Startup Therapy Podcast

Episode #132

Ryan Rutan: Welcome back to the episode of the startup therapy podcast. This is Ryan Rutan joined as always by my friend, the founder of startups dot com. Wil schroder. Well, there comes a time in pretty much every founder's life kind of from the point they started until the point where it no longer exists at all. Where we look around at times and go, this is a shit show of epic proportions. What do we do? Right? So like, you know when the investors have pulled out, when the staff is running for the hills, when when suppliers are cutting us off, all this stuff is going down, we're out of money, Nothing else left. What do, what do we run on as a startup? What is it that's powering us at this point?

Wil Schroter: Your blinded optimism. That's the ticket

Ryan Rutan: right there. That's it. It's an expensive fuel, but it burns

Wil Schroter: hot fuel that powers every startup. It pounders, power pound, I'm

Ryan Rutan: with you. It powers the founders founders, I speak

Wil Schroter: typo I mean seriously, if you think about like kind of almost the entire trajectory of most startups, you want to believe that later on, once we get through your the ship show part that I guess everyone knows there's this shangri la part where everything is just cool. Not it just no matter how many times we think we're past that point, we keep having to come back to, I guess we're just gonna have to run an optimism for a while,

Ryan Rutan: right? It's the nature of the beast. You start to see some success. You start to trade up your victories. You also start to trade up your problems, right? They still right along with the startup. It turns out so get used to it. It's okay. It's part of it.

Wil Schroter: It is, but but I think that, you know, in the early days and I kind of, let's call this freshman year where everything

Ryan Rutan: just seems like a disaster.

Wil Schroter: Uh, there's a bit of a playbook to this whole thing right now. We're not gonna sit here and talk about how some of it's cool, you know, don't sweat it left in, its not cool. None of it's cool. But what we need to talk about is what is the playbook that founders use founders like ourselves, Ryan, who have actually been through this enough times to know, even though it's going to suck, this is exactly what you do to get your optimism back to get through this whole thing so that you can get yourself to the other side of it. All right. So before we get into this next topic, I just want to let you know what we talk about here is like 1% of the conversation, you know, really, this conversation is going on all day long online at groups dot startups dot com. Where Ryan and I pretty much talk endlessly with founders about every one of these topics. So if by the end of this discussion, you like the topic and you want to dig into it a little bit more with Ryan and I just had two groups startups dot com and we'll pick it up from there.

Ryan Rutan: So, I mean, you've you've said this before, I've heard you say this to founders over and over and over again. Like look what's done is done. You've got to move on now, right? Like you can't be spending all of your time looking in the rear view mirror. Um because the ship's still moving forward, right, are their rear view mirrors on the ship? I'm gonna go with. No, I think you just turn around at that point. Um, so in any case, there's a rear view mirror on this ship, um, and you spend a lot of time looking at it, um, you're gonna end up running into other troubles, right? So it's it's not just a matter of let this go for your own sake. Yes, that's also true. But you have to let it go for the sake of your startup, right? The amount of time you spend looking backwards, and I'm not saying don't think about it right? And don't analyze what went wrong, but give it its proper analysis and then put it to bed, right? I know people who are, you know, a year later and I'm watching all sorts of problems, problems crop up around their startup and they're still focused on like what happened a year back. Um, not a good, not a good thing, right?

Wil Schroter: Uh, And so it's gonna look like, uh, we've been working with this one investor and they've been telling us the entire time that, that they're going to put money in and we've just learned and we've been burning down to the last dollar always that, that they just pulled out. You know, we're fucked and we're gonna sit around and we're just gonna think about it the moment they said, no, what's done is done right? There's nothing we can do about that. We're going to think about, right? We're gonna beat ourselves up about it. We're gonna keep talking about it. We're gonna pretend like the fact that it's done doesn't matter that somehow had we done something differently, it's going to change the present and we don't have that time to

Ryan Rutan: waste.

Wil Schroter: Okay. So you said, uh, you know, get past, don't think about it too much and I think we both agree at some point. Maybe we have some retrospection, of course teaching moments

Ryan Rutan: and learn from you have to, you have to analyze it.

