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Is starting 2 start-ups at once crazy?

My co-founder and I are down to the short straws on a new start-up. We've vetted several ideas and are down to a few. We feel that 2 are potentially home runs but they're very different. One is a pure B2B play that can entirely disrupt a very large, economically important segment of the freight transportation sector. But the requirements phase is going to take some time to nail down the scope so we get the product feature set right. The other idea is highly disruptive. It's a "new paradigm" for something (sorry I can't say more about it) that's both B2C (consumption side) and B2B (supply side).

I'm actually thinking about doing both. The pure B2B one is going to take some time to scope, design, build and to gain a modest level of traction to prove the concept. The new paradigm one, while highly unique, is actually pretty simple to build technically speaking. Think how simple SnapChat is. That's what we're talking about.

So is it crazy to do both simultaneously? I have the bandwidth and with a few additional dev resources we can execute both and get the first new paradigm product out in 3 to 4 months. It's one of these "win big or fail fast" type of things that just might be worth the gamble.

46 Replies

Michael Barnathan
3
0
Michael Barnathan Entrepreneur • Advisor
Co-Founder of The Mountaintop Program, Google Alum
Most people will tell you no, but I actually find the pre-customer stages of a startup fairly low intensity, and have successfully dipped my toes in the water before getting a strong signal on one and pursuing that full-time. It's doable in the exploratory stages; it becomes much harder to maintain later.
Michael M
0
0
Michael M Entrepreneur
Never Stop Creating!
What does your market research and MVP tell you, that should show you where the efforts are applied. If you have the bandwidth then dip away, test, market, test again and let the results speak for themselves. I think the majority of ventures early stage always look promising till the pen hits the paper and ideas turn to dollars. I have to agree if both show promise and both are as disruptive as you research has shown you that bandwidth will begin to look like a straw and one will suffocate the other.
Paul Travis
0
0
Paul Travis Entrepreneur
Multifaceted Online Executor: Product Marketing to Program Mgmt. to Business Development
Knowing my own tendency to get distracted, and using the principle of opportunity cost, I would say you're most likely to be successful by figuring out where you have the highest likelihood of the quickest traction -- and focusing there.
Brian Ledger
2
0
Brian Ledger Advisor
Data Scientist at Coherent Path
Let me whittle this down a little. """ My co-founder and I are down to the short straws on a new start-up. We feel that 2 are potentially home runs but they're very different. a) disruptive B2B play of the freight transportation sector. - But the requirements phase is going to take some time to nail down the scope so we get the product feature set right. - The pure B2B one is going to take some time to scope, design, build and to gain a modest level of traction to prove the concept. b) highly disruptive spin off of snapchat. - both B2C (consumption side) and B2B (supply side). - while highly unique, is actually pretty simple to build technically speaking. - 3 to 4 months - win big or fail fast - gamble c) both """ While the insight may be greater, this crafted narrative suggests you have two risky assets, and one is riskier than the other. So you think that the second option is a better project, but has a higher risk. Is it really a better project? What can make that project fail fast? By the way, snapchat isn't a trivial piece of software. The simplicity of design in it's interface belies a literal network of agreements. If a project seems simple on its face, I would assess that we don't know enough about it. I'll argue one last thing. If a project has a verifiably huge expectation, then you can use that expectation to amortize your risk, by pursuing well-fitted agreements with your investors. There is no need to execute a project that you actually, personally, feel is *risky* in every sense of the word. - Brian Ledger Dir. Front End & Networked Operations Coherent Path
Mani Fazeli
3
0
Mani Fazeli Entrepreneur • Advisor
Head of Product at Wave
While it may seem like a wise decision to work on these in staggered parallel, I would not endorse this path regardless of the ease of implementing MVPs. It's not a matter of possibility, but probability, of whether you can make either succeed when partially focused on both. Startups are tough enough so there's no need to stack the deck against yourself. Do your future self a favour and validate each idea with some customer research and interviews, then commit to the one you truly believe you can make succeed. If you do succeed, know that your track record, wealth, and gravitas will attract many suitors to just go and do it all over again for your favorite idea and market at that time. Mani Fazeli @mcfazeli
David DeMember
1
0
David DeMember Advisor
Co-Founder at Toi
Starting up 2 companies and vetting 2 concepts through lean experiments can be very different things.

If you haven't yet, you should read Lean Startup (it's like a 1-2 week read at most).
Bruno Riccio
0
0
Bruno Riccio Entrepreneur
Member at Anges Québec
Sounds like you are pretty excited and passionate about both ventures. If you start thinking about it too much you will discourage yourself from taking on any of them.
Do you have the right team? Do have the funding? Then go for it!
Peter Weiss
4
0
Peter Weiss Entrepreneur
President at American Outlook, Inc.
Short answer - yes, you're crazy.

Longer answer - if you are going to need outside funding doing two at a time is going to be challenge and, if you find investors who will back you, they will probably apply either a significant valuation discount or otherwise impose penalties, restrictions or high performance requirements.

If you don't need outside money (or can make it far enough to borrow rather than raise equity) AND you are really confident about your skills and capacity, go for it. Remember, however, that most people who are running multiple businesses simultaneously have the resources to be steering the ships but not handling much day-to-day executive or management duties. Mark Cuban, Richard Branson and Donald Trump keep very talented people around them to run their companies - they are the brand and the keeper of the vision but not the management.

Good luck - sounds like fun whatever you decide.
Neil Gordon
1
0
Neil Gordon Advisor
Board Member, Corporate Finance Advisor and Strategy Consultant
You and your co-founder are in the best position to know if you have the bandwidth for both ventures simultaneously. If you raise outside capital though, expect that investors will demand your full time attention to the venture they're funding. (It might be possible at that time for you and your co-founder to split up and each devote full time to one venture or the other.)
Richard Pridham
0
0
Richard Pridham Entrepreneur • Advisor
Investor, President & CEO at Retina Labs
Brian Ledger: I think what I meant by "simple", is that the B2B idea is far more complex. The problem we'd solve addresses several huge pain points in the ground freight industry but we're talking about streamlining supply chain logistics here. There are many moving parts to this and it is far more complex from a business process point of view, not to mention the technology.

The other "new paradigm" idea is simpler from a conceptional perspective. That's not to say it won't be hard to get right from an app/technology point of view. It will but I think we've mocked up and wireframed it sufficiently and have a grasp on all the use cases to start building MVP. We think that an MVP will take no more than 3-4 months while the other idea will take probably that much time to understand the requirements sufficiently so that we can commence development. It's also going to take time to get traction as we'd be offering an entirely new way (via marketplace) for various supply chain parties to transact business. This means changing attitudes in a relatively "old school" sector. Change occurs but it takes time. But the industry is so ripe for disruption and dis-intermediation that a company that figures this it out can be immensely successful in the long run.

So the desire to do both is not necessarily a reflection of doubt about which one will work bit perhaps as a means to hedge bets. I certainly get the "distraction" angle and that's my biggest concern. But Michael Barnathan stated,pre-customer phases tend to be less intense so doing both might be feasible.
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