December 2015 Posts

How to talk about when it’s time to pull the plug on a startup

How to talk about when it’s time to pull the plug on a startup

Western culture, as a whole, is not great at talking about death. Sure, people happily watch armies of the undead munching on the few remaining humans in The Walking Dead every week, but when it comes to a serious, sober conversation about The End, we avoid it like it’s a zombie horde.

And with good reason. It’s not a particularly pleasant topic to consider when applied to ourselves or the ones we love. As a father of three, I see a visceral reaction when I try to talk about it with my kids. It’s as if deep in our lizard brains we fear that just by talking about it, we might make it happen.

Oddly enough, I see the same behaviour mirrored in startups. It seem like if you talk about the failure and death of a company, you risk creating a self-fulfilling prophecy. Even though I believe I approach the topic rationally enough, I find myself feeling weirdly nervous as an investor talking to CEOs in our studio about company death. When I examine these feelings, I think it comes down to worrying that my CEOs will feel like I don’t trust them to do their jobs, and that this will demotivate them at a critical moment.