How To Make It as a
First-Time Entrepreneur

How to Make it as a First-Time Entrepreneur

Vinicius Vacanti is co-founder and CEO of Yipit. Next posts on how to acquire users for free and how to raise a Series A. Don’t miss them by subscribing via email or via twitter.

When we quit our jobs to start a new company, the first question we always got: “So, what are you working on?”

It’s actually a question I hated getting.

It puts you on the spot. You feel like you’re getting sized up. You have to justify to this person why you thought your idea was good enough to quit your job. Why this was going to be the next big thing and you’re the one that thought of it, not them.

Luckily, I had a quick answer: “Actually, we can’t really tell you. We’re in stealth mode.”

Why were we in “stealth mode”?

We had the same reason almost everyone else had, we didn’t want to awaken competitors or other entrepreneurs to our great new idea.

But, in retrospect, I know that, at least for me, it wasn’t the only reason.

We were in stealth mode not for fear of competition but of finding out our idea wasn’t very good.

You’ve quit your job. Your friends and family are behind you. Everyone’s waiting for what brilliant thing you’ve come up with. I mean, you quit your job, so it must be a really good idea. But, the truth is you’re not so sure it’s that brilliant. Somedays you think it’s great. Somedays you think it’s doomed.

So, instead of facing those fears, we could just say we were in “stealth mode”.

But, that fear sadly prevented us from having many important conversations with potential customers, investors, journalists, and other founders.

When we finally overcame those fears and started talking about our ideas, it was shocking how much a single conversation could impact the direction of our startup.

Letting go of “stealth mode” was one of the best decisions we made.

Overcoming the Fear

I’ve put the various fears of failure into buckets and how we overcame them:

  • Fear of family, friends not liking our idea. We started thinking about our ideas as experiments and expressed them as such. While they were supportive of us, they were quick to give honest feedback on our ideas which became a valuable source of input. Especially valuable were other founders who gave us great advice on product and market.
  • Fear of strangers not liking our idea. As we started thinking of our ideas as experiments, strangers became an excellent opportunity to practice our startup pitch and collect some feedback. You’d also be really surprised how random strangers may happen to know someone or something that can dramatically help your startup.
  • Fear of potential customers not liking our idea. This is by far the worst fear. We quickly learned that customer feedback was an essential part of product development. A customer not liking our idea was a great source of learnings so that we could iterate to a better product instead of guessing for a year what people might want.
  • Fear of an investor not liking our idea. We realized that talking to investors about our early ideas was a great way to develop a relationship. To be clear, it’s not about pitching them for money but for getting feedback. By the time our product started taking off, they already knew us and were impressed with our progress.
  • Fear of a journalist not liking our idea. Journalists have way more stuff to do then find a bad product from a first-time founder and write about how no one should use it. It’s hard enough getting journalists to cover your startup when it’s good. Good luck trying to get them to write about it when it’s bad.
  • Fear of competition. While this was more of a superficial fear, we realized that any good idea had many teams working on it at the same time. We were going to succeed because of our team and our approach and not because no one else was trying. We also became followers of the lean startup movement and our idea to prototype cycles went from months to days.

Unless you have an unbelievably good reason to be in “stealth mode” and it’s very unlikely you do, get out of it. You’re missing out, we did.

Vinicius Vacanti is co-founder and CEO of Yipit. Next posts on how to acquire users for free and how to raise a Series A. Don’t miss them by subscribing via email or via twitter.

  • http://thebeeobee.com/ thebeeobee

    “This article changed my life” – Me in 3 months.
    Thanks.

    • http://viniciusvacanti.com Vinicius Vacanti

      ha. hope you get there.

      • http://thebeeobee.com/ thebeeobee

        I’ve been working on something in stealth for a little over 2 months, when last week, someone released a service that is 99.9% almost exactly what I was working on. Even the tag line was the same!

        So I realized the way I was going about things was flawed…but wasn’t sure why.

        Not telling anyone had no effect on whether or not I’d be first to market or someone would come up with the same idea…there are obviously people all over working on the same idea and trying to fix the same problem.

        At first I was freaked out and ready to trash my idea but after giving it some thought, I’ve considered some ways to do things differently and possibly make a big change to the way people do business on the internet. I have to test these theories and ask customers what they think about them, but that’s the next step.

        Regardless, it was nice to see that some major trendy investors put money behind and idea that was almost identical to what I was working on.

        So yeah, doing things differently from this moment forward (once I switch the momentum of the project) and your post really reconfirmed my new direction.

        • http://viniciusvacanti.com Vinicius Vacanti

          glad to hear it! best of luck.

  • http://www.hypedsound.com jonathanjaeger

    It’s surprising the number of people I talk to who don’t want to reveal their idea in fear that someone could “steal” it. It’s hard enough to convince someone that your idea is good let along have someone drop what they’re doing suddenly and execute on it better than you.

    • http://viniciusvacanti.com Vinicius Vacanti

      In general, people overvalue their idea and undervalue themselves.

    • http://abdallahalhakim.tumblr.com/ Abdallah Al-Hakim

      There is a very good conversation on the Brad Feld blog about the how the term “stole my idea” is a bit overreaching in most cases. Brad makes the point that it is all about execution and it is what determines which ideas get adopted – Here is link to comments http://www.feld.com/wp/archives/2012/07/the-tension-of-confidentiality.html#comment-584239310

      • http://viniciusvacanti.com Vinicius Vacanti

        Every day, I realize how much knowing the tactical approach to engage with an idea is more valuable than coming up with the ideas themselves.

