Category Archives: Life Lessons

Is it ever okay to take a break from your startup?

As a startup entrepreneur, is it ever okay to take a day, or (avert your eyes) even a week off?

At any sign of fatigue, my first instinct is always to hit the accelerator. Another few hours of work are just a pump-up speech (and energy drink) away. But after years of leading scientific and technology teams, I’ve long since learned the limitations of constantly returning to this strategy.

Like many tough guy rules, like “don’t show emotion” and “don’t ask for help”, “don’t take breaks” is a simplistic platitude.

Make no mistake about it – I am obsessed with LabDoor. My work keeps me up late into each night. I come home and reflect on our daily successes and failures. Many nights are spent working through major work challenges in my dreams. Then, I wake up, strategize in the shower, and get back to work.

‘Sprint and Follow’ Leadership is great for a short-term boost in work output. But every time you force your team (and yourself) beyond its limits, know that you are borrowing against future productivity.

Remember when you used to pull ‘all-nighters’ in college? It may have seemed like a good idea at the time, and may have even saved you from a few failed exams. But when you understand these three factors, maybe you’ll reconsider:

  1. Why were you in the library at 3AM Wednesday morning? Could it have anything to do with that Sunday morning hangover that kept you unproductive until 3PM that day? A big Sunday study session would have saved you a full night of sleep.
  2. Was your mind at 100% for your big test? Scientifically, that’s nearly impossible. Studies show that 17 hours of sleep deprivation has cognitive effects equivalent to a BAC of 0.05%. At 24+ hours without sleep, your equivalent BAC level would leave you illegal to drive a car.
  3. What did you do immediately after that exam? Odds are that you didn’t immediately start studying for your next big test. Be honest – you skipped your next class, went straight to bed, and paid back your sleep debt.

We’re not building LabDoor for a quick exit. We have hundreds of big tests in front of us. In our early months, we were proud of our frequent all-nighters. Now, we’re planning ahead. Consistently shipping new code every day and novel science every week. And now we’re not embarrassed to take a couple weekends and holidays completely off the grid.

This blog post was written weeks ago, and automatically published today. Our office is closed, and everyone is home with their families. LabDoor is poised for a huge 2014, and our team is going to be running at 100% all year.

Dealing with rejection

It happened again. You walked into a VC partner meeting with a ton of confidence. Your first meeting went great, with the associate gushing over the potential of your startup. Then, you got an introduction to the partner specializing in your industry. Another slam-dunk. But today at the partner meeting, you took some hard shots. There were a couple questions you didn’t handle cleanly. The partner at the far end of the table had her arms crossed defiantly the whole pitch. And by the time you made the drive from Sand Hill Road back to your office, you already had that dreaded email in your inbox:

“Thanks for taking the time to present your company to XX Capital. While we were very impressed with your passion and knowledge of the industry…”

All of a sudden, you’re getting flashbacks to being 17, opening the mailbox, and pulling out that little, standard envelope with your favorite college’s emblem on the top left corner. You know that they can’t fit an entire enrollment packet into that one-page letter.

Even the very best entrepreneurs in the world get rejected over 50% of the time that they pitch an investor. When Mark Suster tells his fundraising story, he makes it very clear that 75% of investors turned him down. And this was when he was pitching two startups that ended up with very successful exits.

So how do you handle the constant pressure of rejection?

The first lesson is to never shy away from it. The only way to successfully run an investment round is to run startup funding as a sales funnel, identifying as many qualified leads as possible, then running through them with passion and intensity. If you get so afraid of rejection that you slow down your process at all, you’re finished. There’s no way to half-ass the funding process.

The second lesson is to just get used to it. Over the course of two startups, I’ve already run through close to 100 pitches. My rejections are definitely over 50%, and likely even higher than Suster’s 75% number. Prepare yourself at the beginning of the process for short-term failure, and know that they’re practically a requirement on the path of startup success.

The third lesson is to celebrate the wins. All those rejections become worth it when you finally get an investor to say yes. Really savor those wins. Drink a six-pack with your team. Accept the pats on the back from your friends. Don’t let anyone tell you that it’s not a big deal to raise money for a startup. Fundraising is hard work, and is often a vital part of growing a rapidly growing, scalable startup.

The fourth, and most important, lesson is to learn the ‘why’ of the rejection. Sometimes the investor doesn’t feel comfortable with the industry. Other times, they’ve been burned in this space before, and are hesitant to jump back in. There are times where investors are simply distracted by external causes, from an upcoming trip to a pending divorce. These are all things that you are not expected to control.

