My top 5 learnings from crashing our first company - and why I am thankful for all our failure
„The website cannot be reached“
Wow, that was it.
For the first time since Tim, Björn and I started our first common company Navinum back in 2011 the website is down.
Not for some minutes due to a server error – but permanently. Due to a fatal error in the business model.
Should I be sad now? No, not for a second. I am super happy about how the ride we made has developed and I am thankful for all the learnings we made over the last seven years.
Today I want so share my top 5 learnings from crashing a company with a several million $-valuation and how it helped me to grow personally in terms of resiliency and mental balance as well as it helped the three of us to grow as founders (who today luckily run several successful businesses together).
Back to university. Where it all began.
When my two partners and I met in 2004 during our MBA at the Hamburg Media School we pretty quickly noticed that there is a really good connection between us on a private level and that we can work together on business projects extremely efficiently – even if (or maybe especially because!) all three of us have super different characters.
The closer the end of our MBA came the more often we asked ourselves in which companies to start our careers or if maybe we should just start our own company directly after university.
We decided that it seemed to be smart to make the first mistakes in someone else’s company and so had our first jobs in big corporates like Bertelsmann, RMS or Axel Springer – but we never gave up the idea of founding companies together. At least we met some times during our first years after university and spend some time or even whole weekends to discuss technology trends, business ideas and entrepreneurial opportunities. Everytime we met we had super inspiring discussion and also promising ideas.
The truth is: just having good ideas is not sufficient. And part of the truth also is: the longer you are employed in a corporate the less likely it is that you will jump into the cold water of entrepreneurship. With every promotion you get, with every salary raise you receive and with every company car you may drive your potential downside of trading your (allegedly secure) corporate job for the highly unsecure position as a startup founder is getting bigger and bigger.
The day where my world turned upside down – and how the worst day in my life became the starting point for something wonderful.
It was that one day in spring 2010 when I got fired twice the same day: My former employer and I decided not to continue working together and my girlfriend also split up. All within 24hours.
Wow, what a mess. I was 31 years old and faster than I could realize I had no job and no girlfriend any more.
It took me some days (and nights with beer, gintonic and good friends) to shake myself and to get a clear view again. And behind all the sadness I realized that one thing had changed: suddenly I had nothing to lose anymore. I could take almost every risk now as the likelihood to found a family and to become responsible for a wife and children over the next years had dramatically decreased.
And so I decided to call Tim and Björn and to invite them for the next weekend. We met for two days of brainstorming at our old MBA school and collected dozens of business and product ideas.
After these two days we three knew, that:
firstly, we had some ideas we truly believed in
secondly, we did not yet know, which of these ideas we would follow, but that
thirdly, we were totally convinced that we three together were strong enough to start that journey.
So in the end, we all quit our jobs (ok, I obviously did not have to do so any more) without knowing what exactly we would do together in our first company but also being full of trust that this was the completely right setup and that together we would be able to build successful companies.
So, this is my Learning #1 “When you are going through hell, keep going”
Losing my job and my relationship really hit me hard and I was in deep sorrows those days. But luckily I pretty soon saw some sunlight at the end of the road (meaning; Tim and Björn) what gave me orientation and motivated me to not just lie on my couch commiserating myself. And I think this learning is key for many situations. Even if everything seems to be out of control and to crash, try to find that sunbeam that gives you motivation to get up again. That can be friends, family, colleagues or your former teacher from university. Knowing that there are partners around me that even in this sad situation would support me with everything they had and that were willing to put all their eggs in one basket completely changed my mindset from sadness to pure excitement and gave me new hope and energy.
Suddenly we were entrepreneurs
It was January 2012 when we for the first time sat as three unemployed guys in our first own office (which was not more than one room without a fully working heater in a left outhouse of our former university). Over the next weeks we eliminated more and more of the business ideas we had collected over the last weeks and months and in the end were romantically convinced that our mission was to build NAVINUM - the best solution for wine e-commerce. We managed to raise some million Euros in venture capital with not more than a landing page and 20 powerpoint-sildes and were super ambitious.
We really built high end technology here - the only problem was: the product was great from a technical perspective, but nevertheless did not catch enough users. For weeks and months we were far beyond our expectations which got more and more depressing. At the same time the pressure from (some of) our investors increased strongly.I personally went through all stages of stress you can imagine. I started grinding of my teeth, I did not sleep very well, I had really strong pain in my back even if I was doing a lot of sports and from an orthopedic view my back was in a very good condition.
