Building a startup with friends … hurdles to face

A post usually draws its inspiration in recent experience or trending topics.

This one comes from experience and me finally opening my eyes or, well, just noticing that more and more startups I face are built by a bunch of friends.

I mean, usually early stage startups. I also mean young friends. The fact that I came to my senses during a startup contest held by a university might have helped emphasize this pinpointed view, I must admit.

Yet, my title theme remains valid anyway. Which is quite good, be it only for the sake of this post.

Building a startup is cool. Doing it with close friends might prove even cooler. Succeeding with them would be extreme.

Failing with them might prove difficult, at least.

Quick look at the process of giving birth to a startup:

Some guys (gender-neutral “guys” so my “guys” here is both guy-guy and girl-guy), sitting at a table, sipping some beers, discussing the World.

Idea pops up. Guys like it. Let’s work and build on it! A startup is cool. Let’s build a startup! I like marketing, I am to be the CMO. You had the initial idea and study business, you are our CEO. Open road to success!

When this works out, these guys have the best life and job ever and can enjoy speaker spots at the likes of SXSW, TNW, and so on.

When this does not work out, well, an increasing number of guys I meet are quite unprepared.

Failure sure is an option.

Now, the issue to be faced will occur when it comes to the actual handling of what failure includes.

A startup, be it the coolest one, the initially richest one, etc… is, at first, a company.

And a company has to be managed. And managed quite seriously.

Hurdles, faced by startup founders too

Hurdles, faced by startup founders too

That is where my friendly bunch of “guys” might fail. Talking to these people (various teams, various people, same issue), I asked them about how they were organized, who decided it would be organized this way and, more importantly, how they would handle crisis – and maybe the crisis that their organization would create.

Whatever the reason for failure or crisis, when startups are founded by half a dozen people, it means the revenue drawn from the product sold (assuming it is even sold) will have to cater for the lives of this whole bunch. The more people, the more money is needed. The sad bit is that numbers within the startup do not usually make bigger numbers on the market.

Call it the bodybuilder syndrome. The bigger the muscles, the more they need to eat. If the eating is too light, muscles will feed themselves out of their own selves.

For the startup, it means creating foundations for losing money even before making some.

Then, there is a second hurdle to face for those startups with numerous founders: the roles and responsibilities.

Even if everybody is basically happy to grant themselves C-titles, there might come a time when the skipper (e.g. the guy that everybody “smiled” to the CEO position in the first place) will have to skip.

During harsh times, the boss has to be the boss and act as the boss.

My question to this boss : “Are you ready to sack your friends ?”.

I have had little answers to this question.

As a reminder, a startup is a company. The CEO of a startup is the boss. The boss has to lead the company and make decisions even if the decision is about getting rid of lazy buggers (still friends) or laying off employees (yes, the CMO friend) to reduce costs and pressure on the company.

Too many lack that vision. That sure is the un-sexy part of startups but the sorry real-life though.

Actually, that is the “work hard” part (of the “Work hard, play hard“). A startup is a lot of passion and fun but a startup is also a real company.

So now, guys, work hard ! … And play harder !

[Picture credits : Phil Roeder]

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