Now that the dust has begun to settle, I’d like to talk about a theme that has been toward the forefront of my mind for the last few months: failure. Since our first annual board meeting in March, every turn for my startup company has been a turn for the worse. People often say that starting a business is like a roller coaster, a thrill ride with wild ups and downs. Without any real ‘ups’, I didn’t feel exhilaration from this ride. It wasn’t skydiving, where the out-of-control free-fall yielded to a rush of adrenaline before the chute deployed for pure, soaring bliss. It wasn’t even the log ride, where you’re at least treated to a moment of excitement before getting drenched. It was more like taking the giant slide at the fair, but as an adult: it’s a slow and uncomfortable ride down, you feel like you shouldn’t be there, and you leave with a lasting rug burn. Analogies aside, the sting of failure was not something I was prepared for…it’s deeply tangible, and it sticks with you. It’s a widely shared fact that 90% of startups fail, but very few people talk about what that looks or feels like. Well, as someone who is partially to blame for Felix’s early demise, I’ll try to point out where we went astray.
After revisiting my original post on founding Felix, I realize that our mistakes started from the very beginning. We severely misjudged the scope of our company: our most important project idea turned out to be fundamentally flawed, and the steady consulting work never materialized. I was recruited to join the company with the assurance that we would raise $50,000 in investment during the first 6 months. This never happened, which might be a good thing. With the couple of small investments that we actually received, it did not make sense for us to form a C corporation; rather, we should have incorporated as the simpler S-corp (and upgraded to a C-corp later if we grew to accept a wider investor base). It also didn’t make sense to rent a commercial space when we weren’t generating consulting revenue; instead, a majority of our small investment funding was diverted to maintaining the overhead. And nobody was alarmed about this unbalanced budgeting until the bank account ran low, which was frustrating as the company secretary.
Ultimately, what doomed Felix was a halfhearted commitment from its members. Starting with its president, who formed the company with people he trusted to guide his ideas to profitability but then opted to focus almost exclusively on his own freelance work. Since each Felix project was his brainchild on some level, his dis-involvement in the company played out like a ship captain speaking of a faraway destination, preparing for a voyage, then declining to set sail with the crew. The other three board members were helpful individually in an advisory capacity, but together we were unable to find consulting projects, broker investment deals, or re-center the company president. As secretary, I was responsible for leading communication among the board, which proved challenging – not only was I up against conflicting schedules, but I frequently had to re-orient the board to the basic facts of the company. I felt like I was on an island, working on projects with an undefined direction or destination, on a shoestring budget, compensated in increasingly worthless stock. I carry some culpability for the missing sense of urgency — my priorities were traveling internationally and preparing for my first conference presentation this time last year — but I felt put off that Felix never became a high priority for anyone else on the team. Word to the wise: don’t start a company unless everyone involved is fully committed to its success.
So what happens now? We actually have no mechanism of dissolution built into the company constitution (small oops by our attorney), so the company will remain open as long as one board member wishes that it remain open. I can’t realistically resign as company secretary unless there’s a dependable replacement, so I’ll be in charge of keeping corporate records and submitting our tax forms for 2019 and beyond. Now that I’ve moved out of Springfield and allowed our property lease to expire, the other members of the team are expressing some lukewarm excitement for a new project, building a gasifier to generate electricity from waste tires. It’s another interesting but underdeveloped concept that’s being pitched to potential clients as a working design. Due to the legal considerations of this project, I feel responsible for guiding the gasifier design so that it operates efficiently as advertised, is professionally documented, and complies with environmental standards. I still own a sizable fraction of the company’s stock, so I stand to benefit if the company succeeds. Based on past results, however, I can’t count on it.
Whether Felix miraculously rebounds or not, it’s time for me to move on. As the months-long collapse was happening, I felt a swirling slew of unhealthy emotions: anger, at my business partners for what I perceived as ambivalence; guilt, for my personal involvement in this mess from the start; and fear, for my future prospects as an engineer after falling on my face like this. The fear lingers, like I stepped off into a great unknown. I had been groomed for success my entire life, particularly at Rice and Vanderbilt where failure was made to seem unfathomable. Of course I had heard that entrepreneurs usually fail several times, but the corollary “they just pick themselves back up” neglects to mention the pain of the fall. Until the next stage of my life is figured out, I honestly don’t know how this will affect me. I hope that prospective employers perceive it as a learning experience, I am beginning to discuss it in this way. It’s a setback for sure, but it certainly doesn’t detract from my abilities as an engineer. If anything, the opposite is true…during this year I ran numerous electrochemistry experiments, designed a tire gasifier and sludge-dredging robot, prepared engineering datasheets for these equipment designs, and learned how to manage corporate paperwork and private investment deals. As I pick up the pieces and plan for my next adventure, I’m hoping that is enough.
Worldly Observations 