Failure is a choose-your-own adventure for startups

Apr 6, 2022

Startup failure is not just about downturns; it intertwines with media narratives and founder experiences. The podcast delves into the complexity of failure, discussing how it's misrepresented and the pressures founders face. It highlights the unique challenges of female founders, questioning biased media portrayals and the impact of investor expectations. Additionally, listeners explore the emotional landscape of layoffs and restructuring while advocating for more empathetic journalism in tech reporting.

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INSIGHT

Defining Startup Failure

Theranos and WeWork represent outlier implosions, not typical startup failure.
Focus on non-fraudulent startups that simply miss expectations, struggle, or pivot.

INSIGHT

Nuance of Failure

Startup failure isn't always a shutdown; it can be a mistake or realization that alters a business's trajectory.
It's more nuanced than just companies crumbling due to a lack of product.

INSIGHT

Startup Hype/Failure Cycle

Alex Wilhelm's startup failure cycle involves initial product-market fit, followed by increased VC funding and growth.
Eventually, companies may discover weaker product-market fit leading to struggles, down rounds, or even failure.

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This is our Wednesday show, where we niche down to a single topic, think about a question and unpack the rest. This week, given a parade of headlines and news that Fast shut down, Natasha and Alex asked: What are we missing when we talk about startup failure?

The question comes after one of Natasha’s recent Startups Weekly columns, where she looked into the complexity of startup failure, fallacy of takedown stories, and importance of diversity in newsrooms. Here's an excerpt:

"There’s the argument that startup tensions are inevitable and common, so should we spotlight every time something bubbles to the surface, especially at the cost of an underrepresented founder who may just be doing their best? There’s also an argument that the business is messy, so we should report on the issues as we hear about them; and there’s the narrative of the female takedown story, in which people believe that women are targeted by the press more than men due to unreasonably high standards."

In today's episode we discussed our own definitions of failure past Theranos and WeWork, current examples of rising tensions, and what this means for early-stage startups and historically overlooked founders. There's been more layoffs recently, some notable valuation cuts, and the implosion of Fast to weigh against 2021's strident startup optimism. That makes this the perfect time to dig into the topic of failure, and how to cover it from a startup perspective.

Finally, as promised, here's a look at our artsy depictions of the startup failure cycle:

https://twitter.com/nmasc\_/status/1511365442249580548

Don't forget that Equity is live this Thursday, and you can you come hang out with us on Hopin (free, and you can ask questions) or Twitter Spaces (free, but you cannot ask questions) if you'd like! See you then!

Credits: Equity is produced by Theresa Loconsolo with editing by Kell. Bryce Durbin is our Illustrator. We'd also like to thank the audience development team and Henry Pickavet, who manages TechCrunch audio products.

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