Wil Schroter: But like one night,

Ryan Rutan: right? You can't keep carrying it around

Wil Schroter: with you in one night. Here's the problem whatever we do. However, we internalize this or beat ourselves up, etcetera, he's gonna get reflected tenfold in the organization. The last thing you want to see is that the founder who just missed out in a funding round is running around with their tail between their legs, you know, terrified of what just happened because now here's what we did. We just projected that problem onto the rest of the stuff, they're all freaked out which actually makes the problem 100 times worse where we're

Ryan Rutan: and boy does it travel fast? I mean it just like you said, even some of just the physical manifestations like just watching how you move around, you know, people are paying attention to this stuff, right? We're all very perceptive animals at the end of the day and this is not one of the situations where you ever have to say it again. So the people in the back in here, um it gets through the organization really fast, right? And it's obvious to to be able to tell like when, when somebody shook um the decision making starts to change, right meeting start to change, we go into emergency mode and look sometimes you have to write, go back to your example if you're burning cash and you just found out that that that you know 250 grand or half a million or whatever was coming um in the bridge round isn't coming, you do have to make some drastic decisions sometimes right? But that's sort of the point here. Um if these things are as grave as you're making them out to be, it's about what happens next. That actually matters right? It's your reaction to them. That matters. If you're spending all of your time analyzing the mistake trying to take away some, you know, crystallized learning from it, you're gonna run into another problem really quick. So if you're trying to collect issues, this is probably a good way of going about it. Um, but like let's just say it one more time when it's done, it's done right? You have to pivot and move from that point forward circumstances change, your actions have to change. Um, so that's where you wanna be spending your time right? Getting the ship back on course again, making sure that you can survive under these new circumstances, whatever they might be and making the decisions in sort of the best light possible, um, which is not while facing backwards,

Wil Schroter: right? And at that moment all eyes are on you. The founder of the founding team. What have you? Everyone's gonna look to you to say how are you reacting? Because look, even if you act great and they don't believe you, that's one thing okay. But if we react shitty and they were like, man, my only ounce of hope was that you were gonna, you know, lead this thing that just makes like guarantees failure, right? Never

Ryan Rutan: looks good to see the general riding towards the rear line. I'm just going for resupply, I'll be right back. You guys stay here

Wil Schroter: and keep fighting importance of having optimism is generating optimism. I think we have to recognize that as founders, that's a really great point. This, this auto generated thing, We have to wake up every day and creative, you have to look for the little areas that are still a positive, okay, wow funding round fell out or key developer left, etcetera. Okay, what can we do to kind of drive this forward? Where is the optimism? Right?

Ryan Rutan: That's really interesting. I think it's easy to forget to that not everybody's gonna be inherently optimistic as the founder and we forget that it's like, well I'm, I'm still, you know, whistling and and happy over here. Why isn't everybody else? Oh, well because they know that that funding around just got pulled out and they're all worried about where they're gonna have their jobs in a month, right? I may know the answer to that. They certainly don't. Um, and to your point, right? The, you know, if if we're, if we're looking defeated and cow town into the world, then it's not going to be a good look and it's certainly not gonna spread Optimus is gonna spread the opposite. So, um, yeah, it's a really good point will. Um, and I don't know that I've ever really thought about it that way before in terms of how dependent the organization's optimism is on us,

Wil Schroter: right? And look, we don't have the luxury and I understand we can go home and cry if we want to welcome to do that,

Ryan Rutan: but we have to wait till you get home, okay.

