I’ve had the pleasure to be part of several startup ventures and advise on several others. The one thing I think nobody really talks about is the bias that entrepreneurs here in the Silicon Valley have to prematurely commit to an idea or company. Something I call ‘premature commitment bias’.
The typical startup scenario I’ve seen around the Valley is:
Most entrepreneurs in this position think:
“We raised a million, so we’re going to do this, no matter what.”
They end up burning through all the money after spending months and months of blood, sweat and tears building a business that’s not going to work. If they’re lucky, they might get a second round venture capital, but that’s not very likely.
They don’t have the option to cash in their chips and return the money to their investors. In reality they could – but psychologically, they don’t allow themselves to think that way.
Silicon Valley is structured such that it promotes the kind of culture where you feel like you have to finish the business you started, even though that business may no longer make sense.
I’ve always felt that entrepreneurship needs to be based on learning. As I look around at Silicon Valley startups and culture, it’s not built around learning.
The culture here doesn’t promote learning because you’re pitching a business where in theory, you know the absolute least about it. You know about the problem and solution but you haven’t yet validated the market to see if anyone really cares about the solution or that they’re willing to pay for the solution you came up with.
I’d estimate that 80% of the engineers in Silicon Valley are wasting their time: they’re building something that probably nobody cares about.
I liken the problem of premature commitment bias to having a crush on somebody.
When I think about crushes I had on girls in high school – I’d build up a romantic idea in my head, “Gee, this person is really nice, I really like her”, all without validating if she liked me back. The problem is, when you find out she doesn’t, it changes your perspective on things in a hurry.
Just like you want to have a crush on a girl who has a crush on you, you want to build a business that likes you back – where people care about the solution you have to offer.
I really don’t have an answer for overcoming premature commitment bias yet. I’m not really sure what the solution is. Some people are doing interesting things like Eric Ries and the maturation of his lean startup methodology which has come about from lessons learned. These are steps in the right direction, but I don’t think they’re really addressing this issue.
What are your thoughts?