BUSINESS

3 High-Quality Lessons from a Failed Startup

May of 2018 was an exciting month. I joined a small team focused on removing the pain from a complex business process involving multiple stakeholders. Despite the startup’s failure, I learned three important lessons.

Your First Customer Is Everything

Our initial conversations with customers were promising. Everyone agreed the problem we were addressing was painful indeed. Energized by this discovery, we built a tool that would enable our customers to remove most of the pain we had identified.

We had exciting potential customer conversations and even ran a pilot project. Then we launched. The phone did not ring. The website did not generate the leads we expected. Sales did not materialize.

A customer is someone who gives you money.

Everyone in the company knew we needed to make sales, but we had difficulty recruiting our first paying customer. Instead of collecting money, we had encouraging conversations with warm leads and ran too long on the slightest hint of interest they showed. The Lean Startup[1] method might have helped us get customers fully on board, but this lesson is harder to learn than it might seem.

  1. Everything starts with vision and ends with a customer
  2. How long a project needs to be vision-led depends in part on its complexity
  3. Selling to a customer means putting our best foot forward
  4. It is difficult to determine when you’re ready to sell, because software is never finished

Vision Is Vital

It is easy to pin the blame of missing the market on visionary leadership, but the reality is that most startups fail. The cost of shaky or unclear vision is high. Our startup had a remedy for a real pain point. Our tactics aligned with our vision. Our team was a success because of clear vision.

  1. We incrementally improved our product to match the vision
  2. We optimized for adaptability to respond to what we learned as our vision clarified
  3. We worked as a unit in alignment to our purpose

Vision is indispensable, but it needs give way to the voice of the customer.

Without vision, paralysis-by-analysis rules the day. Fear of failure haunts every decision. I would rather follow a visionary leader than a timid, fearful one.

Visionary leaders need competent voices to interrupt their vision with reality. This is not the fault of those with vision. Followers need to know when to run with a vision, and when to ask questions and challenge assumptions. This is a difficult balance—wisdom is required.

The Team Is (Also) Everything

Let’s get to the heart it all. A business is a team of people working toward producing revenue through value creation. Teams bond with clear vision, and our sense of purpose brought us together. Teams collaborate to reach goals. Teams connect us with life-long relationships and knowledge that enriches us.

We found and hired people who shared the vision and gave every ounce of their talent to realize it. That was a success!

There is nothing better than knowing your team has your back.

I am humbled to have been part of a company whose leadership believed in and supported their team. Each team member played an important part, and they are some of the finest human beings I have ever known. After it all ends, all we have is friendship.

Footnotes


  1. “Startup success can be engineered by following the process, which means it can be learned, which means it can be taught.” — The Lean Startup Methodology. ↩︎

Harvey Ramer
Harvey Ramer
Harvey has been writing code for nearly twenty years. He builds web applications with React, Node.js, and MongoDB and deploys them to the cloud with CI/CD pipelines. He talks and writes about the Christian worldview, technology, startups, and how differences can become a collaborative asset.