Mental Health In An Enlightened Society

This blog post is part 3 in my 3 part series on Mental Health. You can find part 1 here: Medicating Ourselves Into Lives Not Worth Living, and part 2 here: Psychiatric Discontents & A Movement Towards A Better Model Of Mental Health


The Bridge from the Unhealthy Triad to the Average Triad

I should clarify that my first blog post is primarily directed at people in the average and healthy triads; levels 1-6.  I admit, I haven’t learned very much about how to treat people at the severely unhealthy end of the mental health spectrum, it’s not where I have personal experience, and it is not where I think we are societally deficient. And I do believe that if your center of gravity is in the unhealthy levels of psychological development, medication can be a very stabilizing influence, helping people put their lives back together.

However, while I acknowledge that medication can be very helpful for people in the unhealthy triad, I must state again that it’s only part of the solution, and that our treatment of people in the unhealthy area of the mental health spectrum still suffers from rampant biological reductionism and a lack of self-empowerment. An alternative model to the DSM that I found I could strongly relate to is the Recovery Model. (I also like aspects of Acceptance and Commitment Therapy)

“It has also been pointed out that the Diagnostic and Statistical Manual of Mental Disorders uses criteria, definitions and terminology that are inconsistent with a recovery model, and therefore does not promote a culture in which people can improve and recover. It has been suggested that the DSM-V requires greater sensitivity to cultural issues and gender; needs to recognize the need for others to change as well as just those singled out for a diagnosis of disorder; and that it needs to adopt a dimensional approach to assessment that better captures individuality and does not erroneously imply excess psychopathology or chronicity.

Whereas the Recovery Model, “emphasizes and supports each individual’s potential for recovery” and “recovery is seen within the model as a personal journey.” The model posits that recovery is composed of 7 elements: hope, a secure base, a sense of self, supportive relationships, empowerment & social inclusion, coping skills, and meaning.

I found particular resonance with this model because I could personally relate to each of these 7 elements in my own personal journey with mental unhealthiness.

I guess this is the place to say that I reject the notion that “I did not experience depression, I only experienced teenage angst.” It is true, I did not have Major Depressive Disorder, but I’m fairly confident I had a mild case of depression. Just because this experience occurred during my teenage years does not make it accurate to relegate my experience off the mental health spectrum onto a compartmentalized label called “Teenage Angst”. If mental health is a spectrum where you can spiral up or down the levels of the development, then I could have spiraled down, just as I spiraled up.

I went back to my journal entries about depression while writing this post, in order to investigate my mindset at the time. I have decided to share some deeply personal quotes from these journals in the proceeding section, because I would like to share some of my experience in hope of helping others on their journey.  I’ve been on a difficult personal journey the last 6 years and in the last few months have felt a major transformation in both my inner and outer worlds.

To provide more context for my journey, it could be helpful to know that in the personality typing systems of the Enneagram and Myers Briggs I’m a 5w4, INTJ/P. All types deal with their journey differently, so the more similar a personality type is the more relatable my experiences will be. The basic fear of the 5 is that they will be incapable of functioning successfully in the world, and their basic desire is to discover something new and share it with the world. After the successful release of the Startup Genome Report in May I had noticed myself feeling a new sense of openness. As I read the Enneagram Book in the following months I labeled myself at level 2 on the developmental scale of healthiness. I couldn’t label myself a 1, because I knew I had so much more room to grow.  But as I reached the last paragraph on the very last page of the book I had an epiphany.

“Level 1, however, is not the end of the road, but the beginning of another. It is the beginning of the world of the True Self, the Essence, which is not defined in the ways the ego is. Once a person has become liberated from the trap of his own personality type, he will begin to experience all kinds of wonderful impressions of himself, the world and of life. Moreover, such a person would be able to integrate the positive qualities of all nine types, since they are no longer attached to behavior and beliefs connected with one of them.  There is much that could be said about Level 1, and the expanding horizons of Essence, but that is for another time.”

My epiphany was, “that was me.”

This however does not mean that I cannot fall back down, and my ego certainly continues creep up in many situations in daily life. But those are “states”, and right now my overall “structure” and sense of being has, as the author’s of the enneagram put it, shifted from a world of ego fixation to a world of essence.

Here is a quote from a journal entry I wrote on Jan 9, 2007, when I was feeling very depressed, [no editing, spelling mistakes and grammatical errors preserved]

“I’m so fucking angry right now. I don’t like what I’m dong. I don’t like what I see ahead. In fact I can’t see ahead. Its completely cloudy. I am unfulfilled. And discouraged. In short, I am depressed. And I seem to want to be right now. Find some music to listen to that fuels that fire. Deepens the painful emotions. I think this is the most depressed, pessimistic I’ve been in a long time. It comes at a time after I felt the most optimism. Coincidentally? I thought I had shit figured out. I wanted to start making progress, exponential progress, feeling like limits were being stretched and its all seemed to come crashing down.”

In the entry I proceed to discuss what’s wrong with each area of my life (friends, a technology club I started, school, sports) and conclude with this:

“Hmm, Maybe my answer is to transfer… I had momentarily forgotten about that… New beginning, would get to stop sports, get new friends improve socially, new things are always good. I don’t know. I really don’t know. I feel really lost now. I want to start doing big important things. Ugh not even that right now. Just nothing I am doing right now is making me happy. Just look at my hours spent in the day. How much of what I’m doing do I like. I really need a mentor… or something like it. FUCK FUCK FUCK FUCK. UGH… Why does that feel good?

I think I want to lay and bed and cry… release… it will make me feel better. I guess I know I do want to do big important things. But I have to do that in baby steps towards that goal. All my life now is fundamentals and fucking disappointment. I’ve had enough learning through failure now. At least until I can adapt what I’ve learned and fail again only once my mind as reached a new paradigm. I guess I’m out now…. FUCK FUCK… I hope things look up. Perchance I meet someone good at macworld… doors I’m read for you to open sesame…”

In fact, a large part of why I didn’t spiral down, is captured in the 7 elements of the Recovery Model.

1) Hope
“Finding and nurturing hope has been described as a key to recovery. It is said to include not just optimism but a sustainable belief in oneself and a willingness to persevere through uncertainty and setbacks. Hope may start at a certain turning point, or emerge gradually as a small and fragile feeling, and may fluctuate with despair. It is said to involve trusting, and risking disappointment, failure and further hurt.”

If there is one common thread in my journal entries about depression, it is that I never lost hope. It’s at the end of the previous quote and in many others.

