sustainable company.

Not a Unicorn. 

Entrepreneurship = (Customers + Revenues + Profits); Financing and Exit are optional.

Looking For Some Hands-On Advice?

I receive many emails from entrepreneurs who want to discuss their specific businesses. I’m very happy to discuss your situation during my free online 1M/1M Roundtables, held almost every Thursday. During each roundtable, up to five entrepreneurs can pitch their businesses and receive my immediate and straightforward feedback.

To give entrepreneurs all over the world access to Silicon Valley’s knowledge, methodology, and network, I founded the One Million by One Million (1M/1M) global virtual incubator. 1M/1M aims to nurture a million entrepreneurs to reach a million dollars each in annual revenue and beyond, thereby creating a trillion dollars in global GDP and ten million jobs.

For those still testing the waters of entrepreneurship, I’ve written my Entrepreneur Journeys book series to inform and inspire. My newest book, Billion Dollar Unicorns, is now available from Amazon.

If you are interested in entrepreneurship topics and my writings, you can follow me here. I hope to publish articles on LinkedIn every week.

Photo credit: yosuke muroya/Flickr.com.