For months, I have been watching our new business revenue steadily decline. Why? Well the easy answer is the economy. We work with start-ups, primarily funded by investors who are reevaluating their investments. And while contracts disintegrate, our workforce wants to get paid. For a small company like Intrigo, the effects are dramatic. So the once mighty and all powerful Intrigo is not so mighty. Being graced by years of luck and an unnatural sense of optimism, I’ve gotten an unpleasant taste of reality. But that’s ok. And that’s my point. In the start-up game, failure dominates progress. Without it, you never truly understand what must be improved upon. With each mistake comes a new model of thought. To most, this is uncomfortable. Those individuals should not be entrepreneurs.

I’ve always seen the corporate world most similar to engine power. How many horses you got under that hood? Well James Watt, the inventor of the steam engine, needed a way to sell his engine to a society that relied on horses, the industrial power of the day. He did some fancy math and determined that 33,000 ft-lbs./minute represents one horse power. While a bit optimistic, the number is still used today. Up until car manufacturers refocused on fuel efficiency, measuring cars by their horse power was common. For large companies like IBM, Microsoft, and Google, it’s all about intelligent horsepower. The more they have, the more they produce. So when you go corporate and I mean work for a company with over 50’ish employees, you’re a horse. More horses equals more power, as long as the company keeps feeding it’s horses.

On the other end of the “make money” world, you have the brand new startups and small entrepreneur based businesses. For them, it’s not about horsepower; it’s about efficiency and innovation. Hiring few specialized workers for the least amount of money to produce the best new thing in the quickest amount of time. Pulling from physics, I like to call this the “coefficient of innovation.” Whenever I meet with a new startup, I care most about how long they can sustain poverty and persevere through failure. If a startup can overcome the coefficient of innovation, they’ll at least moderately succeed. But overcoming is not easy. In fact, it’s a natural barrier of entry to success.

How does one succeed? Let’s first answer the question of how one starts. You have an idea. You are excited. You get others excited. You get money. And you begin to work. As time passes, the original excitement is converted to optimism as you hit the first of many roadblocks. Each of these distractions slowly chips away and the optimism becomes pessimism. People get frustrated. People get very frustrated. People loose faith. The thing about people is that they are influential. People like to believe in something, and as the owner it is your duty to re-invigorate their original beliefs. While it seems so simple, the dark side is quite tempting.

Some of us Portland business owners have lost some good talent because we neglected to see how good things really are in these bad times. Intrigo recently launched Ugreekrow.com, Wirehire.com, and Notehall.com and they’re all rocking through adoption. Before that, we launched close to 80 other projects in three years. But some recent, perfectly timed, events have clouded the once bright and cheerful optimism that previously propelled Intrigo. So I’m restructuring. And once again I’m very optimistic. My mother skeptically challenges my optimism as do several others, but what do we have without it. My point being, don’t ever give up, just restructure your approach.   

This entry was posted on Friday, November 14th, 2008 at 9:26 am and is filed under Start-Up Tips. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.