In our continuing series of up-close, in-depth interviews with the founders of the StartupYard Batch X companies, we come to another of the 3 companies that join us this round are working in the field of crypto asset trading. ShufflUp is working to make the growing world of crypto-currencies and crypto asset markets available to regular people. It’s a fully automated trading platform that uses techniques from electrical engineering and high-frequency trading to generate steady profits for small-time investors. The team comes from India, and has decided to locate its operations in Europe, incorporating in Estonia.
Shufflup Co-Founder and CEO Shilpa Mitra is a data researcher with 5 years experience in statistical data analysis. During her engineering career she has focused on building software, and in the process got into close proximity with many programming languages. She was part of a collaborative research project with Tokyo Electron Limited during her Ph.D. studies which culminated into a full length academic research paper, published in one of the esteemed peer-reviewed journals. She is captivated by the possibilities of blockchain transforming the current inefficient financial system. I spoke with her this week about Shufflup
Hi Shilpa, first of all I want to highlight your career so far, because at 26 you’ve accomplished a lot of amazing things, including studying for a PHD in electronic engineering. Can you tell us how you got to where you are?
First of all, I want to clear this that I am not a PhD.
My Co-Founder Sromana Mukhopadhyay and I went to the US with the vision of changing the world through our love for maths and technology, like any other PhD student might think during their first year of study. By the end of the first year, we had published two research papers in two esteemed peer-reviewed journals, completed almost all the courses, taught a bunch of undergrad students, cleared the dreaded PhD qualifying exam but still somewhere the creative soul within me was not satisfied.
I realized that I can better utilize my data-processing skills to develop something which is useful for the people I care about and this realization brought me back to India. The tech-lover within me got fascinated by the revolutionary concept of digital currencies and the more I learnt about them the more I realized that they possess the power to change the future economy.
Going from electronic engineering to blockchain technology seems like a big leap. What got you interested in working on blockchain and cryptocurrencies?
You can say it began as an academic sort of curiousity. There are interesting mathematical concepts in blockchain technology, and the idea of distributed databases and trustless networks.
I started reading the whitepapers of various cryptocurrencies in order to understand the underlying blockchain technology. I started trading with crypto-coins on various exchanges but soon enough spotted the obvious inefficiencies of the crypto market. I realized these inefficiencies provided the potential of being even larger than the inefficiencies of the current unbalanced financial system. Upon researching more and after some days of digging deeper, my calculations proved that the inefficiencies that prevail in more than 15,000 crypto markets and 500 exchanges are capable of creating 440 thousand arbitrage opportunities per second, which are capable of producing 8-10% profit each month.
Now let’s dig deeper into how two electrical engineers have done it, considering we have always dealt with electrical signals and currents coming out of transistors. As electrical engineers we have used time series analysis to predict the useful lifespan of transistors. We realized that the data coming out of exchanges is also time-series data and the same time-series analysis tools can be applied to exchanges’ data as well. It is simply the source of the data that has changed, not the nature of it. Hence is not a ‘big leap’. It is because of our backgrounds that we are able to build everything we are building today.
Just imagine the global currency system as a series of outlets and inlets, just like an electrical grid. You have a peak flow that is predictable. You have a directionality in the system that can be modeled and observed. You can see that money and transactions flow across the system in a certain way, based on the capacity of the various parts of the network to manage the traffic, as well as the actual needs on the side of the users of these systems.
Now, whether it is crypto-currency or forex or electrical grid systems, the same type of statistical analysis can be applied to predict movements and to design the ideal way of managing those movements. What we do is called “currency arbitrage,” but it resembles electrical grid arbitrage as well. Providing liquidity where it is low, and sucking up liquidity where it is high, in order to keep the whole system stable, is the same whether you’re dealing with crypto tokens or energy itself.
Q: What are you trying to accomplish with Shufflup that you think no other platform has been able or willing to do?
Arbitrage and automated trading are not new concepts in the least. Our approaches to these activities I believe are unique, however I want to be clear why we have chosen this direction for our company.
Unlike other complex crypto platforms, which try to serve more sophisticated and more liquid investors, at ShufflUp we are trying to help that section of people in society who are neglected and not taken into consideration by other crypto trading platforms. There are 25 million crypto wallets in the world and out of which only 3- 5 million are in active use, whereas the world’s population is 7.44 billion.
Other algorithmic trading platforms are making their tools available to this bracket of tech-savvy and the so-called ‘accredited’ investors who are already in the business of crypto trading. At ShufflUp we will initially target the rest of the 20 Million passive wallets of ‘HODL’ers who have bitcoins sitting in their wallets and doing nothing. Then we will move forward to target retail users. We are primarily focused on small investors and the minimum deposit is 0.025 BTC. At present in order to use ShufflUp, a user only needs to have bitcoins in his wallet, deposit them to our platform, sit back and relax to see his profit steadily moving up.
With ShufflUp, no complex setup or figuring out innovative trading strategies or 24/7 monitoring is required, ours is a no-brainer and hands-off platform. We want to be a sensible bet for the average low income person who wants to profit from a dynamic, changing economy.
Can you tell us a bit more about how your technology really works?
At ShufflUp, our mission is to bring cryptocurrency profit to the masses because we believe digital currency is the future. A part of making that future work is distributing the gains of growth in the crypto market, and getting more people engaged with it. Through our technology, we have been able to eliminate the long-standing issues of arbitrage crypto trading. To realize significant profit through this form of trading by a single trader, huge funds are normally required upfront. A person also requires his/her funds to be properly distributed among several exchanges and the right coin-pairs where the opportunities are occurring. Basically, you need a large reach and high liquidity to profit from helping to maintain the balance of the system.
ShufflUp aggregates data from several exchanges, analyses them based on historical data patterns to understand where the next arbitrage opportunities are going to happen and distributes the funds in those coin-pairs. As of now, our system processes 40,000 datasets/sec to identify the next set of arbitrage opportunities. Needless to say, this will go on increasing as we scale.
Identifying the opportunities is one thing, but not all of them are executable for various reasons, such as network latency, high associated fees and volume associated with the trade. In order to avoid order slippage our technology determines the exact quantity at which to place the order based on statistical correlation and then executes only those trades which it predicts to be executable.
So far our algorithm has correctly predicted and executed 99.62% of all the arbitrage opportunities that have occurred during the last 3 months in the integrated coin-pairs. One of the things that few of you who are familiar with crypto arbitrage trading must be wondering is the transaction time and transaction fees associated with the arbitrage trading. Our smart system distributes the funds in such a way that it reduces the transaction time & fee by 90%. Also it is important to mention that all the profit that our system has made during the last 3 months is after taking into account the maker, taker, deposit and the withdrawal fees in the exchanges.
We have been organizing our private beta for the past 3 months with 12 investors – 2.5BTC and generated 55.2% profit for them. Also 250 users are in the pipeline eagerly waiting for our product to go public.
