Tag: Green Pants Chronicles

Rationalizing the Risk. Stop Worrying, Start Living. The $15k Deductible.

Act 1: Inception

To read the Green Pants Chronicles from the beginning, click here.

Stop Worrying and Start Living

Dale Carnegie has two books that achieved outsized recognition. The one that everyone knows is “How to Win Friends and Influence People” and I think it’s still wildly relevant even today. The other, perhaps less well-known tome is “How to Stop Worrying and Start Living.” I bring it up here because it was directly influential in how I rationalized the risk of leaving my job to start a company.

The basic gist of the book is that most of our worry comes from the unknown. All of the bad stuff that could happen to us starts swirling around in our minds, and as the permutations multiply exponentially, we find ourselves in a panic, unable to control all of the many terrible things that could come to pass. Carnegie simply provides a routine to get that stuff organized and then rationalize the worst case scenario.

Roughly speaking, it goes like this:

First, name one of the things that you are worried about…. Then, ask if it’s the worst outcome. Usually, your frightened mind says “no” and takes it down another level. So you name that one. So on, and so forth, until you realize the actual worst case.

And then you do two things:

  1. Recognize that it’s pretty unlikely, and,
  2. Work out what you’d do in that situation.

For me, it went like this:

Irrational Me: OMG, I’m leaving a high paying job with a successful company. What if I wreck our family’s financial situation and we end up destitute?

Rational Me:Ok, that’s not realistic. I’m a well known VP of Sales in the area. I could easily get a job as a VP again. Laurie is a well connected MSW. She could easily get a job as a social worker again.

Irrational Me: Yeah, but what if we can’t find jobs!

Rational Me: Ok…. If needed, I could start a regional or national job search and open up the opportunities.

Irrational Me: Yea, but what if I still can’t find anything!

Rational Me: Ok… well, that’s pretty unrealistic, but I’m not afraid of hard work, and I could always step back into being an individual contributor, and a skilled sales person can make a lot of money.

Irrational Me: Yeah, but what if you are too old, or too experienced, or too whatever and you can’t even get that job?

Rational Me: Ok… now this is getting silly…. But on the very low chance that I can’t find any job related to sales whatsoever, I’ve never been afraid of hard work. I ran a lawn service in high school. I could easily do manual labor to make ends meet.

Irrational Me: Ok, but what if it’s not enough money!

Rational Me: I’ve saved a bunch of money in my 401k and in my kid’s college funds. In the ultra-low-chance that all of this terrible chain of events did actually somehow occur, we could liquidate that until we get on our feet again.

Irrational Me: Yeah, but what if that runs out!

Rational Me: Dammit! This is silly! Ok, well, I have very little debt, I could use credit cards for awhile to cover my bets and dig out of the hole.

Irrational Me: What if you don’t! What if you go bankrupt and lost the house!

Rational Me: OMG. Won’t happen, but ok. Let’s say that happened. I’m very close with my brother, my mom, my step mom, my wife’s family, and my step-sisters. I also feel very fortunate to have several close friends. If the absolute most catastrophic things came to pass, someone among these many close connections would allow my family to move in for awhile until we got back on our feet.

Rational Me: And if that didn’t happen, Laurie ran a homeless shelter. We would at least know the ropes.

Rational Me: And if that didn’t happen, I camped for two months in my early twenties on a bit of a road trip. I know how to camp and could do that for awhile with my family if this absolute most terrible financial situation played out for us.

This seems like an infinitely silly exercise, but it mattered to me. I really did reconcile myself to the fact that no matter how bad it got, I wasn’t going to die, and I was pretty sure I wouldn’t lose my family. I could figure it out, no matter how far down this ladder of increasingly unlikely events I fell.

Which led me to a very freeing conclusion:

As long as I had my wife, my kids and my dog, everything else was gravy.

Walking around everyday thinking that everything you have above and beyond your immediate family is icing on the cake is a wildly liberating sensation.

It was going to be ok. This wasn’t going to be a risk of survival…. This was going to be a risk of comfort. We might not get to go on expensive vacations for awhile (and we didn’t). We might not have fancy cars (I drove a used Honda Civic for several years). We might drink boxed wine and eat a lot of beans instead of fancy dinners (yep, did that too). But it was all gravy. And we were going to be fine. And I was free.

