98 Lessons I Learned Firsthand from Running a Cybersecurity Startup | by Ethan Smart | Jun, 2024

Over the weekend, I took some time to reflect on the numerous lessons I’ve learned throughout the startup journey with appNovi. I initially jotted these down by hand, contemplating whether they were worth sharing. As I enjoyed a cup of tea on my back deck one evening, I realized that this list would have been invaluable to me when I was just starting out.

So, for founders or early employees in a startup, here are my 98 hard-earned lessons. Hopefully, some of them will save you from learning the hard way!

1. Customer Focus Over Competition: Focus more on providing a great product for customers and less on what the competition is doing. Differentiating on features is for crowded markets. Be obsessed with your customers and solving their pains.
2. Customer Focus: There is nothing more important than talking to customers, prospects, design partners, and building a product. Everything else is secondary.
3. Problem-Driven Development: Start with the problem your customer faces. Master that pain, then build the solution. Don’t create technology looking for a problem.
4. Customer Feedback: If a prospect gets excited about your potential but won’t pay, it’s pointless feedback.
5. Pre-Demo Customer Questions: Ask potential customers if this is a problem, if it’s a big and growing problem, if it’s the right solution, if they would pay for it, and how much they’d pay or save. If they won’t pay for it, ask how it can be improved to make it worth paying for.
6. Early Days Focus: Don’t stress about someone larger copying you. You could write out, in great detail, a good go-to-market plan and a product idea document, place it on the CEO of CrowdStrike’s desk, and he would probably throw it away because they are so focused on so many other things.
7. Celebrate Wins: Celebrate the wins. Allow yourself to feel good. The journey is hard, and celebrating victories is crucial.
8. No Savior Advisors: There is no advisor who will save you and your business. Valuable advisors are rare and usually those willing to invest their money into your venture.
9. Mentorship: A good mentor is crucial. Seek experienced former founders who want to give back. Incentivize them to be part of your journey, your personal journey, and future endeavors.
10. Self-Reliance: Don’t pray for miracles. Pray for strength, focus, and intelligence to do the hard work. No one is coming to save you. Take responsibility and get to work.
11. Structured Advisor Equity: If you think an advisor is worth it, structure their equity around milestones, include an earn-out, and have a cliff. You’ll learn within 6–12 months if they are worth it.
12. Tackle Difficult Tasks: The tasks you want to avoid are probably the ones that will produce the most results.
13. Optimal Co-Founders: Having 2 or 3 co-founders is optimal. Be very careful about whom you choose and know their expected contributions from the start.
14. Employment Agreements: Every founder should have an employment agreement and a cliff on equity. Some may fall off in the first 12 to 18 months.
15. Niche Mastery: Solve the smallest unit of the problem better than anyone else. Find your niche, win that piece, and you’ll win the market.
16. Innovation Discernment: Some innovations are worth pursuing, while others are not. Be discerning.
17. Address Traction Issues: If you’re not hitting milestones, particularly around traction, ask yourself the hard questions. People need to be using your product and loving it more each month.
18. Milestone Tracking: Set milestones for the company and measure execution against them. Even if you don’t intend to raise money, track progress.
19. Time Management: Everything will take longer than you think, even when you factor that in. Aim to hit quarterly targets in two-thirds of the time.
20. Investor Money Misconception: Relying on investor money to solve problems is intellectual laziness and unattractive to investors.
21. Investor Impressions: First-time technical founders should realize they impress investors more with kindness than cleverness. CEOs and CROs should clearly communicate market strategy.
22. Founder-Led Sales: As the founder, you should secure your first 5–10 customers through founder-led sales before hiring a sales person. This hands-on approach ensures you understand your customers’ needs and the market dynamics.
23. Embrace Hard Work: Do the things you don’t like doing, get used to doing them, and stop complaining because someday you won’t have to do them.
24. Runway Simulation: Regularly imagine running out of runway and identify what could have saved the company. Then, drop everything and do that.
25. Smart Spending: Spend money and take risks with clear milestones. Avoid raising money without a clear plan.
26. Take Breaks: Take vacation time, especially when you’re feeling burnt out. You’ll be more productive afterward and might solve problems while away.
27. Ego Management: Check your ego at the door. It won’t help. Be willing to eat sh*t and then clean the plates you ate it off of.
28. Employee Emotions: Your employees’ emotions are not your responsibility. Make them feel safe, support their efforts, but hold them to high standards.
29. Prepare for Failure: At some point, everything will fall apart. Be prepared and ask for help, even if it’s just someone to listen.
30. Embrace Hardship: When you think you’re at your lowest because “it can’t get any worse,” it probably will.
31. Co-Founder Communication: Co-founders need to address hard truths. It’s better to hurt feelings than to fail.
32. Handling Rejection: Many people will reject you. Accept it, refine your ideas, and keep moving forward.
33. Idea Evolution: Your initial idea will likely seem laughable in hindsight. Remember this while being rejected and refining it.
34. Avoid Tarpit Ideas: Watch out for tarpit ideas. Some things remain unresolved for a good reason.
35. Originality Realization: You’re not as original as you think. Competitors probably didn’t steal your idea; they likely thought you stole theirs.
36. Market Opportunities: The market is big. If someone lands the top companies, stay encouraged and go after the others.
37. System Development: Start developing systems and processes before you think you need them.
38. User Hospitality: Be more hospitable to users than you think you need to be.
39. Task Management: Do the hard and boring tasks now. Waiting won’t help and will only make them harder.
