3 Biggest Regrets of Startup Founders
How to avoid their mistakes and build a company (and a life) you love.
I hate this company,” I said to myself, sitting in the office in San Francisco. “I can’t believe I created this.”
This is how Darius Mirshahzadeh opens his book, The Core Value Equation.
Darius had been successful by any external measure. He was the founder and CEO of a company that would soon hit the $10,000,000 revenue mark. He had 150 employees and a seventeen-thousand-square-foot modern tech office space in the heart of San Francisco’s SOMA district.
And yet, he had serious regrets as a founder.
Is it possible to reach most of your entrepreneurial goals and still wish that you’d done things differently?
My experience working with founders and CEOs for the past 20 years suggests that the answer to the above question is a resounding “yes”.
Despite the dazzling trappings of startup success: funky offices, sleek tools, money in the bank, and a large team, many founders have regrets about how they went about building their business.
Here are the three most common ones that I have come across advising startups and interviewing hundreds of entrepreneurs.
Regret #1: Sacrificing your ideals in the name of financial success
Most startups come to life fueled by their founders’ ambitious aspirations. They want to delight customers, create innovative products, have a highly engaged team, make a dent in the world, and turn a healthy profit. All this while having a perfect work-life balance.
Unfortunately, these lofty ideals often fade away further down the line.
For many startups getting funding, acquiring customers, being fast to market, and generating revenues prove to be so challenging and all-consuming that everything else falls by the wayside.
For this reason, making an impact, producing a world-changing product, self-care, and creating a fantastic workplace, often get pushed off into the unspecified future.
It’s not a conscious trade-off — just a knee-jerk reaction to the urgency of building a financially viable business.
In many cases, founders have made decisions that they later come to regret — decisions that were meant to be temporary solutions.
An often overlooked aspect of this is that:
“Temporary solutions often become permanent problems.” — Craig Bruce
Every “temporary” solution gets deeply embedded in your company’s structure, processes, and culture, and it’s incredibly hard to reverse it.
Just like you can’t unscramble eggs, you cannot undo the imprinting done in the early stages of a startup.
As the entrepreneur and venture capitalist, Peter Thiel quipped — and what has been referred to as Thiel’s Law since:
“A startup messed up at its foundation cannot be fixed.”
An experience that many founders talk about during their entrepreneurial journey is what I call the Day of Reckoning. It’s when you look back, take it all in, and see your creation with clarity and detachment.
Sometimes what founders see fills them with pride. Sometimes it makes them wish the earth would open and swallow them.
Many outwardly successful founders are shaken by their Day of Reckoning because that’s when they realize that the company they created doesn’t reflect their original intentions and is not suited for the kind of business that they really want to be in.
It’s a hard pill to swallow, and you don’t want the same thing to happen to you.
How to avoid this regret
Adopt a paradoxical mindset.
It all boils down to using “AND” instead of “OR.” Yes, this small, three-letter word has the power to change your life and transform your business.
I get it. Launching and running a company is a wild ride, full of ups and downs and decisions that need to be made on the fly. And I bet that you’ve been asking yourself questions like these all the time:
- Should we hire the guy with loads of experience (even though he seems to be a bit of a jerk) OR the one who seems to have a great attitude but insufficient skills?
- Do we try to make the product perfect before we launch, or do we launch now?
- Should we look for a new investor now OR try to bootstrap?
- Do we focus on making money OR making an impact?
In reality, many of the choices you are faced with are an illusion. A false dilemma. We’ve been socialized to believe that we can’t have both, and so we are perpetually trapped in the same old quandary:
A OR B?
The good news is that you can overcome many hurdles if you can get smarter about your approach to business and life dilemmas.
As F. Scott Fitzgerald said:
“The test of a first-rate intelligence is the ability to hold two opposed ideas in mind at the same time and still retain the ability to function.”
So what would that look like for you and your business? How could you hold two opposing ideas in your mind and still retain your ability to function?
Professor Wendy Smith, an associate professor of organizational behavior at the Alfred Lerner School of Business at the University of Delaware, answers in our conversation on the CultureLab Podcast:
“We need better questions. Instead of asking: Should we do A or B, we should be asking: What would it look like if we could do both A and B?”
So start asking:
How can we make an impact AND be profitable at the same time? What could that look like?
Be stubborn and persistent about asking better questions — and you’ll be surprised by the outcomes.
But the feeling of “selling out” isn’t the only reason some founders feel like failures.
Regret #2: Trying to emulate the insanely successful
In the past decades, uber-successful entrepreneurs have gained a God-like status in our culture. We idolize the Elon Musks and Richard Bransons of this world and celebrate the supersonic growth of the tech giants like Netflix and Apple. There are plenty of larger-than-life figures that many startup founders look up to.
The problem is that while real entrepreneurs are a diverse group of individuals, their icons look terribly alike: American, workaholic males, with a hypomanic edge.
When the real-world founders try to emulate the specter of an “ideal entrepreneur,” they quickly notice that they are nothing like it. They often have the “wrong” age, gender, and social background.
So, to overcompensate, many founders try to be even more dynamic and hardworking than their heroes.
The ramifications of this can be serious — from burnout to disempowered teams who rely on their CEO for every decision.
A guest of the CultureLab Podcast and the author of a new book, The Unicorn’s Shadow, Ethan Mollick, helps us bust the myth of the ideal founder.
Analyzing available data and evidence, Mollick discovered that successful founders are neither uniformly male, nor are they always young, risk-hungry, and hopelessly workaholic.
In fact, it’s quite to the contrary. Successful entrepreneurs come in all shapes and sizes — there is no cookie-cutter formula when it comes to who you need to be to succeed.
