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🧠 the truth about startups

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Hey IdeaHub Crew! 🎉

Do you remember the first time you had a great startup idea?

Felt cool huh? You immediately start your mental shopping spree.

I’m going to buy the lambo here, the yacht there and I’ll build my dream house over there!

Once all these imaginary purchases are bought, you come back to reality.

  • “But I don’t know if I can fund that?”

  • “Would anyone even buy it?”

  • “I have a good job, why mess that up”.

It’s easy to romanticise the startup lifestyle. With flashy movies about entrepreneurs getting rich overnight and stories of people hitting it big with their equity pay day.

But in all reality, it’s a long and painful struggle. Our mission at IdeaHub is to help you folks take the small steps from Idea to Reality.

Today’s a little reminder that if you can manage to push through the pain, there may be a fortune waiting for you on the other side.

Even today’s sponsor Vanta, had it’s struggles, but we’ll get into that later.

Read the biggest startup myths here… 👇

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The Breakdown

Four Biggest Startup Myths

Myth #1: founders come from wealthy backgrounds

Jan Koum (Co-founder of WhatsApp), grew up in Ukraine without electricity or hot water. In 2009, he co-founded WhatsApp, which initially struggled but eventually became a global phenomenon. In 2014, Facebook acquired WhatsApp for $19 billion.

Rags to Riches Timeline

  1. Humble Beginnings in Ukraine:

    • Growing up poor, he faced hardships like lack of electricity and reliance on food stamps.

  2. Immigration to the U.S.:

    • At 16, immigrated to the U.S., settling in a small apartment in California, overcoming language barriers.

  3. Tech Career and Entrepreneurship:

    • Landed a job at Yahoo but hated the corporate life, so he chased his ideas and found entrepreneurship.

    • Co-founded WhatsApp in 2009, initially struggling but later becoming a global phenomenon.

  4. Acquisition by Facebook:

    • In 2014, Facebook acquired WhatsApp for $19 billion, catapulting Koum from poverty to billionaire CEO status, leaving a lasting legacy in the tech industry.

You don’t need to come from money to make money.

Myth #2: founders can do it alone

Jack Ma (Alibaba Group) was rejected by Harvard ten times and even by KFC when they first came to China. It took him a long time before he created Alibaba, one of the biggest e-commerce giants out there. He found along the way that working with other people and building his community was the secret to his troubles.

Rejection to Acceptance Timeline

1. Showing Resilience:

  • Despite the setbacks, Ma did not allow rejection to deter him from his ambitions.

  • He decided to build his network and get to know other entrepreneurs.

2. Seizing Opportunities:

  • Undeterred by his academic and professional setbacks, Ma pursued various entrepreneurial ventures. This is the key here - keep moving!

  • He dabbled in different industries, including teaching English and founding a translation agency, all the while honing his people skills.

3. The Birth of Alibaba:

  • In 1999, Jack Ma founded Alibaba, an online marketplace connecting Chinese manufacturers with international buyers.

Today, Ma’s legacy is as a visionary entrepreneur and philanthropist.

Myth #3: founders don’t spend their own money

We hear about genius founders raising millions for their startups.

Some of them just kids out of college. Never had a job. Never had a boss.

*VC investor immediately wires $3m*

Not always. Sometimes, they put their money where their mouth is.

Enter Founder of Under Armour, Kevin Plank.

1. Early Life and Athletics:

  • Kevin Plank grew up in Maryland, USA. He excelled in football and even played as a walk-on special teams player at the University of Maryland.

2. The Idea Takes Shape:

  • While at the University of Maryland, Plank noticed that his cotton T-shirts would become drenched with sweat during practices and games (problem spotted)

  • Inspired by the need for better athletic apparel, Plank conceived the idea for Under Armour, a brand that would offer moisture-wicking performance apparel to athletes (solution offered to a specific customer)

3. From Basement Startup to Business Success:

  • In 1996, at the age of 23, Plank founded Under Armour from his grandmother's basement in Washington, D.C.

  • He sold directly to college football teams.

  • It quickly gained traction, and Under Armour became a trusted brand among athletes seeking high-performance gear. But how would he fund growth?

4. Overcoming Financial Struggles:

  • He had to max out his credit cards and use personal savings to keep the business afloat. Not financial advice but this hustle kept the business alive.

  • Despite the financial pressures, Plank remained steadfast in his belief in the potential of his brand and persevered through the tough times.

Revenue in Q3 of 2023 was $1.5bn…

Not bad for a college athlete from Maryland.

Myth #4: founder get’s the easy jobs

Sometimes, VC backed founders get the reputation that all they do is:

  • Raise millions of $$$

  • Go for coffees with investors

  • Hire a bunch of people to do the work for them

But, in most cases, they are doing things that don’t scale to test customer behaviour.

Here’s Christina Cacioppo, the CEO and Co-Founder of Vanta 

Vanta is a company that specializes in security and compliance automation and today’s sponsor. Download their compliance checklist here for free

Five years ago, Cacioppo received a message from a customer alerting her to a small glitch in their automated email system. The email, meant to provide daily updates on the customer's Vanta account activity, had mistakenly featured the wrong company name. Cacioppo responded - “Sorry we have a bug, I’ll fix that now”.

What the customer didn't realize was that the supposedly "automated" email had actually been meticulously crafted by Cacioppo herself in the early hours of the morning. Rising before dawn each day, she set her alarm for 5:45 a.m. to craft these emails by hand, ensuring they met the standards of excellence she envisioned for Vanta's customer experience.

Sometimes you have to be willing to get up at dawn each day to write dozens or hundreds of handwritten emails to set the tone of customer experience in your company.

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That’s it for today! Reply to this email at [email protected] with any questions!

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