Remember the Alamo
I spent this week in San Antonio speaking with the Alamo Angels about what we are doing at symphonie.ai to help optimize contribution margin for e-commerce brands everywhere. I met some wonderful people there that I suspect will become friends as much as investors – I highly recommend anyone reach out if you'd like to be put in touch with them.
On my last day in San Antonio, I walked over to see the Alamo where about 250 Texians and Tejanos refused to surrender to 2,000+ Mexican soldiers; they were outnumbered almost 10:1. The Alamo is much smaller than I expected it to be and, walking around its grounds, I contemplated feedback I received about my recent pitch.
All feedback is a gift
In a nutshell, what I heard was "great team", "great background", "great business idea", "great pitch" but "as technical founders, folks get concerned you will try to build a Rolls Royce before you try to sell what you have". This is fair feedback and not the first time I heard it. I suspect there is a widespread belief that technical co-founders are prone to "focusing on the technology instead of the business". So, I write this post for technical co-founders everywhere so you more easily learn from what I have learned the hard way.
Early in this journey I was reluctant to show anyone anything that was still in development or in beta. I've since shed that shyness and now show what we have as soon as we have it. Whatever you build does not need to be perfect, it just has to work reasonably well.
It took me a while to fully accept that when an investor cuts you a check, they intrinsically assume 90% of their investment will go to zero. If they wanted safety, they'd invest that check in a Treasury at 5%.
Investors do not want to throw their money away, but they understand they are gambling that 1 out of 10 investments will pay off and pay off very big. You won't be 1 out of those 10 if you are too conservative with deploying the capital they gave you. As someone recently said to me, "if you take my check and put it in your bank account to spend it too slowly growing your business, then I might as well keep the check and put it in my own bank account".
So, when I understood this lesson I became less focused on "what is my runway?" and more focused on "where can I spend capital to move our product or business forward?". This does not mean you spend foolishly; it means that if you have to choose between 1) e.g., preserving 3-months of your runway, and 2) e.g., moving your business forward 3-months faster, then you spend the capital. The investor is gambling that you will be successful spending the capital they gave you; you are gambling that you can spend that capital smart enough to grow your business fast enough to raise more capital (or gain sufficient revenue you do not need to raise).
👉 Everyone in the start-up ecosystem is gambling and they know they are gambling.
This is one thing that I did from Day One because I learned this lesson very early in my career. I rarely talk to anyone about the technology unless they ask – and even when they ask I start with high-level summaries and only dive into details if asked to do so.
No one invests in a start-up because the "technology is cool" – they do so because they think whatever business the technology enables it will make them money. This alone explains why VCs are furiously investing billions into "AI" tools that confidently tell you this:
VCs are gambling that at least one of those "AI" start-ups will make billions and pay for all the other duds. That is, at least one company will figure out how to make money off genAI and that it will be a company in THEIR portfolio – it does not matter if 99% of the start-ups are ridiculous non-sense, just that the VCs are lucky enough to find the 1% who figure out how to make money from the non-sense.
What does this have to do with the Alamo?
The Alamo was a military loss for the Texians and Tejanos; General Santa Anna took no prisoners because he thought that "giving no quarter" would terrify and demoralize the insurrectionists into abandoning their attempt to secede from Mexico. It failed. Instead, the insurrectionists were enraged and "remember the Alamo" became a rallying cry in subsequent battles.
While walking around the Alamo I considered my previous post on the importance of resilience in the start-up game. You cannot give up with your first failure and you cannot be arrogantly stupid – you have to think deeply about advice and feedback you receive from 1) investors; 2) partners; and 3) customers. We would all like every bit of feedback to be positive; however, we often learn much more from the negative feedback. Just like the victory at the Alamo counterintuitively sealed Santa Anna's ultimate failure, its negative feedback that counterintuitively improves your chances of success.
Of course, if there is never any positive feedback, maybe you should reconsider what you are doing 😄.
...what we really want to know is what you were listening to!
As I mentioned in a prior post, I listen to music while writing because it makes the words flow like ink – the music "flavors" the writing. This time I was listening to Brantley Gilbert - "Bottoms Up" because the lyrics remind me of an important streak of independence in American culture that I admire and love:
I see you and me riding like Bonnie and Clyde
Going ninety five, burning down 129, yeah
Looking for the law, while I push my luck
And she's ridin' shotgun like it ain't no thing
Turn the radio up so the girl can sing right
Pull into the party like, "Y'all, wassup?"
You can feel this streak in Texas everywhere you go. You can feel it too in Washington State where I live – maybe less so in the Seattle region but it is there too. It is what makes America "America" and what I think cofounds and shocks Europeans. We bend no knee just like those Texians and Tejanos did not at the Alamo.
You need this streak in your personality if you want to succeed at the start-up game because every decision you do as a start-up is an example of "...while I push my luck". At the end of the day, probability is against you so just push and push.
