This post was originally published on Medium
Context: I’m in Cork now, mentoring the teams at RebelBio, the BioTech accelerator that SOSV created. And I just talked to the cohort of 2017 about how difficult it is to start and grow a business. And I remembered wanting to quit 6 months after starting MavenHut, the gaming startup I’ve cofounded in 2012.
One time. It was that moment when I woke up and said: I can’t take it anymore. It was just 6 months into MavenHut, at the end of August 2012, but I felt that all I was doing was for nothing, I wasn’t moving forward at all.
Cristi and Elvis, my co-founders, were creating a great product, that was interesting for our users. We were at about 100,000 installs in July-August 2012. I still said to myself: I can’t do this anymore.
I was the one raising money for MavenHut. I was the one meeting investors and talking to them, getting all the criticism from them, trying to convince them that a trio of guys from Romania can build a global business in gaming using a Solitaire game. And investors would say things like “oh, interesting, let’s talk next month, to see if you are still growing”. Or “I would invest $50-100k now, but only if you find someone else to invest the rest”. We were, at that point, looking for about $500,000 in investment, so it wasn’t that easy to come out with “the rest”.
Nobody told me that raising money took this long. When you were reading the startup literature you were under the impression that it takes several days, the most, to raise money.
Well, that day of August 2012, I was finally accepting the hard truth. It might be even longer than the 6 months I had already under my belt. Even though we had good signs from investors, even if we could take €50,000 as investment from Enterprise Ireland because we won a pitching contest with them. Gaming is a cash hungry business. €50,000 would not be enough to hire 2-3 good people and also promote the games. We would be running out of money almost as soon as that money hit our accounts. And this time we would have to pay the salaries of the people that trusted us enough to come and work with us, not only the food for the 3 co-founders.
Add to this the fact that I started 2012 with several tens of thousands of dollars in my accounts and now, when I looked up the balance, all I could see were $300. I had put almost all my money in MavenHut.
Moreover, I no longer had any personal revenue to speak of. Previous clients from my old consulting business asked me constantly when I was coming back and “make real money”, not “startup money”. I’ve already promised my co-founders that I would only focus on MavenHut, so it was no contest. We all quit on previous opportunities, it wasn’t like I was some kind of hero.
That’s when I stumbled. For a second, there, I didn’t believe that I could do it. I didn’t think I could make it for 4 more months until the end of 2012. That’s when we would shut down the business, provided we didn’t raise enough money.
That was the only time I ever felt that I would quit MavenHut.
How come that I didn’t quit, then?
First of all, I wasn’t alone in this. At one point or the other, my co-founders felt that it wouldn’t work, as well. But we found that talking to each other helped. So I had a long talk with Cristi that day.
Cristi suggested I should take one of the consulting contracts my previous clients wanted me to take and see if I really wanted to go back there, while also making some personal money. He also kept reminding me that SOSv, the investment fund, was really interested in us. And the only reason it was taking so long was that we were trying to close the deal during the holidays. Lawyers and investors need to take vacations as well. So we had a business deal in place, but no contracts to show yet.
Actually, this is what pushed me over to almost quitting, if I think about it.
The context: we already had the deal in place with SOSv. They would invest 50K now and, based on MavenHut hitting specific KPIs, they would follow with another €500,000 investment. But signing the documents kept getting postponed by different things I perceived to be “small” and “not that important”. The last block on the road was that the lawyers (ours or theirs, I don’t remember exactly) just let us know that they would be on vacation for a week. Or something like that.
Keep in mind that SOSv was one of the 50-60 potential investors I’ve talked to in the previous 6 months. People that kept telling me things like:
– “Solitaire is free on all computers, nobody will give you money for it”
– “what if Zynga decides to do a similar game?”
– “right now there is another team starting in Dublin and the 6 guys in it were part of big companies like Tilt Poker, Ubisoft, EA” (random names, I can’t remember the exact companies, but they were big)
– “you only have one developer in 3 co-founders, that’s not good”
– “gaming is too risky”
– “I have gaming companies in my portfolio and I don’t want to invest in another ever”
– “I will put $50k, $100k, only if somebody else puts the difference”
– “let’s talk in a month when you should have more users”
– “I don’t invest in companies pre-revenues” (it was a lie)
– “I am not interested in revenues so early, but you should have another product besides Solitaire”
All of these reasons are not something new for anybody that raises money. It’s the same, with a different flavor. And it’s killing you slowly.
What did I do?
Finally, what happened is that I took a consulting contract. Which should’ve been over and done in 2 weeks. And it took 3 months. By the time I got the money from that contract in my account, we already signed the deal with SOSv and already got the follow-on €500,000 investment, as well, because we moved really fast to the KPIs set up for the €50,000 deal. By the end of 2012, when we would’ve killed the company if we didn’t raise money, we were 8 people at MavenHut and the company was growing fast. And in January 2013, the first month we made any real money, we made enough to pay all the salaries from revenues. By August 2013, one year after the fateful day, MavenHut was generating about 30 times the revenues from January 2013.
