Wisdom Shared by Second Time Founders: Learn from Mistakes [Honest Confessions]

While each idea, startup, and founder are unique in their own way, there are some insightful lessons that each of us can learn from these second-time founders and entrepreneurs. Success isn’t ultimate, and neither are failures. 

Let’s read what are the typical mistakes to avoid as a founder of a startup looking to achieve success in their venture: 

#1 Know when to quit an idea or direction

While every idea is in some way novel and innovative, not all ideas are worthwhile. Founders need to be agile and flexible enough to realize the difference between actual market demand and a supposed opportunity. Yes, grabbing a market opportunity previously unapparent is a mark of success, but be quick to realize if the idea is failing. 

Founders should not base their decisions on mere instincts and plan their moves. They should evaluate the product fit and be certain if the demand is certain or already exists. Stewart Butterfield first failed to create a multiplayer game, realized his defeat, and moved on to using the messaging portion of the game product, which we all now know as the highly popular app Slack.  

Mizael Pena, the founder of Hardy Sprouts, says, 

“ (quit an idea) If it carries on too long without clear direction, it takes too many resources, time, and or energy, and no clear sight of when you may accomplish it.”

#2  Build business, not ego boosters

First, founders need to demarcate clear boundaries between themselves and their business. Shunning egos and learning to accept failures is the first step toward success. However cliche that may sound, the quote still holds great relevance. Falling in love with your product or not accepting that you don’t know everything can make your business obsolete and redundant. Be open to change, to pivot.

 “As a CEO, I am finding that I have to become a learning CEO. I have to go to school all the time because I am learning new skills that I need to run this company, and I am realizing that I am not equipped to just coast. I have to constantly renew my skills.” says Indra Nooyi, former CEO of Pepsi. 

Arrogance is a big killer of the startup dream. Being confident is a good thing, but thinking of yourself to be the ultimate Steve Jobs is sheer vanity.  Better Place’s CEO, Shai Agassi, had lofty dreams of getting the world rid of its dependency on oil. These goals were nothing but a pretense of grandeur. The business failed miserably.  ‘ 

#3 You don't need to code to validate an idea

“What you need are users! You can get users with a simple excel file or a spreadsheet.”

~Ariano Farano, Watchup

For a founder to validate their idea, they don’t need to code or know any software skills. You could validate or test your idea with a simple sketch or excel file or, if you want to go that extra mile, with loads of research and expert advice - whether free or paid - to foolproof your plan before you set up your business. 

Noam Wasserman, the writer of the book ‘The Founder's Dilemmas:

 Anticipating and Avoiding the Pitfalls That Can Sink a Startup’ sums up very succinctly “ideas are cheap; execution is dear.” As a founder, you could write blog posts, conduct surveys and user interviews, or promote your idea by other means to gauge the interest of the target market you are aiming for. 

#4 Over-communicate with your investors

Whether you are seeking funds from a VC, an angel investor, or going the FDI route, talk about your concerns and understand theirs. Be open from the start. Especially with foreign investors, special care needs to be taken, given the different formalities and guidelines you both need to adhere to. 

Earl Valencia of Plentica says, 

“The biggest lesson is to make sure you over-communicate with people and investors. It’s important to show them when times are tough as much as when times are good.”

This idea extends to your relations with your audience - whether on social media or face-to-face - build your brand in public and let your audience know your work from day one. This step is essential to building relationships with prospective customers, investors, partners, and employees. 

Table by Salt helps startups manage the banking and legal processes involved in fundraising for startups raising foreign capital. The startups get all the required assistance with RBI and MCA filings, opening a capital bank account, and transferring funds.

#5 Focus on being social and not being on social media

Myles Delfin is the founder of one of the biggest biker communities in the Philippines. He finds excessive social media engagement as distracting and equivalent to parlor tricks, “ for me it’s (parlor tricks) anything that takes the founder’s attention away from the fundamentals of his business: business development, branding, sales, client servicing.”   

Though it is necessary to engage early with potential customers, founders recommend spending less time on excessive handling of social media channels unless most of the customers are there on these channels. The founders’ focus should be on creating a solid MVP using the actionable insights from users and customers rather than spending hours on social media engagement. 

#6  Outsource services when needed, but don't be ignorant

While founders may consider themselves a jack-od-all-trades, there are still 24 hours in a day, and one cannot sit and do everything by themselves. Founders need to play on their core competencies and outsource the other tasks to save crucial time and opportunities so essential for a startup still trying to find its grounds. 

If the startup is looking to scale its operations, it is best to look for financial and strategic partnerships, seek investments, and develop a robust distribution strategy. Avoid scaling the business by yourself at all costs, as it could turn out to be a huge blunder. 

Angelo De Guzman, the founder of Cloudswyft, shares a wonderful piece of wisdom, 

“Work on the Partnership and distribution strategy (usually for scaling enterprise software) that would strongly fit your model. Don’t be afraid to explore and test as many models as you can and learn from your mistakes that. Get better every day, every week, every month, every quarter, and every year.”

As a growing startup, the legal, finance, management, and recruitment tasks must be handled under expert guidance to avoid small hiccups or major downfalls. 

#7 Busy work doesn't mean productive work

 “We think, mistakenly, that success is the result of the amount of time we put in at work, instead of the quality of time we put in.” 

~ Arianna Huffington

Excess of labor doesn’t always consequence in the absolute success of your product. It can always be a cause of fatigue and health issues for the founders but never a guarantee of finding the right product fit, capturing the attention of the right audience, converting the interest into actual sales, and reaching the break-even point sooner than later. 

Consistent and informed efforts in the right direction, with the right team, and for the right product could be possible vectors that synergize a startup’s efforts into actual revenues and long-lasting customer relationships. And the most important bit - you need to be passionate about the product or company you are building.

 Mark Cuban rightly says, 

“Don’t start a business unless it’s an obsession and something you love. If you have an exit strategy, it’s not an obsession.” 

Do you have any other pearls of wisdom to share for entrepreneurs and founders who are too busy to look for success and are passionately working to turn their ideas into viable products with market demand? Let us know in the comments. 

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