Debunking myths of the startup world
Making Myths From Models on The Startup Journey
Those of us who spend a lot of time with startups recognize that the ups and downs, the drama, the near-misses on the way to success, create a great story arc.
So it’s no wonder that Rizwan Virk, a serial entrepreneur, investor and founder of Play Labs accelerator at MIT, centered his book, Startup Myths and Models: What You Won’t Learn in Business School, around the myth of Joseph Campbell’s Hero’s Journey. Within that larger metaphor, Virk then identifies and debunks common “startup myths” – common misconceptions of what it takes to lead a successful startup – inside each phase of the journey. It’s an insightful book that unpacks a lot of conventional wisdom about important topics such as getting funding, hiring the right people, and operating as a leader.
As an executive coach who works regularly with startups and in particular startup founders, I wanted to talk to Virk about the insights discovered along his own path.
I asked Virk why he wrote the book. “I’ve been involved in startups now almost 25 years,” he told me. “People have a lot of misconceptions about startups and I found myself teaching the same lessons over and over again. I wrote the book as a way to encapsulate the lessons to reach more people.”
While studying management science (“it’s not really a science,” he told me) at Stanford Business School, Virk learned classic models for running and evaluating businesses. However, he saw that they didn’t really apply to startups. “There aren’t really these concrete steps,” he said. “Every journey is very different. I wanted to come up with a way to talk about it that captured the art of management but still included a series of models that were practical.”
Here are some insights and antidotes to the conventional wisdom that we discussed.
You’re not supposed to be the smartest one in the room
Virk points out the difficulty in finding the right level of management oversight you have to have over your team. “There are two dueling myths,” he said in the book. “‘Get out of the way and let people do their jobs,’ and its opposite ‘I can do it faster myself,’ represent two extreme ways of managing.”
There’s a reason. Both styles highlight entrepreneurs who are trying to find a balance of managing people in a highly dynamic environment. When you start your company you handle everything at a detailed level. By definition you know everything about the company, you are probably the most committed, and so it actually is faster to do things yourself. The result is that your people feel disempowered, disengaged, and don’t learn to think for themselves.
The opposite is also true. The reason you hire people is so that they can do things when you’re not around – essential for scale. You want to give your employees freedom, and you’re probably consumed with fundraising or dealing with landing customers. You’re not around and you let your employees have free reign. The result is that people don’t get the direction they need.
Neither of these approaches will work to help you grow your company to scale. The way to reconcile these two myths is to see when you need to zoom in – to step in to give detailed guidance – or zoom out – step away and let your employees figure things out.
Culture is more than happy hours
“There’s this stereotype that culture is having a beer on Fridays. It’s not,” Virk told me. “Culture is about how employees work together, how they attack projects, how long they stay at the office, how much they talk to each other. It’s about the attitude towards customers – are they trying to be really helpful and someone’s problem or are they just trying to get off the phone?”
Virk added that there is also a myth that experience is the most important thing. Actually, he learned, cultural fit is more important than experience. “I’ve hired many people who had a lot of experience and they came from bigger companies and then they got into a startup and they thought this is just way too chaotic,” he said.
In his first startup, Virk said that his culture was “working all the time.” He thought that was the only way to grow a company until he visited another founder in New York. The other founder built a startup working 9-5. He was intentional about creating a sustainable work environment. No coincidence, it wasn’t his first startup.
Virk said he didn’t know any of this when he started his first company. But when he brought in a new CEO to run the company, he clearly noticed how the personality of the CEO permeates the culture.
“You’re building a culture whether you want to or not,” he said. “So you may as well consciously build it.”
Know your motivations and seek out your blindspots
It’s critical to know why you are starting your company and what you’re hoping to get out of it, Virk said. There are a lot of decisions to make along the startup journey, many of them with imperfect information. Self-knowledge will help you make decisions as you go through the startup journey.
In his book, Virk includes some questions he uses in his startup accelerator for founders. It’s to take an inventory of themselves. This includes questions about their motivations, what they think a good outcome looks like, and are they more interested in building a product or in building a business. Do they want to start a business or do they want to lead and run a business? If there are cofounders, do they all have the same motivations? Thinking about these questions in advance will help entrepreneurs make better decisions as they choose their investors, hire their teams, and create their company strategy.
Entrepreneurs have blind spots, and they don’t realize it. Virk said that to try to get at these, they should look at what happens to them again and again to see what their blind spots might be. “In one company I invested in, the founder would always bring on a new advisor and tell his old advisors that he wasn’t going to listen to them anymore, he was only going to listen to the new advisor. And then a few months later it would happen again with another new advisor. It turns out he was doing that to his employees too.”
You can’t see your own patterns clearly sometimes, he said, so that’s why you need mentors, advisors, and coaches. On the bright side, leadership can be learned. As legendary venture capitalist Randy Komisar says in the book: “…everybody can take their (own personal) style and become effective leaders if they understand their strengths and weaknesses, and understand what a leader needs to do.”
“One thing I’ve learned over the years, Virk said, is that it’s important to help founders see a bigger broader perspective. That helps them overcome all these myths and, hopefully, build a successful company.”