However, if the investor was confused by your pitch, missed the key value of your startup, or disliked the delivery of your presentation, there are lessons to be learned. I wince when I think back at some of my very first pitches. The slides were poorly organized, I stumbled through my words, and the business model was practically incomprehensible. It is no wonder so many investors turned me down in the early days. But after nearly every meeting, I opened up this laptop, and performed a brain dump of all the lessons I learned in that pitch. Where had I connected with the investor? Which parts piqued her interest? Why did I get the ‘confused puppy’ look during the monetization slide?

After every few pitches, I would tweak slides to make them clearer. Then, we would bring the team together and form a fake VC meeting, where everyone was allowed to interrupt me, grill me on specific details of my pitch, and generally force me to hit as many curveballs as possible. Afterwards, I still continued to face rejections, but now they were a little less common.

At the end of the day, that’s the lesson. Fundraising is hard. You’re asking someone to give you thousands or millions of dollars to spend on an extremely high-risk venture in an industry where most investors lose money. Treat fundraising season like you do the rest of your business, with extreme energy and passion, and you’ll survive the rash of rejections just long enough to put money in the bank.

‘Sprint and Follow’ Leadership

“Lead by example.”

This cliché, constantly provided to new entrepreneurs and first-time CEOs, is often terrible advice for the heads of large organizations (or founders of startups that aspire to be large). What entrepreneurs usually gather from this recommendation is that they simply need to work their asses off, and their team will follow them.

This kind of ‘sprint and follow’ leadership works great for short-term objectives and small companies, where the passion and charisma of a leader can will a team to a win. The original ‘sprint and follow’ leaders were Braveheart-style warriors, where the objective was victory in a single battle and the alternative was near-certain death. But on a scale of leadership, these people would be categorized as Level 3 or Level 4 leaders.They achieve significant performance standards from their teams, but find their gains unscalable to larger projects or longer durations.

One of the hardest parts of being a product-oriented CEO is learning to lead the team from the sidelines, instead of trying to make every play themselves. Mark Zuckerberg once famously operated in the latter fashion, continuing to work in the bullpen and driving Facebook’s heads-down, developer-centric culture from the front.

In this structure, motivation is often extrinsic and reinforcement is often negative. Bill Gates, the top product CEO of his generation, spent much of the first five years of his Microsoft career directly leading the technical development, often jumping into action to redo work when his employees did not perform up to his standards (and then openly berating them for the errors).

“At various stages of the company I’ve had to learn new things. In the first five years I didn’t let any line of code get out of the company that I hadn’t reviewed, and most people’s code I didn’t like as well as mine, so I’d mostly just rewrite it.” — Bill Gates, October 13, 2005

Confession time: I am not a Level 5 leader. But I come to work at LabDoor every day focusing on the skills and will necessary to earn that title.

In my early days at LabDoor, and at Avomeen before it, I was a ‘Sprint and Follow’ leader. My key metrics were hours worked and tasks completed. I reviewed every report and sat in every meeting. It was truly painful for me to watch a project get delegated and then completed less-than-perfectly. At Avomeen, if the output on a Scanning Electron Microscope reading looked a little blurry, I’d jump into the seat and spend thirty minutes developing a better image myself. During LabDoor’s time at Rock Health, it was a matter of pride for me to be the last person out the door each night, not just from our company, but amongst the entire accelerator class.

After about 30 straight months of this between the two startups, things started fraying at the seams. I found myself constantly exhausted, permanent bags under my eyes and increasingly losing my battle with the snooze button each morning. My team, which had loyally sprinted with me every step of the way, began to show signs of slowing down as well. We were a powerful force at the edge of our limits. I was building a lean startup in all the wrong ways.

LabDoor has since done a ton of things right. Starting at the top, I’ve trained myself to recognize and highlight my own shortcomings, especially to my own team. It’s given me the courage to ‘quit’ on projects and tasks that weren’t positively impacting our company. My two co-founders owned their departments, and led without being told to lead.

We had fewer team meetings. The press stopped hearing from us. Our perpetual ‘seed round’ quietly closed. And through it all, we had the most productive four months of our company’s existence.

Now, we’re lining up a series of huge milestones ready to launch in rapid fire over the next few months. We’re all working towards the same key metric — the amount of actionable scientific data delivered to our users.

