Home > Babak Jafarian > Too Much Money and Ego; If you want to kill a Start-up!

Too Much Money and Ego; If you want to kill a Start-up!

In his article, Paul GrahamFiancial Disaster mentioned 18 mistakes that kill start-ups. Among them, two caught my attention. Number one, Single Founder! How many times you have seen a founder who can not convinced any other to join her/him or ego does not let her/him to share the glory with others. “Single founder syndrome” marginalizes start-up culture by reducing true power of founder! It is a one man show, she/he against others (VCs and other board members).

Raising too much money and spending a lot is another recipe for disaster!  Once you raise several million dollars of money, the clock is ticking. If VCs fund you, they’re not going to let you just put the money in the bank and keep operating as two guys living on ramen. They want that money to go to work. At the very least you’ll move into proper office space and hire more people. That will change the atmosphere, and not entirely for the better. Now most of your people will be employees rather than founders. They won’t be as committed; they’ll need to be told what to do; they’ll start to engage in office politics and you know the rest!

  1. November 9, 2009 at 7:59 pm

    No kidding, music to my ears. Usually there is top technical know-how or top commerical know-how but never both. The best example for delegation is SAP of all things, the German software company, through their partner network they got it figured out. NO ego and good spread of exposure. An entire industry does not go under, and a strong teamwork survives many a storm. An upstart should always delegate some of their management tasks. At least that way you make less costly mistakes!

  1. No trackbacks yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: