A couple years ago I had coffee with a local high tech executive who wanted to vent about east coast venture capitalists. He had what he thought was a great idea for a startup, but couldn’t get the local VCs to bite without him first starting the business. His line of thinking went like this: if you give me the money, I’ll leave my job and start the business - but how could I leave my job without money to start the business? Note to self: apparently west coast VCs don’t have LPs that require the management of investment risk. ;)
In my favorite chapter of Sun Tzu’s Art of War (Chapter 11: The Nine Situations), there is a line about how to manage your army when you have entered what is called facile ground:
“When your army has crossed the border, you should burn your boats and bridges, in order to make it clear to everybody that you have no hankering after home.”
If you are looking at starting a company, you are without a doubt on facile ground. While you have stepped into hostile territory, you have not gone so far as to lose the optionality of moving forward or back. The choice now is yours to make: do you march forward to meet the enemy, or retreat back to the safety of your home? The advice in Art of War is clear: burn the boats and bridges, eliminating all possibility of retreat.
Many of us remember fondly the process of starting a business in the Dot Com Boom: idea, money, product, business. Unfortunately for most of recorded human history, the process of starting a business is: idea, product, business, and then (maybe) money. We can long for the days of the Dot Com Boom, but unfortunately have to live with the reality of the post-Dot Com Bust.
Don’t enter facile ground without a clear plan for success. But once you are on facile ground, optionality is a detriment.