Why not all startup movement is forward progress
My friend Samantha Coxe, also our portfolio CEO and inventor of an electronic flossing device, FLAUS, articulated a term that I’ve grown to love. Rocking Horses of course are a timeless children’s toy dating back to the seventeenth century Europe, enabling children to safely pretend ride by rocking back and forth atop a wooden horse, but in this context we’ll refer to “Rocking Horses” as people who are consistently in motion, but who are not necessarily moving forward. Rocking Horses in her former Skadden legal world were those who were inordinately busy and stressed but who were also inefficient in getting the job done. They were good at creating the optics of hard work, but they were inefficient at solving client problems. In other words, there was a lot of movement, but not a lot of progress.
At Stanford University there’s an adage about students being similar to ducks. They appear deeply calm and serene on the surface, but are paddling like hell under the water. Sprezzatura, or effortless ease in making the hard look easy, is powerful. Sometimes it says more to get the job done on what seems to be even less effort.
In the startup world I came to a heuristic many years ago that I articulate as “fast” and “slow” founders, but “Rocking Horse” is a rather more descriptive term for it. At Everywhere Ventures we really aim to test and select for “Fast” founders. Fast founders are laser focused prioritizers who get the most important things done first. They know that startup life is a resource-constrained optimization where not everything fits in. You won’t have enough money, you won’t have enough time, and your product will never do everything your investor or client wants it to. You’ll never have enough ARR to satisfy everyone, and it’s up to you to pitch vision like hell to make it such that even without every perfect detail, you still get it done. It’s up to you to ruthlessly prioritize what and how it gets done, and what dozen things you leave on the cutting room floor as you sprint to the next task at 90 miles per hour.
Slow founders get stuck. Slow founders get mired in obscure and unimportant details. They wait until tomorrow or next week to fix something rather than getting on the phone today. Slow founders fail to prioritize. They create the optics of movement without actually moving forward. One red herring in an investing process is when a simple process is made unduly slow or expensive for no obvious reason. For example:
Overly complicating a pre-seed round with many tranches and price step ups to save very nominal amounts of equity (and piss off newer investors who immediately come in as second class citizens for almost zero gain).
Having an overly complex cap table with a million tiny angels or advisors. Long run you’ll have to deal with them on every future signing or new round.
Focusing on obscure corner cases driving up legal bills, and dragging out closing processes (I once saw a founder spend $400,000 on legal going with one of the premier European firms, and arguing it was because of fintech complexity). If it’s that complicated or you can’t figure out a cheaper way, you’re already dead.
Explaining that there’s no way to bring down costs, or that you have to spend a certain amount on your burn rate in a specific, very expensive location. If you can’t think globally, outside the box, you’ve already lost my confidence.
Saying that you have to buy an expensive conference pass rather than networking your way into a panel speaking gig where your flight or hotel is paid for. It’s up to you to tell your story so convincingly that opportunity comes to you.
What’s interesting is that prior success is no antidote to the Rocking Horse trap. In many ways prior success can be a consequence of hyper control, and having the perfect resume is more often than not actually a yellow flag. Memorizing the test, acing the exam, getting into the school and then the high power banking or consulting gig where you’re “data driven” and “highly analytical” might be an asset in some parts of society, but it can be a flashing neon Rocking Horse yellow sign. I’d much rather see a pattern of repeated risk taking, an openness to change, and an extremely high-cadence personality that will get many reps in faster than others.
When we’re evaluating a team, we’re looking for high cadence, not clairvoyance.
Startup life is about data, but it’s more about intuition, and loose hands on the steering wheel, moving decisively, and humbly listening to feedback. You have to get on the right superhighway, but you cannot have white knuckles trying to control every inch of the road. You have to drive efficiently, and feel the road beneath your tires rather than gripping too tightly on the wheel. Often times the MBA, former consultant archetype wants to over-control the journey and ends up in analysis paralysis, getting stuck for days or weeks or months with imperfect information. This is a slow founder. The fast founder experiments rapidly, listens to others, iterates, and maintains a deep humility to let the road drive the business, not the vehicle.
Dylan Field, founder of Figma, spoke early on about how data was wrong. Taste was right. Data told him people wouldn’t care about collaboration, but his taste told him otherwise. Designers didn’t know what they didn’t know. He had to listen to his intuition and actually move taste forward ahead of data. This is counterintuitive and the slow, analysis paralysis founder could never have created Figma. Someone else could have run around with all the data in the world, and been a Rocking Horse.
Founder archetypes are not unidimensional or one-sided, but watch out for the Rocking Horse traps. Avoid early complexity. Prioritize rigorously. Think outside the box on how you could do the same thing at half the cost. Someone once told me that their boss would rush into the elevator and ask them for their “third best idea.” His point was that their first idea wouldn’t work, the second was far too expensive, and the third idea was one that might actually work. Testing for your third best idea is one that probes your own depths for flexibility and adaptability. Ask your CTO candidate “if you couldn’t use that database architecture, or this tech stack, what would be your second choice? If you couldn’t do that how else could we build this?” If they cannot think outside of the box enough to come up with two or three alternative answers, this person has the white knuckles on the steering wheel. They’re not adaptable. They’re not open to alternatives, and the realities that ten things you try won’t work.
Hire for adaptable, fast moving, humble colleagues. Avoid the Rocking Horses who run around creating a lot of motion and noise but don’t get anything done. And if you find yourself surrounded by them, don’t wait until tomorrow. Fire them today.