Chat transcript with a friend 2-14-08 [lightly edited for readability; I am in italics]

i was miserable
at the end of freshmen year
i know u were
like seriously — depression
not medication kind
i know
no i know the kind
but just like hella pissed off at my situation
its cynical introversion
it can get that way at times
and its a horrible state that requires a large effort to get out of
and its a bitch o an energy well that u can easily get sucked back into
would u say thats accurate
i know its an intellectual depression from being a realist
its definitely a bad state
its about state control
it can be hard
when its one of your natural habits
true
I find myself not getting in them very often now
i had to artificially pump my state up
and went too high as to be unnatural
in the beginning
and its taken work finding that balance
and YES for sure I’m a realist
it only happens with me when my game isnt going wellwith women or in job searches or academic wrk
i know exactly what u mean
i was inflated in my ego for a while
ok so in congruence with checking about a lot of this game stuff another person who i initially thought was sleezy
like all these game people
but have found to be really smart
and able to communicate really well
is tony robbins
yea
i’ve actually found i’ve built a really good system for myself
where its bad i will still feel bad emotions
sometimes
and maybe it will sit with me for a day
stuff doesnt sit with me much longer than a day
3 dys at worst
but I rebuild stronger — my motivation is always err my disappointment is always channeled into going back out and doing it again — better
the best thing you can do is take action
the worst
is not taking action
I build back a passion every time i fail
right now that cycle exists for me
though the periodicity is too long
yea
ha thats interesting
I think of myself
my development
in cycles too
like cycles on a very slow curve upward
its a giant second order differential equation that is the driving force of development
yep
xactly
i won’t know what that is till next yr
no u wont
but u explained it accurately
i use music a lot too
same
music matches my mood
and can be a tool to change it
that and my time at the piano and on my bike
the trick is putting a transform on your time axis
to increase rate of growth
and decrease periodicity
i think i know what ur saying
and peharps amplitude of cycles also has to increase as a result
exercise is also really good
it releases a lot of important chemicals
that drive growth
i know and i let my wrk get in the way
yea
schoolwork has been getting in the way
of my personal growth
lately
btw I’m really glad i failed freshmen year
socially?
yea
because you need a bad experience — many hit a bottom , a rock bottom way worse than mine – but you need something to motivate you to change
and I’ve discovered so much from it

Email to a David Braun, (2-25-08):

“I’’m happy to listen. I know what you’re talking about. When the only option is to take on challenges and succeed and failure is not an option, we can do amazing things. So many examples of this. Pushing yourself in the 4th quarter, hitting rock bottom and taking on game, the spartans burning their boats before battle,  the list goes on. I hope to continually challenge myself and grow. I was depressed in a sad and frustrated way, for a while in the early years upon becoming a teenager. I remember being sad for the first time on a birthday when i was 15. I was like “fuck, another year’s gone by? I’m losing my childhood”. But since taking full control and responsibility of my life and really being obsessed with learning and growth I’ve become so much happier. And now I look back at the last  few years and am wowed by what the future could be if I can maintain the kind of progress I’ve had over the past 2 years. I also realize how quickly it could all disappear, that I haven’t really achieved anything yet, and that only makes me push harder. “

2) Secure base
Appropriate housing, a sufficient income, freedom from violence, and adequate access to health care have also been proposed. It has been suggested that home is where recovery may begin.

Although I didn’t discuss much of my inner turmoil with my family, they were incredibly supportive throughout most of this journey,. I lost some support from my Dad and Sister when I decided to take a gap year and then later not go to college, but by that time I was ready to handle the pressure and make a bold, independent move. My mom stayed supportive throughout the whole process, and has been a source of unconditional love my whole life. I feel very fortunate. My dad played a major role in helping me get my feet underneath me when I wanted to transition my focus away from sports into the world of ideas. He taught me the basics of starting an organization, went to conferences with me, showed me how to network, and was a sounding board for operationalizing many of my ideas.

From Tyler Emerson,

“I remember meeting Max at Singularity Summit 2007. Once in a while you meet someone who you know will do great things. I had that feeling when meeting John Schloendorn and Michael and William Andregg. The same feeling was there with Max. It wasn’t only his passion, intellect and sincerity. It was the passion and support of his Dad. His father’s joy at seeing his son in an intellectual candy store. The pride and excitement in which his Dad spoke about him. Max alone made a lasting impression, but I’ll never forget that feeling of seeing a precocious son being supported unconditionally by his father. Max is already beyond his years. I hope he finds the support that his creative, collaborative gifts merit.”

From Kosta Grammatis,

“You came from a privileged life with two parents who adore you. Not many are lucky to have the perspective you have – you didn’t have to worry about a lot of things.”

3) Self
Recovery of a durable sense of self (if it had been lost or taken away) has been proposed as an important element. A research review suggested that people sometimes achieve this by “positive withdrawal”—regulating social involvement and negotiating public space in order to only move towards others in a way that feels safe yet meaningful; and nurturing personal psychological space that allows room for developing understanding and a broad sense of self, interests, spirituality, etc. It was suggested that the process is usually greatly facilitated by experiences of interpersonal acceptance, mutuality, and a sense of social belonging; and is often challenging in the face of the typical barrage of overt and covert negative messages that come from the broader social context.

Until my teenage years, much of my identity and social circle had been built around being a star athlete. Then I experienced a back injury that severely limited by ability to compete, challenging the roots of my identity. Following is a quote from my dad, (4-26-08):

Are there any unusual circumstances your child has had to overcome?

Max has always been a superior athlete.  Primarily soccer and basketball. However, in 8th grade he had a number of collisions and ended up with a major injury. His sacral-illiac joint was jammed. Neither we nor the coaches picked up on how serious it was for over a year, and just expected he would “get over it” and that he should “play through it”.  His body reacted by shifting his pelvis to protect itself, which later caused a compounding groin injury. He was misdiagnosed as having one leg shorter than the other and for a year wore orthotics. It took us three years and many specialists to unravel the compounding effects of the injury.  Throughout it Max continued to try and play, but was never on top of his game.  Though he would get somewhat discouraged as we went from one specialist (chiropractors, physical therapists, sports trainers, muscle therapists) to another, he remained determined to regain his ability to play.  Sports had always also been a major way that he got recognition, a lens through which he was seen by his friends. It has been difficult for him, especially as entered high school, and for the last three years, to not be seen as a star athlete.  We think we solved the original problem and have been eliminating the compounding secondary problems, and he had his best year this year.  He plans to do additional outside core strength training in order to finally have the kind of sports year he’s been hoping to have.”

With regard to changing social context, by December of my senior of high school I had almost completely removed myself from my high school social scene and turned my focus towards starting fresh and finding like-minded peers in the new communities of futurism and entrepreneurship. Two and half years later I have forged a completely new social circle, and since have had little to no connection with anyone from my high school years. I’ve worked through all the negative feelings and associations that lingered about that stage of my life, and now feel that there are some people from high school who I would like to talk to again, and others I would not, but I have moved on and discharged any bad feelings about the whole situation.

Self-acceptance was actually something that never wavered throughout my journey. I almost never said things like, “I wish I was somebody else” or “I hate myself”. Self-acceptance was always inside me but journaling, adopting strategies from personal development books, and consistent action that eventually created numerous small victories, really helped me solidify a belief in myself.

4) Supportive relationships
A common aspect of recovery is said to be the presence of others who believe in the person’s potential to recover, and who stand by them. While mental health professionals can offer a particular limited kind of relationship and help foster hope, relationships with friends, family and the community are said to often be of wider and longer-term importance. Others who have experienced similar difficulties, who may be on a journey of recovery, can be of particular importance. Those who share the same values and outlooks more generally (not just in the area of mental health) may also be particularly important. It is said that one-way relationships based on being helped can actually be devaluing, and that reciprocal relationships and mutual support networks can be of more value to self-esteem and recovery.

