I love speed. I just returned from the famous Nürburgring track where I spend 2 days pushing my car to the limit. Driving with 200km/h into crazy corners and keeping control is my definition of flow. The deep concentration and focus it requires is addictive.
It made me remember entrepreneurial challenges like closing financing rounds or important negotiations where speed, precision and timing was required. On the way back I asked myself the following question.
What does race car driving has in common with startup life?
Both require speed
Startups are about speed. At RegioHelden we developed the first MVP in 2–3 weeks and started to gather customer feedback as soon as possible. When we scaled the organisation I always required a sense of urgency, pragmatism and focus on quick results. When employees told me something a certain task would require a week I would usually try to challenge them, strip out unnecessary work and reduce the amount of time the task took. It often worked.
Speed became a core value of the company. For example we would make a point by doing “Hero weekends”. It was our internal version of Startup Weekend where we would start on Friday night and work on projects until Sunday afternoon. The point was to prove that 48h of concentrated uninterrupted teamwork can do wonders to fast output.
A startup is always a race against time. Your money will run-out, your competition might be faster or even your own motivation might fade. Your time is the most valuable resource. Treat it like that and speed up your execution by creating a sense of urgency in your team.
Both rely on data which turns into experience
In the race car you deal with a lot: Visual input, sounds, movements of the car, instruments, the weather, other drivers, safety staff etc. You process all the data and try to make the best decision very fast. Hit the right braking points, the right steering angle to hit the apex in a matter of milliseconds. It’s amazing!
At RegioHelden we would put up a lot of dashboards and gather as much data as possible to improve our decisions. We measured sales performance around the funnel. We measured customer cohort retention and NPS. We measured revenue growth numbers by product, location and team. We would look at the data daily on the screens and tried to get into a flow of continuous improvement.
Over the years I developed a sense about anomalies. Still today I can look at most of the dashboards and immediately sense if something “feels off”. It’s rather a feeling than actual knowledge and probably the same as a seasoned driver who doesn’t need to look at the instruments to feel that something is wrong. That’s experience.
Both require looking into the rear view mirror from time to time
At Nürburgring 98% of my focus is on the track in front of me and 2% on the rear mirror to watch other cars. At my company I did the same. I never thought too much about competition and we were pretty much always focussed on my own goals & execution.
My rearview mirror: talking to competitors
Most of the research of competition I did was by talking to my competitors employees and CEOs when I met them at conferences or visited them from time to time (after I established a relation). Usually in a quick 10–20 minute glance I would get a good feeling about where my competitor stood.
It seems counter-intuitive but usually people are open to a degree when you talk nicely to them. It helped a lot to gather a good overview about the market and work-out gentlemen-agreements against poaching of clients and customers.
So I would say on the race track as well as in startup life ignoring the competition is bad because it can hit you unexpected but spending too much time in the rear mirror keeps you from achieving your own goals.
Both give you the opportunity to crash and learn from failures
The way from Flugplatz to Schwedenkreuz is one of the most dangerous parts of the Nürburgring track. You drive full speed (meaning >230km/h in a Porsche 911) upwards into a blind left curve after a hill. The hill lets the car jump which I underestimated. So I got into a drift (looked good from behind!) but 1s later exited the racetrack on the left side and crashed into the guardrail. The sound of the crash made me think that I completely wrecked the car. It sucked…
Also in startups failures are pretty much unavoidable. The question if just what you do about them.
I remember an episode when one of my most important employees quit just weeks after we closed our first VC round. We were scaling like crazy and I felt like a failure. I was ashamed to tell my investors about it because the employee was part my pitch and the whole growth story. It sucked…
But in the end both failures were not as bad as I initially expected. The car just had two scratches in the rear and we found a replacement of the employee within four weeks. My investors didn’t even care about it.
I learned a bunch from both situations. Brake before the hill and after, never on top. Don’t steer in the air. Look for signs of employee dissatisfaction and check in regularly on their mood and plans. Have a succession plan for important employees. In that way I think failures are awesome learning opportunities.
So my take-away is this: Failures should be avoided as best as possible. But when they happen both the consequences should be dealt with and learnings for the future should be made fast.
Both require to take a break and reflect from time to time
Nürburgring is famous for its 24h race. But nobody in the world would drive 24h non-stop. A team consists of four drivers and three of them are taking a break or sleeping while one is in the car. An activity with such high intensity and high concentration requires to take a break and recharge. Otherwise focus would slip and mistakes with huge consequences could happen.
In my startup life quarterly 2–3 day offsites with the management team were good opportunities to take a break from the daily hustle and reflect on the direction we were going. Often we changed course a little after and re-prioritized certain projects because of things we learned in the previous quarter.
Also personal breaks are so important to get a little distance and be able to look at your startup from an outside perspective. This doesn’t mean you should take 12 weeks of vacation, but working non-stop for years (which I did at the beginning) is neither productive nor healthy.
I hope you can scale your startup as fast as a race car driver. But while you’re at it please don’t kill your startup by forgetting about the gear-shift from lab to factory.
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