Many people including many mentors of SY have asked us, ’what if these opportunities gradually diminish in numbers as the market matures?’ That is a valid concern, because as a market matures technically and in scale, arbitrage becomes more common, and so less profitable.
But here I would beg to argue that even after so many years discrepancies still exist in the traditional market. Arbitrage always becomes more complex, but it does not go away. We will have to continue to evolve and learn from existing datasets. In that sense, our early mover advantage will be increasingly important, as we will have more data than others who attempt to enter the market later.
Having said that we have two very different trading strategies currently under simulation which will drive us forward in the path of our broader vision. One of them is based on complex predictive trend line analysis coupled with a few technical indicators which we know only the top experienced, disciplined, dedicated and the rich bracket of traders can take advantage of. The other strategy is based on analyzing market psychology because ultimately, market prices are created by the constantly fluctuating perceptions of market participants.
Here too, you can take some clues from understanding the flow of an electrical circuit or grid. The needs of a system can be understood through outside indicators. For example, famously, electrical grid operators must study television schedules to understand when consumer are likely to turn off their televisions at night, in order to ramp down the supply quickly enough not to over-power the grid. They must understand the upcoming weather patterns in order to provide enough power to the grid to run cooling systems.
You can apply the same macro forces analysis to crypto trading as well, which is something we don’t believe is common in this market yet.
Q: What do you hope that Shufflup will be able to do for its users in the next few years that they can’t do now?
As we are targeting the masses, or in other words retail investors, we will have our focus in developing an end-to-end solution for our users where they will be able to buy not only Bitcoin but also other cryptocurrencies because with arbitrage we will have an umbrella of cryptocurrencies. They will be able to buy these at a much lower commission than what is available at other exchanges/platforms.
We will also have two different schemes for our users based on a long-term and a short-term approach. If someone prefers to keep their crypto with us on a short-term basis, we would take a 20% cut from their profit, on the other hand if they stay with us on a long-term basis, we would take an even smaller cut from their profit. We are planning to go into partnerships with different companies which would enable our users to pay for their rent or coffee or pizza directly from our platform at a discounted price. Again, this is helping to spread the use of the currencies, and make them more attractive as a real utility to more parties. At ShufflUp, we are dedicated to expediting the mass adoption of cryptocurrencies.
Why do you believe so strong that blockchain technology can make the financial system more efficient, or more fair?
I firmly believe that blockchain is the future of finance, and this technology will do to the financial system what email did to the postal system. Remember, the postal system is not dead because of email. It’s bigger than it was when email came along. But we use it very differently now. We use it for much more important things. The use cases that migrated to email did so because the electronic form made so much more sense than the physical, in almost every way. I believe the same will occur around blockchain.
Blockchain will have a profound impact on the consumers who will hugely benefit from greater efficiency, greater security and greater transparency. A new decentralized financial system would remove the intervention and complexity that exists in the existing financial system and would lower the barrier to entry for those people who are currently denied entry (the unbanked population).
Yes the financial system would also become more fair as blockchain’s underlying protocols support stronger identity management thus helping regulators combat illegal money laundering and terrorist activities. The truth is that the financial system as it exists today is not technologically backwards, but it is built largely to the benefit of the wealthy nations, the rich, and the powerful. It has few real incentives to provide tools for smaller investors and for the poor and unempowered to use modern financial tools. That is a growing problem that I believe blockchain technology can work to counterbalance, and help to democratize access to finance.
What other things can blockchain be used for that most people have been ignoring?
I think in the areas of e-voting by bringing more transparency so that election results are honest and accurate, coming from a country like India I believe a fair electoral system can bring much needed socio-economic change to developing countries.
I also think the sharing and gig economy can strongly benefit from decentralization, as many of the existing systems are designed to benefit a relative few at the top of organizations, and are not equitable to the people who use the system. You can see this with companies such as Uber, where the drivers are being pushed to work for the minimum amount possible, while the company itself needs to take a larger portion of their earnings to stay solvent as prices continue to drop. If this system were mediated by a cryptocurrency where the economics were more transparent, I believe consumers could make better decisions, and those working in the gig economy would get access to fair compensation for their work.
As it is, these markets today work on a “black-box” basis, meaning that you simply have to believe that a company like Uber understands its own economic model, and that the driver understands the cost/benefit of working for them, and that the price you pay is fair and equitable. You must take the word of the company on faith, without proof. However, in a black box model, the company at the center is incentivized to change the rules in its own favor, and to profit from a lack of information from the parties it transacts with. That is not a system in which the good of ordinary people is the focus.
Decentralization means that the ability of the rich and powerful to take advantage of your lack of information in everyday economic decisions is neutralized. That is the ultimate promise of cryptocurrencies, and what we should all hope for in the future.
How did you start working as a team? What makes you the right people to build Shufflup?
Sromana and I know each other since our undergrad days (about 8 years). We initially started preparing for several competitive exams together, cracked all of them, and got admission to the PH.D. program in the USA together. In that way, we became a team before we had a mission. We noticed the loopholes of crypto trading world in a joint effort and wanted to solve it together.
Data analysis and data processing, dealing with different statistical tools like Wavelet and Fourier Transform has been our forte and this project requires deep digging of data.
We are each other’s best critics, and constantly pushing one another to perform better. For all the above reasons we felt uniquely qualified to work as a team and solve the problems that we are solving now at ShufflUp.
How has your experience been at StartupYard, and in Europe generally? Did it match with your expectations, or did it surprise you in some way?
A: Prague is a beautiful place to live, extremely peaceful with an extremely systematic and well-connected transportation system. These are the kinds of things that I notice as an engineer by training: that this is a society that understands organization of public spaces very well. Europe in general has wonderful advantages for quality of life.
StartupYard has been great so far, I love the people here at SY as you let us be ourselves yet push us at the right time in the right direction. We can’t thank you enough for accepting us into this program as it was a huge validation as well as support for us that we are moving in the right direction. We got to learn a lot from some of the mentors, actually formed a lot of ideas that we are working on now, which would never have been possible without SY.
Being in SY and attending the workshops helped us ‘know’ about different core metrics of building a business about which we did not have any idea even a few months ago. The most important thing which I learnt is finding like-minded investors who will push your company in the right direction and not just crave to get manifold returns. Basically I can go on and on, on how being at SY has been such a learning experience and a much-needed one for us.
With each new batch of startups at StartupYard, we run a series of detailed interviews with the founders to give our community a sense of who they are, and how they see the world they’re trying to change. Last week we announced 7 new companies in StartupYard Batch X. Today, we jump in with an interview of Anja Varnicic, CEO and Co-founder of Urbigo, the urban smart garden company that promises to “Bring nature closer to you.”
Urbigo is a system including a small modular garden with grow lights, and cylinders for plants containing nutrients and water. The garden is controlled via an interactive mobile app, and users can get the latest advice on how to tend to their mini gardens, as well as order new plants, nutrients, and soil packs from Urbigo.
