When there’s no pretending,
then the truth is safe to say,
Start with the ending,
get it out of the way – David Wilcox
When I was in undergrad people would often ask me what I wanted to be when I grow up.
Then after college people would ask what was my 5 year plan or my 10 year plan.
I had no idea. I was really living in the moment.
And nowadays, in my personal life and in my work life, I still tend to focus on the here and now.
But with young startups, I often suggest early stage companies to think about the ending at times. At least quarterly.
What is the ending?
The day you run out of cash.
It’s not uncommon for an early stage company to raise seed or Series A capital that does not take them to profitability. That’s true for a number of our portfolio companies. Consider, Boxee, Twitter and Tumblr. Those companies clearly did not generate revenue but all of them were able to successfully raise follow on rounds. That’s because they made signficant product progress with the first invested capital.
Founders should think about what you want your company to look like when it raises the next round of capital. And then work backwards from there. How do you make that happen? Who do you need to hire. What do you have to learn. What do you have to create. What should you focus on ?
Don’t get me wrong. Focusing on the here & now and executing is the name of the game. But it’s worthwhile to start with the ending from time to time.