In 2010, my then-co-founder and I flew to Seattle to participate in “Techstars for a Day.” For those who don’t know, Techstars is a prominent and selective startup accelerator. During “Techstars for a Day,” they host companies they’re considering admitting. It’s an unofficial finalist interview of sorts.
As we flew across the country, we were confident we’d be accepted. After all, we were finalists and we were awesome. How could Techstars not accept us?
To make a long story short, we were wrong; we weren’t awesome, and Techstars did reject us.
My co-founder and I were both pissed because… well… rejection sucks. However, while it felt like a crummy ending to an exciting opportunity at the time, in retrospect, it wasn’t the end of anything. It wasn’t even the end of my relationship with Techstars.
Nine years later, I was invited to be a mentor for companies in the Techstars Raleigh/Durham accelerator. Meeting the new class of Techstars portfolio companies — which I did last week — gave me an opportunity to see the ways in which my own knowledge of entrepreneurship has evolved. For example, here are four ways in which the companies I mentored know more than I did when I was applying to Techstars, and another four things they still need to learn:
4 Things the current Techstars entrepreneurs were better at than me:
- Introduced themselves with concise explanations: Every company I met introduced themselves by telling me what they did in a few quick sentences that made their basic premise easy to understand. I mention this not just because they’d honed their elevator pitches in ways I wish I had when I was in their position, but also because it took me years to learn the value of explaining things simply, clearly, and directly.
- Prioritized traction: After explaining what they did, most of the entrepreneurs I met shared stats about how many customers they already had and how many enterprise deals they were busy negotiating. Yes, I was skeptical of their numbers because early companies often misrepresent traction, but at least they knew to talk about it. I didn’t know that when I was at their stage. I was still in a naive “if you build it, they will come” mindset.
- Pre-meeting research: Most of the companies made a point of referencing something they’d read about me online, which meant they’d taken time to do research before their meetings. In my early days of building companies, I rarely did that, and I’m sure it cost me opportunities.
- Always follow-up: I’m writing this post within a week of my mentoring sessions and I’ve already heard from most of the companies. They’ve thanked me for my help and asked if they can add me to their regular “progress report” emails. In contrast, I’m still terrible at following up and updating people… just ask my previous investors!
4 Things the current Techstars entrepreneurs still need to learn:
- Customer acquisition is your product: All the entrepreneurs I met wanted to spend the entire time explaining their products. I had to interrupt them to ask questions about their customer acquisition strategies, and none had good answers. But they had plenty to say about their “amazing” user interfaces and “revolutionary” features. Uggg.
- The customer wasn’t the user: My personal startup motto is: if the person paying for your product isn’t your end user, it’s a bad business model. And yet, more than half the companies I met were selling to people who weren’t their end users. For example, they’d be pitching a medical device that insurance companies would pay for, doctors would prescribe, and patients would use. While I realize these kinds of models exists (i.e. prescription drugs), they’re particularly challenging and require tons of startup capital..
- Making it about them instead of their customers: Too many of the entrepreneurs I met wanted to tell me their personal stories. They shared why they were building their companies, how they’d gotten started, and what motivated them to keep working. In contrast, none of them mentioned their customers or their customers’ needs without my asking. That’s selfish. We don’t build startups for ourselves. We build startups for other people.
- Having too many answers: The entrepreneurs I met answered every question I asked; none of them were willing to say “I don’t know.” They all either believed they knew everything or believed they had to appear as though they knew everything. In either case, they were wrong. As a Techstars applicant, I thought I had to know everything, and I was wrong. As a Techstars mentor, I realize I can’t know everything. A willingness to say “I don’t know” is critical for entrepreneurs because it helps us avoid making the kinds of false assumptions that often kill our companies.
Observations like the ones I’ve described above, and my ability to make them, help me recognize the kinds of things I’ve learned since getting rejected from Techstars. Even if, five minutes from now, someone successfully persuades me I’m wrong about all of the lessons I’ve shared, it doesn’t change or diminish the role my Techstars rejection played in my personal education and growth. Had Techstars not rejected me and my company, all the subsequent events in my entrepreneurial career that followed wouldn’t have happened — I got accepted to a different accelerator, I raised venture from different investors, I hired different employees, I moved to a different city, and so on.
Would I have been happier with the progression of my life and career had I been accepted to Techstars Seattle in 2010? I have no idea. Am I happy with my life and career now? Absolutely.
What that tells me — and hopefully tells anyone reading this — is that, in the moment, a rejection usually feels like something preventing us from reaching our goals. But we shouldn’t let it discourage us. After a bit of time we’ll be able to look back and see how our rejections were the starting points of new paths forward.