Setting Milestones and Trying to Fail Fast

Another part of the rationalization was setting milestones that were weeks or months away, and being committed to shutting down the effort if we didn’t hit those milestones (or have a reasonable path to hitting them). The very first milestone was getting a team to commit to the journey with me. The next milestone was getting a prototype built. The next milestone was getting a single paying client to commit.

In my mind, those first milestones of team formation, incorporation and prototype had to be wrapped up by April, or we’d hang it up and I’d go back and get a “real” job. (Spoiler alert: We hit those milestones).

The $15,000 Deductible on the Catastrophic Insurance Plan

If there was one thing that crystalized the risk the most for me, it was the catastrophic insurance plan that my kids and I were on in those first months. We were pretty healthy as a family, and I needed to just get several months of attempting RFMConnex under my belt. Extending my COBRA insurance from Bronto was a scary amount of money, and joining Laurie’s plan at United Way wasn’t much better. I had money saved in my 401k and my credit cards had high limits and low balances. So I chose a plan with a $15,000 family deductible for Jack, Cora and me, with the assumption that if we were all in a wreck together that I had the money to cover that bet, and that these next months of no salary was all about day to day cash management.

So, we rolled the dice and it worked out (but, yeah… scary!).

Introducing “The Green Pants Chronicles”

To read the Green Pants Chronicles from the beginning, click here.

False Bravado and Platitudes

The entrepreneurial journey is an exhilarating, terrifying, empowering, destructive and addictive experience. So often, what is written about these journeys falls into one of two categories… Platitudes and False Bravado.

The False Bravado is that annoying “we’re killing it” thing that many entrepreneurs feel trapped into saying anytime they are asked “how’s it going?” If 90% of startups fail, everyone is decidedly not “killing it.” The Platitudes are those distilled bits of wisdom that we all write to make it look like “we are killing it” or have already “killed it” and which tend to leave out situational variables, larger context, and dumb luck. I’m hoping to avoid these traps.

The Green Pants Chronicles

My hope in writing this series about my own entrepreneurial journey with Windsor Circle, which I’m dubbing “The Green Pants Chronicles” (after our team’s penchant for wearing said kelly green knickers) is to capture the experience in rough chronological order, and to do so with the Openness and Transparency that we valued so highly in our team. Some of the journey was amazing, and made us look like heroes. Some of it sucked, and at best showed that the stars don’t always align, and at worst, highlighted very human moments of not landing on the right strategy or execution soon enough to realize the rare air that Unicorns breathe. Above all things, I hope that these entries are real in their rendering of the 8 year journey.

My friend Christopher Gergen wisely counseled that I should capture the play in a series of acts (versus the time-based journal series I’d originally conceived). After some deep thought, I decided to frame it as such:

  1. Inception – How did the formation process happen?
  2. Launch – What did we do to actually get going?
  3. Validation + Early Growth – How did we set and pass through early milestones?
  4. High Growth – What did we do to pour fuel on the fire?
  5. Decision to Pivot – When did we start seeing issues and what did we do?
  6. Pivot – Once the decision was made, how did we push through this hard phase?
  7. Exit – As buyers looked at Windsor Circle, what did we do to exit?

I’m giving the decision and act of pivoting their own “chapters” because getting to the decision, and then making that decision and living with it, are very different things.

Two Caveats and An Admission

I’m going to write as openly as possible, with two caveats and an admission… First, I care about the people that were involved on the journey, and I’ll craft my entries in a way that respects everyone that was involved to the best of my ability. Secondly, there are things that require my continued confidentiality, and where those obligations exist, I’ll observe them.

As for an admission: Humans remember things based on perception, and those perceptions are obscured by time. I’m all too human. I’ll actively and openly incorporate feedback from the many people involved in the journey. In some places, that might be to modify my writing if I’ve just gotten something plain wrong. In others, it might be to capture and offer a differing perspective directly in the post so that numerous views and vantage points can be considered by the reader. Either way, I’m open to feedback and will incorporate it to the best of my ability.

I’m looking forward to capturing the journey on “paper” and reliving the wildest professional experience of my life… See you out there.