Surviving

In the early days of a startup, the most important number is the burn rate. Every single person must be indispensable. Eventually, if successful, the company starts building up some structure. Conservatism takes over. With the business growing consistently, the founder adds structure, career tracks, and a stable hierarchy.

The new important measure becomes the “bus number,” the number of people who can get hit by a bus with the company still remaining functional. Suddenly, every single person must now be dispensable.

This is like the transition from unicellularity to multicellularity. The founder has to invest in a bureaucracy that impersonalizes the company and turns every employee into an interchangeable part. Otherwise, one person could quit and crash the company.

Around this time, parasites start entering. They don’t want the risk of a small startup business. They want lots of perks, high salaries, low workload, and the minimum work for the maximum return. They aren’t truly aligned; the company is just a job to pay the rent. The interchangeability actually attracts them!

They know they don’t need to pull their weight, and they aren’t accountable individually for the business’s success or failure. The system will support them. This behavior is rational for them, but it degenerates into entitlement and eventually causes collapse, though that may take a very long time.

Finally, some stifled employee decides to exit the stultifying bureaucracy and become a founder, and the cycle starts anew.

If you don’t write history, you will not be the winner.

A startup is willing something into existence. Elon has a saying about startups: “It's like chewing broken glass and staring into the abyss.” The reason is there's no place to hide. You cannot blame somebody else. You just have to figure it out. There is no safety net. Your company could die, everything could go to zero, and you could be humiliated in public by the haters.

(Haters actually just hate themselves, though. They are rooting for somebody else's failure because they don’t have the courage to try themselves. They can no longer make calculated bets because, to protect their egos, they've convinced themselves everything is going to fail.)

You need some degree of idealism and determination. In building a startup, you cannot be purely economically motivated. At least I couldn't, because many times the rational thing to do is quit. The rational thing to do is quit and get a decent job where they pay you well and you don't have as much responsibility. There's nothing wrong with that. If you're a rational human being, that's probably a pretty good thing to do.

The reason to do a startup is to build something you can't buy. Elon cannot buy a trip to Mars. I wrote The Network State because to unblock biomedicine and get life extension technologies, we need to solve the sovereignty problem. I think this is the long-term path to super-soldier serums and other breakthroughs for humanity.

Businessman and investor Ben Horowitz has a great blog post about founders’ persistence called “Nobody Cares.” (I actually do care about entrepreneurs, and so does Ben.) But I send the post to entrepreneurs sometimes when they need to hear it. Here is the key excerpt:

“Nobody cares, just coach your team” might be the best CEO advice ever. Because, you see, nobody cares. When things go wrong in your company, nobody cares. The press doesn’t care, your investors don’t care, your board doesn’t care, your employees don’t care, even your mama doesn’t care. Nobody cares.

And they are right not to care. A great reason for failing won’t preserve one dollar for your investors, won’t save one employee’s job, or get you one new customer. It especially won’t make you feel one bit better when you shut down your company and declare bankruptcy.

All the mental energy you use to elaborate your misery would be far better used trying to find the one seemingly impossible way out of your current mess. It’s best to spend zero time on what you could have done and all of your time on what you might do. Because in the end, nobody cares, just run your company.

Mark Zuckerburg also said something like this: “When you feel boxed in, if you're smart enough, there's usually a move.” Technology is multi-dimensional enough that there is usually a move available. If you're smart enough and dedicated enough, you can find it.

Business presents difficult situations where you need to achieve the best outcome possible under the circumstances. In fact, you'll often piss off somebody no matter what you do. Now repeat that cycle many times. The job is actually so hard that even as a great founder, you will fail at many things, pretty badly.

The realism to know what is impossible, the imagination to know what is possible.