Wil Schroter: You know, what do, what you gotta do, just don't do it in the office, so you're working remotely, you're already at home, you know, it's

Ryan Rutan: true. So I don't technically, I can start crying in the middle of a

Wil Schroter: meeting and be okay. But the, the point though is we don't have the luxury as the leadership of an organization to, you know, talk to cry over spilled milk, right? And I know internally that makes it hard for us to, because we keep thinking that successful companies, successful entrepreneurs, what they must do is they must make a lot of the right decisions, right? Not the way it works, successful entrepreneurs make tons of bad decisions and tons of things go wrong. This thing going wrong no matter how bad it is, is one of a million things that's still going to go wrong. This is all part of the process. It sucks going back to freshman year getting stuffed in your locker or dealing with acne or whatever you're dealing with. It sucks puberty, there's nothing cool about it, right? But it's part of the process. You have to go through it and you have to look past what just happened five seconds ago in order to find that Optimism.

Ryan Rutan: Yeah. Okay, so let's, let's, let's put a, let's put a direction on that. So I think what we're kind of getting at here is our next major point, which is around focus, right? So at the point of which you've, you've decided, yes, I'm going to leave the bags here at the station, I'm not going to bring them with me, I'm not gonna drag it around in the streets, I'm going to move forward. Focus becomes the key element to moving forward and and having success after one of these major disasters. Yeah,

Wil Schroter: well, I think what happens is we get so distracted in the moment of what just happened that we take away all of our capabilities to actually become successful. Give an example years ago I met this um british s a. S. Officer, but he's an S. S. Officer and uh he had developed this munition that allowed you to shoot people and learned what it meant to be able to take a live fire shot, right? It's spun in a way where it didn't hurt you, whatever for her, but it didn't kill him. And so I asked him, I said um I've got to imagine you must have been shot at some point, and he said in his perfect british accent, that I'm not gonna try to murder with with my own version. Um He said, yeah, I've actually been shot five times. I was like, at the same time, he's like, no, it's five separate engagements. I was shot. And I was like, wait, wait, wait, what? You've been shot either the most unlucky person? He's like, no, I'm in close quarters combat, right? And so uh when people are firing close quarters, you're going to hit each other, right? And so I said, okay, well how did you not die? Right? He said, here's the basics of your training. He said, when you're, when you're in the middle of a firefight, you cannot think two steps ahead, you think says the only thing you can do is focus all of your energy and I need to get to cover, I need to reload, I need to cite up, I need to fire, I need to not hopefully get hit again.

Ryan Rutan: I might change the order on those.

Wil Schroter: I might start

Ryan Rutan: again. I might just put that first.

Wil Schroter: Uh, fun fact he said that people don't die from getting bullet wounds and they died. They died from the shock and the bleed out of bullet wounds. He said the whole point of his munition was to get people to fight through it, which made him the biggest badass I've ever seen

Ryan Rutan: anyway. That's pretty interesting.

Wil Schroter: But but I'll never forget what he told me because this idea that when the ship hits the fan, you cannot focus on lots of things. You have to Isolate and focus on one thing to get to the next step. I mean,

Ryan Rutan: biology teaches us this

Wil Schroter: right? Like this is

Ryan Rutan: the whole point of adrenaline is not just the energy it gives you, it's the focus, right? It literally forces you into like a pinhole camera mode where all you can see is what's right in front of you and people talk about this when they're, when they're having true like physical adrenaline reactions that it gets down to that tunnel vision that's on purpose. That's so you don't pay attention to what's over there and what's over there, you know, like, oh tiger. But there's bananas on the tree over there. I think I'm hungry. I'm gonna get a banana. No, you're going to deal with the tiger. Right? So yeah, it totally makes sense. I mean, the analogy holds here,

Wil Schroter: here's what happens though. Funding round breaks. I know we're talking about about funding, but let's just focus on this for a second. You lose a customer indication, same thing, right? And immediately, here's what we say. I need to find another investor. I need to find another customer. Problem with that level of focus is you can't do that in one step. I can't sit down on my computer right now and find a customer or get an investor

Ryan Rutan: right. If it was that easy, you probably wouldn't be having this problem, right? Right, right.

