April 20th, 2021 | By: Wil Schroter
If most early-stage Founders were being completely transparent with their staff, their company updates would probably look something like this:
"Hey everyone, good to see you all on Zoom. So my quick update is this — We don't know if we have enough runway to make it to our next funding round. Also, I'm getting a lot of personal emails from folks saying they don't see the vision anymore. And personally, I don't really think this was the right decision for me or my family. So.. who wants to lead with OKR updates?"
That's the kind of truth that exists for us as Founders every day, and yet we find ourselves "hiding" that truth from our staff on a daily basis. Does that make us horrible people? Do all Founders leave this kind of information out? If we went full transparency, would everyone understand?
There's a fine line between being "fully transparent" (which sounds awesome) and terrifying the living shit out of our staff. For many of us who are Founders for the first time, we wrestle with this brutal dichotomy daily, trying to figure out if holding back certain pieces of information is the right thing to do, or, whether anyone else does the same.
Let's be clear — this isn't a discussion about whether we can justify lying to anyone — we can't. However, Founders don't automatically get the luxury of sharing everything that's on our minds, because fundamentally, we are building a boat that's full of holes, taking on water, and statistically likely to sit at the bottom of the ocean when we're done with it.
Our jobs, therefore, are to inform without terrifying. Imagine two versions of the same response to a question about what joining our startup will be like:
Version A (honesty) "Joining this startup will be the hardest job you'll ever have. You'll often wonder if you're going to be employed by the end of the year, you'll have no certainty of how your compensation will ever pan out, and the company itself will statistically be out of business within a few years."
Version B (optimism) "Joining this startup will be the most challenging job you'll ever have. Your role will constantly evolve while we shape the product and company, you have nearly unlimited upside on your compensation, and the company itself has a shot at being a unicorn in this space."
Both can be true, but it's our job to shape that space in between, not leaning too far in the direction of terrifying everyone but also not overselling our optimism. It's a balance, tapered by our own judgment which every single Founder has to master.
When it comes to our own feelings, transparency is a huge luxury. Yes, it would feel amazing to get all of these second-guessing feelings off of our chest and out of our heads. "Guys, I have to say, I'm totally fried and I don't know if I keep doing this" maybe what we want to say, but what we have to say is "Yeah, it's been tough, but I'm seeing this thing through!"
Why? Because it's our job to set the tone for that very optimism that we rely on the rest of our staff to feed off of. We don't get the luxury of wallowing in problems or self-pity. It's not about being dishonest, it's about recognizing that our own frustrations don't always take a priority over the needs of our startup. It's what parents do for their entire lives!
Our sharing should always be under the unspoken contract that we are there to protect our staff, not drive them off to defection. If we're 4 weeks from running out of money — yes, we have an obligation to share that. But if we are feeling 50/50 about our future (like every Founder does), we have to wrangle that doubt into a weapon of drive and focus. If we don't, no one will do it for us, and if we drop our guard and just pour our hearts out, we shouldn't be surprised when we watch our staff walk out the door as we finish our good cry.
The Emotional Cost of Being a Founder. When we talk about building startups, we talk about lots of costs: Staffing costs, the cost of capital, cost per acquisition, and opportunity cost. But we never talk about the biggest cost – the emotional cost.
3 Benefits of Emotional Intelligence for Today’s Business Leaders. Leaders who can recognize their own emotions in relation to how they affect their behavior are better able to control their own impulses and handle change.
Why Do I Feel So Alone? No one ever tells you in the “Starting a Company” brochure that the journey will not only include crippling anxiety, drowning in personal debt, and endless challenges — but also a healthy dose of personal loneliness.
Wil Schroter is the Founder + CEO @ Startups.com, a startup platform that includes Bizplan, Clarity, Fundable, Launchrock, and Zirtual. He started his first company at age 19 which grew to over $700 million in billings within 5 years (despite his involvement). After that he launched 8 more companies, the last 3 venture backed, to refine his learning of what not to do. He's a seasoned expert at starting companies and a total amateur at everything else.