Entrepreneur Dan Sodergren reveals the lessons he learnt from his tech startup failure, so you don’t have to.
Starting a company can be one of the most rewarding things you can do. Foundinga tech company, in the modern world, can also be hugely profitable. Just look at the unicorns all around us, those companies worth more than $1bn. There aremore than just a few these days.
However, the reality is that according to Bloomberg, eight out of ten entrepreneurs who start businesses fail within the first 18 months. This mortally rate rises even higher when it’s a tech company, with around nine out of ten of tech companies failing to exist for more than three years.
My tech startup Follogro was one of those nine, one of the ones that didnt make it.
Your startup can fail for a whole host of reasons, some nicely documented here. The top three reasons for failure from the documented 100+ start up failures are as follows:
A lack of marketing (42 per cent)
A lack of money (21 per cent)
Getting the wrong team members (12 per cent)
At Follogro, we had one of these sorted, but not the rest and so our little startup with big dreams failed to survive.
Here is what I learnt
There are three main headers to the lessons I learnt, conveniently splitting into a further three each. The BIG headers all come under three P’s of: personal, people, and profit.
You will have a love life. Love your startup.
When you start out on your journey with a new business either have your personal life sorted or simply realise you might not have the time for one. What I mean is that. You have to make a choice. The startup is going to take all your time. You have to devote yourself to it fully. If you have someone they are in for a bumpy ride. Their upside is a long way off, longer than you think. My advice: keep things simple stay single. But if you can’t, talk long and hard about what this journey means for your partner.
Keep yourself healthy.
Related to the first point, having a partner can be great for your psychological health. But it also might not be. Make sure you keep yourself healthy. For your mind and body. Late nights, too much pizza, booze and networking, mixes with a sedentary lifestyle and no working out, all add up. Take it from a chubby entrepreneur; you don’t want to live like this. It will also affect your work. Keep your energy levels as high as you can. You will need all the energy you can get.
Mediate and keep mindful.
Part of your mental health is to meditate almost as much as you can. Do it twice a day at least. Get out into the sunshine, get into natural, get yourself back into your body and be mindful. The rush of today’s world is magnified with the 1, 000 jobs you do at the beginning. Try to centre yourself. Let your mind be your ally. To do so you will need to train it. I used things like Calm and listen to Deepak Chopkra. But what you use is up to you.
Love your co-founder but…
If you want your startup to succeed, it is statistically likely that there will be more than one of you starting it. The rule here is that you should know your startup founder really well. You need to know what they are made of. Everyone wants to start a company. But the reality of getting to the promise land is spending a lot of time in the desert. Make sure you are travelling with someone who is mentally tough enough to do so. If they are not, get rid of them now.
Know your investors and…
You need to do as much due diligence on your investors as they do on you. If they don’t normally invest in your sector, run away. If they don’t invest long term, run away. If they don’t have enough money for you, run away. In fact, mainly run away. As by their own admittance, VC investors might not be great for the startup community or your startup.
Listen to advisors but…
Your advisors can look at the world, from what worked, not what might work in the future. This is your future. Own it. Listen to them and take advice but also take advice from the world as well.
The world online can be much more up to date than someone who is now retired or even worse someone who has never succeeded themselves and is paid by the government to advise you on what to do. don’t take advice from a nanny who has never has had kids.
Read on to find out about how profit factors in and why failure isn’t necessarily a bad thing.