  • http://www.cdixon.org/ chris dixon

    Great advice. One experience every startup founder should have (ideally, before raising money) is launching a website that no one – not even your family and friends – ever use. Once you do this you realize how crowded the world is and how little people care. After that you can roll up your sleeves and figure out how to create something people want and how to get them to learn about it.

    • http://viniciusvacanti.com Vinicius Vacanti

      Love that advice. A great way to relieve the burden of expectations.

  • Michael Gauthier
  • http://twitter.com/ricardodsanchez Ricardo Sanchez

    Thanks for sharing.

  • http://technbiz.blogspot.com paramendra

    I found the post tremendously entertaining. This blog is one of the best for an early stage tech startup person out there. Kudos. 

  • jansn

    Ideas are worthless. Concepts are unique so it might be negative when somebody copies it. But in the end, value is only captured with the right solution.

    People that are stealth know their idea needs work. People comfortable sharing parts of their concept know they can execute it.

    In the end it’s great when people actually think it’s a great idea to launch themselves. It’s a form of validation and might come in handy when you’re after a new market, other people will help you create it!

  • http://abdallahalhakim.tumblr.com/ Abdallah Al-Hakim

    I liked @cdixon:disqus point – when attending on of Eric Ries talks, mentioned the need to do experiments as a startup and come up with conclusions to be built into other experiments. This is an important point because without experiments you are just working with assumptions.

    • http://viniciusvacanti.com Vinicius Vacanti

      it’s amazing to me that teams will spend a year developing without ever testing any of their assumptions

  • http://www.agilitysocialcues.com/ Lisa Shaughnessy

    Terrific post! I went through this about 9 months ago when I was launching my website and business. Once I et go of all of those fears I opened up to others about what I was doing. I made great connections and found opportunities I wouldn’t have otherwise. Even if a person you connect with isn’t the right fit, someone in their network might be.

    I wish I’d read an article like this a year ago! :) But glad that others will benefit from your experience.

    • http://viniciusvacanti.com Vinicius Vacanti

      I went through the same thing.

  • ruodayuan

    Interesting points – the potential for shame and embarrassment is a powerful barrier to opening up, especially when you end a good record of jobs. I can imagine, “Friends: you went from Blackstone to Quadrangle to do WHAT!? We’re expecting something brilliant no doubt. Good luck!”

    I think there’s some ways to help mitigate these fears, albeit they’re from my personal experiences so may not be relevant for others. 

    First is to try starting something big as early as possible. I loved doing entrepreneurial things from a young age so college to me was a prime learning ground. The experience forces you to face publicity since most everyone knows you and scrutinize your successes/failures. Albeit in the sheltered world of uni, it gives you a taste of the ups and downs.

    I started 3 organizations. First as a relatively minor co-founder my sophomore year – it was the main Consulting Club at my uni’s BBA program so we got alot of institutional support that made it easy to setup. Second as a sole founder my junior year that didn’t go well. I loved international development so I had big ambitions to create an innovative microfinance non-profit – the failure, in hindsight, was extremely valuable as it highlighted technical aspects I missed (recruiting, motivating teams, setting accountability, managing where to invest time/effort/resources, etc.), as well as the right way to deal with the emotions of failed expectations. I took another stab at it from the summer of my junior year ’til graduation and the second try turned out great. It’s neat to see resumes from current students with roles in something you created 3 years back. In retrospect, there were still things I would have done differently.

    Second is to start working honestly and passionately on your startup before you go full-time. I recognize this may not be advisable for everyone depending on situation and personality. I started dabbling in the NY tech scene from July 4 of last year to learn about the community. My co-founder and I started to work in earnest from November while retaining jobs, but we treated it with all seriousness, 3am hours be damned. It helped alot to start vetting concepts with family, friends, and potential customers. We used all our major competitors’ products and befriended their users :) We got comfortable just being open and asking for criticisms until we had a short-term product plan and long-term vision we were happy with. We also learned (after panick attacks) that there’s always others trying to do something similar to you and you’re just going to have to deal with it and persevere – ultimately the key is vision and execution.

    I officially left banking last month, but really detached my heart when I turned down my 3rd year extension earlier in the year. However, the process for phasing out and committing to the startup route and conceiving+developing our product started over a year ago. I think it helped alot to deal early with fears of shame (and that strange look from friends) so that when people ask you “so, what’re you working on?”, you can proudly say “I’m working on so-and-so idea/product, and it’s going to be insanely great, so you better check it out!” We’ll see if our being open and avoiding stealth mode will eventually translate to long-term success. We just had our first meetings with NY angels today, so we’re super excited to get underway!

    P.S. Long term lurker of your blog, Vin, but thought this entry was especially timely as it’s been on my mind before. Thanks for your writing – they definitely helped shape our thinking throughout the process. Also, reading over my post, I realize how ridiculously long it is – pretty much a blog entry of its own haha. I stalk alot of blogs, but this is actually my first time responding. Sorry to everyone for breaking proper blog comment protocols. Will keep future posts short. :P

    • http://viniciusvacanti.com Vinicius Vacanti

      that’s great advice.