Hi Anja, coming from a plant biology background, what made you want to turn your passion for the science into a business, helping people grow plants at home?
So, as an environmental scientist, I have long asked the question: “what role do plants really play in our lives?” The truth is that we are entirely dependant on them. For oxygen. For nutrients. For flavor, and for our wellbeing. Yet modern society has moved off the farm, and now treats plants and spices as commodities that are easily fungible between one brand and another. If not from Spain, then from Brazil. If not from Turkey, then from California.
We don’t understand where our food and our air comes from anymore, and I think that is a problem for people living in cities. Of course, we can’t expect people all to live in hydroponic greenhouses in their flats, but we should get ourselves closer to the foods that we eat and the flavors that we taste.
The way of doing that for us at UrbiGo has been to bring just a little bit of green into people’s lives, and to show them the immediate benefits of tending to plants that we depend on for everything. We came up with a focus on spices that can be grown in the urban kitchen, because not only do fresh coriander or mint taste better than dried and packaged versions, but also getting something to eat directly from a plant in your home reminds you of the life behind the things that you eat, and the natural world you depend on.
As with any other true love story, the startup idea happened unexpectedly and accidentally. I wanted to make these ideas into a real business. Luckily enough, I had a chance to share my business idea with Alex, our now CTO, who had previous startup experiences. We shared our thoughts, he loved it, and boom – UrbiGo was born!
How do you think incorporating gardening into one’s everyday life can affect positive change for somebody living in a city?
They say plants are the friends that always listen. And they really do. Indoor plants and urban gardening has become madly popular in the past few years because it reduces stress, make our air cleaner and our bodies healthier. And those are the thing we usually forget about or take for granted.
Having and growing fresh ingredients from your own garden is a creative activity. It brings us the same feelings we have as in making a sculpture or a painting, or writing a song. Gardening is viewed in Eastern cultures as almost poetic in nature.
For the millenial generation, we want to feel that connection to the Earth, and doing so makes us feel more responsible and more connected to nature. It makes us feel like grownups to be able to make life in an urban area where nature has seemingly little control.
I also believe that the millennial generation regrets the excessive commoditization of food. We yearn for the experience of knowing how our food is made, what it is, and how it makes its journey to our plates. So you see many different ways this is expressed in the modern consumer culture. Farm to kitchen restaurants. Farmer’s markets. Home gardens, and smart mini-gardens like Urbigo, that will help people to get back some of the control that we have lost over our diets and our environment.
]What would you say are the biggest mistakes we make when it comes to designing urban homes, and thinking about our living environment?
]Today, a larger share of younger urban residents live in rented flats or flatshares than have ever done in the past. What we see happening in cities is interior spaces being divided into smaller and smaller parts, and unless the presence of plants is part of the planning for those spaces, it ends up as a kind of afterthought.
Take a walk for example through an Ikea, which is where a lot of young people are going to get a sense of how to use their personal space… the plants are the last thing you see there. They are the afterthought. They are what you add when you have everything done.
This is backwards, I think. We need to plan more around plants, and plan to live with more plants in our personal spaces. That can affect the placement of windows, or the whole design of a building. The use of light must be reconsidered. In some cities such as Paris or Berlin now, whole buildings are being constructed with plants on their walls and rooftops. This is a good start.
Do not treat plants as a pleasant addition to your home. If you do, you will not have room for them when you decide they are the thing missing for you.
Let’s talk more about Urbigo’s products. What would you say distinguishes you from other indoor gardening solutions? What is your “killer app?”
UrbiGo isn’t just a fancy smart garden that grows fresh herbs for you – it is a community of plant lovers and enthusiasts that are changing urban gardening as we know it.
UrbiGo gardeners get to control their UrbiGo mini smart garden from their phones and learn how to grow their own fresh and nutritious ingredients in a fun and simple way through a gamified app. By completing daily challenges in the app we want to motivate and empower people to become successful urban gardeners and live more sustainably.
We take some cues from products such as FitBit, or Calm, an App for managing stress and relaxation. The way they engage millions of users into doing something good for their body and mind is something we can learn from. Tending to your garden should be a small but integral part of your daily ritual, and with UrbiGo app we want to make the process learning and enjoyable even for those who could kill a cactus.
Now is an interesting time for home gardening, because today urban millennials are becoming used to healthy lifestyle daily rituals using technologies like smartphones and watches. We don’t want to suck people into paying attention to their phones, but rather to use the medium of the smartphone to help people live a healthier and more satisfying life, and live in a better environment.
Suppose that urban gardening becomes the norm for people living in cities 10 or 20 years from now. How else would you like to change the way we design our lives around food, cooking, and living spaces in the future?
Since we tend to spend most of our days in offices and indoor spaces, I believe it will be essential to stay connected with things that matter most like family, friends and nature. Plants and greenery have this power to gather people, especially in urban areas where those are scarce. And we wanted to make this values approachable and simple for our users which inspired us to create product and a network of like minded plant lovers and untaped enthusiasts.
Many people living in cities rarely if ever buy fresh spices and ingredients for cooking. What are they missing out on? What are some of the concrete benefits of growing at home?Besides improving your overall health, growing and consuming your own fresh ingredients makes you connected with nature and origin of your food, that obviously doesn’t grow on market shelves and from plastic packaging.
We’ve heard lots of complaints from our customers, that store-bought herbs dry out in a matter of a few days and don’t have the fresh and intense tastes they’ve come to expect. Once you have something fresh, it can be very striking to taste the difference between that, and something not fresh. So I think people should have more choice about what to consume and when to consume it – this is why the UrbiGo app educates consumers about the benefits of “growing your own ingredients” so you can make proper decisions about your health and wellbeing. Be better informed, and make more informed decisions.
Food gardening is most of all a local and sustainable way of producing fresh ingredients and educating your family on where your food comes from. As cities transform into concrete jungles, this kind of relationship with nature will become crucial for us future generations’ well-being.
As a business, where would you like Urbigo to be 5 years from now? What will be your metric for having accomplished your mission?
We go where our customers needs are, and thus we are experimenting with the ways to include smart indoor gardening into every future home. The next logical long term step would be to incorporate UrbiGo into the smart home device network because there is a space and interest in companies for the next gen “plant device” that would improve urban health and connect with their low-friction lifestyles.
For now our goal is to get a smart garden into every home, and turn that into a network of people who are thinking much more about their well-being, health and importance of food gardening.
Imagine, using smart home technology to, in a way, bring us back to an earlier age when you would ask your neighbors for an egg or a cup of sugar. Maybe in 5 years you will be able to use UrbiGo to compete in urban gardening skills with your neighbor, grow chillies in your office desk or have a “green pet” for your kids. Maybe it will lead to people sharing much more of their domestic lives and spaces with each other, and helping each other to live better.
