Sometimes having to burn it all down is the best medicine our startup can take.
It sure doesn’t feel that way at the time. When we’re sitting across from an income statement that’s been decimated and thinking of having to go back to our team, investors, and partners to tell them some truly horrible news, the last thing we’re thinking is “Hey this might be great!”
But for those of you that have never been through it, I’m here to tell you, it may in fact be the best thing that ever happened to our startups.
That’s because a Hard Reset gives us the one opportunity to go back and reset all of our decisions that we’ve made, teeing us up to build a far more efficient and capable startup going forward. It sucks — as I said — but it also has some one-time benefits we’ll simply never get again.
We get to Pick a New Kickball Team
One of the things that we rarely spend time thinking about is whether or not if given the opportunity, we’d hire back the exact same people for the exact same roles we did the first time. You see, when we’re building our startup initially, we add roles on an ad hoc basis based on a ton of assumptions of what the business might do. That means invariably we hire for jobs that never really became what we thought they’d be by people who never quite lived up to their billing. It happens.
The Hard Reset means we get to pick a whole new kickball team from scratch, and only focus on the players and positions that are absolutely critical. We get the benefit of knowing what we really needed versus what we thought we’d need. And more importantly, we get to make those decisions based on real-world experience with people we’ve had reps with. It’s a very different ballgame.
We get to Reset Past Decisions
It’s so rare in life that we can basically hit the “undo” button on big decisions like organizational structures, that ridiculous office lease we signed, or the countless vendor deals we did that “sounded good at the time.”
The Hard Reset means we get to undo all of that. The fact that there are so many decisions we will never make again, and have a one-time chance to undo them says it all. While clearing out of our once-proud office feels shitty in the beginning, there’s no version where this time next year we’re going to be looking back at our income statement saying “Boy, I really wish we were throwing $20K a month down the drain for an office no one ever wanted to go to.” (I’m looking at you, COVID…)
We Attain Ultimate Efficiency
Resetting our operating expenses for true efficiency is something we end up doing because we have to, but over time we start to realize that it may have been the most productive thing we could have ever done. That’s because, along the way, we’re rarely optimizing for efficiency. We’re optimizing for optimism. We hope that new salesperson will hit their numbers. We hope that the new developer will ship the product faster. We keep hoping that all of these decisions will lead to efficiency. But — now we actually know.
So this time around we have a much more efficient path to profitability. We know what we can live without, and we know what we absolutely must-have. It’s the ultimate do-over, and if we look at it in the context of resetting our business to achieve a better future outcome, it just might give us a much better feeling about the months to come.