Working on a startup is much more like racing a BMX bike than riding a roller coaster.
Founders of early-stage ventures often compare their experience to being on a roller coaster.
It’s easy to see why: the highs, the lows, the exhilarating thrills, the sickening drops. But I think that’s the wrong analogy. Surely there is more to working on a startup than entertaining ourselves briefly, making ourselves feel ill, and ending up back where we started?
A startup is much more like being in a BMX race. And that is very different from riding a roller coaster.
Firstly, a BMX bike has handlebars and pedals.
There are no rails. We are not safely restrained in a carriage. Nobody has predetermined our course.
We have to steer ourselves and the combination of gravity and our own efforts determines how fast we go.
Secondly, and perhaps more importantly, we can crash.
The real risk involved with riding a roller coaster is infinitesimally small. They are designed to scare us, and trick our brain into thinking we’re doing something dangerous, but really they are very safe. We can just sit back and enjoy the ride.
In a BMX race, on the other hand, there’s a very real prospect that we will hit the dirt, and that will hurt.
Thirdly, we are in a race.
When we ride a roller coaster everybody arrives at the destination at the same time.
On a BMX bike, we are competing against others who are doing their best to go faster and do better. There will be winners and losers. We might get beaten.
If we realise we’re in a BMX race rather than sitting on a roller coaster, there many things we will choose to do differently.
At school success is measured by how well we do things that people have done before. It’s important to build a foundation for ourselves by understanding all the things that others have discovered and learned.
But in a startup, it’s the exact opposite: success is measured by how well we do things that nobody has done before and that most people don’t think we can do.
Of course the problem with trying something when we don’t know if it will work or not is that sometimes the result is failure. How do we cope with that?
The trope that gets rolled out whenever there is a high-profile startup failure is:
Most startups fail.
Often people using this excuse really mean:
Most startups fail, but on average startups succeed because the rare big successes more than cancel out the more common losses.
That logic works well in a spreadsheet.
But that is an unhelpful response, when considering an individual failure and trying to take lessons from it. When we fail it hurts, and averages are not much consolation.
When a startup fails it is more useful to ask what characteristics of that particular company caused it to fail, and whether other companies with those characteristics sometimes succeed.
If the answer is “no” then brushing off the failure with a statement that implies it’s a component of a bigger success is deluded. Our failures are not converging on success.
If the answer is “yes” then we should ask what was different in this case.
Let’s start there, rather than assuming that we can somehow fail our way to success with a fixed mindset.
Most founders are terrible at assessing risk. This is actually a good thing, because a successful startup is inevitably a lot harder and more time consuming than anyone ever anticipates at the outset. In many cases, delusion is all that gets someone going.
We usually prefer to think positively, and so don’t want to consider the possible downsides too much. We know that most young companies fail, but assume we will be the rare exception.
But I recommend doing the opposite. Understanding the downsides, and the corresponding impact and likelihood, is what allows us to take bigger risks, to be excited and optimistic about the chance of success. Think of the worst case. Only the paranoid survive.1 When we are honest about the challenges ahead we’ll be much more likely to navigate through them.2
Having a good Plan B in mind means we can run harder at Plan A. But we also need to agree in advance when we will switch from Plan A to Plan B. Otherwise we inevitably stick with Plan A longer than we should, hoping things will improve, even when it’s obviously not working. We’re less likely to make good decisions when things are not going well and we’re under pressure. It’s often not as bad as we fear anyway. More than once I’ve seen Plan B turn out to be the better option.
There is a “success bias” in startup culture, where winners tell their stories and conveniently ignore all the mistakes they made, which are often the most interesting and important lessons. As a result we assume that success happens in a straight line. But thick skin comes from scar tissue. The most successful people have often messed up in many interesting ways.
We also don’t hear enough from the founders who tried something and failed, despite the fact that the lessons they uncovered in the process are likely much more relevant.
I’m sad to see “failure” become a buzzword. I’ve even seen some advisors advocate failure as a good and useful way to cut your teeth in startups. Too often founders acting on this advice say “I failed fast” when what they actually mean is “I always knew my idea was never very good to start with”. Which begs the question: what was the lesson from the failure? There is no feedback loop.
The sport of BMX first made headlines in New Zealand when our most successful rider, Sarah Walker, won a silver medal at the 2012 London Olympics.
She had a serious crash in 2014, breaking multiple bones. But, she used that painful experience to improve her performance.
BMX riders can’t hide from the painful consequences of failure. They experience it first hand. The best ones use that as a catalyst to improve their performance.
Rather than celebrating our failures, we should talk about our lessons, set up and learn from feedback loops, and fail better.
Those of us who have never experienced it can only imagine being balanced on the pedals waiting for the green light at the top of the start ramp in a major BMX race, and the mental discipline required to not be terrified and completely immobilised in that moment.
These days it is normal for high-performance athletes to have sports psychologists to help them prepare for these situations.
For example, during their successful World Cup campaigns in 2011 and 2015, the All Blacks players and coaches credited people like Gilbert Enoka and Ceri Evans with helping them to overcome their previous reputation for choking and crumbling under the pressure of knock-out games. They learned simple techniques to use on the field to help them re-focus and retain their composure.3
Likewise, Sarah has described the difference that her mental skills coach made as she got back to training and racing after her big crash.4 By better understanding her limits, she learned to ride right up to that threshold without fear.
And yet, among early-stage founders it is very rare to find anybody who has even given this kind of advice any thought.
A high-growth business is a succession of crunch moments. How founders behave when they happen makes all the difference, and by the time they are obvious it’s often too late. We need to have learned and rehearsed responses and turned them into habits, just like high-performance sports people do, or it’s unlikely that they will be instinctive.
We can’t just assume that all the big decisions are in the distant future either. The start of a BMX race is critical, and over in a split second. The outcome of the race is often decided before the first jump, as riders rapidly accelerate down the ramp and jostle for track position. The best riders have a mental checklist they run through while perched at the start gate, to ensure they are ready when it’s time to go.
Similarly, with startups. A startup is not a sprint, but mis-steps made at the very beginning often amplify over time and can easily end up having a significant impact: mindlessly splitting the equity equally amongst founders setting the stage for future resentment; raising a seed round with onerous terms that will be impossible to unwind in later rounds; clogging the share register with lots of small, unengaged investors; or adding less-than-impressive early employees who will then struggle to hire the great team needed to grow.
Far too many startups fall over because founders have made poor decisions under pressure. BMX riders are better prepared.
Whenever we feel that mixture of exhilaration and terror that reminds us a little bit of the last time we took a ride on a roller coaster, we should stop, smile and realise that we’re doing something much more dangerous, and as a result potentially much more rewarding too, if we can do it well.
Riders ready? Go!
A version of this essay was first published by The Spinoff.
There is an excellent example of this in the ‘Don’t Accentuate The Positive’ episode of The Happiness Lab podcast. They talk about how Michael Phelps would, when training, would visualise things going wrong, and so when disaster struck in the final of the 200m Butterfly at the 2008 Olympics (his goggles became loose and filled with water) he didn’t panic - in fact he still won the gold medal and broke the world record. ↩︎
How New Zealand assistant coach Gilbert Enoka turned All Blacks around with a strict no-dickheads policy, by Daniel Schofield, The Telegraph, 4th November 2014. ↩︎