Thanks for the perspective here. Luck does certainly matter a lot, but companies also point to luck as to why they succeeded when others failed all too often. DINNR is certainly an extreme case where execution positioned the Company in a place where luck couldn’t help. However, there are many other examples where a business succeeds or fails because of decisions made by the founding team that positions it for success or failure. Homejoy is potentially the best modern-day example. It was heralded as the “uber” of home cleaning and yet it couldn’t acquire or maintain customers affordably. Handy has survived. Why? Not simply because of luck, but because the unit economics have the potential to work (still not there yet I don’t believe).
The reality is that for luck to even matter, a Company’s house must be in order. Too many times internal forces lead to the inability of a business to thrive far before luck can be a factor.
Lynn, thanks so much for sharing. It’s a super important topic and one that I thoroughly enjoyed learning more about (and think we should be talking more about in this class).
One thing that came to mind as you discussed the male “hubris-female humility effect” was with respect to the difference between confidence in launching a business vs. humility in running it. When I reflect on the most impressive and admirable founders I’ve met, they are incredibly humble. Founders like Mick Mountz (Kiva Systems) and others come across like very simple, warm, approachable, and humble in how they conduct themselves. However, they had the confidence to pursue a vision. In short, I am wrestling with the idea that hubris (or extreme confidence) and humility are mutually exclusive. And if humility is such a compelling attribute of a CEO, that can’t be the only driver behind the gender gap we see. In any event, I’d love to learn more, so please let me know what else I can read to get caught up to speed on the topic!
Interesting post. The challenge that isn’t entirely encapsulated here resides in the type of person who starts a business.
There’s a saying that an entrepreneur is crazy enough to jump off a cliff without a parachute, but has enough confidence in himself/herself to build one before he/she hits the ground. When I think of that analogy and overlay some of the advice here, I feel a disconnect between theory and reality. With the exception of “the passion being gone”, the reasons highlighted in your post will often lead someone to think “it’s not me. It’s you (e.g. the market, a co-founder etc.). Realizing that you yourself are the problem is one that most founders will do everything in their power to ignore. I know I did.
Thanks for your thoughts. Pressure testing can take place through a number of the tactics that Geoff Smart and Randy Street highlight in their work (asking for real examples of instances when a candidate had to deal with uncertainty and going deep into that example). Generally, the theme here is that young companies are adaptive organizations and as they grow they become more mechanical and structured in nature. It is no surprise that his shift may cause tension with the first wave of employees. However, a shift from nimble to structured also has the potential to have adverse consequences on the ability of an organization to manage through the tumult of being a startup (albeit a later stage one). People create culture and since “culture eats strategy for breakfast” making sure you have a dynamic team that can do more than just hit pre-determined benchmarks is integral.