How to avoid this regret
Instead of trying to be someone you are clearly not, work on becoming the kind of founder and leader you can be proud of.
Here’s an exercise I often use when coaching founders and leaders. I learned it from Debbie Milmann, a renowned designer and podcast host. Debbie got it from the design legend Milton Glaser, and there’s my own twist in the one you’ll find below.
A word of caution: this exercise transforms people’s lives. So be careful what you wish for because it’s highly likely to become your reality.
First, grab a notebook, a pen, and a cup of something delicious. Find a quiet spot where you will be undisturbed.
You are getting ready to describe the life and business you want to have in 5 or 10 years from now.
Here are some things to keep in mind before you start writing.
- Imagine what your business and your life could become if nothing would hold you back.
- Dream big.
- Get specific about all aspects of your life.
- Go into as much detail as you can.
- Make it vivid, paint a picture.
- Write in full sentences and paragraphs.
- Don’t edit yourself! You might be surprised by what comes out on the paper. That’s okay; we often don’t let our most authentic selves come out.
- Keep writing until you have nothing else to add.
Your Average Tuesday Exercise
Now, imagine that it’s ten years from now. Paint a broad picture of your ideal life first. Write about your family, friends, where you live, what you work on, what your company is like, and what kind of founder and leader you have become. After you have put the broad strokes, paint in the details: write about your average Tuesday, ten years from now…
It’s meant to be just an ordinary day — and yet a kind of day the would fully reflect your ideal life. What happens during that day?
Start from the minute you wake up, brush your teeth, have your coffee or tea, all the way through until the moment you tuck yourself in at night. Engage all your senses. Describe what you see, smell, hear, touch, and taste.
What is that day like for you? What happens? Whom do you meet, and what do you do?
Here is Debbie Millman’s advice:
“Put your whole heart into it, and write like there’s no tomorrow. Write like your life depends on it, because it does.
And then read it. Once a year. And see what happens.”
And finally, the third regret that many founders have.
Regret #3: Failing to focus on cultivating the right company culture from day one
These days, most startups make an effort to articulate what their company stands for, what makes it unique, and which values they choose to guide them on their way to success.
In fact, you’ll be hard-pressed to find a website without a page dedicated to “Our Manifesto” or “Our Values.”
But the way startups identify their mission and their values leaves a lot to be desired. If only I had a penny for every time I heard: “We just Googled companies we liked and looked at what values they had. Then we picked the ones that seemed more or less like us”…
It gets worse: after the mission and values are proudly displayed on the website and communicated to the employees, the culture “project” gets dropped.
I get it — there is an ocean of possibilities when you run a business and what emerges out of that ocean tends to be messy, urgent, and hugely time-consuming. As a result, you get plenty of seemingly valid excuses to postpone working on culture.
Many founders tell themselves: “This is not the right time. We’ll get to it tomorrow.” But the proverb is right:
Tomorrow never comes.
What does come, instead, is the day you collide with your own culture.
It’s a bit like bumping into a glass door. You are on your way somewhere, and then, bam! You smash your face against an invisible barrier. It can literally knock the wind out of you.
This is how a founder and CEO, Darius Mirshahzadeh, describes the day he collided with the culture in his company:
“I realized I had built a business that had people who probably did not share my company’s core values. I saw my company in a new light — a patched-together Frankenstein. I had created a monster. To say I was upset was an understatement.”
How to avoid this regret
You need to work on your culture from day one. A strong culture is a foundation for outstanding performance and tangible business results. It’s the best investment you will ever make in your business.
What you need is not just a great “culture playbook” — your mission, vision, philosophy, core desired feelings, and core values — you need a set of practices, rituals, and structures that will help you bring your culture playbook to life.
You need to create the right conditions for the right culture to emerge and evolve.
So, where do you start?
From checking your culture batteries.
Your culture will fuel performance and drive engagement only when your batteries are full. Two conditions need to be met to get a full culture charge:
- People need to KNOW what you stand for. — Quick litmus test: If someone they trust asks your team members to tell them what your culture playbook consists of, what will they say? Will it be consistent across the board, or will each person say something else? Will people be able to give specific examples of how your culture playbook translates into their daily work?
- People need to be able to DO what it takes to bring your culture playbook to life. — Quick litmus test: If someone they trust asks your team members if you and everyone else in the company walks the talk — sticks to your core values, and continuously works on creating an environment you have described in your culture playbook, what will they say? Will they be able to give specific examples of difficult decisions they took with your mission and values as a compass? Will they have stories to share about the cost of not adhering to your values? How about the benefits?
The first step you can take towards cultivating a healthy culture is to start monitoring it, just like monitoring other KPIs, such as revenues, customer acquisition cost, retention rates, operational efficiency, and profitability.
Checking your batteries gives you a good indication as to where you are today and what you need to focus on going forward.
And remember: every decision, every interaction, and every conversation you have is either adding or taking away from the power of your culture. So ask yourself every day:
Have I been I charging, or have I been draining the culture batteries today?
Real success in entrepreneurship is rarely limited to what meets the eye. Often, we have regrets that stem from something much deeper than the typical trappings of startup success.
You can’t consider yourself successful when you lack a sense of meaning and fulfillment, can’t make the impact that you had initially envisioned, or contribute to making this world a better place.
The key to entrepreneurial success is learning from mistakes — if you can learn from the mistakes others make — even better! So don’t grow to have the same regrets other founders have: learn to adopt a paradoxical mindset, define your personal vision of success, and cultivate a culture that fuels performance, engagement, and business results.
I write about how to unlock the power of your company culture. A Culture Strategist + The CultureLab Podcast Host — agabajer.com/podcast