By senior of high school I started actively seeking out a new community and I want to thank a number of my close friends who I discussed these issues with on many occasions, which played an instrumental role in supporting me on this journey: Bjoern Lasse Herrmann, Alexandros Pagidas, Tyler Willis, Rahmin Sarabi, Mike Del Ponte, Travis Wallis, Rafe Furst, Kim Scheinberg, John Smart, David Braun, Ben Casnocha, Kosta Grammatis, Mathias Holzmann, Eddie Harran, Sagarika Sundaram, Korvus Friend, Mike Deliso, Preben Antonsen and many others in smaller doses.

5) Empowerment and Inclusion
Empowerment and self-determination are said to be important to recovery, including having self control. This can mean developing the confidence for independent assertive decision making and help-seeking. Achieving social inclusion may require support and may require challenging stigma and prejudice about mental distress/disorder/difference. It may also require recovering unpracticed social skills or making up for gaps in work history.

I continually carved out my own path and preserved my own autonomy. I read about subjects I was interested inI started projects I was passionate aboutI attended lots of industry events and conferencesI took a gap year, and decided not to go to college when I realized I had better options. I talked openly about what I was dealing with, and I actively worked on improving my ability to relate to people.

6) Coping strategies
The development of personal coping strategies (including self-management or self-help) is said to be an important element. Developing coping and problem solving skills to manage individual traits and problem issues may require a person becoming their own expert, in order to identify key stress points and possible crisis points, and to understand and develop personal ways of responding and coping. Being able to move on can mean having to cope with feelings of loss, which may include despair and anger. When an individual is ready, this can mean a process of grieving. It may require accepting past suffering and lost opportunities or lost time.

I was obsessed with translating my daily will power into systems that would support my continued growth. I was obsessively focused on learning productivity systems, self-management techniques, energy management systems, regular journaling, reflection practices, meditation, power naps, affirmations, goal setting, personal development books, tapes, anything I could get my hands on and my head around to improve. This burning desire grew out of the following and final element: meaning.

7) Meaning
Developing a sense of meaning and overall purpose is said to be important for sustaining the recovery process. This may involve recovering or developing a social or work role. It may also involve renewing, finding or developing a guiding philosophy, religion, politics or culture. From a postmodern perspective, this can be seen as developing a narrative.

I always told myself that my frustration was just a temporary situation. I just needed to keep fighting. Big things were in front of me and I was part of a much bigger story. I just needed to keep going and never give up.

In reference to athletics, (12-8-05)

“I don’t see the light down the tunnel. Its looking dark. I’m not playing well, or how I think I can. It was put there 2-3 years ago in foresight of my determination, I tell myself it’s to stop you from getting in the athletic life…you can’t get into that, it will lead you away from something big. Something big you are gonna do. What will it be? Sounds cliché eh? So you get the picture things aren’t going well, I’m feeling depressed today. Bored with stuff. I can’t find anything to do.”

(12-4-05)

“I go in out of these depression phases so often. Never like deep suicide depression just this sense of failure, life is slipping away. And other times there is this feeling of connectedness and awe and that everything is going to work out. My destiny is unfolding.”

9-30-2007, email to John Smart:

“My belief, although Preben argues it is probably an altered instantiation of the same God Complex Program that humans have somehow developed, is that there’s much more to the Universe than we currently understand. I don’t think that humans are insignificant. I think that there’s some purpose to the Universe that we don’t yet understand. It doesn’t make sense for what we know now, for this to be all there is. This idea is somewhat counter to the atheist dogma, that “Humans are only here for a short time, we are insignificant, the universe is so big we hardly matter. Nothing you do in your life has any affect, the cycles in the universe will continue regardless of yours or humanities actions. Enjoy life. Spend time with family, be a good person and death will come and take you away inevitably.”

My belief is that we are building up to something. That we are a part of something bigger. And here the singularity fits in. Where the things we discover with greater than human intelligence will lead to new paradigms in thinking about the universe. The universe seems too goal oriented, too intent on increasing order for there not to be big revelations around the corner. And yes, its very possible this humanity fails.”

12-9-2010

“This journey I”m on. It’s not just for me.

I felt the death of casey [my golden retriever, my brother of 10 years], and kendra [my classmate and one of my twin sister’s best friends]. Last night and this morning. I look at the emotion, the pain, the celebration of life.

The future of that is on my shoulders. I feel that depth. That’s what I’m driving for. It’s not Max striving for mastery in a vacuum. That’s what I’m keeping alive. I have the ability. It’s now my responsibility. A long with a few others but not many. I don’t know if they will make it but I will.

Look at all the human connection. We are keeping that and taking it to the next level. As well as taking life to the next phase of evolution. Life doesn’t stop with humanity. We just happen to be holding the baton now. But we must not collapse. Others came before us. Others will come after us.

Nail entrepreneurship as a management science and trigger the entrepreneurial enlightenment. Nail the software and understand how to execute the principles and how they all fit together and leverage data to understand the real business implications. the software is the best place to go first –

I’m not focusing on emotional relationships right now. Or focused on figuring out the pattern [of the universe] with john smart. That’s a 3rd 4th and 5th priority and I only have permission to devote conscious will power to those projects when the primary projects are aligned and cooking. Those are my priorities. “

The Bridge from the Average Triad to the Healthy Triad

Medication is okay for people in the unhealthy triads, but I have many grievances with the emphasis we place on medication to help people in the average spectrum of mental health. Medication can’t make you healthy, it can only play a role in stabilizing unhealthiness. So once you’re in the average spectrum, most what I said in first post still applies. The path from the average levels of development towards healthiness is paved by taking conscious control of your development in psychosocial spheres; not by altering your mental state with biological drugs.It’s difficult to generalize about all drugs, but many drugs, especially anti-depressiants and psychotropics, have the side effect of a loss of creativity, a loss of emotional clarity, and a loss of empathy and motivation, which significantly inhibits a person’s growth toward healthy levels of development. Granted there are edge cases, where people are biologically incapable of becoming healthy, but this is not the case for 99% of the population.

Many have argued that taking medication has enabled them to hold a job, buy a house, uphold a marriage and maintain a social circle. I think that’s great progress for someone moving out of the unhealthy triad, but we must not let people confuse security with fulfillment. Fault me for seeing too much potential in human nature but I don’t think a life of maintenance, teetering on the contingency of continued medication is what we should be striving for. When people in the aforementioned situation try to tell me they are fulfilled, I can’t help but wonder if their criteria for fulfillment is completing some mental checklist modeled after the JonsesI’m sorry, but if you believe this is fulfillment, you are selling yourself short. This is settling. Push yourself to get over yourexperiential avoidance and confront your fears. If medication subdues any part of your true self, you are achieving stability at the expense of authentic self-expression. If you desire fulfillment, stability must be a temporary trade off. No path to fulfillment is stable. You must RISK something!

The way forward is a worldview that puts pathology in its rightful place, and focuses most of our energy on a science of healthiness and human flourishing.

