Published in the San Diego Union-Tribune, April 12, 2021
Recently, I started a project. Like all entrepreneurs, I think I knew the problem I was solving for, and all I needed to do was plow ahead. At the very beginning of the project, I set as the baseline requirement, the sine quo non, that the “table” had to be preserved. Well, it turned out that every decision that was driven by saving the “table” compounded upon each other and the farther I got into the project, the deeper into the woods I walked, and of course you know the end of the story. I got lost.
The cost of saving the “table” ballooned eight times over. Finally, I was a beaten man, and I scrapped the table. I didn’t just scrap it. I broke it into little pieces, and then I burned each piece. How could I have been so stupid?
Those very first decisions often become slowly set in concrete and in retrospect each decision that emanated from the first one was ultimately wrong. So how can the entrepreneur do a reset early enough in the process to make sure he is not on the wrong road? One technique is to consistently ask the same questions over and over again, not with the idea of reinforcing your thinking, but of continually trying to punch a hole in it. Like a dog with a bone, grind on it.
I was a co-founder of a biotech. Don’t laugh. I know the difference between ibuprofen and Prozac so I was qualified. I was dazzled by the scientist founder, and I thought that if the science she had developed actually worked, it would be a game changer. Big market, big problem.
And so, we began. We raised money, and we failed. Why? The team could not play well together, big egos, wrong skills in the wrong chairs, and after blowing through a few million, the company hit a major pause button. No litigation, but broken relationships.
The first decision, the fatal mistake, was that the founding science team wanted to stay at their prestigious institution where they had endowed chairs, so there was no deep commitment on their part to building a company, to go all in, to bet on themselves. The “table” in this story was co-founder insistence on control without skin in the game. My saying “OK, we will work it out later” was stupid on my part. I failed to confront the hard question early.
Great science, no team. And you cannot finance that model.
Better to be lucky than smart, though. A couple of years later, the company got resurrected, we brought in a real CEO, a new team, the science actually worked, and they are raising $35 million in a series A financing and entering clinical trials. But it could just as easily have ended up as banjo picks.
My area of effort is behavioral economics — why do we do stupid things, when with just a slight turn of the head, removing the blinders of certainty, the possibility of success might begin to loom larger in the rearview mirror.
May I politely suggest a technique for blinder removal — go sit under a tree. When we stopped, literally stopped, it allowed for a complete reset of team and skills. You cannot fix a race car while it is still on the track.
One more confession (good for the soul at this time of year) is this. I wrote about the hip app Clubhouse five months ago when it first launched. I thought listening to a bunch of famous people talking about how they made risotto was stupid. I was wrong. It is addictive, and it will be a giant grand slam success when they figure out how to monetize my random wandering around a room. But in the end, I think I will stick with the Groucho mantra.
As a final note for the Passover and Easter season. I thought about Moses and JC as entrepreneurs. They identified a problem and they solved it. But unlike the rest of us, they did have a distinctly unfair advantage when they went out for financing. They didn’t have to battle the venture capitalist Philistines, and they got a great pre-money valuation. After all, they had God on their management team.
Rule No. 662
If shoes are uncomfortable, try sandals.