Three Operational Mistakes I Made with My First Startup
(5 Minute Read) Focus on what matters by avoiding these unnecessary operational distractions
👋🏼 I’m Alek, a repeat founder with a successful exit. I share my experience navigating career and company-building challenges in 5-minute reads every week. My posts typically focus on building resilience and applying a practical, data-driven mindset to your ambitions.
Three Operational Mistakes I Made with My First Startup
Now that I’m further along with my second company, I can comfortably reflect on my mistakes when building my first. There were some silly places where I invested my time and money. Today, I’ll share the three operational mistakes I made when I started my first company. If you ever find yourself on an entrepreneurial path, I hope sharing these mistakes saves you time and stress, ultimately allowing you to focus on the things that really matter.
#1 — Don’t be overly concerned about idea theft
When I started my first company, Game Boost Analytics (GBA), I researched patent law and the patent application process. I wrote NDAs and required people to sign them before they learned more. All of this took my time and focus away from building a good product.
With GBA, I was worried about telling too many people about the idea. Now, I’ll share my ideas with anyone. What changed? I realized that:
Most other people are too busy to steal your idea. Nobody cares enough. They have their own lives and it’s highly unlikely they’re going to uproot their lives to work on your idea. So, sharing your idea isn’t high risk.
Most ideas have been tried before. Nearly 10 billion other humans have existed on the planet Earth in the last 20 years, many of them were/are equally capable of coming up with the same idea. The odds that you are the only one who’s had this idea are slim. So, your idea is not unique and +1 person knowing about it typically won’t hurt.
Success is about the execution. Given #2, if your idea is good and doesn’t exist, it’s because other people have failed. This is because 1) it wasn’t possible until recently, and nobody has succeeded yet, or 2) people have failed to execute in the right way. In either case, it comes down to execution. If you believe you’re going to turn your idea into reality, you have to also believe you will execute faster or better than anyone else. What’s the harm in adding +1 person to the competition?
Most ideas don’t emerge fully formed. Airbnb started as a couch-surfing app, and Amazon started with books. Most companies have evolved into what they are now. Sharing your idea with someone is like sharing the first page of a book. It doesn’t matter if they steal it; what really matters is what you do with the rest of the pages.
If you agree with any or all of the above, then save yourself time and mental energy… don’t be overly protective of something that doesn’t need your protection.
#2 — Don’t set up an LLC that’s too specific
When I started GBA, I created an LLC called “Game Boost Analytics.” The original idea for GBA was to use analytics to help people improve their video game skills, so the name felt apropos. As my cofounder and I built GBA, the idea evolved based on the feedback we heard from users. The idea became more about showing people video clips of their in-game performance and less about showing them numbers and data. We clung to the original idea, “We are an analytics company, not a highlight reel company.” Partially, we felt stuck to our original idea because of our name. As a result, we wasted valuable time lingering on analytics when people wanted video.
Learning from that mistake, I’ve created a more general LLC for all my future ideas. The legal name for my current company is “Alek Hagopian Software & Services LLC.” This gives me a general legal name under which I can operate multiple businesses, including my independent consulting work and software startups. For each business, I can spin up a website and tie the website to my LLC in the footer (see SolidlyAI or WatchdogAI for examples).
#3 — Don’t worry about intermingling finances
After creating the LLC, I opened a business credit card and bank account when I started GBA. There were definite benefits to this, including getting nice perks designed for software startups (we used Brex), but the benefits didn’t outweigh the costs as dramatically as I thought they would:
Managing multiple accounts didn’t save me as much time as I imagined, because I was constantly moving money between my personal and business accounts.
I took on additional stress of maximizing the perks I received, “Should I wait to using these AWS credits? Which website hosting vendor will I get the most cost-savings with?”
Again, none of this mattered in the end. The decision to split my finances up saved me some money and kept my finances a little more organized. But, I spent too much time trying to squeeze out every bit of rewards-portal-cost-savings. I even spent days migrating platforms to take advantage of small subscription savings (e.g., $10/month).
With Alek Hagopian Software & Services LLC, I’ve left everything intermingled for over a year and it’s been totally fine. All I do now is take 5 minutes every week to review my “money in” and “money out” on my existing accounts, adding it all to a simple spreadsheet so I don’t end up with too much accounting work at the year’s end. This approach has kept things streamlined and saved me from falling into the same traps as we did with GBA.1
Lessons Learned and Moving Forward
I wish I could go back in time and give myself these three pieces of operational advice when I started my first company:
Don’t be overly concerned about idea theft
Don’t set up an LLC that’s too specific
Don’t worry about intermingling finances
This advice would have saved me a lot of time and stress, helping me focus more of my energy on building the right product.
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By sharing my experiences, I hope to provide insight and advice to entrepreneurs facing similar hurdles. Please leave a comment or email me with any questions.
If you have raised money or you have a cofounder, then it may be worth splitting out a separate account and credit card. My advice here is reserved for bootstrapped solo founders.