By Phillip Bogdanovich
I’m not a parent, which is part of the reason running a company hasn’t been an unmitigated disaster for my personal life. All I know about parenting is what I have read and what I have observed my parent-friends contend with. I suppose my limited experience “babysitting” for friends has also provided some insight. And I’ve delivered a couple of babies—but that’s another story.
I may not have firsthand experience parenting a human, but I do have experience starting a company. It’s something I have learned—I hope well—through immersion training. That is, I just started running a company. A lot of close calls, bad decisions, moments of fighting off blind panic, and overwhelming successes have led me to my indelible truth: For me, running a company is raising a child.
Trade doctors and nurses for lawyers and accountants, and you have the birth of a company. The founding of Hyperion was messy. At times I was under the distinct impression that despite all of the running around, no one had any idea what was going on. Somehow the appropriate paperwork was submitted, a business plan was in place, and I had a bouncing baby company.
Now what? I began to feel extremely protective and nearly overtaken by the notion that I was responsible for a new “life,” with absolutely no experience in caring for it. Like my first-time parent friends, my extreme caution eventually gave way to the realization that if I was a generally responsible human being and made fewer bad decisions than good ones, everything would work out. This was not so much a growth phase but rather a “Keep it alive, don’t destroy it” phase.
The Terrible Twos.
Nothing reaches a granular level of detail like a two-year-old beginning to understand the infuriatingly bare concept of “why.” It’s splitting atoms. Eventually division occurs so many times all that’s left is space. This is “why.” If the question is asked enough eventually a point will come that there is no right answer. I remember a conversation with my friend’s son about marshmallows that went like this:
Tiny Frank: “Why do I like marshmallows?”
Me: “Because marshmallows are delicious.”
Tiny Frank: “Are they candy?”
Me: “Not technically, no.”
Tiny Frank: “I like candy.”
Me: “Me too.”
Tiny Frank: “But marshmallows aren’t candy.”
Me: “I know.”
Tiny Frank: “But I like them.”
Me: “I know.”
Tiny Frank: “Why? I like candy and they aren’t candy. Why do I like them?”
Me: “Because they’re delicious.”
Tiny Frank: “Why? They aren’t candy.”
Me: “Because… I… Here. Eat this marshmallow.”
I was just circle-talked into submission by a two-year-old. Walking away, I realized I had not reflected nearly enough on the deliciousness and classification of marshmallows. My argument was ill-conceived and insufficient.
I have experienced similar moments with Hyperion. They have dismantled my perception of the world and had a massive impact on my thoughts about running a company. What I learned is: Don’t for a second believe your truth is the only truth; embrace fluidity. The further you can distill your ideas, the less likely someone is to tear your ideas apart. Hope you have enough reasonable answers that investors, board members, and peers stop asking “Why?” before you run out of clever, sensible things to say.
This is where parenting and running a company become an exercise in living dangerously. Most kids begin establishing independence during their teen years—and force their parents to deal with high school romance, impress the value of hard work and responsibility, and formulate arguments for why their child should spend more time in school and less time being anywhere but school. Adolescents begin interacting with the world on their own terms, outside of their parents’ protection.
Similarly, startup executives have little control over the external factors that affect our companies as they establish their identities. Some of our choices in advisors, board members, and joint ventures may prove to be mistakes in the long run. Markets may change, making our release dates too early or too late.
To survive this transitional period, do what effective parents of teenagers do: lead by guidance and example, not micromanagement and a stranglehold. Stay calm, ask for advice, and surround yourself with good and relevant advisors. If something isn’t in the best interest of the company, cut it loose. Prepare to be frustrated.
Graduation and Beyond.
Eventually most kids make it through high school, then find jobs and/or go to college. Parenting doesn’t end at that point, of course, but the heavy lifting is over. The startup equivalent is bootstrapping yourself into the black, getting funded, getting acquired, or reaching IPO. It’s the dream of every startup “parent” to get to this point.
But just as some kids never go on to become contributing members of society, some companies never make it out of the startup phase. Many failed companies began as good ideas; some were even well run. But some companies just fail. This clearly isn’t the goal of executives like me. We want success. We want to graduate to a fully-fledged company however we measure it. For me, that means graduating to an IPO.
The underlying principal is this: Treat your company like your child. Nurture it and protect it. Always operate in its best interest regardless of how you feel personally. Feed it money and good ideas. Accept the possibility of failure but always guide toward success, seeking advice from those who had proven successful before you. Do not micromanage. The best advice comes from relevant experience and often is spoken from a place of personal failures and gain. Certain advisors will become more or less valuable depending on where you are in your growth cycle. Children don’t need the best third grade teachers forever. Be prepared to part, but do it amicably. These individuals may become the best and most relevant “godparents” later on. The ultimate goal here is for your child to survive, graduate, and finally thrive.