Wil Schroter: Here's what I can do though. I can sit at my computer and I can say in the next hour, I'm gonna create a hit list of who I want to reach out the hour after that. I can focus on crafting three emails in the hour after that. I can get these emails off to people. I need to chunk up my day in such highly focused minuscule bites. All of my intention can be get can be put towards getting to that next step. Nothing else because at that moment I don't have the luxury because she had just hit the fan. I don't have the headspace to be able to create optimism by trying to pursue broad amorphous goals. I need to get my optimism back by showing progress with tiny goals and actually get them done. You know, by the way, I just want to mention if what we're talking about today sounds like the kind of discussion you wish you were having more often. You actually can, you know, we're online all day everyday working through exactly these types of topics with founders just like you. So any question you would have or maybe some problem you just want to work through. We're here and we love this stuff and we're easy to find, you know, head over to groups dot startups dot com and let's just start talking.

Ryan Rutan: Yeah. And it's, it's, it's so hard in the moment though. I just want to reflect on that for a second because you know, we see this happen all the time. You and I definitely talked to more than our fair share of founders in crisis. Um, and I see this a lot where they kind of go into what I'm gonna call the spooked horse syndrome right, where now they've they've been spooked by something they're scared and then they start to make really big movements bold decisions, the type of things that should be reserved for when you have plenty of peace and quiet and plenty of time to ruminate. They're now making on the fly because they feel like they, something drastic just happened. So of course my reaction must be equally drastic. Right? And I just don't see that play out favorably most of the time. Right? So I think that in addition to what you're saying about focus and bringing it into steps, it's break it down into something that's absolutely manageable, right? And, and it's not only is that the path forward. Um, as, as a company, I think for the founder, it's really important to get back to like immediate little quick tiny little steps just to find your footing again to get back on balance because I see it far too often where founders get unbalanced by something and they start making unbalanced decisions in the middle of what's already a shit show, right? Not the time to lose your mind, right? Gotta just focus. And I think that the smaller the target, um, the easier that becomes then to tackle and to ensure that you're not going off reservation simply because you know, some some short term bump in the road has now caused you to go completely cable.

Wil Schroter: I think it's a few things. I think part of it is when the ship hits the fan and if you've had a big setback etcetera and you kind of lost, lost your optimism, you need something to be successful with again, right? So building the email list, sending the email, etcetera. Those are all small, tiny winds that build back success and let's zoom that out for a second to not just us, but to the rest of the organization, well, we need to step back and say, hey, we need to make sure everyone else is having their wins as well. Right? In other words, we need to give them small bite sized things that they can say, I'm making forward progress because the fastest way to rebuild optimism is to show progress, the fastest way to lose. Optimism is to send people on amorphous tasks that have no real chance of winning in the near term. And the near term is so important, um, that, that we can't get around it. I'll give an example when a company, a public company stock price tanks at that moment, investor enthusiasm in optimism plummets right? Probably internal enthusiasm plummets right,

Ryan Rutan: completely flies the coop at that

Wil Schroter: point, correct. And, and at that very moment, you know, everyone's running for the hills, that is the most important moment to show some some breath of life that companies to show that it has opportunities. It shows that the people that are interested in buying the stock and running it back up have something to buy into our optimism is like a stock, right? When it plummets, we gotta build it back up, we gotta get people interested in buying that stock again, right? And there's a method to that, this is the method by the way. It's getting people ourselves included ourselves, most importantly, back on the horse back, making forward progress as quickly as possible

Ryan Rutan: and to that point celebrating each and every one of those little milestones as you cross them, right? You have to write, I think that's the other issue, is that when you've just had a massive issue or failure, I don't really want to call it a failure. I mean, it may feel like a failure. It's probably, you know, sometimes it's incumbent on the founder, sometimes it's not right. We can't always link those things. Um sometimes it's just environmental, right? And we're just stuck by, you know, whatever the major swings in the market are in those moments, we feel

