⏰ 10,000 hours: from first-time founders to seasoned operators
Founders Factory Startup Bulletin #7 (February)
👋 Welcome to the Founders Factory Startup Bulletin. Each month, we bring you a round-up of startup and investment stories, key learnings from founders, and insights from the Founders Factory team.
Hatched following a ‘93 study of violinists and pianists, and popularised by Malcolm Gladwell in his book Outliers, there’s a belief that 10,000 hours is the threshold for achieving greatness at any skill or craft.
Forgiving some potentially dodgy maths, founders can expect to hit the 10,000 hour mark between four and five years into their business. Yet this is the point at which around 50% of new businesses fail, according to studies by the Bureau of Labor. So how does this add up?
Maybe this shows how easy it is to debunk a scientific belief about something (“greatness”) that is so intangible. But perhaps it instead points towards a notion recognised by many successful individuals (entrepreneurs included)—that to achieve success or greatness, you have to be willing to commit yourself totally and wholeheartedly to even stand a chance of success or greatness.
Speaking to first-time founders (as we do in this newsletter), you quickly understand how steep is the learning curve of founders on their debut venture. Forget 10,000 hours—you’ll likely learn more in your first week as a founder as you could learn in any book, course, or tutorial.
For seasoned operators like Pete Flint, 10,000 hours in the game likely came and went long ago. After leaving the founding team of lastminute.com, he launched Trulia, which went on to become the world’s biggest real estate platform. He’s now general partner at NFX, one of Silicon Valley’s most prominent VC funds, which counts unicorns like Doordash and Lyft among its many investments.
Here’s what you can read about in this month’s newsletter:
Pete Flint’s Lessons for CEOs
First-time founder confessions: what we wish we’d known
Our top reads—from talent tactics to lessons from Gamestop
All the latest fundraising news, product launches, and investment updates from Founders Factory
Having built and invested in unicorns, Pete Flint has a good idea of what makes a successful startup. Excerpted below, here’s what we learned when we spoke to Pete last month:
Time is a critical factor for success
When we launched Trulia, there were a number of strong competitors in the real estate space (as a founder, if there isn’t close competition, this could be a red flag that there is no market there). There were two factors, however, that propelled us to the top and ultimately won us market share.
We launched in 2005, just a few months after Google launched their Maps feature. Engaging with this interactive mapping tool created an engaging product experience for customers.
During the 2008 global financial crash, which was precipitated by the US real estate crash, many of our competitors went out of business. Conversely, having just fundraised, we were able to stay afloat and successfully capture the market as it picked back up.
Your product is only as good as your distribution
Given the strength of our competition, we invested heavily in perfecting our product and user experience to make sure we could really differentiate ourselves. Founders should know, however, that your product amounts to nothing if you don’t get your distribution strategy right.
Our growth and distribution strategy included tapping into the SEO space (at the time much less competitive), and adopting an aggressive PR approach to establish our name as a leader.
Look for investors who can give you more than money
I learned this as a founder, and now embody this as an investor: the most attractive investors are the ones who can play an active role in supporting you. When you’re choosing whose cheque to accept, keep this front of mind.
Empathy is key—being a founder can be a lonely experience, so you want someone who can provide support and counsel on the decisions to make when you face inevitable challenges. On the flipside, you also want someone who is able to celebrate you when things do go well. Investors who have experience of being a founder are best placed to do this.
Much has been written of the successes of serial entrepreneurs—but what’s it actually like stepping into a founder role for the first time? Many founders who join our Venture Studio and Accelerator are launching their first business. We speak to a few who reveal some of the valuable takeaways they’ve learned along the way.
“There’s no shortage of people to offer you advice”
Being a founder can be a lonely experience—but that doesn’t mean you are alone. There’s a huge support network available for founders, whether that’s informally through LinkedIn, or formally through Accelerator programs like Founders Factory. Utilise this network available to you, and be disciplined about checking in with them.
One caveat: “Everyone tells you different advice. But ultimately, you’re accountable for choosing, so you have to make sure you're comfortable with the decisions you make,” Tania Kefs, co-founder of work experiences platform Jurnee
“There’s value in ‘faking it til you make it’”
“Founders should have the confidence to go out there and be a company,” says Omar Ismail, founder of fan token platform Temple. In your early days, build a brand, launch a website, etc, as a way of building momentum behind your company.
“Mix humility with stubbornness”
This is a fine balance. “You need to have the humility to accept advice and pivot on certain aspects; but you also need to know when to stick to your guns,” says Shona Chalmers, co-founder of home DIY startup Roomix.
“Being a first time founder can be advantageous”
Don’t think of being a first-timer as a disadvantage—it may be to your benefit. “You bring insane amounts of energy, and a fresh, contrarian perspective that experienced founders may not have,” says Matt Kennedy, founder of circular economy startup Again.
Read our full ‘First Time Founder Confessions’ article here
🐦 Tweet of the month
📚 What we’ve been reading
Data to engineers ratio: A deep dive into 50 top European tech companies (Inside Data by Mikkel Dengsoe)
Four ways startups can win the war for talent (Sifted) - alternative tactics for hiring by Founders Factory’s people operations lead Becky Liu
Gen Z, creators, and our mental health tipping point (Digital Native by Rex Woodbury)
A year on, we haven’t absorbed the lessons of the Gamestop saga (Financial Times)
Where Web3 and Psychedelics might meet (Under the Palm)
💸 News from the Founders Factory portfolio
Nailbot, the intelligent manicure product by Preemadonna, was named an honoree at the 2022 CES Innovation Awards
The Up Company, hospitality industry super app behind ChargedUp, CleanedUp, and ServedUp, raised £7 million in their latest funding round
We launched our Future Leaders of Gut Health initiative, in partnership with Johnson & Johnson, a competition for startups in the gut health space to pitch for $250k investment. You can read investment associate Olivia Brooks’ op-ed on the topic here
Interested in joining one of our portfolio companies? Check out our latest jobs post where you can find details on a vast range of positions available
🗓 Opportunities for founders
NEF+ Programme (London, April) - apply now for the 6-month entrepreneurship programme (in partnership with Founders Forum)
Power to Black Founders (remote, February 22nd) - this Founders Factory event brings together black founders with top VCs and investors for 1:1 office hour sessions, business masterclasses, and networking
Funding in 2022: What the experts are saying (London, February 10th) - an event hosted by Scale XP, discussing the funding landscape with seasoned investors and founders
AWS Software Startup Awards (deadline: March 4th) - shining a spotlight on the most innovative B2B/SaaS startups in the UK and Ireland
See you next month 👋
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The Founders Factory Startup Bulletin brings you a round-up of startup and investment stories, key learnings from founders, and insights from the Founders Factory team.