What If, One Day, You Honestly Portrayed the 'Dark' Side of Building Your Company?
What happens when the only news that founders share is good news, leaving out the tough stuff? Instagram is a good place to look for an answer to this question, given the dynamics that occur when its members share their real-life experiences -- a scenario that might just be a model for the entrepreneurial world.
While most people post only the most photogenic moments of their lives, some celebrity members have recently gotten more authentic, using Instagram's platform. These celebrities include models tired of appearing "airbrushed" all the time. They also include new moms, like model Chrissy Teigen showcasing her stretch marks.
This trend seems to be gaining momentum. Everyone has flaws, after all, and the brave souls showing theirs would rather be open and vulnerable about them than risk raising self-doubt and envy among their followers -- by sharing only nonstop "happy" posts.
Maybe too you want to help others relate more to your experience. Maybe you can't envision making your followers feel awkward about "liking" a photo of your broken leg or lost dog. What if one of those followers also just broke a leg and could really relate to your honest post?
In the entrepreneurial world, highlighting only your company's and your own professional successes might make your peers feel defeated, because they're comparing their own experiences -- good, bad and ugly -- to the polished versions you display.
That's why I'd advise against always presenting these "polished version." My advice is to to put things in perspective by telling the less rosy side of your story.
The good, the bad and the sugar-coated
Last month, I was featured in Entrepreneur.com as one of "16 Businesswomen Who Can Be Counted on to Provide Their Own Seat at the Table." This month, my company was featured in another major outlet, where we shared our insights into the evolving world of online video. We now work in all 50 states and have six offices around the country.
Sounds great, right? In some ways, it has been. I've worked my entire professional life to be acknowledged as a successful entrepreneur and build a team that makes a difference in the world. Nonetheless, all of the accolades in the world don't add up to as much as you might imagine -- because they don't tell the whole truth.
Awareness around the psychological challenges of running a business has heightened in recent years. The dark times are real -- and some never make it out.
In 2011, diaspora*'s co-founder, Ilya Zhitomirskiy, ended his life at 22 years old. A few years later, Jody Sherman, founder and CEO of ecommerce site ecomom, took his own life, as well. These stories shook up the startup community. Although they reflect the worst-case scenario, many entrepreneurs live in a dark and lonely state, always comparing themselves with the founders they see around them in fancy magazines and in humblebrag social media posts.
In a study by Michael Freeman of the University of California--San Francisco and several colleagues, almost 50 percent of participating entrepreneurs reported having at least one mental health condition. Entrepreneurs surveyed were also far more likely to report a history of depression and substance abuse than were other types of people.
I've found myself facing bouts of depression, unable to understand why startup life seems so easy for other founders. There's nothing wrong with being successful, or with broadcasting it -- I'm guilty of that, too -- but I admire those who aren't afraid to bare it all by being vulnerable. Others might just benefit from these truths.
Our recent down period: We spent too much money and didn't make enough.
We started off strong last year: Earnings in Q1 and 2 two exceeded our expectations. Naturally, we started hiring for positions we were excited about exploring and bought the things we thought we needed to grow. Months went by; the spending continued.
By the time we reflected on our situation, however, sales had slowed. August was our lowest-performing month in almost two years, followed by our second lowest in September. We shifted focus immediately toward solving our sales problem, but the regular challenges of running a business persisted: challenging clients, unmotivated employees, overpriced vendors and the daily grind. With less sleep and more stress, problems magnify. Eventually, my emotions became apparent to my team.
We did our best to refocus and inspire everyone, but it's hard to ignore when your ship's on fire. Want to know more of how I dealt with the dark side? Here are some tips on actions you can take to put out the fire and stabilize your ship.
1. Cut expenses. We went through our general ledger and reviewed every dollar spent. One of the biggest challenges? Our fixed expenses had skyrocketed, making it tough to break even. To mitigate the issue, we ended the subscription services we had that weren't adding value -- some as little as $10, some running into the thousands.
Pausing marketing expenses that have longer return on investment cycles is a hard call to make, but temporary sacrifices can solve short-term cash flow problems.
2. Analyze products and services. After running profit and loss statements for each product, we gained a better understanding of where we were losing money. By getting rid of products offering little or no return, you can make time for those that pay out, and simplify your pricing model for clients -- just as we did.
3. Review the team. It's exciting to have a team of people you love, but you have to be honest with yourself. Some of our favorite people weren't contributing their share, and we had to have difficult conversations.
Give underperformers 30 days to boost productivity. Keep those who do; let go of those who don't.
4. Obsess over sales and marketing. According to Mark Cuban, sales solves all problems. In many ways, he's right. Using HubSpot and weekly key performance indicators, we've kept great data. When we finally dug into that data to understand what we were missing, we emerged with two simple equations:
Leads = meetings
Meetings = sales
You might do some digging, yourself. Next, figure out where you went off-track so that you can put some pieces back into place and increase activity at the top of the funnel. This will eventually positively affect your sales team.
To drive more leads into our own business, we partnered with companies and hosted free webinars. Getting back to the basics with diligent follow-up from salespeople increased the number of meetings.
Nothing about this process was or is fun, but it opens your eyes to the possibilities all over again. While no one likes tough conversations, you have to hold yourself and others accountable. Are we doing the right things? Time will tell. As a company, we've been here a dozen times before, and we've seen considerable improvements in the last six weeks.
Our problems didn't arise from a lack of expertise in video marketing, but from a situation that every entrepreneur scaling a business has to come to terms with: You don't know what you don't know, as the saying goes. We've learned from our mistakes; and now we're confident that we can keep moving in a positive direction, because we've never doubted our ability to deliver an exceptional product.
When you know you've got the chops, stick it out. Just never stop finessing the execution -- and maybe copping to the fact that things haven't been so good lately.