To compare the physical challenges of climbing Mt. Everest to those in the startup world is absurd. Unfortunately for first-time founders, the non-physical difficulties are similar.
Every frozen corpse on Mt. Everest was once a highly motivated person.
Sir Edmund Hillary and Tenzing Norgay first summited Everest in 1953. From 1953 through 2018, approximately 16,000 arrived at base camp; of those, 9,159 successfully summited, while over 300 died trying. On the surface, it seems the odds are pretty good at 57%.
Dig in deeper, and the picture changes. The 9,159 summits were done by 5,294 individuals (analogous to serial founders in the startup world). Your odds as a first-time climber drop to 33%. Did motivation play much of a role? I don’t think so. Of the 16,000 people, all shared the same objective – Summit Everest. Each of those that summited did so with a team. A summit attempt requires an army of sherpas and support personnel to run lines, stock base camps, secure routes, hang rope lines, trailblaze, and deal with the inevitable surprises along the way. You also need experienced guides, logistics experts, weather forecasters, and lots of cash.
I’ve intentionally left two people out of these statistics. From 1953 to 2018, only two people succeeded in summitting Everest solo. Both made prior summits, so they are firmly in the serial summiteers club.
As a first-time founder, you’re passionate and highly motivated, just like everyone else that started down this path before you. Your objective is to succeed in business and make it to year 3. Securing funding, producing products, and generating revenues are only steps along the way. You’re not the real deal until you can demonstrate that your company is sustainable.
90% of companies that make it to the starting line (basecamp) fail in the first three years. You have a 10% chance to succeed after you’ve built a team and secured initial funding. Your odds of summitting Everest are over three times better. Funding only means you’ve convinced an outsider to make a bet on your concept. You still have to execute.
If you honestly intend to build a startup as a solo founder, I can only hope you haven’t quit your day job yet because here are the realities:
- Starting a company is hard
- Not everyone is cut out for it
- Passion and Motivation alone have little to do with success
- Competition is fierce
- You will likely fail
- Execution is ultimately the only thing that matters
- You can’t do it alone
- No one cares about your concept
- What your friends and family think is meaningless
- The skills that brought you here won’t be enough going forward
- Less than 1% of ideas prove feasible
- Investors don’t fund ideas
- They don’t fund Solo Founders
- You need a plan
- You need a plan that can execute
If you solve a big enough problem with a viable and competitive solution, you can demonstrate traction, your plan makes sense, and your team can execute, then you will be funded.
I sit on both sides of the startup/investor equation. When I review plans with the fund managers, they first look at the team. If you don’t have a strong team, you likely won’t be able to execute and they won’t take the risk. To try going it alone, you’d better be sure that your grandfather was Albert, your dad is Jeff, and you call your mom Oprah. Solo Founders, like solo climbers, are anomalies.
Based on a study of over 1,000 seed-funded startups, the majority failed from a combination of these top six factors:
- Founder conflict and misalignment – 65%
- Lack of product/market fit – 42%
- They ran out of cash – 29%
- The team couldn’t execute – 23%
- They were outcompeted – 19%
- They couldn’t generate sustainable margins– 18%
Most of these can and should be addressed early in your program. Too often the softer issues just get pushed along rather than agreed to at the start. Decisions you make early have a dramatic effect on your ability to succeed.
It’s hard to attract the people you need based on your idea alone. You need to be further along to convince someone to be part of your dream. Like a climbing guide, an experienced advisor can shorten your timeline, and help keep things on track. Some companies assemble an advisory board early in the process. An advisory board is typically less hands-on but if you can attract the right experts, it will increase your odds of being funded. When interviewing advisors you’ll run across a range of approaches based on that person’s specific experiences and what has worked well for them. All other things being equal it comes down to how well you think you can work them.
My approach starts out as an advisor to help map out how to move forward based on your current status. After that, I tend to be more hands-on than most. You have a lot to get done and few if any team members yet. At Cayenne, we tend to view our roles as temporary cofounders, not simply advising you on how to do things. We help get things done and develop a professional Business Plan in the process.
I hope this provided further insight into what lies ahead on your founder’s journey. This is your Everest – Conquer it! It’s exciting, never dull, you’ll question your sanity often, but if done right, with a solid team, it can be life-changing for you and everyone involved.