Why founders fail, what rookie mistakes even experienced entrepreneurs can make and why it's hard to find a tech cofounder.
I've been building my own businesses since I was 23. I've built a content marketing agency — and sold my shares to my co-founders 4 years later at a 7-figure price tag. I've built a profitable retail chain with >10M revenue. I've been running an e-comm side project that I also sold at 6-figure.
When 4 years ago I decided to launch a startup I had no hesitation — my experience promised me good odds to win.
It was an epic failure. I made every mistake possible and lost over $200K.
Here are the lessons I learned.
So, why do founders fail?
There are 2 ways to succeed in the startup industry: do what others do or do something totally different.
Despite the general belief that startups are always about innovation — they actually are not. Well, at least, not every startup is about it. Or, to better put it, not every startup requires innovative technology. When you're doing just one part of the business better than anyone else — you can already be a startup (even if your A-game is about physical delivery — think, Amazon). So basically, there are two different types of startups:
1) A-players in a little part of the game that everyone else is playing
2) Players that create the game by introducing a disruptive solution to the problem that existed long ago but was not solved or was not perceived to be a problem.
Classic example — AirBnB. It's not that we did not travel in the pre-AirBnB era. We booked hotel rooms. Yes, we were not excited about the prices – but, what's the heck, we needed that vacation, so it did not even occur to us to start looking in some other direction or not going somewhere at all. The problem (high hotel room prices) was there but it was not perceived as an important or even urgent problem. On the other hand, apartment owners did not sit days and nights trying to figure out how to make more money on their property. There was Craigslist (and lots of local copycats in many countries). It was not perfect, but before it, there had been nothing, just word of mouth and a sheet of paper on the window offering a room for rent (and in some places, it is still a widely used tool, more popular than AirBnB).
What they don't teach us in schools or what we can't read in business literature is that both types of startups are absolutely legit — you just have to use totally different strategies and tactics to prevent them from failure.
Why doES the former type of founders fail (the "copycats")?
Startup failure happens when a founder has not done the homework properly. When the market research is not done. When I say "market research" — what do you think about? Your competition, right? Who else is doing it. That's exactly what I was thinking. It is wrong!
Doing "market research" should mean first and foremost research of your customers! Or, as they say it in marketing, user research.
It should mean a meticulous collection of the information online: any place where you customers are hanging out — you should be there.
It should mean doing customer interviews properly: not like you imagine it should be done and like I did it too (post an idea in a Facebook group and ask: so, you think someone will pay for it?)
It should mean talking constantly to real people trying to figure out that sweet spot that only you will know. The secret that is not a secret, but that remains a mystery because no one had actually cared to ask these people HOW they do something and what the bottlenecks of the process are.
If this part of the job is not done properly — startup will fail with 99.9% certainty. There are lucky guesses (see here) but I still believe cases like these are the result of pure luck. Meaning, you can't have any impact whatsoever on your odds. You just roll the dice and see how it will fall knowing all the way that your chances of getting 6 are close to 0.
Why doES the later type of founders fail (the disruptors')?
Startup failure happens when founders did not have enough business experience or enough connections that would help them get this experience from top-tier advisors. Whatever successful disruptive startup you take (Mailchimp, Apple, Shopify, Tesla, PayPal, Stripe, Amazon, AirBnB) — they succeeded not because the technology they had was so unique or amazing. But because they managed to build a robust business on this tech, meaning the managerial skills here were much more important that the skills of developers. Again, let's look at the classics: Apple would not be Apple if another Steve, Steve The Developer was in charge of business decisions.
I'm not saying that developers are unimportant. They are! Very much so. What I want to point out here is that you should not mix up these two types of startups. If you have a disruptive tech (say, a cancer treatment) you can focus on tech and count that your previous business experience will lead the way. If you don't — you have to focus on making a copy of what is already there but just a little bit better in one small detail. And to find out what small detail is, you have to focus on customers, not the tech.
Why I could not find a cofounder
My mistake from the very beginning was that being a non-techie, I was thinking only about the tech side of the deal. I forgot everything I knew — in order to solve something that I did not know how to solve. My main goal from day 1 was to find a cofounder. I desperately wanted to find a tech cofounder to help me "with the coding". What I did not realize is that I was on the wrong stage, and that's why my search for a partner went futile. I did not know myself and could not explain to others what was that secret that I knew about my customers that no one else was privy to. I was just obsessed with the idea that I have to find a cofounder. When I failed to do it, instead of going to square 1 and doing a thorough analysis of WHY I did not find anyone, I just concluded that I was not communicating my brilliant idea properly and that I'll just go ahead, hire an agency and when they build a product for me everyone will see what a genius I was and regret😂
No need to say that this approach led me to lots of tears and losses instead of much anticipated success.
Now, after 4 years of struggle, 4 co-founders to work with:) and dozens of stories I've heard from other founder who managed to find a cofounder and are very happy with their arrangement — I've put together all my experience and hand-on advice in a course "How To Find A Tech CoFounder". It'll save you from the mistakes you're about to make. I'm explaining there:
✅ WHERE TO LOOK FOR COFOUNDER,
✅ WHAT IS THE BEST WAY TO APPROACH THEM,
✅ WHAT INFORMATION DO YOU NEED TO INCREASE YOUR ODDS,
✅ HOW TO USE STORYTELLING AS YOUR SECRET WEAPON
and many other things.
Every single question that you might probably have is answered in the course.
❌ And no, you don't have to join a matching platform.
❌ No, you don't have to spend $1000 to attend online programs and events.
✅ All tools and methods I'm describing are 100% free and available to you from anywhere (US, UK, Australia or Egypt). You don't have to be a citizen of any specific country to build a great startup with a cofounder that you'll find due to my course.
If you're interested — check it out here.