Being incapable of failing is the name of the game
I was having breakfast with a friend and fellow VC (with a shitload more experience) this week and we touched on the topic of the qualities we look for in founders we’d like to back. I’m still learning a lot but we agreed on one thing right off the bat. When we’re investing at a pre-seed, seed or even pre-launched product stage there’re only a few important diligence boxes we look to check off. The most important one, to me, is the the founders complete and utter belief that they can not fail. They know the odds are against them and 999,999 things could go wrong but they believe that they are the one in a million. There are a number of ways that this belief manifests itself when it comes to how a founder acts. Three that I tend to notice are:
Constantly on
Many times it’s the hours that a founder chooses to be “working”. I don’t think it’s healthy to sit in the office for 14 hours every day but I do think you have to be willing to work at any hour of the day when duty calls. When a challenge surfaces in the middle of the night, the ability to kick into high gear and to shine as a leader and executor is key. If your largest lead, located on the other side of the country, wants to meet in person to close the deal tonight it’s your ability and desire to pick up your laptop and to head to the airport to make it there before the sun goes down that makes you stand out as a dedicated founder and closer.
Over the years I’ve seen many examples of founders like this but one in particular comes to mind every time I see this quality in a founding team — TK from ToutApp. TK was one of the first members of WeWork Labs. He did work long hours but it was calculated. He took the time to get to know every single area of the business. He became the best sales person, technical team member, product mind and CEO that that business could ever ask for. Five and a half years later, he’s still working just as hard and his desire to be “constantly on” is a huge reason for their success.
Lifting yourself up by your own bootstraps
Other times a founder’s resilience can be seen through their creativity. I have a soft spot for people who have bootstrapped their way to profitability and/or to product-market-fit. It takes courage and intelligence to place a bet on yourself, without the outside backing of others, and to succeed especially in the earliest days. Along the way the best founders come up with innovative ways to pay the bills (like when the founders of Airbnb sold cereal). When you head out to raise your first round of financing it shows in both qualitative and quantitative ways.
At WeWork this was crazy important in our early days. We didn’t raise our first institutional round until 2012 which was years after we launched. We stayed under the radar, built a sustainable business and grew it, literally, brick by brick. The earliest team members of WeWork were dedicated, passionate and, above all, interested in making the world a better place by building something amazing.
Make others believe
This is something I saw time and time again from the founders of WeWork. Adam and Miguel had an amazing ability to convince people to work harder than they had ever worked, smarter than they had ever worked and with more passion than they had ever worked with.
This trait goes far beyond being great at sales or people management. Great leaders have to possess this skill (it’s almost a superpower) at some level. When your team is working long hours, customers are pushing back and you’ve got little to no capital in the bank the only thing a great founder has going for them is their team’s shared belief in a mission. It’s the founders job to hammer this in. This superpower also applies to closing the earliest customers, the first investors and when hiring the first twenty employees — a great founder has to make others believe.
Ultimately being a founder is not a science. It’s comprised of charting new territory every step of the way and charting your own path. Sometimes you get it right the first try, most of the time you get it wrong the first ten but ultimately the founders who believe that they, and their early team members, are incapable of failing come out on top and everyone from the first investor through the last employee to join wins.
