5 Lessons Learned from a Successful Startup Founder
Startups are hard. As a founder, you are well aware that 90% of startups fail, and 10% within the first year. However, you proceed anyway, hoping to be among the 10% that succeeds. Arjun Moorthy, founder of The Factual, shares five hard lessons he learned from successfully selling his company. These lessons will improve your probability of success and help you avoid some common pitfalls.
Lesson 1: Don’t Hire Full-Time Employees before Product-Market Fit
As Marc Andressen once said, you must get to product-market fit in the early years of your company. Until then, you will be frantically trying many ideas. Hiring full-time employees before you have achieved product-market fit is a big mistake. During this time, any employee other than a co-founder will soon get frustrated by the changes of direction and eventually wonder if the compensation they are giving up elsewhere is worth it.
Lesson 2: Deprioritize Offshore Talent
Saving money is crucial in the early days of your startup. Hiring offshore talent is the best way to save money early on. At The Factual, talented designers and engineers were hired in Argentina for $35-50/hr, where the timezone overlap was pretty good with the US west coast. Founders have found similar impressive talent in Portugal, Spain, Ukraine, and Vietnam for $20/hr or more. They have found offshore talent to be reliable and easy to work with.
Lesson 3: Don’t Hold on to Your First Idea Far Too Long
Your first idea is very likely going to fail. Success with startups usually comes from insights that no one else has. Such insights are seldom read or found in a survey. The key to success is to iterate fast through ideas and get those insights quickly. You can build a complete product for your first idea before finding out people wouldn’t use it. A simpler landing page test might have told you the same for far fewer expenses and time.
Lesson 4: Don’t Build a Bigger MVP Than Necessary
Most founders have a grand vision for the solution to a thorny problem. Setting out to build an expansive product, albeit in stages, is not the way to go. Product form factors like mobile apps or websites are far larger undertakings than people realize, even if you try to minimize the feature set. Instead, find the smallest product area that you can test with.
Lesson 5: Have a Marketing Co-Founder
The number one thing investors look for in a startup is high growth, typically 10% month-over-month or more. Getting to high growth is very difficult and requires constant experimentation with new marketing channels and strategies. A marketing co-founder is essential so that he/she focuses on growth every day and not distracted by other things.
Bonus Lesson: Find a Support Network
Talking with other founders was often the best source of advice for Arjun Moorthy. He had a regular group of four founders who met every quarter for dinner. Beyond the tips, it was crucial to realize that his mistakes are not unique. He hopes founders find their tribe during this incredible journey.
Final Thoughts
These five lessons are essential for any startup founder to consider. They will improve the probability of success while saving money and avoiding common pitfalls. Iterate fast through ideas to gain insights quickly. Ensure product-market fit before hiring full-time employees. Deprioritize offshore talent, and find the smallest product to test with. Lastly, have a marketing co-founder to focus on high growth and find a group of people to support you.
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