I think these very locally focused changes will be a very important part of the smart-home of the future. Not that you are one home connected to the whole planet, but that you are one home connected to the homes around you as well. We all share one environment, and the best way to improve it is to connect and learn together.
You’re employing a number of new technologies in Urbigo’s gardens already, like 3d printing, and LED lighting. How do you see technology making urban gardening even easier in the future?
New technologies have allowed urban gardening become more “smart” and resilient to climate change effects we are experiencing. So you don’t have to be dependent 100% on sunlight, ever changing weather conditions or your personal skills and knowledge .
But, still, people don’t want technology to do everything for them, because growing and tending plants can be part of a soothing ritual as well. I see technology as a tool to make your everyday life greener, easier but also to empower you to learn and share your urban gardening experience with others. We cannot stop urbanization, but with technology we can help people stay connected with nature.
Has there been a major surprise for you since joining the StartupYard program? Did you learn something you weren’t expecting to?
I’m not sure if it was a surprise, but we have certainly noted that the interest in smart gardening in the corporate and business spheres are also growing very fast. I think as millennials begin to move higher in large organizations, this is going to become an area where we can have a big impact with our product.
People spend up to half their time in offices, and in many cases, these spaces are poorly adapted to keeping people healthy and happy. Companies are understanding more and more that the total wellbeing of their employees is a vital consideration, and that if they cannot provide a better environment for people, then workers will go to those who can. I think this is very positive, and I hope to continue to raise people’s standards for their immediate environment, and inspire people to demand greener workplaces.
What have been your team’s biggest personal or professional challenges in making this project a reality?
We’ve been able to grow the waitlist for UrbiGo to over 500 people and we got major interest not just from individuals but also corporates. One of the challenges for us, as we are engineers, was to let go of some of our ideas about what people should like, and really listen to what our customers are saying about what they want.
You can come up with great ideas, but if you can’t get your ego out of the way, you will miss the experiences and stories that really define who your customers are, and how they see your products fitting into their lives. Learning this at the beginning of our startup journey was crucial to get first sales, traction and investments.
We cannot stop the technology and urbanization, but we have to design a product that accommodates our customer’s fast paced life and needs and also engages them into doing something little everyday that is good for themselves. This is an ongoing process but we are happy that so many people help us do that and share our vision.
What do people need to get started with their own urban gardens? How can they get their hands on an UrbiGo smart garden?
Since UrbiGo does not require big space, plant knowledge or time but accommodates to your lifestyle, you are basically one click away from starting to grow your mini indoor garden.
We have had testers out in the field for a whole, and we’re ready to go live. Right now, we are taking signups for a special, limited first batch of Urbigo gardens for those real enthusiasts who are ready to join our smart urban gardening community. This exclusive run will start delivery in December 2018, and the wider public will be able to order from Urbigo during the next year.
About Ondrej Krajicek
Ondrej Krajicek is Chief Technology Strategist for Y-Soft, and Y-Soft Ventures, a Brno-based printing and 3d manufacturing tech company where he has been a team member since almost the beginning. Ondrej is a dedicated startup mentor, and a longtime member of our community, where he has published his thoughts and unique perspectives on the technology business and other topics many times. Today Y-Soft is one of Czechia’s few technology “unicorns,” and serves large and small companies all over the world. At Y-Soft, Ondrej considers it his mission to grow the Czech economy by encouraging technologists to focus on crafting superior products and relying on their best skills, rather than focusing on cheap labor and manufacturing.
What It Means to Be a Mentor
Thank you StartupYard for giving me the opportunity and looking forward to the next cohort.
I should have started writing this article after my mentoring day at StartupYard, which is November 21st. Having past experience with several cohorts, I just could not resist and started as soon as I got the idea. So it is rather sunny day in Texas and I am looking forward to working with StartupYard and the incubated startups once more. I am writing this to give myself more clarity on why am I doing this, what should I deliver to the startups I am going to talk to and what should be my take aways from the day. I also have a tiny ambition that this may change somebody’s perspective on mentoring and improve the experience for any mentors out there and those being mentored as well.
I have been working with StartupYard since 2014 and it has been a tremendous experience. They truly have a great team with three people who really stand out: Helena who handles all the scheduling, Lloyd who does a great job with no-nonsense PR (a true rarity in Europe) and Cedric, who leads it all.
You are not the smartest guy around…
I will never forget two immortal quotes from Bohumil Hrabal in Slavnosti sněženek: “Máte štěstí, že jedu kolem.” and “Říkají o mně, že jsem odborník.” Apologies for Czech, it really never gets old.
10 years ago, having been invited to be a mentor, I would probably feel honored and entitled. If repetition is the highest form of flattery, than asking someone to be your mentor is definitely the second highest. And after the thrill of being asked to mentor dissipates, the first thing I need to consider is my responsibility to the teams I am going to work with.
Being a startup team in a world class accelerator is an overwhelming experience. There is little time for everything and spending time with a mentor is an important investment on the team’s side. They are investing time, energy and money in that discussion, regardless of its length. And as a mentor I should never forget that.
I am not a mentor because I am the smartest guy around. I am not a mentor because I am successful. I am a mentor because I had to solve problems, perhaps similar problems in different contexts and I, my team and company survived to see another day.
So how can I make sure that the discussion is worth their while?
One of the best mentors I had the chance to meet, Ken Singer taught me one of the key principles of Silicon Valley: Pay it Forward. If someone seeks your help, help them — without expecting anything in return from them. Someone else, some other time, will help you too. Next time you are pondering how to replicate Silicon Valley success in the Czech Republic, think about this and the culture which is preventing this simple approach to take of here.
How does this apply to being a mentor? Do not expect any tangible benefit in return. You will not get shares or money just because you graced someone with your presence and shared your experience. Certainly not by answering few questions.
Being useful means adopting the mind set of freely sharing anything and everything which feels relevant to the situation. Connecting people with people.
The real problem is that sharing is difficult. Robert Kaplan gave a great talk about mentoring which is available on YouTube.
If there is one principle I need to follow, one thing to take from Robert Kaplan, than it is that I should not tell them what to do. Kaplan claims that mentoring advice is only as good as the story, but what if it’s you telling them stories. Stories are about context, problem, solution and lesson — just like bedtime stories of our childhood. Just this time, it’s about business.
Instead of asking them to tell me their story and risking, that my advice would only be as good as their story, I should tell them mine and let them take what they feel they should.
I see mentoring as a form of leadership. This is the less obvious kind where I do not manage anyone, certainly not the team I am talking to. My biggest power over the team is listening.
That is easier said than done.
Ask the right questions
I usually start with three questions:
- How can I help you today?
- What can I help you with?
- Can I have a whiteboard please?
But no, these are not the right questions. As Kaplan teaches, leadership is about finding the right questions and my “right” questions are about users, employees and customers.
- Why is anyone going to pay you for your services or products?
- Why should people work for you?
- Why should your customers choose you and not your competitors?
The hard part is not asking these questions, but feeling the answers.
