I'm resigning. How can a programmer launch his startup and avoid failure?

Programming is a wonderful profession for many reasons. It provides almost unlimited scope for growth and self-improvement - you can grow from a simple coder into a software architect or an expert in one of the IT market niches. It allows you to make good money even in the early stages of your career, because there are more offers for worthy programmers than themselves. It finally instills fundamental life skills such as a logical approach to problem solving, strategic thinking, the ability to master new technologies and relearn. “Being on my deathbed, I plan to look back at my life and say: “Wow, that was quite an adventure!” And not something like: “Well, I lived in comfort and safety.” Tom Preston-Werner, founder of GitHub But still, programming as a career has its drawbacks: office work “for an uncle” often seems pointless, constantly learning new technologies and solving problems is tiring and leads to burnout, and the realities of the modern IT market with fierce competition and growing demands from employers only exacerbate fatigue. Therefore, many developers at one stage or another of their career think about their own startup. Throw off the shackles of office slavery, get rid of the need to find a common language with bosses and become the captain of your own, small but proud ship - is this not a dream? For many developers, creating their own startup is really a blue dream that will allow them to truly realize their potential, become rich, and maybe even make this world happy with something new and useful. For those, “Why join a navy when you can be a pirate?” Steve Jobs

Pros and cons of your startup for a programmer

So, quitting your “uncle” job and going solo with your startup is a good idea or not? No one can answer this question for you, but we will help you weigh the pros and cons.

pros

• Big reward if successful

  Let's not dissemble: monetary motivation will always be in one of the first places. Despite the fact that the work of a professional programmer in the modern world is well paid, the amount of material reward in the event of the success of your own startup will be disproportionately greater.

• Freedom to make decisions and work schedule

  But not only the thirst for big money calls developers to go free swimming. Working for your own startup, where you make all the decisions and set the schedule for your work, is not the same as being an employee in an office, no matter how high the position.

• Potential for rapid growth and development

  To succeed, a startup must evolve, introduce new features, and adapt to market conditions much faster than large companies, otherwise it simply will not survive. That is why, working on a startup, a developer can develop much faster and better, mastering new technologies and gaining experience in areas that are often left out of his focus when working for hire.

• Opportunity to work only with people who suit you

  The ability to select people yourself, focusing only on your own preferences instead of being forced to work with those who were hired by HR, is another indisputable advantage of a startup. You will finally be able to assemble the team of your dreams, and development as part of a group of like-minded people is often one of the essential ingredients for success.

“The only way to learn how to make startups is to start.” Chris Campbell, co-founder of Wufoo.

Minuses

• The first attempt will most likely fail.

  “More than 90% of startups eventually fail, primarily as a result of self-destruction, and not because of high competition. Of the less than 10% of startups that do succeed, most go through a few near-death situations along the way. To put it simply, we as humans are not very good at building startups yet,” reads an old but insightful Startup Genome report . In general, the chances that your startup will be successful are objectively small. And if this is also your first experience in startup... Let's be honest, the statistics are not on your side.

• high stress

  This is why startup founders, if successful, are rewarded much more than ordinary employees - they bear all the stress of having to constantly make decisions and be responsible for the future fate of the business, and this is by no means an easy burden.

• Unpredictable financial situation

  It is believed that it is normal for a startup not to bring any profit during the first two years of its existence. And after two years, many startups, even if their business model is relatively successful, may experience problems with profitability. Are you ready for months, and quite possibly for years, to work in the red? If not, it might be too early to slam your resignation letter in your boss's face and walk off into the sunset yelling “goodbye losers” to your office co-workers.

• Lack of free time

  It is often said that most SMB owners are “married to their jobs.” This is also true for the creators of IT businesses, except that startup developers can “disappear at work,” even sitting with a laptop in the kitchen. But the fact remains that many startup founders some time after getting rid of “office slavery” begin to recall 8-hour shifts in the office with nostalgic sadness.

• The need to acquire new skills and learn

  Many experienced and in-demand developers, having created their startup, find that while they have outstanding technical knowledge, they are far behind in other skills needed to successfully run a business. And there are many such - from leadership and oratorical qualities, to management and negotiation.

“Adding new features to a product is like having sex. It is enough to make a mistake once, and you will have to take care of this mistake for the rest of your life.” Dave McClure, founder of 500 Startups

Why do over 90% of startups fail?

It must be said that most startups are just made up of mistakes, and that's okay. As Dave McClure, founder of venture fund 500 Startups, said, a startup is a company that is delusional about what its product is, who its customers are, and how it makes money. There is nothing wrong with making mistakes in the early stages of a company, the lack of analysis and work on mistakes is the real reason for the failure of most startups.

1. Premature scaling

   “Premature scaling is the most common cause of underperformance for most startups. Many lose out on the competition because they expand too early to get ahead of themselves,” says the same Startup Genome report. Hence the conclusion - even if the startup idea seems brilliant to you, and the earliest stages of the project were successful, you should not throw all your efforts and resources into scaling, hiring more people, entering new markets and launching additional functionality that may become a burden in the future.

2. Lack of focus

   Another very common problem and one of the main reasons why many startups don't even get to the stage where they can start scaling. Sometimes a startup owner is just doing the wrong thing. Instead of working on the product and focusing on those aspects that really need improvement, many spend time on meaningless meetings and planning meetings, networking, focusing on promoting and advertising the product, while the product itself remains raw and unfinished.

3. Dependence on one person

   As entrepreneur and investor Mark Suster pointed out, individuals don't make great companies, teams do. Taking all the work on yourself, trying to achieve success alone, is another typical mistake of most startups. Unfortunately, loners rarely succeed, and move towards the goal much more slowly. Research shows that solo founders take, on average, 3.6 times longer to outgrow the startup stage. Also, statistics show that a balanced founding team, including a “techie” and an effective manager, shows a user base growth of 2.9 times higher.

4. Fundamental Planning Mistakes

   While it's normal for startups and their founders to make misconceptions and miscalculations, some mistakes can be fatal. Research shows that 72% of company founders soon realize that their unique idea is not a competitive advantage. And startups that have not yet attracted third-party investment often overestimate the size of their market niche by 100 times or more, also incorrectly defining this niche as new and therefore free from competition.

5. Incorrect distribution of finances and miscalculations in budget planning

   Many investors and startup founders tend to spend too much money, often two to three times what they need, in the very early stages after a launch. Various mistakes in planning and budget allocation lead to the fact that at some stage a startup faces a shortage of funds, which becomes critical, affects the growth of the company, and often leads to its complete collapse.

“Tell others about your startup idea openly. Let the lack of interest and their doubts spur your motivation to bring this idea to life.” Todd Garland, founder of BuySellads. In the second part of this material, we will talk about the difficulties a startup founder will face in developing, managing and promoting their product, as well as analyze the most interesting tips for beginners from experienced IT entrepreneurs and investors. Own startup: how not to repeat the mistakes of losers and stay afloat