The lack of models, frameworks, and techniques for the healthy to accelerate their development is stagnating society’s top line.

Martin Seligman, former head of the American Psychological Association, has well documented our obsession with pathology, and our lack of scientific literature on what it means to be healthy. This points to a deeper problem that is also at the crux of my first blog post. If we don’t how to help someone flourish, the best we can do is make someone “not ill”. But if we can help someone become “not ill”, but we can’t help them become healthy, then they will most likely become ill again, where in, we can help them become “not ill” again, perpetuating a cycle of mental relapse where people never discover how to become healthy. And there is no doubt relapse is a too frequent phenomenon.

So, what would a science of healthiness include?

Here’s how I’d imagine the journey:

We’d first turn our focus inward, since true progress in the outer world will never be found if we don’t first understand ourselves, how we work, what we want, why we do things, and who we really are. In pursuit of self-mastery we’d first nurture an indefatigable optimism that there are greener pastures ahead, and a sense of personal mission that we are on our own Hero’s Journey. We’d grow our self-awareness so we could start lighting the dark caverns of being within ourselves. We’d starting dreaming of the life we want to live and set goals that inspire us. We’d learn the science of managing ourselves through techniques like energy management, journaling, andneuro-linguistic programming. When our inner world stabilized and began to grow, we’d turn our attention to our outer world. We would start searching for problems we are passionate about solving. We would look honestly at ourselves to make sure the path to achieving our goals matched our skills and interests. We’d start taking action towards our goals, working diligently, patiently and persistently. We’d learn how to optimize our productivity and how to “get things done“. We’d move swiftly and flexibly, adjusting both our inner and outer trajectory as time passed and we continued to experience and learn. We’d strengthen our decision making skills and make tough decisions with integrity whenever the time came. We’d know our purpose and our priorities and make sacrifices when they were called for. We would do so with a calm resoluteness knowing that we will find all we need in due time. When things on journey inevitably turned south, we could rely on the inner strength we have developed to carry us through difficult waters. We’d put in our 10,000 hours and develop mastery around a skillset aligned with our purpose. We’d have harmony between Body, Mind, and Spirit. We’d have financial freedom and fulfilling relationships. We’d have abundant physical energy, emotional openness, intellectual stimulation and a driving sense of purpose. We’d have the courage to keep asking the hard questions, and in our pursuit for higher and higher truths, we would finally transcend the world ego and step into the world of essence.

Every End is a New Beginning: Ego Transcendence And Beyond.

“Transcending the ego is the gate to every spiritual path”

“The form of transcendence that appears to link directly to ethical behavior and human well-being is the transcendence of egoity in the midst of ordinary waking consciousness. It is by ceasing to cling to the contents of consciousness—to our thoughts, moods, desires, etc.—that we make progress. Such a project does not, in principle, require that we experience more contents.  The freedom from self that is both the goal and foundation of “spiritual” life is coincident with normal perception and cognition—though, admittedly, this can be difficult to realize.”

I wonder what would happen if a greater percentage of the world’s population made it this far. If we tapped into the development of our True Selves. If we loved ourselves, our friends, our community, our humanity, our planet. If we all contributed in our fullest capacity to the larger story of an evolving, unfolding universe that everything around us is a part of.

It’s hard to imagine how fast the world would evolve if a greater percentage of the population reached this level of mental health. It would be the end of war, the end of hunger, the end of corruption, the end depression and despair, and the beginning of a wonderful new world that I hope someday we all get to experience.


This blog post is part 3 in my 3 part series on Mental Health. You can find part 1 here: Medicating Ourselves Into Lives Not Worth Living, and part 2 here: Psychiatric Discontents & A Movement Towards A Better Model Of Mental Health

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My 3 Part Series On Mental Health

Due to length considerations, I’ve separated my posts into a 3 part series.

You can find part 1 here: Medicating Ourselves Into Lives Not Worth Living, part 2 here: Psychiatric Discontents & A Movement Towards A Better Model Of Mental Health and part 3 here: Towards A New Paradigm of Mental Health And An Enlightened Society.

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The Paradox of the Self-Improvement Industry

The self-improvement industry is full of contradiction. Perhaps the most obvious, is that most of the people who buy self-improvement products don’t seem to improve.

This leads to the perception by most effective and intelligent people that something is off. The industry must be either a cult or a scam.

My close friend Bjoern Herrmann perceives one of the leading self-improvement “gurus”, Tony Robbins, as such:

Tony Robbins implicates a short cut to personal success and happiness. I’d compare him to a pill of ecstasy – he makes a certain type of people temporarily feel better. This delays them from practicing continuous introspection and prevents them from maturing as healthy human beings. Instead they are being misled by false excitement. Go on his website and read these titles “The path to permanent weight loss’ or the ‘the money masters’ … the absolute wording in his messaging sounds to me like a scam to exploit people who lost their internal compass. Those people need thoughtful and ongoing support of their family and friends.  If I think about it there is not much difference between Tony Robbins business and a secte or a radical political movement. In fact many abusive and criminal sects/political movements started off as self help movements.

There is no doubt that the self help industry attracts people who are looking for a quick fix. Most of the people attracted to the movement are undoubtedly struggling and a bit broken. It does appear that most fail to make significant changes in their life because they have trouble following through and are unable to establish a work ethic of continual practice after the emotional high of the weekend or program wears off. (This problem is much wider spread than the self-improvement industry. People everywhere get excited by peak experiences and performances but fail to find sufficient motivation to endure the daily grind of building anything worthwhile. Many kids like playing sports, but few get up before school to practice everyday. Conferences generate many business ideas and partnerships, but few follow through and implement them.)

However, it is important to note that struggling souls looking for answers in a self-help guru may not be living admirably, the intention of buying a self-improvement product is more admirable than simply doing nothing and wallowing in self-despair. At least these people are trying to improve their situation. The majority of people with problems have resigned from trying to fix them.

Because the quality of the audience of the self-improvement industry is low, the quality of the content unjustifiably gets a bad rap. I’ve looked at enough of the industries’ material to know that there are many high quality products and techniques, do have the potential to create lasting change in people’s lives, if practiced regularly. I can say this from personal experience, having adopted many habits and techniques into my own life. But it does require a discerning eye though to separate the wheat from the chaff. For business reasons, I will discuss below, a lot of the gold is surrounded by crap as a result of a corrupting allure of profits.

I must agree with Bjoern that many info-marketers do have scammy marketing tactics. It is sad that many have adopted these tactics, especially when many of them have important ideas to share. I know this industry is particularly fond of the A/B test, so the messaging must have evolved this way because it is more effective and drives more sales. Even so, the moral judgment on scammy marketing tactics, isn’t so cut and dry. If the product is really good, how different is a scammy marketing tactic from a parent trying to get a child to eat their vegetables by singing “hear comes the choo choo train” and shoveling a spoonful of peas into their child’s previously clenched mouth.

