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From the surface, entrepreneurship usually seems to be like a spotlight reel: speedy progress, media protection, profitable exits. I’ve lived that story — constructing and operating a number of firms, serving as CEO of SetSchedule and exiting companies in actual property and tech earlier than transferring into enterprise funding. However the fact is, my actual schooling did not come from the wins. It got here from the errors.
Now, as a enterprise investor centered on figuring out what makes firms sustainable and founders resilient, I usually replicate on the alternatives I might by no means make once more. These aren’t simply my battle scars — they’re the very issues that made me a greater entrepreneur. And in my expertise, there are three huge errors that many entrepreneurs, together with myself, have made. In the event you’re constructing one thing now, let these function guideposts.
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1. Believing everybody could be a associate
Within the early days of entrepreneurship, there is a rush to construct momentum — and in that rush, it is simple to mistake proximity for alignment. I made the error of elevating early workforce members into companions with out actually understanding if we shared the identical values or long-term imaginative and prescient. Typically I felt a way of obligation. Typically it was about giving somebody an even bigger stake to maintain them round. However what I’ve realized is that true partnership is about greater than titles or fairness — it is about shared sacrifice and perception within the mission.
When partnerships are constructed on comfort, compensation or charisma alone, they normally crack underneath strain. A few of the most public enterprise breakdowns stem from this similar misjudgment. Fb’s early falling-out between Mark Zuckerberg and Eduardo Saverin is a first-rate instance. Saverin was there at the beginning, however their priorities diverged shortly — and that divergence led to a authorized and private battle that outlined the early firm tradition.
Steve Jobs and John Sculley’s notorious fallout at Apple is one other cautionary story. Jobs introduced Sculley in from Pepsi, pondering they might complement one another. Nevertheless, their values and management kinds clashed. Jobs was ultimately compelled out of the very firm he based.
I have been there. I’ve handed out belief earlier than it was earned. I’ve mistaken transactional loyalty for long-term dedication. And I’ve paid the value in time, cash and emotional bandwidth.
Lesson: Not everybody who begins the race with you is supposed to complete it by your aspect. Partnerships require aligned values, not simply aligned targets.
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2. Chasing progress in any respect prices
In the event you’ve ever pitched a VC, you’ve got in all probability stated some model of: “We’re rising quick.” For some time, I believed that pace was the one factor that mattered. I expanded groups, opened new verticals and pushed advertising and marketing spend to the bounds — all within the identify of progress. However quick progress with out a robust basis is like constructing a skyscraper on sand.
I as soon as doubled the scale of a workforce earlier than understanding what our best methods have been. The outcome? Burnout, bloated overhead and a product that wasn’t enhancing quick sufficient to justify the size.
There are many case research right here. Quick, a one-click checkout startup, raised $120 million earlier than shutting down in 2022 — regardless of rising headcount and advertising and marketing spend aggressively. The product could not sustain with the hype. Or think about WeWork, which grew to become the poster little one for “progress in any respect prices.” At its peak, it was valued at $47 billion. By 2023, it was struggling for survival, largely as a result of it expanded sooner than its core enterprise mannequin may help.
In each instances — and in mine — progress wasn’t the enemy. However chasing it with out self-discipline, with out product-market match and with out unit economics is a quick approach to scale failure.
Lesson: Sustainable progress is a byproduct of a robust product, environment friendly operations and readability of mission — not simply ambition.
3. Turning into unconditionally obsessive about the enterprise
Entrepreneurs are advised to be obsessed. Dwell it. Breathe it. Sacrifice every part for it. And sure, you need to care deeply. However here is the lure: When your id is just too tightly tied to your organization, you lose sight of its pure life cycle — and your individual.
I’ve seen good founders miss exit alternatives as a result of they believed they have been constructing one thing everlasting. I’ve finished it, too — clung too tightly, too lengthy. However here is what I’ve come to grasp: Companies have a shelf life, and sensible founders be taught when to enter, when to scale and when to exit.
Jeff Bezos, one of many biggest builders of our time, famously stated: “Amazon just isn’t too huge to fail… The truth is, I predict in the future Amazon will fail.” He identified that firms have lifespans, and the aim is to extend it as a lot as attainable whereas accepting that no firm lasts ceaselessly.
Take into consideration the S&P 500 twenty years in the past. Lots of the present giants — Tesla, Meta, even Google — both did not exist or weren’t related but. In 2004, Fb was simply launching from a Harvard dorm room. The common lifespan of an S&P 500 firm has dropped from 33 years in 1964 to only 18 years immediately, in keeping with Innosight’s Company Longevity Report.
That knowledge would not lie. Firms fade. Markets shift. Expertise outpaces even probably the most dominant companies. Your job as a founder is not to defy that — it is to remain conscious of it.
Too many entrepreneurs wrap their private value into the success of their firm, and it clouds their judgment. They ignore purple flags. They move on acquisition gives. They burn out. However being obsessive about what you are promoting does not imply you ought to be blind to its evolution — or to your individual.
Lesson: Be passionate, however not delusional. Each enterprise has a cycle. Know when to construct, when to pivot and when to stroll away.
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I’ve constructed firms. I’ve exited some, pivoted others and shut a couple of down. At present, as an investor, I spend extra time evaluating the founder than the product. As a result of what I’ve realized — via success, however principally via failure — is that mindset, judgment and self-awareness matter greater than the right pitch.
Would I undo these errors? Not an opportunity. They taught me issues no MBA may. They harm. They price money and time. However additionally they gave me readability.
So should you’re constructing one thing immediately, ask your self: Am I partnering with the correct individuals? Am I chasing progress or constructing an amazing product? Am I obsessed … or conscious?
The solutions would possibly simply be the distinction between a lesson and a legacy.
