Every entrepreneur knows that most startups fail, but very few of them actually understand why.
I was three years into running a venture-backed tech company that was doing all the things venture-backed tech companies are supposed to be doing. We had a product people loved, we had a rapidly growing user base, and we’d raised a few million dollars worth of investment capital. Sure, we had our troubles. However, on the whole, the company was on an “up and to the right” kind of trajectory that entrepreneurs dream of.
But the company failed. And it didn’t fail for any of the reasons I’d always been warned about by people talking about why their startups had failed. We didn’t fail because we’d run out of money. We didn’t struggle finding product-market-fit. We didn’t get out-competed. We didn’t have a bad team.
Instead, the company failed for a reason I’d never heard mentioned by other entrepreneurs. However, in retrospect, I’m convinced it’s actually the real reason most startups ultimately fail.
Startup success comes from stability
To understand why my seemingly promising startup failed — and yours probably will, too — I should explain that, before my startup failed, my personal life felt like it was on a trajectory as promising as my company’s. My wife and I both had careers we enjoyed, we’d recently bought a house, we had good friends, a cute dog, and so on.
I mention this because most startups get launched under roughly similar circumstances. No, I don’t mean everyone launching startups is a happy new homeowner with a cute pet. But I do mean the lives of startup founders tend to be relatively “good” and “stable.” After all, people don’t usually launch startups when they’re homeless, fleeing war torn countries, dying from cancer, or dealing with other similarly challenging circumstances.
This basic level of stability and comfort isn’t obvious to entrepreneurs when they’re launching new ventures. However, it becomes apparent as startups age and the lives of their founders change. I realized this after my life significantly changed. It was the day I became a father.
Yes, I realize everyone’s lives change when they become parents. But the birth of my child changed my life in a very different way than what most new parents experience. The day I became a parent, my daughter almost died.
Thankfully, she survived. However, the stability that was so critical to my startup’s success didn’t survive, and, as a result, neither did my startup.
The disease that killed my startup
The reason my daughter nearly died the day she was born was because of a disease called Long QT Syndrome (LQTS). You’ve likely never heard of it. It’s uncommon. I won’t distract you with all the details here.
Instead, I’ll briefly explain that LQTS is a rare, incurable condition that’s part of a broader disease category known as sudden arrhythmic death syndromes (SADS). When someone has a SADS condition, the person doesn’t “look” sick because the disease doesn’t have any sort of physically visible manifestation. Instead, people with SADS conditions have problems with the electrical systems powering their hearts. Those defects have a nasty habit of causing sudden, fatal arrhythmias.
In other words, my daughter has an invisible and incurable disease that, at any moment, can kill her without warning.
If that weren’t terrible enough, my daughter’s disease is a genetic disease, meaning she inherited it from a parent. That parent happens to be me.
Mind you, I didn’t know any of this until the day my daughter was born. Instead, I’d been unknowingly living with the same invisible, incurable, killer heart condition. Or, as my daughter’s doctor told me shortly after explaining his diagnosis of my child: “Mr. Dinin… it’s a miracle you’re still alive. We need to get you to a doctor, too.”
Life is unpredictable
As you might imagine, confronting mine and my daughter’s pending mortality changed my priorities. It forced me to reevaluate my obligations and made it difficult to continue working on a startup as I struggled making the same kinds of time and emotional commitments to it that I had prior to my daughter’s birth.
Ultimately, the challenge was too much. I shut down my company, I took a job teaching entrepreneurship at Duke University, and here I am, writing articles about entrepreneurship rather than building companies myself.
To be clear, I’m not sharing this story to make excuses for being a failed entrepreneur. I actually value being a failed entrepreneur. I believe my failures make me a better teacher of entrepreneurship.
Instead, I’m sharing my story publicly here — as I’ve done elsewhere — because it helps me teach other entrepreneurs a lesson I wish someone had taught me about why startups fail. It lets me teach them to prepare for something similarly unpredictable to happen to them. And, just to be clear, if you run your startup long enough for it to approach “success,” you will encounter something similarly unpredictable because startups take a long time. Much longer than most entrepreneurs realize. Startups take years. Sometimes they take decades. During that time, life continues to happen, and life is unpredictable.
Unpredictability will kill your startup
As you work on your startup, you’re going to get older. So will the people around you that you care about. When people age, lots of things happen that can’t be predicted or controlled, including the reality that some people — possibly you — are going to get sick. Some people are even going to die. Those kinds of things can (and will!) impact your startup.
For what it’s worth, life’s unpredictability isn’t always bad. Wonderful things happen, too, but wonderful things also kill startups.
For example, as you’re building your startup, you might get offered your “dream job.” If that happens, would you be able to sacrifice the opportunity to do something you’ve always dreamed of for a risky startup that may or may not achieve its goals?
The point is, whatever unexpected challenges or opportunities present themselves during your startup journey, life doesn’t stop being unpredictable just because you’re busy being an entrepreneur. Plus, because startups take a long time, the odds of something major and life-changing happening are high. When those kinds of unpredictable life events occur, companies often falter and fail.
That’s what happened to my startup. Sure, I could describe the failure in other ways. I could say we “ran out of money.” I could say we “didn’t find product-market-fit.” I could say we got “out competed.” Those things did happen, but none of them were the reason my startup failed. They were outcomes.
The real reason my startup failed is because life is unpredictable. When my life changed, my priorities shifted, my startup was no longer as much of a priority, I couldn’t accomplish all the things my startup needed from me, and I had to shut it down.
Chances are, the same thing will happen to you, and you’ll have to respond the same way.
To be clear, I hope the exact same thing won’t happen to you. I don’t want any child diagnosed with a rare and deadly disease. Instead, I hope something much better happens to you. I hope you fall in love, and that’s what changes your priorities. I hope a rich uncle bequeaths you an enormous fortune. I hope you win the lottery.
Whatever the case, I just want to be sure you understand that life is unpredictable. This unpredictability means that, during the long time it’ll take you to build your startup, you’ll almost certainly face some significant and possibly challenging life events. When you do, I guarantee your priorities will shift, and your shifting priorities will impact your startup. Most likely, they’re going to cause it to fail. At least now, having read my story, you won’t be as surprised as I was.
A silver lining
As I conclude what probably seems like a depressing article, let me also offer some hope. Yes, the unpredictability of life is challenging for entrepreneurs, but it can also have some surprising benefits. In my case, since I’m no longer building venture-backed tech companies, I’ve been able to put my entrepreneurial skillset to better use. Specifically, instead of fundraising for my startups, I spend my time fundraising for children with heart conditions like my daughter’s.
Because of that, and because February is National Heart Month, I’m using this article as an opportunity to promote Duke University’s Pediatric Electrophysiology Fund, which is a fund my family established to support life-saving research by the very doctors who helped save mine and my daughter’s lives.
Just by reading this article, you’re already helping me because I’m donating all the proceeds I get from people reading this article — and all of my articles in the month of February — to the Pediatric Electrophysiology Fund. How awesome is that?
And guess what… you can easily do more! All you have to do is share this article with other people.
Seriously, that’s it. Share a link for this article on social media, send it in an email, or do whatever else with it that’ll get other people reading. The more people who read this article, the more Medium.com pays me in royalty money, and all that money is being donated to charity.