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Dare to do things that don't scale

February 23, 2022

...and embrace the nature of the early stages

Guidance and Shortcuts

Don't we all know that feeling of having worked for hours just to realize that our work was in vain?

Those were the good old days. When we were not working in the cloud, when Powerpoint, Excel or Word crashed on us and with its crash deleted the fruits of our work of the past 4 hours. The days when we reported to the team leader, director or CEO who just "did not know what he was doing", and we ended up producing slides and proposals just to figure out that by the time they were finished, they were no longer needed. This might be one of the reasons and driving forces that brought you where you are today. An aspiring entrepreneur. Be your own boss. You are determined to do things better than those who came before you and most definitely you aspire to do a better job than your former bosses in minimizing excess work and guiding your team.

For those of you who haven’t already noticed it, I got some bad news today. I’m just going to come out and say it: it is pretty much impossible to avoid "excess work" in the early stage of a start-up journey and there’s an additional cost that comes from being in it. Sure, you may have your docs in the cloud and your Powerpoint presentation won’t get lost. But believe me you’ll spend hours turning in circles and “figuring it out” all the while wondering if you’re wasting your time. And time is not the only extra cost. Yes, I’m referring to the money type of cost, not just the time, emotional and mental costs, although those are very real also.

It is pretty much impossible to avoid "excess work" in the early stage of a start-up journey and there’s an additional cost that comes from being in it...

The early stages are dynamic. The flexibility and adaptability your business needs during these times leads to a steep learning curve, and the growing dent in your wallet after every new expense feels significant.

Yet - here I am - and I want to dare you to not think and act like long-term oriented buyers in the early stage of your start-up journey.

Don't we all love a great deal?!

The kind of deal that makes us feel great about ourselves, proud of our wisdom and uncanny ability to "beat the system". A few months ago I found such a great 300€ deal on a bargain for raw bite bars. I grabbed it quickly, as I felt so sure that my wife and I would enjoy these healthy snacks all the more for having acquired them at a hefty 30% discount.

For the regular readers of our blog you already know that things will not be going according to plan because life and business never do! Your guess would be right. Two weeks after the proud acquisition we found out that my wife can’t eat our favorite, healthy snack bars any longer due to a dietary change required by the treatment plan of one of her physicians. As the consequence dawned on us, we stared in dismay at the +200 bars now piled up in our living room. I stared even longer realizing it was now up to me to eat those things on my own. Our great bargain had turned into a “sunk cost” pretty quickly, and I was sick of those bars before I’d even finished the first box.

It got me thinking though. This health bar situation is a reflection of a classic problem in early stage start-ups. We’ve barely started running our race and we’re overeager to do everything right and get the right deals. Be extra smart. Work harder, better and more efficiently than those who walked this path before us. Hence we’re especially tempted by great bargains, especially the bulk, long-term purchases. Such a money saver, right!?

One unfortunate reality at the early stages of business is that your critical hypothesis as well as your underlying business model are constantly changing and adapting to the needs of the market - at least they should 🤓Therefore things can, and do, shift quickly. It’s difficult to predict your future, and as a consequence difficult to predict the utility of any long-term expense. Buying a yearly subscription to a service you won’t end up needing in 2 months is a waste of money. Plus, there’s an additional emotional cost involved also because now you have to convince yourself to ditch the service that’s no longer needed and deal with the guilt of the sunk cost.

One unfortunate reality at the early stages of business is that your critical hypothesis as well as your underlying business model are constantly changing and adapting to the needs of the market

Do yourself a favor and embrace the nature of the early stages. It can feel more freeing to allow yourself to easily adapt without the teeth-gnashing of sunk costs. You’ll make the more “expensive” choices now, and yet you may save money in the long-term. Ironic in a way, yes. But the early stage nature of your business calls for flexibility first. If you give yourself and your business time to get to the more mature stages of business, then the long-term, “bulk” purchases will eventually come back and make sense again in the future.

I mean 300€ worth of raw bite bars...just think about it. On the one hand it's not a big deal...but on the other hand, as an eco-minded, planet-loving guy, it was a pretty annoying situation. Wasting food really sucks, and there was just no way that one person could get through all of those bars. Fast forward several months and I’ve lost my appetite for those bars for good. I ended up giving most of them away before they turned bad! I am however grateful for the important reminder of realizing that both long and short-term buying have their place. It’s not that one is better or “sexier” than the other...the two strategies are well suited to their own stage in the business life cycle.

Speaking of your best moves depending on what stage of the business life cycle you’re at… you may want to also check-out our post about MVP (Minimum-Viable Product) Thinking. You’ll notice that MVP mirrors some of the same ideas we’re expounding here: the core idea at the early business stages is to think big in the long term but to take small, actionable steps in the short term.

So, back to our story. You’re a young start-up still figuring it out. That’s OK. There are perks to these early stages, and there are downsides too. The quicker you can accept the downsides the easier it will be for you. Truth bomb: you’re going to pay the extra fee of being a young company. It’s either going to happen by 1. Opting for short-term, non-bulk purchases (more expensive than long-term buying, I know) or 2. Watch some of your long-term purchases sink. Either way, you’ll pay.

Just like some tourists pay a tourist tax in the form of border visas, when you are in the early, discovery stage of your business, there are certain extra costs that are part and parcel of this stage of your business journey. Back in the old world, the reality where you were an employee, you well remember complaining about your useless Powerpoint presentation and the incompetency of your boss. Now in the new world, your new entrepreneurial reality, you’re facing new kinds of frustration and “losses” (although you’re not actually losing - it’s all a part of the creative process!). You can gripe and complain about it all you want, or you can focus on the necessary impact you are trying to create, pay the “tax”, and cross the border to continue your adventure.

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