On the other hand it is quite deplorable if it’s not just the marketing tactics that change, but the core content also morphs to pander to the quick fix mentality of the desperate consumer, as it has with the best selling book The Secret, which teaches people that the secret to life is positive imagery. All you need to do is want something bad enough, and if you just focus your intentions strongly enough on what you want, you will get it. (Watching Dave Chappele’s satirical take on The Secret is a must). Positive thinking is a necessary but not sufficient condition for goal achievement. But it sure would be convenient if that was all that was needed!

If it’s true that scammy marketing tactics get broken individuals in the market majority to open up their hearts, minds and wallets, then that means there is a serious void for the people who are really making waves in the world, who are scared away by these marketing tactics. Because I do think there is real value in many of the top-tier self-improvement products, that could help many effective people reach a greater percentage of their potential.

This is the paradox of the self-improvement industry. It starts out with well intentioned high quality content but because greater profits are found with the mindless majority, it inevitably evolves to cater to them, shunning the world’s more effective, independent thinkers, who are the ones who actually have the inter-personal foundation to apply these techniques to radically improve themselves. But the marketing causes the healthy to turn a blind eye, and the sick to buy a remedy they cannot absorb.

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Medicating Ourselves Into Lives Not Worth Living

This blog post is part 1 in my 3 part series on Mental Health. You can find part 2 here: Psychiatric Discontents & A Movement Towards A Better Model Of Mental Health, and part 3 here: Towards A New Paradigm of Mental Health And An Enlightened Society.


The world has way too many people on medication. It is destroying their potential to create a life they love. And it is destroying the world.

We medicate to treat real, serious symptoms, but from my own experience, I don’t believe our medication practices are treating the true cause. And we won’t treat the true cause until we stop attributing mental health problems to something out of our conscious control, such as genetics and biochemical imbalances.

The cause for most mental health problems is that straight up most people just lose the battle against themselves. 

People may be in bad environments. They may have the deck stacked against them but true health will only be found when people confront their internal reality honestly and valiantly.

It is no easy task, but most mental illness can be solved if people learned to control their thoughts and were able to successfully navigate their way to healthy environments that helped them achieve their goals.

Instead of helping people engage in that fight, we numb them into submission with medication.

In my own personal journey I had dark days as a teenager starting around 15, as I dealt with my dissatisfaction with life. I had thrown away belief in god and was dealing with existential angst. I had sports injuries that prevented from competing, stripping my personal identity bare, which at the time was tied to my athletic competence. I had trouble adjusting to the high school social scene. I found my classmates unfriendly and actively mean. I couldn’t find anyone who would have the conversations I wanted to have. I was asking big questions that nobody I knew I found relevant. I felt misunderstood, alone and arrogant. I felt my high school was wasting my time, trying to give me an elite education for a world that no longer existed.

While my particular form of malady may be rare, in experiencing deep pain as a result of dissatisfaction with the world, I’m sure I’m not alone. I could have let my pain consume me. Instead, I used the pain as fuel to find greener pastures. I searched for ideas I was passionate about, and people I could relate to who could support me in creating the life I wanted.

I think if I talked to a doctor about my depression they would have given me medication. I believe this would have destroyed my life.

My acute pain might be gone, but its absence would delude me into believing nothing was wrong and prevent me figuring out how to create a life I love. My life would be pervaded by a permanent background noise, whispering, “Something is missing.”

It is not pain we should seek to avoid. It is settling for a life anything short of our dreams. Ideals may not be achievable but we should never stop trying to get closer to them. 

In some circumstances it is probably beneficial to dull our senses to give our traumas time to heal and the mind a chance to reset. But anything more than a few weeks or months is a resignation of your life.

The reality is that, it is fucking hard to get life where you want it to be. Right now, my life is almost everything I have wanted it to be. But boy has it taken a long time. I think this journey probably started for me at 15. That means it was a fight that lasted more than 6 years. The first time I really felt the tide turn was two years ago when I went to a spa with my friends at the end of a six week experience at an innovation camp in Berlin called Palomar5. I remember lying on my back in a heated pool, with my eyes closed, feeling for the first time that my life was finally on track.

But on track did not mean I had arrived. It was a month before Palomar5 that I decided I was going to figure out how to increase the success rate of startups and try to do my part to accelerate the global pace of innovation. It would take nearly two more years of hard work and persistence, and ignoring lot of people who told me I was too young, too inexperienced and too naive to accomplish what I set out to do, before my ideas would finally gain traction in the form of the Startup Genome.

I now have excellent mental health, excellent physical health, a close-knit circle of friends and a thriving startup. But getting here has felt like climbing a monumental mountain, requiring a tremendous amount of mental toughness and interpersonal work. It’s maybe been only in the last 10 days since the successful launch of the Startup Genome Compass that I have felt I truly reached the mountaintop. If this is true, then it was a 6 year journey. But every end has a new beginning and I am now setting my sights on a new much larger mountain.

I worry that most people haven’t built up the mental toughness to complete this journey. They don’t have the fortitude to stare darkness in the face and keep fighting until they create the life they want. At the same time I believe this inner strength is inside everyone. All people are connected to a long lineage of descendants who have overcome incredible adversity on the journey from Early Primate to Modern Man.

Six years felt like s tremendously long time, and at times I doubted I would ever make it. But I never gave up. If I had to, I would have kept going for 20 years, 30 years, my entire life, because anything less isn’t a life worth living.

My hope is that more people find it in themselves to embark on this journey and battle themselves and their environment until they carve out a life they love. At this point, I don’t have a systemic solution, but I wanted to point out in this post that most of the world’s 6.77 billion people are not achieving their full potential, and until we acknowledge our society’s overzealous prescription of medication as a growing part of the problem, society will be continuing to dig its own grave.


This blog post is part 1 in my 3 part series on Mental Health. You can find part 2 here: Psychiatric Discontents & A Movement Towards A Better Model Of Mental Health, and part 3 here: Towards A New Paradigm of Mental Health And An Enlightened Society.

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21 Years Of Making Sense Of The World

Today I turn 21 years old.

I feel fortunate to have been given the necessary conditions and opportunities to get where I am today. I want to thank my parents Peggeth and Jeff, my twin sister Zoe, my brother and golden retriever Casey (who passed away late last year), and my many friends who have supported me on this journey and have brought so much to my life. I hope I have brought as much to yours.

We are living in a special time in human history. Never have we possessed greater opportunities and greater challenges.

The next few decades are shaping up to be pretty decisive for humanity, but I think we’re up to the challenge.

In fact, I’m excited as hell about the future.

My heart pounds and my blood rushes as I think about the increasing role my friends and I will play in shaping this bright future of ours.

For many reasons, society seems to have taken a step backwards or sideways the last few decades. Society’s richest and powerful have not been doing a good job. While the intensity of their pursuit of wealth and progress is commendable, things clearly are not working. Markets are collapsing, democratic governments are dysfunctional, too many authoritarian regimes still have not been overthrown, leaving billions in a stagnating despair, and our ecological system is on the brink of disaster.

As best as I can tell, somehow our (previously adaptive) worldview has failed to evolve and is still directed at a world that no longer exists.

While the future looks like bleak to many, I remain optimistic simply for the fact that we have so much potential to get it right if we can direct our time on energy on the right goals, and pursue them in the right way.

