5 counter intuitive facts about startups and more on Venture Capital
The main idea of the 3rd lecture on startups was that "There is only one thing in startups where you have to follow the intuition - hiring people. In all other cases - don't listen to it!".
Let's now talk about the 5 counterintuitive startup things.
1. Founders usually don't listen to advices of experienced people that they may be doing a mistake. They feel that it is against their nature, it doesn't seem to be the right thing and eventually end up with a failure. We are all ambitious, think that if we have an idea we know exactly how it can be implemented and how it has to look like.
But let's be realistic: though it's not necessary to be super experienced when starting a startup, it's better to listen to people who have gone through the way you are going to walk. I just remember me when I was 16-18 and my parents were giving me advice or trying to prevent me from doing smth, I was thinking "What are they talking about? They don't understand how fun this and that is" and so on... But now looking back I realize how right they were and I should have listened to what they said, because they know life. So yeah, let's follow the advices.
2. You don't need to have experience in startups to found one. The most important is your ability to develop a product which can solve the problems of your customers. So it's better to hold eyes wide open and learn to really listen to what people say.
3.Founders may think of the way how to crack the code and build a startup in an easier way. But the truth is that your way to a startup is layed with sweat and pain. There is no way of avoiding it. Your results are directly dependent on the amount of effort that you put in it, because you can't receive gold from stones, it's just impossible.
4. Remember, it will never get easier. It's like in life, you think "Soon I will achieve this and can then finally relax and be happy". But what happens as soon as you achieved it? You are happy for 5 minutes, but then you see that there is always more and more to go. You have to constatly keep on going, there is no point when you can stop and rest on your oars. Startup is about devoting your life to it!
5. I was always wondering "How do investors/venture capitalists know where to invest and who is going to succeed? Maybe they failed to choose a future 500 bn company, how unfair could it be." But let's look at the famous German startup incubator "Rocket Internet". They have a range of very successful startups such as Zalando, Foodpanda, HelloFresh, made an IPO last year, but their revenue is constantly sinking, share price drops with every day. And you may think "Oh, these guys are so experinced, they can make a golden goose from any startup", but reality shows that they can't. Investing in a startup is always a kind of russian roulette, you can never say whether it is going to be top or flop.
Next point of our lecture was to talk about how to come up with ideas. What I concluded is that you really have to start thinking outside the box, finding such niches which nobody has yet dared to conquer and be quick enough to do it before others. You may either have some global problem in mind and try to find solution to it or just try fixing some small problems which really annoy you and eventually help thousands of people.
In final part of the class we were watching the documentary called "Something ventured" which was telling about the first first venture capitalists back in the 60s. In this time noone even had an idea what VC means and it was just a bunch of young men with different backgrounds who decided to get in a kind of business they had no idea about. And I was really amazed how these courageous and smart people managed to take risk and literally build our future. Just imagine: Apple, IBM, Cisco, Power Point, Facebook - all these companies exist only thanks to venture capitalists.
But being in this business can play a mean trick on you. You as a founder, creator of the idea, can be easily thrown away if the things that you do, do not fit the expectations of VCs or some other team members. And for VCs there is nothing left to do as to fire you, because in their opinion you can somehow put the success of the company at risk. I was thinking how painful for a founder it really feels, it's like to take away a child from a mother. Thus I think that the only thing you can do about this as a founder is to realize that once you decide to get involved with VCs, you always have to be on the alert and follow the rules of the game. Playing the game is quite risky, but it's worth trying anyway and you better be ready that once it could come to a moment when you'll have to sacrifice a part of your soul.
Still I admire these VCs and would really like to get an opportunity to learn from such personalities.