Why I Don't Build a Startup

01

The door of 2009

Back then there was a gap, and money was the fuel. Start-ups had plenty of it, and if you were willing to put in a huge amount of time, you could simply take the responsibility to try things out. The founders were just as inexperienced as everyone else, and so were the investors. Not everyone had Jeff Bezos as a backer. Most were people with money who thought they knew how it works.

The golden rule was that nine out of ten start-ups fail, which also means that nobody really knew why one worked and the other didn't. Everyone talked about culture and people, and everyone was just testing and playing.

My gap was the combination of tech and marketing. I had been programming since I was twelve, lived only in the digital world and did my Abitur at a school focused on technology and electrical engineering. Because I earned money on the side during school and university, I learned what marketing actually means, at a time when "digital marketing" wasn't even a term. The start-ups only knew they needed someone who understood both.

In Europe there was nobody with years of experience in SEO or Google Ads, so if you wanted to learn, you could do anything. That was the boost. After one year I was leading whole teams, the first one in 2009 at 9flats, with more than ten people.

02

What is left of it today

Today it's different. Most start-ups I see look to me like copies of copies, and as an employee you work there in structures and processes very similar to those of big companies.

What has stayed is the speed. You develop personal skills faster and more easily in a start-up than in a corporation. I've worked in a corporation too, and there you know you're driving in the wrong direction and keep driving until someone with more power understands it as well. In a start-up it's the other way round: if you notice the direction is wrong, you find everyone on your side, because everyone wants to go the right way as fast as possible.

What I learned along the way is that it isn't always the healthy path, neither for the founders nor, in the end, for the business, and least of all when someone else is paying for it.

03

What I'd tell a 22-year-old

Use the start-up the way the start-up uses you. It's a vehicle: you learn skills faster there and understand the business world faster than anywhere else, with the money the start-up burns for it. Today you even get paid well there, which was different in 2009, so take the salary.

I wouldn't want equity, and I have to be that honest. It's not a movie, and you never know if and when the company gets sold. With virtual shares, no IPO and no sale, because the business simply makes money, you're stuck in one business forever, and that is the endless game again.

At the ZenMate exit my shares went to zero. I've also seen how many ways there are to not pay, in the end, what was promised at the start. It's not out of malice, because they have to survive, but don't plan with the promise.

04

Ownership, not size

A start-up isn't an asset you build alone. It takes a huge part of your time, and you're not free in your decisions. Not every founder is the same, but I've seen the pattern often: founders who have to do what someone else decided. Once you have taken a lot of outside money, that money matters more than anything else and in the end overrules what you want. That's why you deal with investors so much, and with so much politics, at least in my experience. With outside money, you only build something because you want the exit, one way or the other.

I only need the money for one thing, which is to decide freely, so a path that takes exactly that away from me can't be the path there. A million-euro business financed by outside money owns my time just as much as a billion-euro one. The variable isn't how big it is, it's who owns it.

For a long time I wanted the big one anyway. At some point I couldn't picture what a company worth a billion would give me that one worth a million doesn't. So I stopped wanting it.

What I learned is that a start-up isn't the way I want to reach my 250K, especially with a family. If you go to an investor and say "I want to build a €250,000 business", you get nothing, because it's too small to be worth it for him. So the start-up doesn't fit me, even though I have the experience for it.

05

This week

If you hold shares or virtual shares, look up in your contract what they pay at a sale, and when. If you hold none, ask yourself whether you would take your current job for the salary and the learning alone. My ZenMate shares are the reason I ask.

06

The open question

I still love that world, the way I love sport when I watch it on TV, and I have decided it's not the game I want to play. A 250K business is too small for an investor. So nobody else's money sits in it, and I decide freely. Does that hold once I want more? Take that question with you toward the decision this season is heading for: make more, or stay and focus on something else.

Next in this season: “My Start as a Freelancer”. Where I could start from, what my first full year brought, and the four goals that came before this one.