“A startup is an impossibility”, said once one of my board members. He claimed that if you really think about it, a startup has no chance of success.
Because you have no capital, no product, no customers, no references, no offices, no credit, no employees and on and on…
But still, the founder is marching along as if all these things will come along, in due time.
I compare it to soldiers going to war. Each one knows there is a risk of dying, and yet, each one thinks “It won’t happen to me.” If a soldier knew with 100% certainty they will die, would they go to war?
This chapter is about starting a fire from scratch, and how it relates to starting a company from scratch – as in, the startup phase. Starting a fire from scratch can also be seen as an impossibility.
Do you have experience lighting a fire from scratch?
Have you gone through the trial and error of what can go wrong when you attempt to light a fire from scratch?
If you have not seen this clip from the movie Cast Away with Tom Hanks – watch it first.
Tom Hanks starts a fire in Cast Away:
Why is starting a fire a good metaphor for a founder starting a startup?
A fire can be started by anyone and anywhere, almost. There are no limits on gender, race, religion and so on. If you understand the physics of starting a fire, you can do it with different raw ingredients.
For example, you can start with two sticks and kindling like in Cast Away. You can start with gasoline and logs, and you can improvise with rags and matches, or magnifying glass and paper.
There is no ONE WAY to stat a fire. Yet, if you do not understand the physics and mechanics of starting a fire – no matter you will have, it will not do the trick.
Think of it as the Goldilocks effect. You can have too little going on which will not start a fire, and you can have too much which will also not start a fire.
What does that mean?
Fire needs three things to get going: Heat, fuel and oxygen. If you take any one of the elements away completely, there will be no fire. If you overload one of them, you can also mess things up. In the Tom Hanks case, too much air came through at first (too much oxygen that also cooled off the kindling). So you have to balance the three elements at the SAME TIME in order to get the result.
This is stage 0 of the process. You keep at it, trying to get to smoke.
When you finally get to smoke, that is NOT fire yet. That has the potential to either light up into a small flame, or snuff out…
Many founders find themselves in stage 0, where they keep trying to get to smoke. And if you do not monitor the elements, you can spend a lot of time, energy, and investors’ money in the process. Some founders, get to phase 1, the smoke phase, and it is very reassuring. Yet, smoke is NOT fire.
As you saw in the clip, when smoke began, Tom Hanks stopped what he was doing – and switched to blowing very carefully on the smoke just the RIGHT amount of oxygen to turn the smoke to a small flame.
Even when he got to a small flame, he could have overblown his breath and put OUT the small flame. So, making sure the right amount of the three elements comes to bare – is critical.
After the small flame begins you are in stage 2 – in which you have to carefully add more fuel. As if you would place a big log on top of a small flame, it will die. If you keep blowing air and oxygen on a small flame, it will also die. This is the exact skillet that allows a founder to create fire from “nothing”.
Some of it you can learn from a text book, yet some has to do with pure intuition and adjusting to the circumstances of the moment. Try to imagine what you would answer someone if they asked you “how do I start a fire from scratch?”
As you can see, it is not simple answer, and the skill of the person making the fire, and identifying the materials available and how to best light them – is critical.
VCs can asses a startup stage by comparing it to fire:
Stage 0 – founder has an idea of making a bonfire
Stage 1 – founder assembles minimal ingredients to start smoke
Stage 2 – founder started a small flame and needs to add fuel carefully
Stage 3 – the fire is burning and stable and now more and more logs are needed to increase the heat to get to a bonfire
As you can see, in each stage even if you HAVE all the ingredients, you can still put out the fire. By mistake, or by not reading the situation correctly. A founder can add more oxygen when its not needed, or run out of oxygen when it is needed. Thus, startups’ outcomes are very hard to predict.
The timing is also critical. Even if the startup does everything right, and created a small flame that is waiting for bigger logs – they may not be coming on time, and the fire will die. If you invented the microchip 20 years before it could be used, there would be no market for it. Same is with creating the best typewriter machine, after digital word processing became popular.
And last, is pure luck. Yes, luck.
Being in the right place, at the right time, and knowing what to do – is how you get to produce a unicorn.
Napoleon was famous to realize this notion. He figured that all of his army’s generals are trained the same way, in the same academy, by the same instructors, with the same books and props. And yet, some graduates win battles and some don’t. So he famously said: “I know he’s a good general, but is he lucky?”
Napoleon asked not for the smartest generals, or the good ones – but rather for the lucky ones.
VCs have the same issue with founders. They can be the smartest people, with the best academic degrees and know how. And yet, that alone is NOT what will help them start a fire from scratch…
Having a team that can build the fire once its started, and keeping bringing more and more customers, is how the flame turns to a bonfire eventually.
I tell every team I worked with: “I only started the fire, you kept bringing bigger and bigger logs to make it what it is today.”