Wil Schroter: like,

Ryan Rutan: okay, we just had this major bad thing happen. I'm not going to talk about any little good things that are happening because they're so dwarfed and sitting in the shadow of this big thing that happened, right? And I think that's absolutely the wrong way to take that right to your point. We've got to build momentum and momentum starts with small movements, right? So we've got to take the little movements. We gotta celebrate them, rebuild that optimism, rebuild the team's pace, rebuild everybody's enthusiasm and energy and get things moving again right. Um now, you know, not everything is gonna be, you know, a big glamorous win. Um we've talked about this before, another podcast where we want to celebrate all the little wins along the way anyways, because that's really what the big winds are made up of, right? Those, it's just it's a collection of tiny little winds that at the end you can sort of put a visual bow on and say, yeah, all those things collectively turn into this outcome, that's great. But you have to maintain that optimism momentum, particularly after some sort of a big shortfall. And so, you know, I want to reinforce that what you're saying is absolutely correct. We've got to make sure we break these things down into little steps and then as we're taking and passing each one of those little steps on this new trajectory forward, we've got to make sure that everybody's feeling fucking awesome about accomplishing that stuff,

Wil Schroter: right? Because what we're talking about is again a game plan here, actually how we rebuild optimism. And if we break optimism down into its core parts, we're talking about wins, right? We're talking about seeing the future is better than it is today. The way to do that is to have things go well that we can recognize right? The way to totally mess that up is the only dwell on the things that aren't good and there's so many aspects of building a startup, especially in the formative years that are shitty right? I mean that's just kind of the way it is and if all we do, if all we do is just kind of double down, Oh my God, that went wrong, that went wrong, this person left, that didn't go the way we wanted to, we are screwed. Trust me, there is no start up that gets by because things just keep going so well in every direction and I can't believe how much money people are throwing at us, You know, that that's just, that never happens, right? And if you think it's just not happening, your startup doesn't happen at any startup, that's

Ryan Rutan: bananas, it doesn't, you know, I think it, it becomes easier with time, certainly with experience when you've kind of been through the ups and downs before you start to realize that you know what, this is part of the journey, right? This climb up this steep side of the hill, I'm going to enjoy it as a hike to the extent that I can, knowing that I get to ski down the other side, right? But you gotta do the climbing first. And so I think it is really, really difficult. If this is the first time you're going through it, listen up, you're going to go through this 100 more times 1000 maybe. So just take it easy, take a breath. Um and you know, you started this from nothing, right? So the fact that it's now facing some adversity, if anything is a great sign right? It means that you've made it far enough that you have high quality problems. Um that's way better than this thing dying in a notebook somewhere. So congratulations, You've got big problems. Those are the best kind of have because it means you're on your way towards something, right? So to the extent you can try try to enjoy the adversity, right? It just think of it as an additional challenge on the way. Um, and you know, nothing, nothing ventured, nothing gained, right? This is what, this is the road that we chose, the path that we chose. We didn't do this because it was easy. Um, jobs are easy, we did this because we wanted to leave some sort of mark on the universe. Well, it turns out there is a reaction that is equal to every action, right? And so this is the universe acting back. It's like I'm gonna leave a dent on you too, kid, this is what happens how we play

Wil Schroter: in my mind. Ryan, I don't feel like our optimism should be left in the hands of fate. I don't think as founders, right? We have the luxury or we have the responsibility of just hoping things go so well, so often that optimism just becomes itself, right? That's it's ridiculous. And it's impossible. The only way long term we're gonna continue building optimism building momentum for our business is if we make it happen every single day, we run a playbook and we constantly recognize that just like it's important to keep sales going and keep our funding going, etcetera. Keeping the optimism going is our lifeblood, and guess what? It's our job. Alright, so that was fun, but let's actually keep this conversation going, you've heard what we think about this, but you know, Ryan and I would really like to hear what you think and we're online, like all day long, pretty much talking about every startup topic you could think of from fundraising, the customer acquisition to just really have to get all of this crazy startup stuff out of your head. And there's tons of other founders, just like you, they're weighing in on these topics, so you'll get a chance to just hang out and meet some really smart founders were also super, super easy to find. You head over to groups dot startups dot com and let Ryan and I hear what's on your mind, let's get to know each other a little bit and let's just start having more of these conversations

Copyright © 2024 LLC. All rights reserved.