Johnson Cook

Atlanta tech investor. Entrepreneur.

Johnson Cook - Atlanta tech investor. Entrepreneur.

Seek Optionality – Creating Options for Wannapreneuers

 

One characteristic of antifragile is optionality.  When you have optionality, your downside is limited but your upside is unlimited. There’s a lesson here for the wannapreneurs out there.

Young entrepreneurs usually learn this lesson through your relationship with cold calling. You learned early that for your business to go anywhere, you won’t avoid the requirement of some cold calls. It is unavoidable. You may be terrified of cold calling, just like most [normal] people. But a mentor helped me see the light with this: “Just define the worst that can happen from each call.   You get rejected? You upset someone?  Now imagine that actually happens– how bad is it really?

This put things into perspective. You may never enjoy cold calling, but at least you can approach it with no fear and confidence that it’s like that hard workout that has to happen.

This question is one way the risk-averse, mortgage-bearing, family guys can evaluate jumping full time into their startup.

What’s the worst that could happen? Define it. Talk about it. Deal with it. 

Let’s assume you don’t take any debt and you operate the business solely through equity financing and bootstrapping. This means you don’t put your house at risk to open a line of credit or anything silly like that.  How much savings do you have? How much runway? 6-months? 12-months? 2 years?    Does your spouse work? Can you live off a single income? If so, how long? Then double that length of time… is it still do-able? What’s the worst that happens (again, not taking on additional debt here). How long could you go before you had to get another j-o-b?

What are the other bad things that could happen… you are climbing the corporate ladder, right? So you jump off to do a startup? Do you really think you lose your place in line? Do you think that this job is the only one you could get?     Not to mention, how much more valuable you will be on a corporate org chart after 2-years out doing your own thing, failing and not making a penny.   Is that really so bad?

What other awful things keep you from doing this?  Are you worried your spouse is going to leave you? Your kids will disown you? You might have to cancel that lease on the Benz and drive a Honda for a while? You will have to pay out of pocket for health insurance? Ok, well some of these would be pretty bad– I’ll let you decide which– and if there is a risk, then yeah, that’s pretty bad. But be realistic about the worst, deal with it, and work it into your plan. Be smart and be fearless.

Acknowledge the risks (the downside), but don’t lose sight of the upside. The unlimited upside.  Then make a decision, make a plan, and be content.

 

 

Category: Action

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