As an investor, I care a lot – and I mean A LOT – about founders’ motivations for starting a company.
Over the past couple of years, nearly every relevant Bay Area technology company has opened up an engineering office in Seattle and our hometown heroes Amazon and Microsoft are also attracting an unprecedented amount of technology talent to the region, many of whom are itching to start their own companies. With all those new potential founders in town, I’m getting asked a couple of times a week, “How much money should I save up before leaving my day job?”, and “What’s enough market validation to justify me going full time?”
These are the wrong questions.
Let me start with my story…
When Damon Cortesi and I initially founded Simply Measured, we came at it from different backgrounds, but made the decision for the same reason.
For Damon, he felt an urge to move from being a breaker of software to a builder. And more than anything he wanted to cultivate a company culture where people would be proud to tell others about their job. He also found himself spending his evenings working on things entirely outside his field of security and wanted to turn his passion projects into his career. He was willing to walk away from a juicy six-figure salary to do that, and while he didn’t have much saved up, he also wasn’t all that leveraged, so he figured we had a year to make it work.
I was two years out of college and drawn to the unknown. I just wanted to build something great and enjoy myself doing it. While I had what most entrepreneurially-minded software engineers would consider a dream “first job”, writing code AND getting to be customer-facing at a rapidly growing venture-backed startup, I was entirely uninterested in our customer (the healthcare marketer). My job felt too much like well… a job. Unlike Damon, I was living comfortably on $50k/year and had a chunk of cash set aside which gave me a safety net. But like Damon, I found myself pouring all my free time and energy into my passion projects in the evenings, and after joining forces with him on one of them, could no longer focus at my day job.
Our side projects had no customers, no market validation, and were simply products that we couldn’t stop ourselves from building. In our case, we loved social data and how social networks were changing the ways that businesses interacted with consumers. Thinking about this shift, and the opportunity it presented, consumed us.
And while our personal financial situations should have been relevant to our decisions, we didn’t even consider them at the time because our drive to found was so strong. We wanted to invest our time into something we were passionate about and didn’t think once about how much money we’d make, how that compared to what we were walking away from, nor how we were going to support ourselves more than a year out.
This is the best way to start a company.
There will always be many more rational reasons NOT to found a company than the other way around, and the best founding decisions are often irrational and motivated solely by a burning passion to work on one specific thing and pour your life into it.
Founding a company is a huge risk, and the reality is that we both in our own ways could afford to be irrational and take that plunge. As fathers now in our mid-30s, making that decision to start the company like we did back then would have come at a much higher cost.
Everyone’s situation is unique, there isn’t a certain amount of savings required to start a company nor some magical level of level of traction that tells you that you won’t be wasting your time. But there is a level of drive and passion that gets founders to not care about their answers to those questions. Until you find yours, you aren’t ready to quit your day job.
My question back to you is, “What are you so passionate about doing that the answer to those other questions doesn’t matter?”