Founding a startup is a brave business in itself. Prospects to insiders and outsiders alike appear difficult at best. Most of the 600,000 companies founded in the UK this year will fail. Most will never survive to file their 2026 tax assessments. Some will look at those statistics, turn 180 degrees, and walk away.
Those who proceed to create a startup face another challenge altogether. While we’re trying to build revenue by any means possible, our family members pose condescending questions like: ‘Isn’t it time you got a real job?’ They might even throw in the odd, ‘I saw a job going at Google’, if we’re lucky.
This environment is quick to isolate founders. We often feel as if no one in our direct circle of friends understands our situation. No matter how much they attempt to sympathise, they’ll just never get it. We end up avoiding all work-related conversations with them. Soon, the only people we chat to about our businesses are our partners. Solo and single founders often suffer the worst in that respect.
Many blame bad ideas for failed startups. In my opinion, it’s more often the isolation. Almost all successful businesses find a way to overcome it.
Founders must take accountability
Some have come close to my conclusion in the past. But in my opinion, they’ve always ended up at the wrong destination. Tom Eisenmann, a 25-year Harvard Business School professor, in his recent book comes one stop short.
Eisenmann has a fair bit going for him when it comes to solving founder isolation. He has the academic credentials. He has experience as an angel investor. And industry professionals have elected him onto multiple advisory boards.
When Eisenmann completed research for his book Why Startups Fail, hundreds of founders and investors contributed their insight. His result was conclusive. Startups didn’t fail because of bad ideas. They often failed because of the people behind the ideas.
According to Eisenmann, startup founders too often bring the wrong people on board to run their business. Perhaps founders lack industry experience. Perhaps, instead of securing investment from those invested in the industry, they seek investment from VCs that give money and leave given their pre-eminence as a funding source. Everyone involved in the business from day one needs to feel invested and treat it with the utmost care to succeed.
I’d be a fool to disagree with him on that, but he doesn’t highlight what in my view is the most pertinent bit for founders to realise. He reasonably places a lot of value on experience and credentials, he’s almost afraid of pointing out the glue that makes them work. It’s how the teams work together to make the decisions. This isn’t something that people are born with and can’t change!
Empathy must be a priority
Experience and credentials will always help a company succeed. But alone they’ll never cause a startup to crash or fly. If that were the case, investors would always throw bags of money at decent ideas with experienced founders for a sure buck. There are more subtle reasons for business success.
Based on my experience at one of the world’s most exclusive accelerators, it’s personality and how reflexive a founder is that dominates. Investors know this too. In fact, I know that investors take a very close look at founders’ behaviour when allocating funds, often more so than at the business idea itself. A pitch might appear to be about a company’s model for increasing revenue, but beneath the surface pitches are telling VCs and angels a lot more about the founders’ suitability for leadership and their team’s dynamic than anything.
This is important for founders to recognise because, if isolation kills startups, industry experience will do nothing to dig a company out of a hole. Empathy will.
At Techstars, one of the attributes I look for in founders when accepting applications is empathy. When a team member is experiencing problems in their personal life, which could have a serious effect on their work, only empathetic founders can help them handle the situation. And only founders who have the ability to approach them to ask, ‘Is everything ok?’, will run successful businesses.
Empathy is also crucial to succeed in external relations too. If a customer is unhappy about a product or service, industry experience might help a founder discover the problem, but only empathy will ensure that customer feels valued. Everyone who argues about whether the customer or the employee comes first is wrong. Success rests on having the empathy to understand both and respond appropriately.
If we’re to improve the chances of a company succeeding, we need to recognise the negative impact of isolation. From there, we can start looking at ways of overcoming it. For me, that will always involve empathy. We spend weeks learning about ourselves and coaching on team dynamics at my Accelerator. A founder or employee’s worth is based on their behaviour, not their career credentials. Investors know it. Founders need to appreciate it, celebrate it and learn to develop it too.
— Saalim Chowdhury is the Managing Director at Techstars London since 2020.
