Last week, I read about yet another tech start up that after generating a good chunk of seed funding ($1m), a mere seven months after launch, they decided to shut down. After less than a year of building a business, generating investment, going live and then bailing, it 100% implies they have no idea how start-up grafting works. It can take years before a die hard entrepreneur even considers shutting down servers and pulling that painful plug. This is after trying every conceivable method in scaling, marketing, advertising, promoting, PR'ing, tweaking UI/UX, introducing features, removing irrelevant features, customer case studies, consumer survey feedback and analyzing results on traction along with analytic's assessment and building the bloody business while running financials and having sleepless nights about burn rates. Therefore, this company (like thousands of others I read about), bolted after a sheer seven months because life didn't turn up roses. I put them in the exact same entitled category as the Yelp employee who cried a river because her first job didn't land her a $100k signing bonus, corner panoramic view office and free sushi presented by AI (is there such a thing?).
This one start up in particular claimed they had customer acquisition problems and felt it was more appropriate to walk away from their business. I balked. I'm thoroughly sick and tired of hearing about entitled millennials who obviously are lacking the following:
- Ability to continue through the bad times and persevere
- Sheer comprehension of the definition of 'founder' or 'entrepreneur
Yet contain all these ingredients in abundance:
- Their (zero business model) start up isn't going their way nor scaling at a rate of knots...so they bolt
- Have an excess of entitlement and expect that if the start up isn't perfect, they'll create yet another mediocre business and rally for funding, for this second 'attempt' to desperately maintain their 'entrepreneurial' title
- Not understanding (more like clueless personified) on how to run a business and the 18 hour/7 days a week work it requires to keep going...for years
Which brings me to the most important element: Not one of them care about their innovation. If they did, they would persevere through blood, sweat and tears (repeat an infinite number of times per day) for years before sadly considering if their MVP is a solution to a problem that no one is experiencing.
Which Came First?
The new chicken and egg syndrome of investors enabling Bounders is crippling the decent name of real Founders. Both investor and snotty nosed kids should hang their heads in shame. The more that Bounders are fed with cash, the more they multiply like a disease infiltrating and damaging the 'brand' of worthy entrepreneurs.
The more these spoiled kids create start ups that fail within a year and then bolt or bow out, the more these Bounders make a bad name for the industry. The VC's & Angels are also to blame, by investing in kids who have zero expertise in their industry, a laughable or nonexistent business model and creating a copycat version of a proven, successful business, i.e. they didn't innovate, they simply jumped on a hot bandwagon. Investors should not be funding these brats and their 'lets live with our head in the cloud' Bounder attitudes. They should ONLY fund & support true entrepreneurs who focus on their start up 24/7, have proven experience and know how to make money from it.
So last week, after reading a depressing acceleration of more articles about start ups shutting down for the exact same reason as the one above, I coined the name Bounder. It's intentionally derogatory, belittling and ridicules these kids to shame. Name calling is bullying yet referring to someone as a Bounder will guarantee they never take entrepreneurship for granted. Not on my watch...
Advice for Investors
In the later volumes of my autobiography, (Living Off The Irony) I reference my beef with investors. So a few tips for all you fat wallet individuals, incubators and corporations who can't see for looking while looking for the next best thing:
- If you meet an entrepreneur that doesn't meet your wish list check boxes, these are the people who you should be paying close attention to. They're probably crazy (Steve Jobs style), are beyond passionate about their start up and defy the list of: 20'something tech millennial with no credentials nor business model
- If you hear a story about an entrepreneur trying to create the impossible, call them crazy (like many of you have called me.. Do I care? Do I flump!)....and then invest in their crazy idea
- Stop investing in the team - the team has a good chance of not producing innovation but behind every incredible innovation, is a potential genius
- Women bring in a proven 35% ROI so why the hell are you not scrambling towards every pair of boobs?
- If you like a non tech entrepreneur and love their invention, fund them. The Founder can easily find a tech team - they're a dime a dozen. Don't presume tech kids know how to PR & market their invention. Trust me, they're clueless. I see you funding male tech kids, throwing $30m at them and years later, their unique traffic a month is less than 500k. Lame, right?
- Stop demanding entrepreneurs give you a lazy elevator pitch i.e. a combination of X and Y (X & Y = successful businesses). Use your brains and think outside the box. The more the pitch is unlike any copycat combination, the more you should be interested
- Stop enabling Bounders. It makes you and them look weak and I guarantee, you'll be kicking yourselves for funding duplicate start ups that shut down before they hit their 3rd trimester
- Cease using the word unicorn to describe a successful start up. A unicorn is a mythical beast that protects its own. It has no relevance to a start up. Call them double rainbows or blue moons but PLEASE stop with the stupid buzz words that lack relevance. Unicorns and I are wailing in despair over your ill use of the context.
On that note, Muppet and I are off for a mild stroll as she's farting up a storm - sweet potato has its down sides. She pulled a ligament in her black leg (last year was the white one) and it could take 2 hours for her to hobble around the block. But we guarantee we'll be stopping to smell the roses along the way. Any grammatical or spelling errors in this post, get over it. I'm not an English teacher.