Tabayesyo attack – how I learned, that my mind has control over my body
It was in summer 2013 when my back pain got so strong that I almost was not able to get out of my car one day.
That was the moment, my today very close friend Folkert Behrends, that I at these days only knew a little bit, came into place. Less than ten years ago a car hit him while a bike ride so hard that he had to lie in hospital for weeks and months and that all doctors predicted that he would never be able to just walk again without any pain. He proved them wrong and today is one of the world’s best ironman athletes in his agegroup. Today he is running a company called Move-Ment – and helps people to move (by providing them with high-performance sports trainings) but also to become mentally stronger.
Foli, who was living on Lanzarote these days invited me to come to the island for one week. And he gave me a strong promise: that I would leave the island without any pain. Wow, what a strong promise. Desperate as I was, I booked the next flight and suddenly I was on Lanza, where Foli did a lot of sports together.
With some extremely smart tricks Foli helped me to understand, that not my back was my problem but that my mind and the way I coped with all the stress (truth is: I did not cope with it at all!) were the reason for all my back pain.
When we cycled high mountains (and mainly the notorious “Tabayesco Attack”) and intended to mainly have fun, I was much faster and more powerful than when Foli put me under pressure and urged me to give my utmost. When we did fun-rides I was super relaxed and could really perform well. But when I was supposed to hyper-perform, all my muscles were completely tensed up and thus did not increase my performance but made my move less smooth and in the end made me slow.
With Folis help I realized that exactly that was, what happened in my entrepreneurial life: While I was so focused on making our first venture successful I was super cramped tied up in knots.I was mentally stressed and what happened was, that my tension wandered from my head over my muscles to my back. All my back pain was initially caused in the mind.
So, this is my Learning #2. If you want to achieve great results take care of your mind. If you are mentally unstable it is just a question of time when your body will follow and put you out of action. After 30 years of sports, running marathons, doing triathlons and playing hockey with up to 6 training sessions per week I got to know a completely new muscle I had to train – my mind
For the first time in my life I learned about the word resilience - the ability to cope with negative events and setbacks – as well as mindfulness. A book that was recommended to me several times was “Search inside yourself” – a bestseller, written by Chade Meng Tang, who was one of the first Google engineers and developed SIY as a mindfulness training for employees of Google. Today there is a worldwide network of SIY trainings and institutes and the concept has been recommended by US presidents like Carter or spiritual leaders like the Dalai Lama.I am probably the least spiritual person on the world and everything around mindfulness and meditation was mostly hocus pocus for me. But all the things Foli showed me made me curious to learn more about the ability to become mentally stronger. So I devoured the book within hours and started to adapt the various recommendations given.
How meditation helped me to find more calmness and headspace.
The concept that fascinated me the most was the idea of meditation. I downloaded the world’s largest mediation app, called Headspace and started their introduction for newbies, a 30 day program of short daily meditations. There are dozens and hundreds of good articles that describe the value of meditation. And of course there are hundreds of medical studies that also prove it from a scientific perspective.
But for all who are skeptical about the value of meditation I recommend this video of Andy Puddicombe, the founder of headspace.
Also recommendable is this Ted Talk “Don’t try to be mindful” of Daron Larson
I am doing meditation now for more than four years for at least 10-15 minutes per day and I can truly say that the muscle in my mind is growing every day. Today I would say that I am much less prone to stress. I can cope with negative events much better, I do not take things to personal. And the best is: I never ever had any more problems with my back. At the beginning I had to force myself everyday not to forget or skip my meditation session. Today I would not want to miss it. And for all of you who are doubtful: meditation is not about spiritualism, wool socks and joss sticks. Some of the world’s best managers and sports athletes practice daily meditation and today I know, why it helps them to be more focused and less vulnerable.
Hell yeah – we have a problem (and can talk about it)
One of the things that I found really difficult at these times was to manage expectations. I wanted to prove to everyone that me and my partners were able to successfully build companies. And whenever someone asked me, how we were doing, I said. “Oh great, everything is on track”, which just was not true, but I thought that everyone had the expectation that things would go great and I did not want to disappoint anyone. And for sure I also did not want to admit to myself that not everything was great but in contrast a lot of things were really fucked up.
