From age 20-26, I was, quite possibly, the world’s worst entrepreneur. I dropped out of college two classes away from graduating. In a typically low financial risk business – consulting – I managed to rack up hundreds of thousands in debt building, well, nothing. Wracked by credit card and equipment loan debt I had no idea how to pay back, pursued by collectors, living off my girlfriend (now wife)’s paycheck, logic dictated declaring bankruptcy, going back to school and finding a job. So why keep at it?
At the time, I had no idea what a “startup” was, what “entrepreneurship” entailed, what it took to start a business or even how being a “tech co-founder” could make someone money. But I damn sure knew what to do when people (in particular, my Dad) told me to quit this “silly game” and get a real job.
It’s clichÃ©. The son who does something stupid because his father tells him it can’t be done is a parable as old as time itself. The movie Good Will Hunting had a memorable (if overly dramatic) few lines that embody this type of reckless thinking:
Sean: My father was an alcoholic. Mean fuckin’ drunk. Used to come home hammered, looking to whale on someone. So I had to provoke him, so he wouldn’t go after my mother and little brother. Interesting nights were when he wore his rings…
Will: He used to just put a belt, a stick, and a wrench on the kitchen table and say, “Choose.”
Sean: Well, I gotta go with the belt there.
Will: I used to go with the wrench.
Will: Cause fuck him, that’s why.
And yet, when I analyze my motivations in those years, there’s little else that kept me “in the game” apart from that incessant need to prove the doubters among my friends and family wrong.
Perhaps not surprisingly, in the years since, this same pattern has continued to fuel my motivations and influence the course of the company:
July 2007: “You can’t build a big company in the SEO space,” said plenty of business people I talked to. “Stick with consulting – it’s what you know and you’ve got a great brand,” was another oft-received message. Proving both wrong became an obsession and (at least partially) led me to take a venture capital financing round we closed that November.
September 2007: Before we’d even closed our financing round, one of my investors said “You need to hire a head of product and build a product team.” I, of course, thought I could and should do the job myself – wrong. In January of 2009, we hired Adam to run product, a team that now has 6 members, and our software is light years ahead of where I could have taken it alone. I almost certainly should have made that move years before.
January 2008: “You can’t build a search engine sized web index on $1 million.” That advice came not only from close friends, but people who’d worked at Google and Microsoft in web search. A smart entrepreneur probably would have sought other ways to deliver value through SEO software, but not me. I stubbornly doubled down and burned through almost 3/4 of our capital to build our Linkscape product.
I even recall a conversation at one of our board meetings, where I said to some of our investors, “We took this money to build our index and that’s what we’re going to do,” and they replied, “No. We invested this money so you could build a scalable, profitable business.” They were right, but I didn’t listen.
It was only a year later, several months after we’d launched and regained profitability that I looked like anything other than a stubborn fool.
May 2009: “Don’t try to raise money now – you won’t get any.” Sage advice from someone (OnStartups/Hubspot founder Dharmesh Shah) who continues to have an infuriatingly flawless track record when it comes to giving me advice. And what did I do?
Set out to prove him wrong in an experience that proved to be one of the most frustrating, time-wasting and fruitless 4 months of my professional life. But, of course, instead of humbly accepting it was time to listen to someone else, that negativity led me to another stubborn rejection of conventional wisdom.
July, August + September of 2009: From 40 different VCs, I heard 40 different reasons why SEOmoz couldn’t be a big business or a big success and why they weren’t interested in investing. And while there’s a lot of motivations, internal and external that make me want to grow this company into the best it can be, nothing’s as relentless in my mind as the “You can’t do it,” messages I got that summer.
In all of those conversations, though, one universal piece of advice was given: “The self-service / web app model is wrong. You need to build an enterprise sales force / charge more for your product / create embedded software so it’s not so easy to quit.” And, of course, that only served to make me more determined to stay self-service focused and build a product the relied on the value it drove rather than the pain of high switching costs.
Whether we can actually prove them wrong remains to be seen. We’ll likely do ~$12mm in revenue next year, and if we can maintain the growth rate of the past 3 years for the next 3, we’ll certainly be getting close. But the obstacles between here and there are, for the most part, a mystery. Time will tell.
These 5 examples certainly aren’t alone. I’ve had dozens, if not hundreds of similar incidents, big and small. Some yielded positive outcomes, others have led to painful, unnecessary fights, almost always with people I care about.
Undoubtedly, there’s some confirmation bias in this type of thinking and in my actions. From the Skeptic’s Dictionary:
Confirmation bias refers to a type of selective thinking whereby one tends to notice and to look for what confirms one’s beliefs, and to ignore, not look for, or undervalue the relevance of what contradicts one’s beliefs. For example, if you believe that during a full moon there is an increase in admissions to the emergency room where you work, you will take notice of admissions during a full moon, but be inattentive to the moon when admissions occur during other nights of the month. A tendency to do this over time unjustifiably strengthens your belief in the relationship between the full moon and accidents and other lunar effects.
Slate recently had a good article on how this impacts the political spectrum.
Powerful motivations and an unwillingness to back down often receive positive re-inforcement in the startup world. Mark Zuckerberg built an amazing business because he didn’t care about money or what other people thought. Warren Buffet is an amazing investor because he puts money where others wouldn’t and does so when everyone else is running scared.
But there’s no concrete proof that my irrational driving force will improve my odds of success, and plenty to suggest it could do the opposite.
That’s why it’s so curious that, despite an ability to analyze my psyche and see the potential pitfalls, I refuse to change my behavior. I’m more ready than ever to work long hours, push my team to do likewise and go for broke to prove to 40 people who probably haven’t thought about me since I walked out of their offices 18 months ago that they were wrong and I was right.
Re-reading that last paragraph, even I think I’m crazy.
(p.s. Other than being a pessimist about my entrepreneurship, my Dad has been great, especially when I was a young kid.)