How To Deal With Setbacks

It's like saying that you want to be a boxer, but like after you get really good at boxing, you'll never have to take a punch again. It's like, no, the sport, people, that's the sport of the game we're playing.

All right, this is Michael Seibel with Dalton Caldwell, and today we're going to talk about dealing with setbacks. Needless to say, in both of our startups, we experienced a wide variety of setbacks. I think working with so many startups over the last 10 years, what's probably become most obvious to us is how I don't think I've ever seen founders who don't get hit with a lot of punches. Like dodging the punches, impossible. Like even if I'll freeze another way, you might dodge some of the punches, but some of the punches are going to land.

So this is going to be a bit of a talk about what types of punches land and what you might have to deal with if you're in this game for a long time. What do you think, Dalton? Did y'all have a couple punches land over the years?

Yeah, I mean that was my experience as a founder: taking punches constantly. I think what comes up in office hours with me a lot, man, is I think people want to talk to me about one specific thing and asking for advice about that thing, and I'm happy to do it. But a lot of what I want to encourage them to think about is the meta thing, which is that the thing will keep happening over and over again.

So developing a set of skills of identifying a situation of like, "Oh, this is one of these where like something bad happened," and approaching it is part of like the sun rises, the sun sets. Bad things happen, you know? Like this is as much a part of being a startup founder as literally anything else versus thinking you're never gonna have them or that each setback is different. They're not; they just come, just like every sunrise comes.

Right, so let's jump into the first area that produces setbacks: investors in fundraising, the classic. The classic: I went in to fundraise with this expectation, I came out with a bloody nose and a black eye.

Yeah, I thought they liked me, I thought they were my friends, I thought I was special. I thought everyone else was raising; you know everyone else is this—oh, I got all the right intros, I know they're interested in my thing, I did the networking. Like, it's some version of I believed with good reason X was going to happen.

X did not happen! WTF! Like, how dare they or the universe! Like, you end up kind of going nuts on feeling wronged by a person or a system, or whatever you want to call it, like someone did you wrong. Right?

What I think the scary thing about fundraising is that one fundraising process can produce so many of these experiences, so many of them. And you know, I remember personally the first full partnership meeting, like we were raising a round from a real investor, and I had my first full partnership meeting.

I remember thinking like this is it! Like this is, you know, this is destiny! Like this is gonna happen! Like, you know, it's taken me so many meetings to get here. I remember in front of everyone, one of the VCs in the meeting eviscerated me for 45 minutes, and everyone else was quiet.

The person who like invited me to the meeting was quiet, and I just watched that person very logically take apart my entire startup. Almost in a way that I would have had our roles been reversed. It was like, it's like, well, they were probably right, right? They were right! No, no, it wasn't they weren't wrong, right? But like, you know, in some way, they were right.

In other ways, I think we were right. I mean, our company did well in the end, but precisely, yeah, yeah! You could take apart any startup logically at that stage, like where there's no defense.

I just remember leaving that meeting being like, “Oh, like I can't imagine how I felt an hour ago compared to how I feel now.” Okay, literally those seem like two different years of my life. We see this at YC, where like, you know, statistically, most folks don't get into YC. This is the game, and you see the way folks react to it in very different ways when...