In 2015, Harvard Business Review published a nice article about how it is impossible to put yourself in the proverbial shoes of your customers. Cutting to the conclusion, I am not trying to put myself in the shoes of their customers.
I need to become one. This is where my stories help. May be, sometime in my past, I was in a situation which would require products or services of the team I am talking to today. My experience, if it is relevant, kicks in when we start debating the need, the constraints involved and how is their solution solving the problem. Which is now — for the time being — also my problem.
Mentoring is like acting. I love theatre: drama, comedy, opera, but I would be terrible actor. But here I can immerse, I just need to be authentic.
Authentic means that I need to tell them the truth. Not that I expect to lie or think that some mentors lie, but if I am not authentic, they cannot trust me and probably won’t. This is not a place and time for rhetorical alchemy as I am not here to influence: no careful dosing of ethos, logos and pathos. I am a stand and a big bazaar and the mentored team shall pick only what they like. I am not a major stakeholder as I am not materially vested in the team’s success. I am here as a volunteer.
Acting, management and mentoring are alike at least in one more thing: filtering does not work. So how should I establish authenticity? I need to share my beliefs. How can I prove myself? By story telling again. After all, marketing is all about proof points, isn’t it?
When the team shares my beliefs and values, they understand my story and how is it relevant to their products and services, they are in the position to take some advice.
Teach? Share failures!
Merriam-Webster defines the noun “mentor” as a trusted counselor or guide. Having the right context from the team, being their customer at the moment and consistently with my beliefs and values, I am ready to share advice. What I did and how it worked. What I did and how it failed.
In my experience, the best way to share knowledge with others is to share your failures. When I succeed in something, I am seldom completely sure why I succeeded. When I fail, sooner or later I find out why exactly I failed. Failing gives me clarity and confidence. I am never giving up and I dare say that I learned to patiently and diligently study the failures I was part of, my failures or failures of my team.
That clarity and confidence also enables me to share it with the team. It is their choice whether they want to repeat mistakes of others or make their own mistakes.
Not that I agree with the failure worshipping, which seems to be a thing in the startup culture. As Tomas Sedlacek put it in his tweet, I strongly preffer trial-success than trial-error. I also believe in failing fast and measuring hard, which I will probably never fully learn.
And I am not as selfless as it may seem. There has to be something in this for me.
Why am I here today?
Mentoring is a learning experience, so first and foremost, I am hear to learn. Occasionally, I learn about new approach, business model or technology. I used to focus on that.
Today, I am here to train. To stretch my muscles in a different way than I am stretching them every day at work. If you ever exercised with a trainer, you know that your trainer is changing your exercise quite often. You are doing something else on Tuesday than you did on Monday.
Change is good as human body excels at adaptation and always finds equilibrium of achieving results with minimal energy. Human brain is no different and is actually great at building and making mental shortcuts. I am here to train active listening skills in extreme conditions (time is short), maintain an open mind and apply what I know on problems I do not have. I am here to push myself for patience, which is one of my biggest weaknesses.
And I am here to relax. Other teams and other people struggle with difficult issues too. Others are also trying to do what they believe in.
I am not alone in this.
SThis week as part of our ongoing series of talks with alumni, I sat down with Szymon Dwonzczyk, CEO at Turtle Rover to talk about his company’s transition from a pre-product academic startup, to a Kickstarter funded project, and eventually a post-acceleration StartupYard company.
Szymon focused on providing some insights into running a hardware focused tech startup, and shared his experiences with crowdfunding, venture capital negotiations, and his philosophy of customer-led product development. In particular, Szymon talked about the process of a small company building its confidence and sense of self through exposure to customers, advisors, and investors.
Here’s what he had to say:
Hi Szymon, as you know, this series is about giving advice to our current members and your fellow alumni. What do you think you’ve learned in the past year that you didn’t know before?
It can sound a bit formulaic, actually, but I think since joining StartupYard, I have realized that self-confidence is probably the most important quality that a founder can have. You have to be focused on building up your self-confidence and self-esteem. Without that, you can’t get anywhere.
So why are you so much more self-confident today?
I think in a year the Turtle team have grown enormously in our confidence about our ideas. We are able to see more clearly that the best way forward is the way that we believe in most. I think today I am much better able to say that I can adapt and learn how to grow the company in a way that makes sense for us.
I would like to point to three ways that I think anyone can build that kind of confidence, and explain why they have been important to me.
Number one, being forced to speak and perform in public. I can say I was not afraid of speaking in public before joining StartupYard. However I always had issues getting my point across to people. It was not hard for me to speak to people, but hard for me to express how I felt, and not only what I thought. The mentoring process and prepping for the Demo Day is an emotional experience, and it made me much more open.
I can say this changed for me a lot, leading up to, and after our Demo Day. It turned out that I really enjoyed the experience of refining our company’s story, and getting the pitch exactly right. I found I enjoyed expressing my feelings more. I liked seeing in people’s faces that they understood and were suddenly excited about this crazy robotics guy from Poland. I was excited too.
If people can see the same thing you can see, this is enormously good for your self-image. You can be sure you’re doing something valuable.
Number two, I think is talking to a lot of people who may disagree with you. Talking to people often, and early on in your thought process, is really important as well. I realized I think that because of the mentoring process, we probably made as much progress in product development in 1 month as we had done in the previous year.
That is not even because mentors gave us new ideas. Just because they confirmed many things that we initially believed, and helped us to dismiss other things that we were not sure about. Mentoring strengthens your ability to fight for what is naturally right for you. You lose this fear of making mistakes and going against your instincts, because everything you believe has been tested with over 100 experienced people.
Talking to people early and often about your ideas helps you to see them more clearly and take action. Talk to a lot of people.
Lastly, I think being forced to think more about our competitors has helped us to understand ourselves, and to value what we do even more. As you say yourself Lloyd, your competitor can be anything your customer is doing. Your customer themselves can be your competitor, especially in our case because we provide a product that is targeted at makers and robotics people.
I think we saw our competition as always these companies we wanted to be like. Like Boston Dynamics for example, or even companies like Tesla- if they started to make autonomous rovers, we would be screwed!
That’s the way we were thinking, but we saw increasingly that our true competition is not as strong or as well-defined. We compete with behaviors and ways of thinking; what is possible, and what is not possible. If we can convince you that it is possible to create your own robot, with a never-before-seen set of abilities, from scratch, then we have won against our competition in that way. If you decide to build on top of our platform, then it’s a success for us.
You mentioned that your understanding of competition changed quite a bit. How did your understanding of your product change in the last year?
:laughs: It’s funny because the product, just looking at it, changed very little. It is still Turtle Rover. It looks the same, essentially. What changed was our understanding of the product and who it is for.
When we first were making Turtle, of course it was just for us. We are robotics engineers. Then we thought as you always do, that it must be for people who are like us. This assumption we held for way, way too long without any real feedback.
