The Wisdom of Serial Entrepreneurs
My post, “Founder Mode vs. Management Mode: Understanding the Leadership Styles,” quickly became the most read by both regular and new audiences. Released when Founder Mode was a trending topic, it detailed the founder's leadership style. It provided real-time insights for “Lessons” readers, who are primarily founders, investors, advisors, CEOs, and ELT members in startups and small public companies.
Since then, I’ve engaged in many new and stimulating conversations. This post highlights one key takeaway from those discussions.
Startup founders come in all shapes and sizes, but a particular breed stands out: the serial entrepreneur. These founders have founded not just one successful startup, but multiple. They've navigated the ups and downs of the entrepreneurial journey multiple times and emerged wiser and more seasoned for it.
Compared to first-time founders, serial entrepreneurs bring an invaluable level of maturity and perspective. They've been through the roller coaster before and know what to expect. The highs of securing funding, landing significant clients, and seeing their vision come to life. The lows of product failures, crappy VC behavior, and tough decisions to let people go. They've weathered the storms and come out the other side.
This experience shapes how serial entrepreneurs approach the entrepreneurial journey. They are more measured and deliberate in their decision-making. They understand the importance of cash flow and capital efficiency. They know how to build and lead execution-oriented, high-performance teams (Hat tip: Andy Grove). They are comfortable as “operators” and more resilient in the face of setbacks.
One key difference is how serial entrepreneurs manage risk. First-time founders often display high ambition but need more decisiveness. However, once they commit to a course of action, they will take on significant risks to drive rapid growth. Serial entrepreneurs, on the other hand, are more cautious. They've learned that producing sustainable growth is more important than explosive growth at all costs. They are more informed about when to double down and when to do a full pivot. They know when to “bet the company.”
They also possess the vision, management experience, and other insights that enable them to implement what I refer to as a "partial pivot." These are adjustments that cause the company to zig or zag without implementing a complete change in direction. They have the maturity to avoid excessively involving others in decisions to pivot or implement partial pivots.
This maturity also comes through in how serial entrepreneurs manage their psychology. The emotional rollercoaster of founding a startup can be brutal, with extreme highs and lows. Serial entrepreneurs have learned better coping mechanisms. They know how to manage stress, maintain work-life balance, and keep their emotions in check when the going gets tough.
Additionally, serial entrepreneurs have a more expansive network that they can tap into. They've built relationships with investors, industry analysts, and other founders over multiple ventures. They have their advisors and mentors allowing them to access resources, solicit 360º input and take advice more easily. They can shortcut certain processes and avoid pitfalls that tripped up their first startup.
Of course, serial entrepreneurs are not immune to failure. Just like any entrepreneur, they can still make mistakes or encounter unforeseen circumstances that derail their plans. But the key difference is that they are better equipped to handle those setbacks. They have the perspective to know that failure is not fatal, it's just part of the journey.
This maturity manifests in how serial entrepreneurs communicate and interact with their teams, investors, partners, colleagues and family-members. They are more self-assured and authoritative, but also more empathetic and collaborative. They know how to set clear expectations, provide constructive feedback, and delegate effectively.
Interestingly, some venture capitalists prefer “partnering” with first-time, young founders to retain greater control, protect their ownership stakes, and influence the company’s direction. Clearly, they find serial entrepreneurs to be more challenging than younger, first-time founders.
For the tech industry, the value that serial entrepreneurs bring to the table is substantial. Their hard-won experience and battle-tested wisdom can be the difference between a startup that succeeds and one that fails and by extension industry sectors or segments. While first-time founders have enthusiasm, passion and boundless energy and time on their side, serial entrepreneurs have the edge when it comes to navigating the complex and challenging waters of entrepreneurship.
So, if you can work with a serial entrepreneur, serial founder or serial startup CEO, consider yourself fortunate. Soak up their knowledge, learn from their mistakes, and let their maturity and perspective guide your own entrepreneurial journey. It may just be the difference between creating a lasting, sustainable business or becoming another statistic.