Technology and Capitalism together have created an economic engine so powerful that we can now accomplish in a decade what would have taken hundreds, if not thousands of years in the past.

My work so far, has been characterized by trying to comprehend the bigger picture, and learning the inter-personal and extra-personal skills necessary to play a role in creating the future scenarios that seem brightest.

After many years of intellectual exploration, the last year I’ve been fairly single-mindedly laying the foundation for the Startup Genome Project to transform the way startups are built in order to accelerate the pace of innovation all over the world.

With the successful launch of the Startup Genome Compass 10 days ago, the future of the company is incredibly bright and I believe it is the most important thing I could be working on right now. But that means it will probably be many years before it’s time for me to shift my daily work to the even bigger picture I’ve been discussing in this post.

But in the meantime I’d still like to contribute to the transformation of our worldview, which desperately needs evolving. So, yesterday I compiled a list of the patterns, principles and values I’ve discovered in my first 21 years of life that I believe encircle many of the truths we need to adopt, both individually and communally, for our society to evolve. It is not an exhaustive list, but it is pretty comprehensive. (Though, admittedly mostly focused on systems, goal achievement, inter-personal effectiveness and self-awareness)

You can find that list below. And hopefully updated semi-regularly on this page, which will live in the menu bar.

Let me know in the comments a few of the patterns, principles and values you believe are most important for our individual and societal evolution.

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The Entrepreneurial Enlightenment

What makes startups succeed or fail? This is a question we are intent on answering. We believe increasing the success rate of startups has the potential to dramatically increase economic growth all around the world. On May 28th, we released our first report at startupgenome.cc. On August 29th we released our first benchmark application, the Startup Genome Compass to help startups reduce premature scaling.

The role of technology startups in our global economy has never been more important. Startups may seem insignificant compared to large multinational companies that have trillions of dollars of wealth sloshing around in public markets, but a recent Kauffman Foundation study found that the majority of job growth in the United States is driven by technology startups.

The power of information technology has been steadily increasing for the last three decades and has recently reached a level of maturity that has started to trigger a reorganization of the global economy. It has never been easier or cheaper to create a startup thanks to infrastructure like open source software, software as a service, cloud hosting, globally ubiquitous payment processing, viral distribution channels, real-time collaboration, on demand logistic services and hyper-targeted advertising.

As a result, the pace of change is speeding up and the implications of this are immense. Billion dollar startups are emerging faster and faster. The quick ascent of startups like Google, LinkedIn, Facebook, Twitter, Zynga and Groupon are harbingers of a major structural economic change on the horizon. The service sector has dominated the global economy for the last few decades but its sun will set. Just as machinery replaced most manual labor, software will replace repetitive intellectual tasks. Turbo Tax eliminated many accountants, Amazon eliminated many retail jobs and E-Trade eliminated the majority of stockbrokers. In the near future jobs that are more complex yet still methodical will also be replaced by software. Creative Commons is reducing the need for lawyers, Khan Academy shows how one good teacher can replace many bad teachers and the profession of doctors will be disrupted by startups like Halcyon Molecular that turn healthcare from emergency care into a preventative self-care. Balancing out that massive decrease in jobs will be what Richard Florida calls the rise of the creative class.

As the waves of disruption come ever faster, the only way for a company to be competitive will be to behave like a startup. In the landmark book the Innovator’s Dilemma, Clayton Christensen found large companies are excellent at sustaining innovation but by and large fail at disruptive innovation. Startups thrive on creating disruptive innovations. Recently, thought leaders in entrepreneurship have come to the conclusion that in order for large companies to be effective at disruptive innovation they need to make structural changes that make them behave nearly identically to startups.

The increasing economic importance of startups, along with decreased barriers to entry has caused interest in entrepreneurship to explode around the globe. New startup ecosystems are being built up all over the world with the hopes of replicating the success of Silicon Valley. Spearheading this movement are startup accelerators like Seedcamp, Techstars, Opinno, Founders Institute, 500 Startups, and Sandbox, but they are accompanied by hundreds of others. On an individual level, the brightest people worldwide, are increasingly seeing entrepreneurship as the career path of choice. The release of The Social Network has captured the imagination of today’s young people, and catapulted Mark Zuckerberg to the same status as Gordon Gekko in Wall Street almost 25 years ago.

But despite the increasing economic importance of scalable startups, we still don’t understand the patterns of successful creation. More than 90% of startups fail, due primarily to self-destruction rather than competition. For the less than 10% of startups that do succeed, most encounter several near death experiences along the way. Simply put, we just are not very good at creating startups yet.

Eight months ago we launched the Startup Genome Project, with the goal of increasing the success rate of startups and accelerating the pace of innovation around the world by turning entrepreneurship into a science. If successful, it’s hard to imagine the type of impact this could have.

Some of the world’s biggest transformations occurred when arts were turned into sciences. The scientific revolution in the 16th century triggered the age of enlightenment. The development of scientific management, which peaked in the early 1910’s, made large companies dramatically more efficient and arguably was one of the biggest causes of the explosion of wealth the world saw in the last century.

We believe the effects of cracking the code of innovation by turning entrepreneurship into a science will trigger a new era, that we are calling the Entrepreneurial Enlightenment. In the midst of the largest global depression in almost a century, a revolution in entrepreneurship could propel the world to a level of wealth never seen before by enabling scientific discoveries and technological breakthroughs to be integrated into the fabric of society faster than ever before. Offering hope that we may finally be able to master some of the most pressing challenges, including water, energy, food, health, security, poverty and education.

No revolution is triggered alone. In the quest to make entrepreneurship a science, we are standing on the shoulders of giants. In just the last 2-3 years the number of people extracting and codifying the informal learning of entrepreneurs has hit a point of critical mass. Steve Blank kicked off the move towards a science of entrepreneurship with his seminal book The Four Steps to the Epiphany. In the book, he introduced the concept of Customer Development. A few years later Eric Ries combined Customer Development with Agile Development and Lean Manufacturing principles to create the Lean Startup methodology. Interest in the Lean Startup has morphed into a global movement. Other major contributors to the science of entrepreneurship include Dave Mcclure on Metrics, Sean Ellis on Marketing, Alex Osterwalder on Business Models and Paul Graham with his essays.

Yet despite this huge knowledge base emerging about how startups work, startups have been able to absorb little more than the basic patterns of how to build a startup. Most founders don’t know what they should be focusing on and consequently dilute their focus or run in the wrong direction. They are regularly bombarded with advice that seems contradictory, which is often paralyzing. And while startups are now gathering way more qualitative and quantitative feedback than they were just a few years ago, their ability to interpret this data and use it to make better product and business decisions is sorely lacking. The primary cause of these problems is that we lack the necessary structure to synthesize our accumulated knowledge on the nature of startups. We are missing a common language and framework to describe and measure entrepreneurship and innovation.

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A Deep Dive Into The Anatomy Of Premature Scaling [New Infographic]

(Reposted from the Startup Genome Blog)

Three days ago we launched the Startup Genome Compass, a benchmarking tool for startups and our new research on the primary cause of failure for startups: premature scaling.