I’m not delegating more or working harder. The real lesson is much, much simpler. I simply acknowledged my numerous weaknesses, eliminated them from my ‘job description’, and focused my one true strength — intense, unbridled passion — towards the stuff that was left. I’m still not a Level 5 leader, but I’m getting closer.

It’s cool to stay in school.

“Should I drop out of college to become an entrepreneur?”

My only advice regarding potentially leaving school for a startup: Even the most successful college dropouts (see Zuckerberg, Gates, Dell, et. al) never came into their startup expecting to drop out. They just started building their product, and the amazing scale of the startup forced them out of school. I wouldn’t leave school unless you’re getting forced out of school by an amazing startup opportunity.

Just start building.

No excuses – just win baby.

One of the most transformative moments from my High School years came from a very unlikely source, a Madden football video game.

I was playing this game in our football team locker room against one of my teammates. The game was not going well for me, and I was furiously trying to make a comeback on offense. The game ended with me throwing an interception over the middle, and then loudly complaining that my virtual wide receiver had messed up his passing route.

At that moment, our head football coach, Matt Irvin, had stopped to watch a couple plays. He looked at me for a second, and then said “Guess you’ve got an excuse for everything.”

I thought about talking back to him, but instead sat dumbfounded. He was right. I had a tendency to assume that all of my successes were hard-earned, while my failures were the fault of everyone but me.

This is actually a well-known human cognitive bias, called the negative agency bias. However, just because everyone else is doing it, doesn’t mean we’re going to let ourselves get away with this sort of spoilsport attitude.

In the seven years since then, I’ve gone out of my way to attribute as much of my activities and outcomes, both positive and negative, to myself.

When an investor turns me down, I know I need to refine my pitch. When our company misses its monthly targets, it’s time to check my bearings and make sure our strategy and implementation are still on track.

This is not an invitation to beat yourself up over every little setback; rather it is an acknowledgement of your personal responsibility over the outcomes in your life.

Try this approach for a few months, and let me know how it goes. The key to this strategy is to acknowledge the negative outcome, and then immediately look towards your path to improvement. Take that motivation with you as you retool your pitch, fine-tune your business strategy, or even just aim to complete your next virtual pass.

Blogging for yourself

The idea of writing in a journal seems like a quaint or juvenile pursuit, the domain of Moleskine-toting hipsters or angst-ridden teenagers. More recently, this style of writing has been co-opted by the startup culture as a part of a ‘content strategy’ to ‘build brands’ and ‘acquire early adopters’.

For me, writing was truly a personal project. I put over 40,000 words into a word processor before even considering a WordPress theme for a blog or a distribution method for my content.

I write for three reasons:

  • First, for nostalgia. It’s the same reason why I’ve saved every version of my one-page pitch for LabDoor. It’s fun to look back on my vision for the company on the day the concept was conceived. During a time where I didn’t stop to consider a name for this future venture, and instead furiously keyed in the words that described the company I wished existed.
  • Second, for introspection. I used to have weaknesses as an entrepreneur. I still do, but I also did then. The best way that I’ve found to become a stronger leader and entrepreneur is to diligently study the strategy and actions of my past self and unmercifully play Monday Morning Quarterback against myself.
  • Finally, for posterity. There’s a chance that current and aspiring entrepreneurs could learn something from my short, but eventful startup life. It would be a shame to see my past failures wasted without turning into a teachable moment.

So how does an entrepreneur working over 100 hours a week find time to blog? It’s simple – just wait until the words force themselves out of your head, and rush to a tape recorder or word processor to record your thoughts. Forcing yourself in front of a blank screen or notebook on a daily basis is a fool’s errand. Good writing cannot be summoned on demand. But you’ll be amazed how quickly 1,000 words on fundraising pour out of you during a stressed hour between two crucial VC pitches.

The most important thing about blogging as an entrepreneur (or investor for that matter) is not to let elecution get in the way of execution. The grammar, sentence structure, or word choice matters little. Just get the words on paper, or into bits and bytes. I also rarely use my first 10-12 hours of daily energy to write in my startup journal. My best writing instead often comes during the last 1-2 ‘wind-down’ hours between work and sleep, sometimes fueled by a half-bottle of wine.

The key to great writing is to write for yourself. Be excessively honest. Save the hype for your next TechCrunch interview. Just record your thoughts, watch them evolve, learn from your mistakes, and most importantly, keep building a company worth writing about. With a great story, the words will write themselves.