At that time a fellow startup founder from Hamburg told me about an organization I had never heard about:
“EO – Entrepreneurs’ Organization”, which is a worldwide group of entrepreneurs that in the core has the main goal to help each other grow. Besides a lot of learning and networking events all over the world, the core element of EO is the so called forum – a group of up to ten EO members that meet once a month. The idea is that everyone in outright honesty talks about the things that they have to deal with in three different fields: personal / friends&family / job and afterwards receives feedback from the other forum members that share their experience with similar situations, challenges and problems.
Not only that these experiences are highly valuable and very often give extremely helpful ideas how to cope with different situations – for me the even higher value of my EO forum is to know, that all other entrepreneurs also have their more or less serious problems, even if from an outside view they and their companies seem to be super successful and on a perfect way.
Discovering oder learning that almost every founder and company is facing issues and coping with challenges (even when it seems to be super successful from the outside) and being able to share my sorrows with other entrepreneurs really made a difference in how I treated problems from that time on.
So my learning #3 is: do not try to make an impression which just is not true. Be open with your problems. People around you will have much more understanding than you expect. When you are open to them they will also be open to you and they will share their experience and learnings that might give you valuable input in dealing with your problems.
If the horse is dead – you have to get off
Even if over time I managed to better cope with stress and negative events our core business problem remained the same: Navinum just did not have the traction we and our investors had expected.
We really tried our best to improve the product, the marketing, everything. But at some point we decided that it was unlikely to bring Navinum to the expected success and that we should not put the focus of our work on it any more. So together with our investors we decided to bring the company to a hibernate mode where it could run without huge efforts in kind of an auto-pilot-mode from now on.
So we suddenly had to ask ourselves: what are we going tomorrow? What will we put our effort on? How will we earn money?
Afterall, the fact that Navinum was not a success, was not a stigma at all. Even if we did not reach our initial goals a lot of people around us noticed that we had built pretty interesting technology and that we had proven a good expertise in performance marketing. By the blink of an eye we received more and more calls and emails from people that had heard about our new vacancies and asked for support. While building Navinum we had gained a lot of experience in ecommerce marketing, highly customized crm, data analysis and other performance marketing techniques. And faster than we had expected we had a growing number of online marketing projects for different clients running and managed to finance our whole existing team with these projects, so that we did not have to terminate a single employment, which still is one ot the things I am most proud of.
So my learning #4 is: Not everything is bad. Never. For us the door Navinum closed and suddenly another door opened and we saw a new perspective. Even if at that time we did not know that this would lead to a successful agency business, suddenly we could grab a new opportunity and at least knew how to pay our rent and finance our employees’ salaries.
Over the next weeks and months our reputation grew and we received more and more requests from various companies. They came with such a speed that we suddenly had to ask ourselves if we should hire new employees to be able to fulfill all these requests. And suddenly and surprisingly we were in the agency business running a successful performance marketing agency.
Not only that it was super satisfying to suddenly be in a positive and proactive position, earning money and having a lot of positive experiences instead of one setback after the other, the most important fact for me was to see, that all our previous investors of Navinum still seemed to trust us. Even if we had burned a lot (really a lot) of their money, they obviously had seen that at every day we had given all we could to get the best out of Navinum and their investment. And despite the Navinum-flop they seemed to appreciate our 110%-effort, our skills and especially (as far as they tell me) our brutal honesty towards them. And so almost all of them from that day on hired us to support them in their daily business or to support several of their portfolio companies. And today one of them is one of my closest friends and mentors.
My learning #5 is: even if you lose one game, do not forget the team mates that believed in you. They have trusted you and they believed in you for a reason. It will not disappoint them if things go wrong, it would only disappoint them if you were not honest and transparent to them. So do not leave any scorched earth behind you.
Today my partners and I are thankful for running Finc3, a successful online marketing agency group, with a team of 50 (and growing) great colleagues from 15 different countries and I could not imagine anything better and more fulfilling than running my own business with exactly these partners and this team.
The last six years were full of ups and downs and even if I would not want do go through every of these situation again, I am thankful for all the experiences I made. Even if I had to learn some things the hard way I know that these learnings helped me to become steadfast and stable. And the three of us have managed to get through all these challenges, I know everyday there is no one else in the world I would like to have on my side as business partners.
Thanks for the ride so far, guys.
Looking forward for everything that is coming.