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Startups

OT: Stay Long Term or Think Exit?

Ravi Kiran talks about the Importance of Staying On. (Forbes)

The three most exciting events in the big-city start-up promoter’s life appears to be starting-up, raising funds and exiting. This is what a lot of start-up and VC media write about and a lot of people in the start-up ecosystem talk about. Many start-ups look at the Silicon Valley as a role model and fondly refer to it simply as ‘the valley’. They have been tutored to make ‘elevator pitches’, think of various types of the ‘addressable market’, create a ‘plan B’, learn to time a ‘pivot’ and provide ‘exit options’ for the investors. I am sure these are all important dimensions in business and every entrepreneur must learn about them, but sometimes I feel they are not tutored some other business basics.

One of those basics is developing an ability to ‘stay’ in business, something I find in much better supply in the entrepreneur in Middle India. The fact is starting, raising [funds] and exiting may appear glamorous and worthy of story material, but staying requires a different kind of attitude and skill. It’s a mindset and a ‘heartset’ thing, if you will.

While it is true in general that startups seem more enamoured by a build-and-flip model than by creating a business for the longer term, it’s almost sacrilege to uniformly apply a principle like “staying on for the long term”. My note in the comments section:

I’ve seen love marriages and I’ve seen arranged marriages. It seems statistics shows that 20% of love marriages end in divorce, whereas only 10% of arranged marriages do. People in love marriages seem to want to "exit" their marriages much earlier, because they don’t try hard enough. People in arranged marriages, though, stay longer because even when it is simply not working out, they have the feeling that failure is not an option, and they will stay together, unhappy, passing on their misery to their children, fighting, not talking, but god forbid they ever use the word "divorce".

You could make that case. It’s the same with startups.

There are startups that deserve a longer chance, and there are startups that don’t. The service startups that you see today better make sense in a few years, otherwise you end up with something where you’re running just to stay in the same place, and that’s even worse than dying because it doesn’t end. You could give a business 10 years and watch it just about make ends meet, or you could walk out and start another, faster growing company.

It’s easy to justify staying on, and there are a lot of hero stories of those that did. What isn’t apparent is those that are no longer visible – that guy who tried and tried and got his wife to eat one meal a day until she died. No one remembers him, or her. You have to stay true, but you have to stay practical. If at first you don’t succeed, try, try, and try again, and then give it up and try something else. There’s a fine line between brave and foolhardy.