What Bad Startup Founders Have In Common With Bad Drivers

You’re driving down the road and the car in front of you suddenly slows down. You quickly step on the breaks to avoid hitting him. Five seconds later, he turns into a parking lot. What a jerk!

Once he’s out of the lane, you punch down on your gas pedal a little harder than you need to, perhaps hoping he somehow hears the anger in your revved engine, and you annoyedly mutter: “Nice turn signal, a$$-hole.”

In that type of situation, your anger is justified. A driver who doesn’t use a turn signal is ignoring the simple fact that his turn signal isn’t for his benefit. Instead, he should be using his turn signal to communicate what he already knows — his impending slowdown — to the people around him so they can respond appropriately. By not properly communicating with others around him, he’s expecting people to respond to his actions based on information only he has. That’s what makes him a jerk.

While everyone knows people who don’t use their turn signals are jerks because they don’t properly communicate all relevant knowledge during an interaction, unsuccessful startup founders do the same thing all the time. Of course, nobody calls them jerks. Instead, they get praised for “trying hard,” and the people giving that praise placate themselves with lazy cliches like “startups are hard” and “most startups fail.”

Are you using your turn signals?

Although entrepreneurs and investors will name dozens of reasons why most startups fail, they only really fail for the same reason accidents happen when people don’t use turn signals: poor communication.

Don’t believe me? Let’s take a look at the five most common reasons startups fail according to CB Insights:

1) No Market Need – Companies that failed because they weren’t good at communicating how their product solves a market inefficiency.

2) Ran Out Of Cash – Companies that couldn’t communicate their value proposition in a way that convinced customers or investors to give them money.

3) Not The Right Team – The team never figured out how to communicate effectively with each other.

4) Get Outcompeted – Their competition was better at communicating a value proposition that was functionally identical.

5) Pricing/Cost Issue – Companies that were bad at communicating the value of their products, so they couldn’t charge enough to cover their costs.

The linked CB insights article lists 15 other common reasons startups fail. We could go through all of them, plus dozens of others, and see a direct link between the supplied reason for a company’s failure and poor communication. Any other reasons failed founders might give for why their companies shut down are actually just symptoms of poor communication. Trust me, I’ve failed plenty of times, and I’ve had to explain my failures a lot. While I, like most failed founders, prefer to shroud my shortcomings in more noble-sounding descriptions, every reason I give is just a byproduct of poor communication.

Why don’t people use turn signals?

Some people don’t use turn signals because they truly are jerks. However, most people simply forget. They’re so focused on themselves and what they have to accomplish they forget that other people around them aren’t thinking about the same things. When they approach their destinations they’re too busy thinking not just about the turn in front of them, but also everything they have to do once they make that turn: go into the store, buy some bread, buy some fruit, don’t forget the milk this time, etcetera.

The same is true for startup founders. Founders perform so many different jobs that, when speaking about their work with other people, they often forget how much more knowledge they have about their companies than the people with whom they’re talking. This results is poor communication of information.

In essence, a startup founder who neglects to consider the differences in knowledge between herself and the people she’s talking to is no different than the jerk who doesn’t use his turn signal. In that jerk’s mind, he knows exactly when he’s going to turn into a parking lot and what he’s going to do after the turn, and he doesn’t care if the people around him can’t possibly know those things or be prepared to respond appropriately.

If you’re struggling as a startup founder, ask yourself if you’re doing the same thing.

 

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I teach in Duke University’s Innovation & Entrepreneurship program and founded RocketBolt. I write about startups, pedagogy, entrepreneurship, engineering, and poetry. They’re all related, I promise.

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  • Today, I lead the first meeting of a @dukeinnovation faculty committee about creating a methodology for teaching #entrepreneurship that can apply to any type of #venture.
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Adam says the most important thing I taught him was: “How to think differently and approach problems in an unorthodox way, and how that approach to problem solving is one of the most valuable lessons from Duke.”
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