Published in the San Diego Union-Tribune, July 14, 2025
by Neil Senturia
From time to time, I take on a coaching client. In some alternate universe, a fellow sends me a blind email request and then a follow-up email and is insistent that he wants to pay me for my world-renowned advisory services. Already I can tell this guy needs coaching to not be so quick with a dollar, but I can’t resist and so we begin.
Forty employees, $30 million in revenue, in business 10 years, in other words a real business, a real entrepreneur, boot-strapped the whole thing with a couple of college pals that he convinced to drop out (they did not know Peter Thiel at the time), and they built it from scratch.
One of the first questions I asked was when did they last do a two-day real strategic off-site, no interruptions, no cellphone, deep dive into the business. Never. Huh. They have board meetings once a quarter and lunch by 1 p.m.; the risk is the blind leading the blind.
As usual, the confession. I have just finished the exact same exercise for my little artificial intelligence company. Everybody says they hate these “meetings,” but if they are run correctly with rigor and agenda, the results can prove to be monumental. The decisions that emerge are truly organic and have broad consensus and buy-in.
We didn’t know what we didn’t know.
There was one assignment that I had never seen before. There were six of us, and the leader (not me) asked each of us to write down our eight leadership principles, our leadership philosophy.
I have a few genius nerds on the team who immediately went to their computers. The leader says no computers. A big piece of paper from the easel and a Sharpie and handwriting your own words.
“Oh, I have terrible handwriting. I will just use the computer.” Nope. What you say by hand is a reflection. Pick up the pen. Personalities were revealed and strategic alignments were not always as we thought or hoped. “Does he really believe that?”
A classic mantra is to always try to measure what matters. For sure, one good way to do that is the off-site (even if it is in your conference room) as long as the door is locked.
One of the key discussions that emerged during this process was the issue of how, when, and in spite of current venture capital dogma, if we should even try to scale.
Let’s turn to an expert, Saerom Lee, professor at the Wharton School of the University of Pennsylvania.
Lee had his own startup, the investors told him to go fast and break things and scale up, and “I followed their advice and it led to the company’s demise.” And that led to Lee becoming an academic and doing a rigorous research paper, “When Do Startups Scale?”
“Startups that scale within six to 12 months of their founding are 20% to 40% more likely to fail.” Whoa. I have seen that infamous hockey stick, spend a lot of money, lose a lot of money on each transaction, but don’t worry, we will make it up on volume.
Here is the dance. Early traction, VC gets interested, gives you money to hire sales, marketing, back-end DevOps, business development, go big. But early validation of your brilliant product often slows and begins to level off.
Then you have fixed overhead, along with flat or declining revenue. You wonder why Zuck is laying off 3,600 workers (about 5%) in the next couple of months. Google is no slouch. It has laid off approximately 20,000.
Lee goes on, “The study revealed that successful startups, on average, scale after four years.” You need patience (I swear that is on my list), and “to make sure that not just the product, but also the business model is well-designed and scalable.”
Statistically, it often takes seven to 10 years for a platform company to become profitable.
At his startup, Lee remembers his VC telling him he would sleep like a baby. “He meant you are going to wake up every two hours, crying over how miserable your life is. He was right.”
In the investment world at this time, raising money is about as easy as going to Mars. Me, I’m all in on a trip to the Del Taco in El Cajon. You can’t go broke saving money.
Rule No. 798: Tell the patient patience.