Most startups begin as an idea in an entrepreneur’s head. Just a few neurons bouncing around inside a skull full of mush. The entrepreneur typically doesn’t have the necessary resources, skills, or capital to execute on her idea. To get her idea off of the ground she must run a sophisticated confidence scheme designed to convince potential co-founders, employees, investors, and customers that her idea is in reality a real company. In her confidence scheme timing is everything. She’s got to convince everyone that her idea is real at relatively the same time. The investors need to be comfortable that she’s got a great idea and a great team. Her team needs to be comfortable that she’s got the resources and capital necessary to execute on her vision. The truth is that what she is trying to do is literally impossible. Any normal person watching this process would rightly conclude that she was perpetrating a fraud. Of course everyday potential co-founders, employees, investors, and customers suspend disbelief and turn these confidence schemes into real companies.
Recently I read a comment about me on an article about a new venture I’m starting. The comment suggested that my career has been one huge bluff and that my wealthy father bankrolls my lifestyle. The ironic thing is that I have often felt that way myself — around 4AM every morning in fact. Entrepreneurs who don’t are either self-deluded or full blown sociopaths.
When we started Architel almost fifteen years ago we called our service ‘fractional IT’. Just as Netjets provides fractional ownership of a jet we would provide fractional ownership of an IT organization. The only problem is that we were trying to fly around the country with only one wing — we hadn’t quite finished the plane before we started flying. It was a stressful period of time for us and it lasted almost a year. Most companies don’t make it through this period of time I call the “startup wasteland”. Rational people don’t even try and the rest of us are known as entrepreneurs.