Startup Delirium
What do people do after getting a business idea for a startup? They usually seek out an expert in the field to assess the said idea, give it a thumbs up, and point in the direction of potential investors.
What do I do when people come up to me with business ideas? I act like a jerk. I'm rude and cynical, and I try my best to tear their concept apart, smash it to pieces, and drown them in concerns - basically, I do everything in my power to destroy it. I demotivate these people to the point of deadly offense.
Why do I do that?
Before I answer, let's remember what business really is.
It's not a joke, prank, or hobby, so I'll be serious. Business is the process of making money. ?It is a social, cultural, economic, and usually technical phenomenon.? When you do business, you're not just making money, you're also serving society and being accountable to:
Business is a super serious matter, as is evident from these five bullet points. A successful entrepreneur is a practical expert, a warrior of risk and intent. People like these take risks, invest time and energy, and involve others in their business - those who are either willing to share the risks or just spend their time and mental effort for a steady salary. That's nothing to sneeze at either. An entrepreneur acts as a guarantor, forming contracts between partners, investors, employees, and customers or partners of the business.? And unlike a simple promise, a contract has legal force and serves as a binding agreement.
Entrepreneurship isn't a piece of cake. It requires figuring out what the market actually needs, and then serving it proficiently and efficiently while also making a profit without going into the red. Moreover, ever since 2020 dropped, you are diving into a market filled with rivals, deceitful competitors, regulations, politics, and heaps of unpredictability. Nothing is certain, and calculations are futile.? All the while, you are in charge of this circus. You are solely responsible for everything and everyone involved.
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You can't just be wishy-washy with business. It's a modern and super-serious battleground. It has nothing in common with your impulsive desires to start exercising or even go to college for a few years. When you decide to go for a morning jog, there aren't any victims if you fail. Do that, and you'll get my full approval and support (and probably no personal attacks either).? But with business, it's a different story. I'll try to break down your idea with all the mighty cynicism I've got.
So why do I raise these barriers?
I once picked up a cool term from an investor - a "startup delirium." It explains in a nutshell why 99% of startups fail in their first year. The answer is because the founders have no full grasp of reality. They become so infatuated with their idea that they try to jam reality into their vision, like a square peg into a round hole. Basically, they're delusional.
They aren't being dishonest, trying to con the investors, or taking some shortcuts. Driven by books and TV shows about great people, they truly believe in their idea. This belief blinds them, captivates them, and paints a bright future so alluring that risks, analysis, teams, taxes, regulations, development, reputation, and other worldly matters no longer fit into their focus. They really, truly find themselves in the tight grip of their delirium.
To make things worse, if the founder is particularly persuasive, their delusions can spread like a contagious virus, infecting the team and even investors. How does it end? First, mortgaged property to secure the first bank loan for the MVP. And then come the red faces at board meetings, ruined lives and relationships, lost credibility, and years of wasted effort. I should know because I've been both the persuasive founder with delusions and the investor who fell for someone else's delirium.
Note that no one ever has a full grasp of reality. We all hallucinate in one way or another - that's what makes us human. And it's impossible to escape this trap (say hi to the Wachowskis). But we can do is lower the level of delusion and try as hard as we can to get closer to the real picture.
Here's my advice to all startup founders. Do not listen to those who shower you with support and validation. Seek out the ones who are ready to tear you apart. Let them destroy your idea, attack you from all sides, ask the most uncomfortable questions, poke at all the holes, find vulnerabilities, and compare you with competitors. Let them break your delirium with the context of reality. And if your idea is solid, your determination is strong, and you can stand up to the pressure, these same people most likely will be the first to invest in you. If you can withstand this, then get ready for a fresh start, as there's every possibility this will become a successful business or unicorn.
Believe me, when you bring your product to the market and strive for profitability, the market will try to break you much harder than I ever did.