I sometimes wonder what would’ve happened if I was alone in MavenHut. If I had no people to confide in that would understand me: Cristi and Elvis. I don’t think I would’ve quit, to be frank, but it was a lot easier to be able to talk to someone about your frustrations.
It’s interesting that, 4 years later, I rarely remember those bad, bad moments. If you ask me about the early years of MavenHut, just 4-5 years ago, most of the things I would tell you are good things. Elvis coding like a ninja, Cristi understanding the product, me raising the investment “almost” overnight.
But then, I meet with an early stage entrepreneur, like I did recently. And she was beyond frustration with the responses she was getting from investors she was meeting. And I remembered how frustrated I was during 2012 when I was raising money. All of a sudden, the memories came back and it wasn’t “me raising the investment almost overnight”. It was me almost leaving MavenHut.
When you read on the internet about startups, you mostly read about the AirBNBs and the Dropboxes that raised money easily. Even though, I’m sure, it didn’t happen like this for them, as well. But, hey, it’s all fun and games until it isn’t.
So, what next?
What should you do if you think about quitting?
First and foremost, think about what you’re feeling? Is it just the frustration talking or you really don’t trust your business to make it anymore?
If it’s the second case, you should quit. You will be the worst resource for your startup ever if you don’t trust what your company is doing.
If it’s just the frustration talking, then you can go to the next step: removing the frustration or learning to live with it.
Identify what frustrates you
For me, the frustrating thing was the speed (or lack of) with which things were happening. When I looked at it carefully, I understood I was expecting something else. Years of reading about startups made me believe that things happen a lot faster. It wasn’t true for us, though. And, after talking to a lot of entrepreneurs, it’s not true for everybody but a few, few exceptions.
I was also frustrated by not having money anymore. Personal money. Since I spent most of my savings on company related stuff (buying ads, paying for trips to Ireland/Romania and back, really small salaries for us to pay for rent and food), I felt uncomfortable with not having any stream of income.
You can be frustrated by lots of things. By not having users. By not having the best product you can build. By not hitting your targets. By having bad KPIs. By your relationship with your founders. With your employees. With your investors. All of these reasons are valid reasons to feel frustrated, but you need to identify them and face them.
Face the frustration
Waking up wanting to quit doesn’t just happen over night. You probably had issues with something for the last months or so. But you just kept saying it’s just a phase, it’s a thing everybody goes through. And you’re right. Everybody goes through this kind of moments, but not everybody does something about it.
So, how do you face it? Well, the easiest way is to talk to someone as involved as you are in the company. One of your co-founders would be good. If not, talk to your mentor (you do have a mentor, right?). Your investors, if you have them already, could be good discussion partners. Or maybe you have some company advisers. Tell them what you feel. Ask advice. Most of the times, they have more experience than you and they might know what you are going through or put you in contact with someone that does.
You’ll find out that most of the times, just talking about the things that frustrate you will solve the issue. You just need to relieve some pressure. Or you will find the solution on your own, once you speak out loud.
Obviously, be careful who you talk to. Not all investors are ok with you saying you want to quit and not all co-founders will keep trusting you. Just don’t be stupid about who you trust. And, if you were, well, it’s just another thing you need to sort. And you just learned you can’t trust that person for advice or help.
Solve the frustration
Once you identified and faced the frustration, you need to solve it.
More often than not, you just solve your frustration by understanding that some things take time. And you need to learn to wait it out. Like the holiday of the lawyers I told you about earlier. Not even a month later we already signed the initial investment and we had €50,000 in our accounts.
Of course, you can still work during that time. One thing I remember doing then was to jump on the plane and go to Cork, where SOSv offices were, and talk to their CFO. I wanted to be sure that he had all the elements he needed to correctly estimate the potential of our company. I had a three-hours meeting and I learned a lot in that meeting. And Steve, the CFO, confirmed to me that it became a lot easier to understand our business model once he talked to me.
On the other hand, if it’s something that is not time-related, you need to solve the issue. But now you know what’s it about. So you can find someone to do it if you are not good at that. You can read about it. You can take courses. Whatever. As long as you know what the issue really is, you can do something about it.
In the initial stages of the investment process, I needed to do some sort of revenues/cost estimates. And while I could’ve probably done it, it was easier to talk to someone to help me. And this is how our first CFO got into the picture.
What if the KPIs of the company don’t look good?
Well, this is not a good reason to quit. You just make the numbers better.
If you don’t trust that you can make the KPIs better, then you talk to your co-founders/investors and you quit. Or take a different position in the company.
Finally, if you still want to quit, talk to the stakeholders in the company and leave. It might be the best solution for everybody. Just don’t leave tomorrow. Give people time to adjust to your leaving, make the transition and then go. And, probably, in 2-3 years, you will forget the bad things and you will want to start a new company. And the cycle goes like that again.
And, to answer my own question in the title: What if I quit then? Well, I would’ve probably missed a great adventure. I’m just glad I didn’t :)
Article illustration specifically created for me by Miruna
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