Further, the products from those nascent startups — books shipped to your home, eBay for hipsters, and personal computers for artists—would have failed miserably had they remained in their original state. In fact, Apple came back from the dead more than once.
You can chart almost any metric related to startup growth, and from a distance, that chart will look like it goes up and to the right in a nice smooth line. But when you look a little closer, you’ll start to see all the peaks and valleys of a sawtooth growth line, with plenty of exciting ups and terrifying downs.
I’ve been building companies and products for over 20 years now, and sawtooth growth has been one of the hardest entrepreneurial concepts to wrap my brain around. Luckily, I got early lessons in how to deal with the risks associated with those ups and downs.
These days, I seek them out.
Once I got a few successes and failures under my belt, I realised that sawtooth growth should happen on purpose. In other words, you can’t scale up until you tear things down.
One bit of advice I give myself constantly — and I preach this to every founder and executive I advise: A taste of success can do more harm than good, especially early success.
Early in my career, I founded the first social network and publishing platform for writers, Intrepid Media, which blasted out of the gate in the early 2000s. The ride featured immediate profitability, unchecked growth, parties in New York and Las Vegas, and we even produced not one but twoNew York Times bestselling authors.
Conventional cautionary tales would have this company cratering just a few years (or even months) into its existence. It did not. What happened was worse. It stagnated, for years, becoming just successful enough to require my constant commitment, but never growing past a ceiling it hit pretty early on.
It wasn’t until the end that I realised it was my own fault.
I had become addicted to that early success.
What I had done was latched on to the mission. Any time I got a signal that something was working, I kept that feature in the product, whether that signal was an airhorn or a chirp.
What resulted was a customer base that was full of incredible, awesome, loyal people who would essentially stick with any decision I made while the rest of the world passed us by.
I see this happen all the time with early startups, even later stage startups. You probably see it too, as a customer or an early adopter. These are founders who go into their venture with a well-thought-out model that purports to achieve big and excellent goals. But then that early success trips some kind of hoarding circuit in their brain, and they dive into pleasing the base they have, at the expense of the much larger world they were trying to change.
I’ve been in those shoes. I’ve watched, horrified, when entrepreneurs who were smarter and more experienced than me tore apart a system that was working — producing results, producing revenue — and rebuilding it into something else. Why risk all the success we had worked so hard to achieve just to push a crazy idea further into reality?
When I had experienced the teardown-and-rebuild process several times over— sometimes successfully, sometimes not — I finally understood proactive sawtooth growth. It was at that point when I looked at Intrepid Media, my own stagnating startup, and decided to hammer the last nail into the coffin.
It was still making money, still very outwardly successful. But it was time to pack it in.
Starting and growing a company is chasing a moving target. When you don’t pivot with the target, you wind up very comfortable but also very stationary. Eventually, that target moves far enough out of reach that no pivot in the world is going to allow you to catch back up.
So you can either tear down perpetually and in pieces, or you’ll wind up having to tear it all down at once. I was forced into the latter option. But that didn’t mean it was over.
The lesson I ultimately learned is the one that the founders of those massively successful companies already knew. It starts with putting growth in one box and mission in another box, then you work out of one box at a time.
Mission is the reason you founded the business. It’s the idea that changes the game, the solution that solves the problem. It’s the reason you get up every morning and go to work.
Growth is what allows that mission to expand and evolve. It’s more than survival, it’s the conscious effort to take that next step into the unknown and risk losing your way.
The lesson is this: One without the other will fail
Mission without growth is charity, and charity is not business. Both are equally valid ways to operate, but they are not the same thing. Growth without mission leads to that scary kind of failure that surprises you one morning and then all the doors slam shut and you go into bankruptcy.
A secondary lesson that I learned later was even harder to swallow.
If you’re going to be successful, you have to risk upsetting, frustrating, and even alienating the people who helped get you there.
That sounds like an awful way to operate. So let me clarify:
There are limits, of course, to every strategy. I’ve been in situations where our company made decisions, made changes, and even adopted new policies for the sake of shaking things up.
I can tell you, without hesitation or nuance, that every single one of those changes backfired in a way that was painful.
What makes an entrepreneur a good entrepreneur is not risk tolerance or the ability to tune out criticism. It’s the fortitude to stick with a vision when that vision looks like a crazy idea. But crazy ideas without conviction or reasoning are indeed crazy, and random, and not something you should do when you’re out of answers.
I didn’t shut down Intrepid Media until I had already developed the idea to repurpose it. In fact, I was already halfway through the code to rebuild the company as something entirely different, which became ExitEvent, which I sold three years later.
When in doubt, go back to your mission and your original ideas and goals. Just don’t work out of that box for too long.
Joe Procopio is a multi-exit, multi-failure entrepreneur. In 2015, he sold Automated Insights to Vista Equity Partners. In 2013, he sold ExitEvent to Capitol Broadcasting. Before that, he built Intrepid Media, the first social network for writers. You can read more and sign up for his newsletter at www.joeprocopio.com