Then two things happened: first we successfully ran a kickstarter campaign, and then we were accepted at StartupYard. In that space of time, we started to see that our customers were not like us, actually. They were photographers, teachers, engineers, makers. All kinds of different people actually.
It was this sudden realization: “oh… this product isn’t a robot to you, it’s a way to do what you really wanted to do.” Maybe it sounds obvious, but it wasn’t.
Then we were suddenly hearing from a lot of mentors and investors, and again they were telling us, “there’s something here for these people, there’s something for them.” There are suddenly many more possibilities.
What I learned, most importantly, is to make assumptions and test those assumptions more quickly, and more consistently. We had many ideas over the years like: “you can use Turtle to do X,” but we would just think about it. Then actually working with live customers and mentors, we decided “ok, if someone says we should do X, let’s try it.” We actually saw them how complicated it might be to sell that idea, or to make it work. Or we can see how easy and natural the idea actually is.
I think this is something I have learned: do less planning, and do more doing, in general. If you have ideas, get feedback, and get that idea to the MVP stage as fast as you can to get the right kind of feedback from the right people.
So basically, you’re following the Tesla approach to product development…
Yes, I think that’s fair. We are not doing anything at scale like Tesla, so we don’t face the downsides of this approach.
There is a big advantage in shipping a product to the right people even before it is ready. For example, we had a case recently where we were delaying shipping a bunch of rovers to customers because of an issue with Android/iOS compatibility. FInally I just said: “screw it guys, ship it and tell the customers about the issue.” And we shipped it, and you know what? The issue was with our own systems, not with the product. The rovers we shipped worked fine for the customers.
There are many cases like this, where you allow something internally to become a big deal, and actually to customers it maybe isn’t a big deal. Particularly since we have these early adopters, and we are still in the test phases, we have learned you have to have more faith in these people to help you and to solve problems themselves.
The result for us is that many times our customers show us how to do things because we have given them that opportunity. One customer ordered the rover for a museum exhibit, for example, to demonstrate the technology. I found I was almost trying to talk him out of this idea, because I saw that there were going to be some connectivity issues that would be hard to solve. I wanted to help him set this up so it would not fail.
I needn’t have worried because the museum guy is also a tech guy, and he anticipated these issues, and had his own solutions. Actually his network solution was better than ours, so it’s something we benefit from. I had to trust him to do that, and trust that we were sending him something that would not be embarrassing to us when he tried to use it.
Do you think this strategy is something startups should do more, generally?
Yes. Totally. I didn’t realize to what extent early stage companies really ignore their customer feedback and don’t trust their customers to understand them as a small company, and accept errors.
You end up basically fearing the power users of your products because they are the ones who will cause the most “problems” for you in customer support etc. That’s wrong, because these people help to build your knowledge base, and discover a lot of problems before anyone else does. You can use them to make you stronger.
You see so often these small startups that try to act as if they are big corporations. That is a shame to me, because they are missing a once-in-a-lifetime opportunity to have a different relationship with customers. Later on this is not going to be possible so today, we really choose to open up and be transparent with our users as much as possible.
Do you have any concrete advice for a hardware startup in a similar position to Turtle?
Yes. If you are thinking about crowdfunding, such as Kickstarter, then do your research on the most common failures. Don’t believe every catchy bulletpointed list of “tips & tricks.” The people you want on Kickstarter are the ones supporting you, not just the product.
Most importantly: do not outsource your development from the beginning. That is my view, particularly if you are crowdfunding, you will be tempted if the campaign is successful to outsource more and more, and depend on more and more others. This is where most kickstarters tend to fail: they get a lot of traction, and then they try to outsource too much.
If you outsource too much, you don’t gain enough experience. You get the job done, but it doesn’t help you to streamline or improve your processes. It doesn’t help you understand what you are capable of on your own.
We intentionally kept our campaign limited in size, and only accepted true first adopters. This is because if you fail to deliver on one project on Kickstarter, basically you can never do it again. That failure will follow you everywhere. People will think you’re a scammer, and you can’t even prove them wrong if you’ve outsourced the failure, and don’t have anything to show for it. That’s why we were very conservative in our goal, and we are still today working on completing it. If we go back to crowdfunding, we have to have that good history of delivering.
The other thing I want to say is that if you are talking with VC investors, you really need to understand the Venture Capital approach to business. You have to decide if that is the right way for your business to grow. I am open about not being convinced of this today. I believe it may be better for us as a company not to raise money. Startup founders need to be open to this possibility, that it can be better to leave money on the table.
That’s just my feeling. I’m a very Slavic guy, and VC culture is very American I guess. I see VC money as a way to scale, not a way to survive. If I had something I was absolutely sure would scale tomorrow with more money, ok, VC is a good idea. However if you are thinking VC money will save your business or help you to develop a product that is not proven yet… well I think you will have a harder time.
To me, it is a lot easier to build a business model not counting on the investment, and simulate where can you be in 2, 3, 5 years from now. Then use the VC money to speed that up – instead of 5 yrs of development, be there in 2. But anyway, don’t underestimate the power of time – you’ll always need time to learn all the processes in your company, learn how to run the team and prepare the product – it’s not about money, not about finding the right mentors, it’s about gaining the experience that most probably you don’t have – and it needs time, and time only.
At the end of the day, you can speed things up but you can’t skip anything.
My job about half of the year is to travel around Central Europe meeting with startups and entrepreneurs, listening to pitches, and scouring the internet for what might just be the next great startup to join StartupYard.
We have a new batch of startups joining us in Prague in just a few weeks, Batch X, which means we’ll be doing this for the 10th time. We’ve seen lots of startups benefit from a once-in-a-lifetime experience, and we’ve also seen others not get everything they could out of the program when they were here.
Sometimes founders tell us what they wish they had known to do before getting here, so in the spirit of that request, here are 4 things any startup can do to kick ass at an accelerator.
You can also read more about the acceleration process in other posts like: 5 Tips to Get the Most out of Your Mentors, 11 Things We Say All the Time to Startups, and 6 Silly Startup Mistakes You Can Fix in 5 Minutes.
One: Know Your Mentors
“Oh hi… who are you?” Is not a question you should be asking the CEO of a major technology company who has taken a day off from a very busy schedule to come and talk to you about your business for no other reason than he or she feels like giving something back.
Certainly StartupYard is selective when it comes to our mentors. We look for humble, experienced, informed, and engaged people with powerful business networks, who generally have enough of a sense of self-worth that you don’t need to suck up to them. Still, there’s a world of difference between being a kiss-ass, and not knowing someone’s name or where they’re from before you meet them.
Your attitude as a founder in any accelerator program should be: “I have limited time with these resources, so how do I maximize my use of them?” Being with a C-level executive of a major corporation, or with the managing partner of a VC fund, or with a successful startup founder for a mentoring session is like the intellectual equivalent of being left alone in a bank vault. You should really spend your time going after the important stuff.
