Conversation, Fireside Chat, Interview
How To Deal With Setbacks
- Setbacks are inevitable and continuous, occurring as frequently as the sun rising and setting, with specific types of punches expected to recur throughout a founder's long-term career.
- Founders often incorrectly assume setbacks are unique or that the "game" stops after rejection, whereas most people do not get into YC and the majority of Series A raises fail without public announcement.
- Fundraising processes involve high-friction negative experiences, such as enduring up to 45 minutes of aggressive verbal criticism, and the "magical deal" frequently disappoints even when secured or when it fails to materialize.
- Launches often result in silence or negative public reaction where the idea is criticized and the founder is attacked, requiring repeated attempts before adoption spikes, sometimes years later.
- Legal challenges and public criticism are unavoidable for anyone attempting big things, with respected figures facing more than 10 times the setbacks currently encountered by founders.
- Co-founder relationships face inevitable friction that can cause a split if insufficient connective tissue exists, particularly when external pressures mount.
- Most successful alumni take eight to ten years to build their companies, contradicting founder expectations of success within 2.5 years post-YC or after receiving funding.
- Founders retain the ability to control their reactions to setbacks, practice resilience against criticism, and perform worst-case analyses to assess recoverability.
- A founder's reaction to adversity sets a precedent for the team, influencing how co-founders and employees handle bad news, with a single calm declaration capable of pausing panic.
- Bad outcomes such as customer attrition or failed deals are often less severe than feared, as customers frequently stay despite fears and fears often remain hypothetical until spoken aloud.
- Founders can develop a "superpower" of emotional stability that allows them to up-level their teams to handle setbacks better, teaching employees to "take punches" even in the founder's absence.