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Building a Startup Is Like Launching a Rocket
Philosophy, Startup

I read about 80 books a year and am always looking for new suggestions from people in technology (email us your recommendations). A number of VCs and technologists recommended Failure Is Not An Option by Gene Kranz, flight controller for the legendary Apollo 13 space mission. After reading the (audio)book, I see four reasons why the book is so beloved among the tech set.

1. Parallels of Launching a Rocket vs a Startup

“Going to the moon was more art than science because they were doing something that had never been done before.”

To boldly go where no man or woman has gone before was the mission of the US space program in the 70s and is the mission for all great startups today. Kranz retells stories of many space missions and preparations that faced calamitous error because they were doing something that had never been done before, but flight control and the astronauts persevered and found solutions. Startups also face frequent, calamitous problems because they too are building a business that does not exist, and they too must persevere. Most startups (aside from SpaceX) aren’t launching rockets into orbit, but they should treat their mission just as seriously.

2. Engineers vs Operators

“An engineer can explain how a system should work in theory. An operator has to know what an engineer knows then get the systems to tie together to get the mission accomplished. If the systems break down the operator must make rapid decisions to keep the mission moving.”

In our experience as VCs so far, we’ve learned that there are many great engineers, but few great operators. It can be easy to lose sight of the difference when you meet a brilliant engineer, but finding an engineer who can be an operator is the true task. Discovering great operators relates directly to the first point — that things will go wrong. A great operator is capable of making quick decisions in chaos to move the mission forward. Without a great operator, a business is doomed to die at the first instance of difficultly.

Great operators are also dedicated to continuous improvement. Kranz writes of constant flight simulations to test not only what to do in emergencies, but to test themselves in stressful situations that require rapid response. Most startups profess the “fail fast” mantra, which is an evolution of continuous improvement. Failing fast is sort of like live flight simulations, but without the risk of human life. The best operators work on their craft and improve over time from their experiences, especially their failures.

3. A Greater Cause

“It isn’t the quality of equipment that wins the battles, it’s the quality and determination of the people fighting for the cause they believe.”

Sending a man to the moon for your country is a noble and patriotic mission. The best startups pursue missions beyond just starting a business. Operators need to ask: Why does it matter if my business exists? What would keep people working on it if they didn’t have stock options? Money is a hygiene issue. Every business needs to take care of it so employees can survive and not worry about basic needs. Every startup needs to offer stock options because every competitor is offering them. A greater purpose keeps employees motivated beyond money, but also helps to enforce a specific culture that informs the decisions of those employees, how they treat customers, and how they offer products and services. Pursuing a valuable mission is what makes a startup special.

4. Make Data Useable

“You live or die by the data at your fingertips.”

Data allows operators to make informed decisions, but too much data can confuse and slow decision making. Kranz describes a binder of the most important things he needed to know for successfully manning flight control. Good operators should do the same: Define what data matters by separating the signal from the noise and then have it available in an easy to digest format to enable fast decision making. The importance of usable data is one of the reasons why we believe every company must be an AI company in the next decade. We are inundated by data, and machine learning helps us make sense of it. Using machine learning to generate insights for managers will be a key tool for all businesses in the future.

Kranz says that going to the moon was more art than science because they were doing something that had never been done before. Building an important startup is no different. Doing things that are non-incremental require the combination of a willingness to see the world differently, the ability to rapidly learn from mistakes, and an indomitable will. When the “why” for doing something is important enough, failure is indeed not an option.

Disclaimer: We actively write about the themes in which we invest: artificial intelligence, robotics, virtual reality, and augmented reality. From time to time, we will write about companies that are in our portfolio. Content on this site including opinions on specific themes in technology, market estimates, and estimates and commentary regarding publicly traded or private companies is not intended for use in making investment decisions. We hold no obligation to update any of our projections. We express no warranties about any estimates or opinions we make.

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