What important stuff? What is this person’s relevant experience in my field? What connections do they have that could save me weeks or months of waiting for cold emails to get answered? What do they know that I don’t? We say you should try and treat mentors as potential customers, and that’s true as well, but just as with a customer, most of that communication should be you learning from the mentor, not you spending the mentor’s time trying to convince them of your vision.
Wait, what am I saying? Don’t try and pitch the mentors your ideas? No, of course you should do that, but many founders get carried away with this. A mentor hears your pitch, raises a few objections, and before you know it, the whole session is taken up with the two of you in a battle of wills, one trying to convince the other of their rightness.
You know who loses in this situation? You do, because the mentor has nothing to prove. They’ve already had impressive accomplishments and success along the way. They have no pressing goals in their meeting with you. You have goals, so spend your time finding ways the mentor can help you meet them.
That means knowing as much as you can about the mentor before the meeting. Ask the management team about them. We know the mentors. Check out their companies and their profiles on LinkedIn. Get an idea of what you think they can do for you before you sit down and ask them for help. Help them help you, as we say.
Two: Know Your Numbers
Below I’m going to share with you a number of real life #epicail scenarios for founders who have been with us, sometimes for a full 3 months, and have not managed to quite grasp this essential lesson: Know Your Numbers.
- So how many email subscribers do you have right now?
- Uh.. i would have to ask the marketing guy…
- Do you have over 1000?
- It could be…
- Over 10,000?
- Probably not…
- Do you have any idea?
- What’s your runway?
- Well, we have XX Euros in the bank…
- So what’s your runway
- It’s… if we spend it slowly then it could be….
- Ok, hang on: What is your runway at the current burn rate
- Uh… I have to ask…
- You don’t know.
- I don’t know
- How much are you raising?
- It depends how much we can get….
- How much do you want to raise?
- As much as we can get…?
- Yeah, no.
This is about two things, mainly. First, it’s about answering questions as straightforwardly as you possibly can. This means yes or no questions have yes or no answers. Do you have cash for the next 6 months? Yes or no. Of course it’s never that simple, but when a mentor or an investor or a stakeholder is asking you a question like this one, they want a straight answer. If you need to qualify, ie: “yes, but…,” or “no… if,” that’s totally fine. Yes and no are powerful words, which is why founders so often try to avoid them.
The other, related thing some founders try hard to avoid is real numbers. Real numbers are your friend! How much money do you need to raise? “Well… we could get by with around…” No. Start with a round number: “We need to raise €150K for runway for the next 12 months.” Again, you can qualify these answers later, but if you don’t start with something real, then there’s no way for anyone asking the questions to understand what neighborhood they’re even in.
Just giving straightforward answers, with the understanding that you don’t have to know every answer precisely every time (though it helps if you do), we can see these conversations going a bit better:
- So how many email subscribers do you have?
- Last I checked it was between 2000-2500, but I would ask my marketing guy for an exact number
- Great! That’s more than I was expecting
- What’s your runway?
- It’s 6 months with our current cash burn, but we can sustain ourselves if we go lean and cut costs.
- Ok, how much would you have to cut?
- About 50%. We are covering half our burn rate right now in net income
- Ok, thanks for the info
- How much do you want to raise?
- We want to raise €300k in a seed round. If we can’t do that, then €100k in an angel round will be ok for the next 9 months
- Great, let’s talk about your strategy
Those conversations are so much better than the initial ones, right? The truth is, you don’t even have to know a lot of your numbers with great precision. You just have to know what they should be, and what they are not likely to be.
How many email subscribers do you get in a week? Most founders don’t know that to an exact figure, but they should have enough of a finger on the pulse to be able to estimate: if it’s been 10 a week or so, and the last time you checked was last month, then there are probably 40 more than before. It bears checking, but it’s a best guess. It’s an answer, which is better than “I would need to check on that, because I have no idea.”
A lot of numbers questions are asked with the understanding that your answers will be either guesses or estimates. Runway is only semi-concrete. It’s an estimate. Number of downloads is concrete, but again, the exact figure is less important than the ballpark. The amount of money your raising is understood to be a goal, not a figure set in stone, but you have to have an answer to that question that sounds reasonable and compares favorably with the reality.
The simple fact is that often times, founders just don’t study their numbers closely enough. They don’t work enough in spreadsheets and they don’t work enough on contextualizing, for themselves and for those around them, what their numbers and metrics mean, why they are important, what they are, and what they should be.
Anyone might have a difficult time answering “what will your cash flow situation look like in month 15 of your financial projection?” But on the other hand, I should know if I’m going to be making money or losing money at that point. A familiarity with my own numbers saves me from the embarrassment of not knowing this basic fact about them. “I’m going to be making net profit at that point, but I think less than €10,000. I need to check it.” That’s an answer we can work with.
Three: Know Your Deliverables and Your Schedule
Investors, including accelerators like StartupYard, manage their relationships with portfolio companies in ways that are quantifiable and hopefully easy to chart over time. We need data from our startups, and we need to know, within reason, that startups are working on the things we need them to work on. It’s not that investors should run a company, but rather founders should be given certain clear hurdles that they need to meet to satisfy our relationship. This is mutually beneficial, if done correctly.
For example, early in our cooperation, during the acceleration phase, we will have a lot of “deliverables” which we expect founders to work on with us, and to have done by a certain time, to a certain standard.
Examples are things like a website, media kit, business plan, user projections, market overviews, competitor analyses, and so forth. Later it’s a pitch script and a slide deck for Demo Day. Then maybe a one-pager for investors. Years after the program, it may just be basic financial data every quarter. Deliverables at the beginning can be quite big and important items, and deliverables at later stages can be less all-consuming or critical, but they are still deliverables. They still need to get done.
A deliverable that doesn’t seem important to you might be very important for the other party. At least knowing this, and knowing why, is going to help you get much more out of an accelerator. You may find what you didn’t value before, when properly explained, is more valuable than you first thought. It can be the difference between something feeling like homework, and something feeling like it will really help your company move forward.
A big challenge for some founders is to understand that when you are dealing with outside advisors and investors, you are dealing with someone else’s standards of what constitutes “finished,” and “acceptable.” Hopefully, in the best case scenario, this is because the advisor or investor has a bit more experience than you do about what level of work you should be delivering, which is why the item is something they are interested in seeing by a certain date.
The deliverables should be helpful to you. If they aren’t, then there’s something wrong.
At StartupYard, for example, we don’t wait until the day we announce the names of our latest batch of startups to make sure that they all have working websites. These are deliverables that come up weeks before that time. We do this because we know that the odds are good that we will not be happy with the first version, and we want there to be time to change it and improve it.
We only do that because experience tells us it is usually necessary. If it weren’t necessary, we wouldn’t do it.