40. Friends and Family Money: If you take money from friends and family, be prepared to lose that relationship or ensure the money can be afforded to be lost.
41. Disappointment Preparedness: People you think will come through for you often won’t. People over-sell and over-extend themselves. It’s a painful truth.
42. Market Entry: Don’t enter a market with low barriers to entry; it will quickly become crowded.
43. Resilience: It will be harder than you think, but you can become more than you are to make it.
44. Lean Engineering: Don’t over-engineer and build without feedback.
45. Reputation Protection: The cyber space is small. Don’t risk your reputation on short-term decisions.
46. Integrity: It’s always the right time to do the right thing.
47. Valuing People: Good people are rare. Treasure them when you find them.
48. Cost Awareness: The cheapest option often ends up being the most expensive.
49. Seek Help: Ask for help when you are out of your depth.
50. Kindness: Be kinder to people than they deserve.
51. Humility: Be humble. One day you’ll look back and realize how ignorant you were.
52. Mistake Ownership: If you make a mistake, own it. Covering it up usually leads to more mistakes.
53. Fundraising Realities: Someone will raise more money than you. Get over it.
54. Networking: Network almost to the point of excess.
55. Productive Networking: Know the difference between vanity networking and productive networking.
56. Personal Growth: Make the end goal about the person you become rather than what you gain.
57. Financial Responsibility: Don’t lose other people’s money, no matter how disconnected they seem.
58. Helping Others: Be spectacular by being interested in helping others. Help customers by providing the best solution, help people advance their careers, help investors by being the best investment, help employees be productive and set goals. Cherish those around you, especially those overlooked by others.
59. Unreasonable Kindness: Be unreasonably kind.
60. Expectations: Expect little from others but expect a lot from yourself.
61. High Standards: Set high standards for yourself and your team. Don’t let anyone lower them. You don’t need to micromanage, but everyone must meet those standards.
62. Forgiveness and Protection: Be the bigger person, forgive wrongs, but don’t let yourself be put in a position where it can happen again.
63. Expertise: Be the best at something.
64. Focused Excellence: Don’t try to be the best at everything.
65. Hard Work Over Smarts: Someone out there is smarter than you, but you can work harder than them.
66. Survival: The odds favor failure. Sometimes surviving another day is a victory.
67. Customer Relations: Don’t complain about how hard it is, especially to customers.
68. Enjoyment: Have fun, and if you have fun, others will too.
69. Execution Over Ideas: Ideas are cheap; few people execute them.
70. Scalability Awareness: Know what you want in the end. A $50 million exit and a $500 million exit require different resources and a different version of yourself.
71. Investor Honesty: Don’t tell an investor you want to IPO if you want an early exit. You can fool them for 45 minutes, but not during due diligence.
72. Market Timing: Be okay with not being first to market, but understand the impact.
73. Workload Reality: Success means more work, not less.
74. Universal Problems: Everyone has problems, just different ones.
75. Investor Comparisons: If someone has a more respected investor, get over it and get to work.
76. Leadership Approach: As a leader, don’t pitch your idea first then ask for feedback. State the problem and ask for thoughts. Learn from everyone, then state the solution. You might think of something new, and everyone will feel heard.
77. Simplification: Simplify everything. Simple and easy to understand is sexy.
78. Mission Clarity: As a leader, make the solution and mission easy for everyone to understand. Everyone will feel a part of it.
79. Product-Market Fit: If you can’t explain in 1–2 sentences what your product solves, you don’t have product-market fit. Re-evaluate hiring because new hires won’t understand the mission.
80. Altruistic Hiring: Hire people who are altruistic early because missionaries beat mercenaries every time.
81. Identity Separation: Your startup will become intertwined with your identity. Remember, you are more than your startup.
82. Diverse Interactions: Hang out with people outside your industry. It’s good to be reminded that the world will keep spinning without it.
83. Relationship Prioritization: Date your significant other and make time for them. Your startup might not last as long as your relationship.
84. Family Priorities: I missed a family member’s funeral for a meeting. Biggest mistake I ever made. Your startup is not as important as being there for your loved ones.
85. Avoid Premature Scaling: Don’t scale prematurely.
86. Deal Finalization: The deal isn’t done until the ink is dry and the money is in the account. Don’t stop selling and smiling until it is.
87. Confidentiality: Be careful who you talk to and what you tell them. Loose lips sink ships.
88. Coping with Loss: If you lose when you put it all on the line, take a step back. It might take time, but it will eventually pass. This too shall pass.
89. Early Days Appreciation: Enjoy the hard early days. They become the most romantic in the end.
90. Multiple Launches: Launch as many times as you need.
91. Family Time: If you have kids, it’s worth it to give them your time. The business may be your baby, but your kids are your blood.
92. Personal Growth Journey: To be a good founder, you must become the best version of yourself. Treat it like a spiritual journey because it is one.
93. Market Opportunities: The market is big. If someone lands the top companies, stay encouraged and go after the others.
94. Originality Realization: You’re not as original as you think. Competitors probably didn’t steal your idea; they likely thought you stole theirs.
95. Avoid Tarpit Ideas: Watch out for tarpit ideas. Some things remain unresolved for a good reason.
96. Idea Evolution: Your initial idea will likely seem laughable in hindsight. Remember this while being rejected and refining it.
97. Handling Rejection: Many people will reject you. Accept it, refine your ideas, and keep moving forward.
98. Co-Founder Communication: Co-founders need to address hard truths. It’s better to hurt feelings than to fail.