There’s been some confusion about exactly what we mean by premature scaling and we wanted to respond to the feedback we’ve received and elaborate on the findings from our research. To make it clearer, we need to go a little bit deeper into the theory and methodology.

Since February we’ve amassed a dataset of over 3200 high growth technology startups. Our latest research found that the primary cause of failure is premature scaling, an affliction that 70% of startups in our dataset possess.

The difference in performance between startups that scale prematurely and startups that  scale properly is pretty striking. We found that:

 - No startup that scaled prematurely passed the 100,000 user mark.
 - 93% of startups that scale prematurely never break the $100k revenue per month threshold.
 - Startups that scale properly grow about 20 times faster than startups that scale prematurely.

What Is A Startup?

Definition:

Startups are temporary organizations that are designed to evolve into large companies. They move through 6 stages of development throughout their lifecycle: Discovery, Validation, Efficiency, Scale, Sustain & Conservation. Early stage startups are designed to search for product/market fit under conditions of extreme uncertainty. Late stage startups are designed to search for a repeatable and scalable business model and then scale into large companies designed to execute under conditions of high certainty. 

Every startup has an actual stage and a behavioral stage. Actual stage is measured by customer response to a product. We measure it by looking at metrics like numbers of users, user growth, activation rate, retention rate and revenue. The behavioral stage is made up 5 top level dimensions that the startup can control. The 5 dimensions are Customer, Product, Team, Financials and Business Model. Each dimension, both the actual and the 5 behavioral dimensions are always classified into one of the 6 developmental stages.

A startup is classified as inconsistent when any behavioral dimension is at a stage that is different than the actual stage. When a behavioral dimension is at a stage larger than the actual stage we call this premature scaling. Its lesser known sibling, dysfunctional scaling, occurs when the stage of a behavioral dimenion is smaller than the actual stage.

A clear example of premature scaling would be a web startup that rapidly scales up its team to 30-40 people before it has any customers. In this example, the actual stage of the startup would be in Validation (Stage 2) but the behavioral stage of the team would be in Scale (Stage 4).

Let’s go through some more examples and stats for how each dimension can be scaled prematurely.

Customer:

How to scale customer dimension prematurely: Spending too much on customer acquisition before product/ market fit
Overcompensating missing product/market fit with marketing and press
Spending money in poor performing acquisition channels.
Stats: Inconsistent startups are 2.3 times more likely to spend more than one standard deviation above the average on customer acquisition.
Examples of startups that prematurely scaled on the customer dimension: Color, Webvan, Pets.com

Product:
How to scale product dimension prematurely: Building a product without having validated problem/solution fit, Investing into scalability of the product before product/
market fit,  Adding lots of “nice to have” features
Stats: Inconsistent startups write 3.4 times more lines of code in the discovery phase and 2.25 times more code in efficiency stage. Inconsistent startup outsource 4-5 times as much of their product development than consistent startups.
In discovery phase 60% of inconsistent startups focus on validating a product and 80% of consistent startups focus on discovering a problem space. In the validation phase, where startups should be testing demand for a functional product, inconsistent startups are 2.2 times more likely to be focused on streamlining the product and making their customer acquisition process more efficient than consistent startups. It’s widely believed amongst startup thought leaders, that successful startups succeed because they are good searchers and failed startups achieve failure by efficiently executing the irrelevant.
Examples of startups that prematurely scaled the product dimension: Cuil, Webvan, Joost, Google Wave, Slide, 6Apart, most startups that don’t find product market fit or “build something nobody wants”.

Team:
How to scale team dimension prematurely: Hiring too many people too early, Hiring specialists before they are critical: CFO’s, Customer Service Reps, Specialized Network/System Adminstrators or Database specialists, etc., Adopting multilevel management hierarchy, hiring managers (VPs, product managers, etc.) instead of doers, Having more than 1 level of hierarchy,
Stats: The team size of startups that scale prematurely is 3 times bigger than the consistent startups at the same stage. However startups that scale properly end up having a team size that is 38% bigger at the initial scale stage than prematurely scaled startups, and almost surely continue to grow. Startups that scale properly take 76% longer to scale to their team size than startups that scale prematurely.
Examples of startups that prematurely scaled the the fundraising dimension: Webvan, Pets.com, VOX.com.

Financials:
How to scale fundraising dimension prematurely: Raising too much money, thereby making the startup undisciplined, giving lots of breathing room for other dimensions to scale prematurely, and eliminating exit optionality.
Stats: Before scaling, funded inconsistent startups are on average valued twice as much as consistent startup and raise about three times as much money.
Examples of startups that prematurely scaled the the fundraising dimension: Cuil, Webvan, Color.

Business Model:
How to scale business model prematurely: Focusing too much on profit maximization too early, Over-planning, executing without a regular feedback loop, Not adapting business model to a changing market, Failing to focus on the business model and finding out that you can’t get costs lower than revenue at scale.
Stats: Inconsistent startups monetize 0.5 to 3 times as many of their customers early on.
Examples of startups that prematurely scaled the business model dimension: Myspace,  Groupon (time shall tell), 6Apart, Lala.

The focus of this post is on premature scaling, but for context, here are a few example of dysfunctional scaling: Tokbox, Friendster, Orkut, Wesabe, Digg, SixApart, Myspace (on product), and ChatRoulette.

In our research we also found that the following attributes have no influence on whether a company is more likely to scale prematurely: market size, product release cycles, education levels, gender, time that cofounders knew each other, entrepreneurial experience, age, number of products, type of tools to track metrics and location.

Now to further illustrate how we describe startups let’s look at an example mapped onto the Startup Lifecycle Canvas.

Below we have an infographic where we plot Color, today’s most talked about inconsistent startup, against Rally, a startup we worked closely with while building out the model, that was consistently in the Efficiency stage 2 months ago when they made this announcement. Although now I’m happy to say they’re starting to scale.

To view the infographic in full, scroll to the bottom of the image and select “download full size”. If you’re having trouble reading the infographic you can download it here.

You can read more about premature scaling in our full report here. And you can also assess your own startup for premature scaling with our tool the Startup Genome Compass, which we released on Monday.

This post doesn’t discuss how different types of startups vary thru the developmental stages. That’s for another time.
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Navigate Your Startup To Success With The Startup Genome Compass

(Reposted from the Startup Genome Blog)

Today we are releasing the first benchmarking application for startups based on the Startup Genome framework. Founders can now assess their type and stage, diagnose themselves for premature scaling and compare themselves to other startups across more than 25 key performance indicators. Try it here.

Entrepreneurs are the consummate explorers of our generation. Every inch of land has been claimed by one of the world’s 204 countries but the world of ideas is expanding ever rapidly into the realm of the unknown. The future of the world was forever altered when Christopher Columbus and the Western World discovered The Americas. Today, societal transformations are triggered by the commercialization of new technology. The world of technology startups is our era’s Great Frontier. Search Engines, Social Networks and Microblogs were delivered to the massed because brave entrepreneurs ventured into the unknown. But as we’ve written before, despite the enormous societal and economic importance of startups the failure rate is still at more than 90% primarily because of self-destruction rather than competition.
The reason the self-destruction rate is so high is fairly simple; the tools and knowledge of entrepreneurship are still very primitive.