A later investor might not expect this kind of hands-on access to your work, which is clear to you only if you know what your deliverables for them are. This can mean going out of your way to make sure you know exactly what is expected of you, because that might not always be clear. It’s ok to ask what people expect, and it makes your life easier. You don’t want to be caught out the day before your product launch by an investor suddenly demanding that you change your website. You want to know whether that’s something the investor will want some control over.
For example, you can end meetings by saying: “ok, so if I understand correctly, you want to see XYZ, with these details, by next wednesday, and then a final version of that the next week?” This is getting to know your deliverables. It’s much better than just saying: “oh, we need a website? Ok, I’ll get it done pretty soon.” What does it mean to get it done? What is soon?
Discussing your deliverables also allows you to shape them in a positive way. You may not believe a later investor needs to sign off on some aspects of your work. That’s something to make clear beforehand. You may decide together that a particular deliverable is not needed, or a particular schedule is too ambitious.
A major frustration for an investor or advisor who is trying to help a startup to meet a high standard of excellence is to not have the founders take these deliverable schedules seriously. These schedules are in place (hopefully!) for a good reason, and though it may not be one you necessarily agree with all the time, it serves as a fundamental basis of our relationship. This is how we understand if we are being helpful to you or not.
Four: Use Your Management Team
Hey, we’re people too! Each of us has particular skills and particular strengths. If you don’t know what we’re good at, then it’s hard for us to be good at that thing on your behalf.
Remember the axiom: “if you don’t ask, you don’t get.” The management team of the accelerator is there working for you. If the organization is well run, and the incentive structure is set up correctly, then the management team should be interested in making portfolio companies more valuable, founders happier, and products and services better. That’s why we exist, and it’s our main role with our member companies and alumni.
The acceleration process does create a certain sense of whiplash, particularly with a very hands on program like we have at StartupYard. We are so hands on from the beginning that when we start to pull back and let founders steer on their own, they can and sometimes do feel like we’re “letting them go,” or distancing ourselves. Like we don’t care about them anymore, or that they’re “on their own.”
Of course we don’t want that, but the relationship has to change from “push,” to “pull.” Instead of the management team looking over the shoulders of founders, founders exiting the program or even years out have to reach back and ask for our attention if they need it. In my time at StartupYard, I’ve helped to accelerate nearly 50 companies. I can’t spend my days checking up on 50 different founders and seeing if they need my help. They have to come to me, but some never will, even if they need help.
I know this because when I do happen to be talking with alumni founders, it’s a rare instance when it turns out that they haven’t needed help from the management team at some point since we last spoke, and still failed to ask for it. They’ll say: “I didn’t want to bother you… I should have called.” Well, yeah, you should! Some of the best performing startups in our portfolio use us the most. They get that attention just because they ask for it.
Are you a startup founder? Welcome to the suck. Last week I emailed StartupYard alumni to ask them one question: “What has been the most brutal part of your startup journey?”
We talk a lot about the joys of success and the feeling of accomplishment our founders get from overcoming their challenges. Actually though, being a startup founder can be pretty brutal sometimes, and there are plenty of situations where there is no real silver lining. A big part of making it as a founder is relying on your friends and your mentors when things go bad. Even if there isn’t a way to fix it, we can help you move past it and use the experience to grow and mature, even just a bit.
Brutal Doesn’t Mean “Not Worth It.”
It’s rare that a negative emotional or inter-personal experience as a founder is enough to make our alumni give up- in fact we’ve never seen it. Still, it can make the world of any entrepreneur lonely and discouraging, sometimes for long stretches. The best founders have to stick out those patches and make it through anyway.
I’ll be quoting our founders in this article without revealing names. There are some things we can learn from, that are still best not discussed in detail. Here is what a few of our alumni had to say:
Partners Suddenly Change Directions
“Representatives of [A Big Tech Company] said we would ‘build an ecosystem together.’ They got us really excited. 3 months later they ended that initiative and nothing happened. Everything we thought was going to happen never did.”
People Waste Your Time
“I traveled hours to meet this VC, only to find out he wasn’t interested at all. I talked with him for 20 minutes, then traveled hours home for nothing.”
“People want to meet you and they want to cooperate with you, and they can’t do anything. They don’t have anything for you. They’re doing it just to do it. You have to be able to say no at some point.”
People Break Apart
“I had to break up with my co-founder, whom I have known since childhood. It was for the sake of the company, but it made me very sad.”
“I saw that our vision of [my co-founder’s] role, was not the same. He wasn’t doing what we had agreed, and we suffered for that.”
Investors Get Cold Feet
“We shook hands on an agreement. I followed up with him the next week, and he never returned my email. He didn’t even say why he was backing out.”
“We were going to sign, literally that week. The papers were all finished, and they backed out. We had to start from zero.”
Customers Are Harsh
“You change one crucial feature in a way [your users] don’t like, or it doesn’t work for 1 day, and they kill you in the [app store] ratings. They absolutely kill you.”
“The product was just not working well, and I was trying to ignore it. I was trying to be positive, but we needed to really close in and refocus on our existing customers. It was very hard to admit the product was not what we were promising.”
Sometimes Nobody Cares
“We invested in this whole campaign. We thought it was really valuable and people were going to like it, and share it, and buy the product. Nobody did. Not one person.”
“Some features you think are going to be a killer, and nothing happens. Other times it’s something stupid, and everybody loves it, which is confusing.”
You Have to Let People Go
“I had to reduce the staff. It was very hard, even though they knew it could happen. I have since felt cautious about getting close to new people I hire. I am afraid of having to do that again.”
“She was really a great fit for the role, with the right personality and the talent, but she just didn’t want to do the work required. She didn’t have the commitment, and I had to let her go.”
You Run Out of Money
“We were going to be broke in like a month or two. It was either fire everybody right now, or we make a product and sell sell sell. That was a scary time. We kept everybody, but we worked our asses off to do it.”
You’re On Your Own
“You feel a real let-down when you leave the [StartupYard] program. It feels like there was all this momentum behind you, and now you are flying on your own and you don’t feel so confident all of a sudden.”
Your Relationships Can Suffer
“She put me on notice. I knew I couldn’t make her happy and do this, and I had to do this, so we took a break, mutually. So many people depend on you, it’s not possible to be everywhere.”
“[My co-founder] and I were friends since we were in high school. I think we will get past this and be friends again. But not right now.”
You’re Not Always Sure Why You’re Doing it
“It just wasn’t working. It wasn’t happening, and I was just sticking with it ‘to the end.’ I felt very alone.”
“I fear the risk of failing, so I just try to keep things going, but why am I doing this if it’s going to be like this forever? I don’t want that.”
Luck, and getting Getting Past the Brutal Parts
Every founder in our experience has at least one story like this one. Usually they have lots. The only thing that separates the startups that fail from those that succeed, apart from a lot of luck, is sticking through the hard parts. One of the best ways to do this is to build a very strong network of advisors and mentors. That’s something accelerators like StartupYard can help you do.
Are you ready to build the network that will take you to the global market? View StartupYard’s Open Call for Startups: