Naturally, as you grow up, your risk appetite decreases. Family obligations, a more demanding lifestyle, visa requirements, a hard-to-get well-paid job, the list goes on… Is the startup dream over for you? I believe not – actually quite the opposite! Here’s how:
First of all, later on in your career, you are a better founder! Both as a professional and as a leader, experience matters. Building and managing a team, raising money, converting customers – all become easier. Risk appetite aside, time is your friend!
But how do you work with your increasing aversion to risk? To begin with, such an aversion is to be desired! Your opportunity cost is now higher, and so needs to be your threshold for taking the leap. Start with a hard look at a company’s very existence; having a high bar helps.
A workaround that prevailed in the past couple years was to start with raising money. Some strong resumes, a few nice looking slides and, voila – you start with no risk, only the upside! Well, this is probably not on the table anymore. And it is not recommended either. Why?
At the very early days, you’d rather optimise for flexibility. Growing the team on a questionable plan, and having to communicate changes to both your team and investors, slows you down. At best, you’ll perform a local optimization. At worst, you are setting this up for failure.
So, what can you do instead? Plus, in a market that is transitioning from the great resignation to not-so-great layoffs, where capital is becoming harder to get access to, does it even make sense to consider quitting your fantastic job in pursuit of startup happiness?
Here’s the thing: You DON’T need to quit your job to start up – at least at the very beginning. Start with investing your free time first. Hack a first prototype. Talk to some friendly customers. Show things around. And take your time, to digest feedback, iterate and proceed.
Make no mistake, truly committing your free time is not an easy feat. Between family, friends and hobbies, your work life balance will suffer dearly. It’ll be demanding, also quite telling of what’s to follow. And it’ll help you test things out while limiting your upfront risk.
Having very limited resources initially available also helps! You focus on what matters, stick with the people who want it as much as you do, and make hard decisions earlier on. You’ll be surprised by how much you can achieve just between you and/or your cofounders.
And then, fingers crossed, magic happens! Things start to work out. Putting in the time comes easier. Your ‘day job’ fades out in the background. It becomes evident. This is it – it’s your thing. Commitment comes naturally. Your concerns are now gone – for good!
Ideally, you now have all options in front of you. You can keep this as a side gig – but this won’t make a lot of sense anymore… You can quit and grow this organically – it can soon start paying your bills! Or you can raise money on a solid basis and step on the gas…
I believe the above provides for a relevant path to starting up for seasoned professionals who prefer a more calculated approach to risk taking. Of course, there is no single path to success, and I, for one, am quite biased in Marathon Venture Capital‘s context. I hope you put it in good use!