Three months ago the Startup Genome team released a groundbreaking research report that spread like wildfire through the startup ecosystem, far surpassing our expectations. To date we’ve had more than 15k downloads, 100k unique visitors, 100+ publications, and entrepreneurs and VC’s all over considering it a must read. Honestly, we didn’t think content would have such an impact on a startup community that is so characterized by its preference for experiential learning over theory. But it turned out entrepreneurs were hungry for a map to make sense of the territory they’d been exploring. The Startup Genome Report was one of the first detailed maps of the entrepreneurial journey, describing the different types of startups and the stages startups move through as they grow from an idea into a large company generating big profits. Little pieces of the map had been floating around Silicon Valley in the form of war stories from serial entrepreneurs and grizzled investors. But the stories illustrated lessons that lacked a structure to unite them and put them in proper context. The first Startup Genome Report was a big first step towards creating a coherent picture of the territory startups explore.

But in order for entrepreneurs to improve their odds of success they are going to need to change their behavior. While maps are an excellent tool to develop a general intuition of a space, it is difficult to change behavior if you can’t orient yourself on the map and receive regular feedback on your movement.

Which is why today we are releasing the Startup Genome Compass.

Many startups have trouble figuring out the right priorities to set and measuring their effectiveness once they do, almost always landing in the proverbial grey zone. “Is a 5% increase in retention good? Do I have enough users to declare product/market fit? Is now the right time to step on the gas pedal and scale?” We attempt to help entrepreneurs answer these questions by putting their metrics into the right context.

The Startup Genome Compass is a benchmarking tool for entrepreneurs to reduce this grey zone and make better product and business decisions by automatically classifying them by type and stage and comparing them against startups in the same type and stage across more than 25 key performance indicators

Possible Use Cases of the Startup Genome Compass

1. Measure progress by seeing your key performance indicators in comparison to startups that are similar to you.

2. Avoid premature scaling by identifying whether the 5 dimensions of your startup are aligned within and with each other. The 5 dimensions are customer, product, team, business model, financials and market.

3. Set the right priorities and align your team based on the benchmark your type and stage.

4. Find your weaknesses.  See if your user growth or conversion funnels are good enough to move to the next stage.

5. Explore resources and tips that are relevant for your type and stage

6. Share your report with Mentors and Investors so they can support you better

7. Use the benchmark as a supplement for your monthly board meeting.

Tell us how you end up using the Startup Genome Compass, how you it was helpful for you and where you’d like to see us take the product in the future. startupgenome@blackbox.vc.

Premature Scaling

In addition to the benchmark, the Startup Genome Compass also diagnoses startups for what our research team has found is the dominant cause of failure: premature scaling.

We have found that startups progress along 5 core interdependent dimensions: Customers, Product, Team, Business Model and Financials. In a startup many of these dimensions are highly uncertain, in many cases, all of them. The art of high growth entrepreneurship is to master the chaos of getting each of these 5 dimensions to move in time and concert with one another. Most startup failures can be explained by one or more of these dimensions falling out of tune with the others. If a startup shows signs of premature scaling on any of the five dimensions we refer to it as inconsistent.

In our current dataset we have detected inconsistency – indicators of premature scaling – in 70% of startups. The difference in performance numbers are pretty astonishing.

1. No startup that scaled prematurely passed the 100,000 user mark.

2. Startups that scale properly grow about 20 times faster than startups that scale prematurely.

3. 93% of startups that scale prematurely never break the $100k revenue per month threshold.

If you want to learn more about Premature Scaling and how it manifests you download our new mini report Startup Genome Report Extra: Premature Scaling. It contains 25 graphs and contributions from Brad Feld, Fred Destin, Michael Jackson, Bill Liao, Saad Khan and many more.

Dimension Examples for inconsistency (= indicators of premature scaling)
Customer
  • Spending too much on customer acquisition before product/market fit and a repeatable scalable business model
  • Overcompensating missing product/market fit with marketing and press
Product
  • Building a product without problem/solution fit
  • Investing into scalability of the product before product/market fit
  • Adding “nice to have” features
Team
  • Hiring too many people too early
  • Hiring specialists before they are critical: CFO’s, Customer Service Reps, Database specialists, etc.
  • Hiring managers (VPs, product managers, etc.) instead of doers
  • Having more than 1 level of hierarchy
Financials
  • Raising too little money to get thru the valley of death
  • Raising too much money. It isn’t necessarily bad, but usually makes entrepreneurs undisciplined and gives them the freedom to prematurely scale other dimensions. I.e. over-hiring and over-building. Raising too much is also more risky for investors than if they give startups how much they actually needed and waited to see how they progressed.
Business Model
  • Focusing too much on profit maximization too early
  • Over-planning, executing without regular feedback loop
  • Not adapting business model to a changing market
  • Failing to focus on the business model and finding out that you can’t get costs lower than revenue at scale.

 

 

Sign up for the Startup Genome Compass

If you a part of an Internet startup you can sign up for the Startup Genome Compass here. Every startup helps us get closer to cracking the code of innovation and spreading the magic of Silicon Valley with the rest of the world. All your data is anonymized, treated absolutely confidential and will not be shared.

Finally, we’d like to share a little bit of our roadmap with you. We’d love to get your feedback on where you think we should take the product and what we can do to help you be more successful in making your world-changing ideas come to life.

Our Roadmap for the Product

1. We will give you more relevant content based on an extended typology and substages we have identified, but haven’t implemented yet.

2. We will add tools for more areas of your startup: founder & employee salaries, founder personality types, team composition & culture, how much money to raise and when, estimated valuations for your startup and cloud forensics.

3. We will automate the data collection to make your life easier.

4. We will make it easier to make decisions for you by visualizing and augmenting the data more effectively.

5. We will be able to detect progress over bi-weekly and weekly intervals to give a shorter feedback loop.

6. We will integrate your data with other applications such as fundraising tools, and dealflow management solutions.

- Our Methodology

Further reading:

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Quick Thoughts on Wealth Distribution

I’m seeing a lot of writing on wealth inequality lately. Theoretically I think the natural distribution of our complex system should be something close to a power law. And we aren’t THAT far from it now. But it seems as if the bigger reason the global economy is STAGNATING right now is not because of unequal wealth distribution but rather because most of the world’s wealth is being wasted on INEFFICIENCY and FRIVOLITY. Whether its 100M Car Collections, Bloated Government Payrolls or “Dipshit Companies”. Why are CAPITAL and LONG TERM VALUE CREATION so far apart?

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The Celebritization of Entrepreneurship Continues

Earlier today I saw the announcement of a TV show about entrepreneurs.

I have mixed feelings about this reality show, with it’s American idol-esque presentation of startups and startup life. The more I think about it the more I realize how seriously double edged this blade of popularity is for the startup ecosystem. On one hand it will do wonders for the attraction of talent and we may someday surpass Wallstreet and Hollywood in desirability and sex appeal. But we must not become corrupted and forget why we do this. It’s not about the fame, glory or money. It’s about building products that transform the world and drive the human race forward.
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