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Anexit in a year or two would be nice.
“They have a product.”
“They are going to launch it.”
“The product is released and a few people are using it.”
“They need to raise.”
“And how much revenue have they done to date?”
This question is the magic question that seems to stop most startups and entrepreneurs in their tracks. Working in finance, I had this conversation one too many times. Tech companies came to me and it scared the hell out of me.
What are all these ivy league degrees teaching entrepreneurs and employees of startups?
Startups all around the world are raising money like charities, off nothing more than an idea. We’ve been conditioned to become obsessed with the phrase “Capital Raise.”
All the cool kids are doing it. The process of a business has been dumbed down to nothing more than this:
- Make product
- Do product
- Talk about product
- Raise money for product
- Exit business
- The end
It’s the sort of thought process I’d expect from a chimp who doesn’t know about this thing we call ‘business.’
My goal here is not to poke fun at the current state of play; I’d prefer to have a real talk instead. I would love if you could look at this process that’s become popularised and poke holes in it.
Is the sole purpose of life to ‘raise’ and then ‘exit?’ Is that all there is to life?
Is that what our parents busted their chops for to have their child grow up on the internet, build a BS product they don’t believe in, sell the cap raise dream, and then exit before it most likely turns to shit and the dreaded line of “at least we get the data” gets rolled out?
Mybusiness endeavors have been different and I ain’t that smart either. The other day I realized just how crazy I am in this current lifestyle of rockstar entrepreneurs and startups. I was speaking with a known tech investor about a business that I was experimenting with.
I told him that my friend and I sketched out the idea, emailed it to our email list, and then begun making sales to see if people would buy it, and for how much. He was kind of shocked.
“Don’t you need to raise capital?”
“Nope, I’d rather be profitable first and then avoid the raising capital part if possible. Investors feel like parents that want to keep me in their daycare under full watch.”
Clearly my ideas must be bat shit crazy because the thought of raising capital when I haven’t been in business a year or made $50k seems strange to me. Maybe people will like the idea and maybe they won’t. Maybe I’ll get bored in six months and decide it’s not for me. There are so many more important things to think about besides ‘raise’ and exit.’
Let us say for a minute that a business does have an exit. What does that mean? Will you be the happiest you’ve ever been?
Sadly, from what I’ve seen after seven years working with these entrepreneurs who have exited, probably not. The strangest example I can think of is an entrepreneur from the UK that sold his business and then a week later was fired and forced to leave.
He had all the money in the world, but it meant nothing. He came up with a new sport. It’s called “trolling.”
Every day on LinkedIn, he targets people who are saying something positive and tears them to pieces. He calls them liars, he says they are stupid, he pokes holes in their beliefs, and none of it is substantiated. This behavior baffled me as he was spending whole days trolling people.
I turned to Youtube for answers and there was a podcast interview with him. He explained how he had an exit, made tons of money, stayed at home, and got bored. There wasn’t much to do so he decided to use his free time and money to ridicule anyone who was making a go of their career.
The next part is sad: He explains that most of the people he trolls have blocked him and now LinkedIn has shadow banned him, so basically, the game is up and nobody is listening.
This is one of many examples of why a capital raise and exit isn’t the holy grail.
Sowhat’s the point then? If it’s not to have a successful raise and exit, then what is the point of business, or startups, or entrepreneurship?
Here’s what your focus should be:
Build something that solves a problem you’re obsessed with
There’s nothing better than finding a problem that pisses you off or causes you pain and then solving it. It’s seriously rewarding and it can become your life’s legacy.
Problems that you believe are worth solving will give you meaning for your life and that will take front and center rather than the copy/paste approach of raise and exit.
Work with people who you love hanging out with
I was thinking back over my career a few weeks ago and something that stood out for me was that it’s the people I’ve met through business that has been the real highlight.
I’ve met crazy tech surfies, weird former pop stars turned fintech buffs, refugees who’ve come to Australia with nothing and proven everyone wrong, and crazy cattle farmers who dabble in tech during the workweek.
Spending time with each of these people has been the highlight of my career. Instead of chasing ideas, products, investors, or customers I’ve become obsessed with finding these people who are fun to hang around with and do life with.
I wish this realization were unique to me; it’s not. Countless books on startups and entrepreneurs seem to point to the same thing.
Make money to solve more problems or teach someone how to do the same
The exit dream could make you money. You could go down to the Lamborghini showroom and buy one in bright, shiny, Shrek Green.
You can drive the Lambo around the block and do laps and watch people stare.
You can then buy the Rolex, the suit, the house and whatever else you want. Sadly, the feeling of these toys doesn’t last long. Then you’re back to square one again.
Take your focus away from making money for this purpose.
- Thinking of money as a way to solve more problems that interest you
- (Next level shit) Teaching other entrepreneurs how to make money so they too can solve their first problem and hopefully many more
Making money in these two ways is an entirely different experience. You get so much meaning from it that the hangover will completely leave the stock standard raise and exit dream behind forever.
Our thinking about what it means to raise and exit needs to change.